The Bachelor of Arts program in economics is intended to equip students with the basic tools required to understand the operation of a modern economy: the origin and role of prices and markets, the allocation of goods and services, and the factors that enter into the determination of income, employment, and the price level.

B.A. Program. The Bachelor of Arts concentration in economics requires thirteen courses. These must include the core curriculum, which consists of price theory (Economics 20000, 20100) and macroeconomics (Economics 20200 and 20300). One course in economic history (Economics 22000, 22100, 22200, 22300, 22500, 22900, 25400, 25700, 25800, or 27900) and two courses in econometrics are also required; the latter requirement is normally met by Statistics 22000 and Economics 21000. Students should choose the remaining three electives to broaden their exposure to areas of applied economics or advanced theory.

Some students decide after taking Economics 19800-19900 (Introduction to Micro and Macroeconomics for Nonmajors) that they would like to concentrate in economics. These students must take Economics 20000, 20100, and 20200. The directors of the undergraduate program will consider petitions to waive the requirement of Economics 20300 for students who have taken Economics 19800-19900 before any of the Economics 20000-20100-20200 courses. Petitions by students taking Economics 19800-19900 after any of the other Economics 20000-20200 courses will not be considered.

Students concentrating in economics must also take three mathematics courses beyond the general education requirement. These consist of the third quarter of calculus (Mathematics 13300, 15300, or 16300) and one of these two-quarter sequences: Mathematics 19500-19600, Mathematics 20000-20100, or Mathematics 20300-20400. Although Mathematics 13300 is acceptable, students who complete Mathematics 15100-15200-15300 generally perform better in the economics core curriculum. Economics students should take calculus at the highest level for which they qualify based on their performance on the calculus placement test.

In addition to the ten courses listed in the previous paragraphs, students concentrating in economics are required to take three elective courses, two of which must be an economics course numbered higher than 20300. Courses used to satisfy the economic history requirement may not also be counted as one of these three economics electives. The third elective may be another such economics course, or it may be chosen from Mathematics 20300, 20400, 20500, 20700, 20800, 20900, and 27300 (see Preparation for Ph.D. Programs in Economics, below); Computer Science 10500 and 11500; and Statistics 25100. Only one reading course (Economics 29700) may be used as an elective (unless the student is in the honors program).

It is strongly recommended that students complete the calculus sequence during their first year in the College because it is a prerequisite for the core curriculum (Economics 20000-20100-20200-20300). It is further recommended that students take Mathematics 19500-19600 concurrently with Economics 20000-20100, and that they take Economics 21000 immediately after completing Statistics 22000.

Students should aim to complete Economics 21000 by the end of their third year. Economics 21000 is a prerequisite for Economics 21100, 21200, 24000, 26500, 27700, and 29800; and is strongly recommended before Economics 23100, 25000, 25500, and 25700.

NOTE: Students wishing to substitute other courses for those listed in the previous paragraphs must obtain written permission from one of the directors of the undergraduate economics program before registering for the course. Registration in graduate 30000-level courses is by departmental consent.

General MATH 13100-13200, 15100-15200,

Education or 16100-16200†

Concentration 1 MATH 13300, 15300, or 16300†

4 ECON 20000-20100-20200-20300

1 economic history (ECON 22000, 22100, 22200, 22300, 22500, 22900, 25400,
25700, 25800, or 27900)

2 STAT 22000, and either ECON 20900
or 21000

2 MATH 19500-19600 or 20000-20100
(recommended to be taken concurrently
with ECON 20000-20100);
or MATH 20300-20400

3 electives: These must include two 20000-level courses in economics. The third course may also beanother 20000-level course in economics or may be chosenfrom MATH 20300, 20400, 20500,20700, 20800, 20900, and 27300CMSC 10500 and 11500;

or STAT 25100

13

† Credit may be granted by examination.

Grading. A maximum of two grades of Pass is permitted in the thirteen courses required for the concentration in economics; the other eleven grades must be quality grades. Only quality grades are acceptable for Economics 20000, 20100, 20200, 20300, 20900, and 21000; and Statistics 22000.

Honors. Students with grade point averages of at least 3.0 overall and 3.25 in economics are eligible for the honors program. Students who wish to qualify for honors are required to participate in the Undergraduate Honors Workshop (Economics 29800) for a full academic year; Economics 29800 may replace up to two elective courses. While participating in the workshop, students write an honors thesis under faculty guidance; to graduate with honors, students must receive a grade of at least A- on the honors thesis. Students interested in the honors program should contact one of the directors of the undergraduate economics program no later than the second quarter of their third year in the College; they should also have completed their econometrics courses before participation in the Undergraduate Honors Workshop.

Preparation for Ph.D. Programs in Economics. Students interested in pursuing graduate study should augment the standard curriculum with higher-level mathematics and statistics courses. These include Mathematics 20300-20500, Mathematics 25000, Statistics 25100, and Statistics 24400-24500 (instead of Statistics 22000). Students should also consider taking appropriate courses from other departments in the social sciences and seek research assistant jobs during their third and fourth years.

Such students should schedule an appointment with one of the directors of the undergraduate program early in their second year. The Mathematics Concentration with Specialization in Economics may be of interest to students who have a strong mathematics background.

19800. Introduction to Microeconomics. Economics concentrators may use ECON 19800-19900 to fulfill core curriculum requirements only under circumstances described in the previous Program Requirements section. By way of economic theory, applications, and contemporary issues, the course treats (1) the behavior and decision making on the part of individuals, business firms, and governments; and (2) the function of costs, prices, incentives, and markets in the American economy. We discuss contemporary topics such as the distribution of income, the environment, education, sports, and health care. A. Sanderson. Autumn.

19900. Introduction to Macroeconomics. Economics concentrators may use ECON 19800-19900 to fulfill core curriculum requirements only under circumstances described in the previous Program Requirements section. By way of theory and public policy applications, this course covers current major domestic and international macroeconomic issues in the U.S. economy, including the determination of income and output, inflation, unemployment, and economic growth; money, banking, and the Federal Reserve System; federal spending, taxation, and deficits; and international trade, exchange rates, and the balance of payments. A. Sanderson. Winter.

20000. The Elements of Economic Analysis I. PQ: One year of calculus. Students registered for MATH 15300 or 16300 who earned an A- or better in each of the first two quarters of calculus may, with consent of instructor, register concurrently for ECON 20000. This course develops the economic theory of consumer choice. This theory characterizes optimal choices for consumers given their incomes, their preferences, and the relative prices of different goods. The course develops tools for analyzing how these optimal choices change when relative prices and consumer incomes change. Finally, the course presents several measures of consumer welfare. Students learn how to evaluate the impact of taxes and subsidies using these measures. If time permits, the course examines the determination of market prices and quantities, given primitive assumptions concerning the supply of goods. M. Ghatak, Staff, Autumn; M. Dey, G. Tsiang, Staff, Spring.

20100. The Elements of Economic Analysis II. PQ: ECON 20000. This course is a continuation of ECON 20000. The first part discusses markets with one or a few suppliers. The second part focuses on demand and supply for factors of production and the distribution of income in the economy. The course also includes some elementary general equilibrium theory and welfare economics. J. Campbell, Staff, Autumn; N. Stokey, Staff, Winter.

20200. The Elements of Economic Analysis III. PQ: ECON 20000 required; ECON 20100 recommended. As an introduction to macroeconomic theory and policy, this course covers the determination of aggregate demand (i.e., consumption, investment, and the demand for money), aggregate supply, and the interaction between aggregate demand and supply. The course also discusses activist and monetarist views of fiscal and monetary policy. R. Lucas, M. Yorukoglu, Staff, Winter; A. Vissing-Jorgensen, Staff, Spring.

20300. The Elements of Economic Analysis IV. PQ: ECON 20200 or equivalent. This is a course in money and banking, monetary theories, the determinants of the supply and demand for money, the operation of the banking system, monetary policies, financial markets, and portfolio choice. C. Mulligan, Staff, Autumn; Staff, Spring.

20700. Game Theory. PQ: ECON 20100, and MATH 19500 or 25000. Previous experience with game theory not required. This course begins with foundations of decision making (including decision making under uncertainty) and then introduces the key ideas of game theory and explores their applications in economics and the other social sciences. The goals are for students to understand basic game-theoretic models and be able to build models of their own. H. Sonnenschein. Autumn.

20800. Theory of Auctions. PQ: ECON 20100. In part, this course covers the analysis of the standard auction formats (Dutch, English, and sealed-bid), as well as provides conditions under which they are revenue-maximizing. Both independent private-value models and interdependent-value models with affiliated signals are introduced. Multi-unit auctions are also analyzed with an emphasis on Vickrey's auction and its extension to the interdependent-value setting. P. Reny. Autumn.

20900. Introduction to Econometrics: Honors. PQ: STAT 24400 or 24500 required. MATH 19500, 20000, or 25000 recommended. This is a foundations course in econometrics for students who are planning to continue their economics study at the graduate level. The topics are essentially the same as those covered in ECON 21000, but this course gives a more systematic introduction to the application of statistical theory to economic applications. Staff. Winter.

21000. Econometrics A. PQ: ECON 20100 and 20200, STAT 22000, and MATH 19500 or 20000 or 25000. Required of concentrators; students are encouraged to meet this requirement by the end of the third year. Econometrics A covers the single and multiple linear regression model, the associated distribution theory, and testing procedures; corrections for heteroskedasticity, autocorrelation, and simultaneous equations; and other extensions as time permits. Students also apply the techniques to a variety of data sets using PCs. K. Hansen, Autumn; V. Lima, Winter; S. Schennach, Spring.

21100. Econometrics B. PQ: ECON 20900 or 21000. This course is intended to provide students with a basic understanding of how econometrics, economic theory, and knowledge of institutions can be used to draw credible inferences on economic relationships. Specific topics include multivariate linear regression, causal inference, omitted variables bias, fixed and random effects models, simultaneous equation models, the propensity score, and discrete choice models. Students have the opportunity to apply these techniques to empirical questions in industrial organization, as well as in environmental, labor, and public economics. M. Greenstone. Spring.

21200. Time Series Econometrics. PQ: ECON 20900 or 21000. This course examines time series models and the testing of such models against observed evolution of economic quantities. Topics include autocorrelation and heteroscedasticity in time series applications of the general linear model. Students see a variety of time series models with macroeconomic applications. Staff. Spring.

22000. The Economy of Ancient Rome (=ANST 22000, CLCV 22900/32900, ECLT 32900, ECON 22000, HIST 21000, NTEC 32900). The course begins with a brief introduction to Roman imperial history, and then considers the following topics: agrarian production, the economic consequences of urbanization, the types of labor including slaves, the legal institutions for business and investment, and the economic consequences of the demographic structure. Class format includes lecture and discussion of ancient texts. R. Saller. Winter.

22100/32100. Colonization, Servitude, and Slavery: The Early American Experience. PQ: ECON 20000. This course considers economic analysis of the early American labor market, drawing on new research on the economic and social history of the colonies. Topics include the English background and economic stimulus to colonization, economics of the Jamestown experiment, mortality in the early colonies, the economics of white indentured servitude, opportunities for immigrants, the economics of the transatlantic slave trade, the growth of black slavery, and the wealth of the colonies. D. Galenson. Winter.

22200/32000. Topics in American Economic History. PQ: ECON 20000. Economic analysis is applied to important issues in American economic history. Typical topics include the economics of colonization, the transatlantic slave trade, the role of indentured servitude and slavery in the colonial labor market, the sources of nineteenth-century economic growth, economic causes and effects of nineteenth-century immigration, the expansion of education, the economics of westward migration, determinants of long-run trends in the distribution of income and wealth, the quantitative analysis of social mobility, and the economics of racial discrimination in the twentieth-century South. D. Galenson. Autumn, Winter.

22300/32300. Business Ethics in Historical Perspective (=ECON 22300/32300, GSBD 56400). This course examines the way that religious and political movements affect the ethics of business, focusing on such current issues as the conflict between technical efficiency and morality, the ethical status of property rights, the politics of retirement and intergenerational equity, comparable worth and other conflicts between ethical and economic standards for compensation, the ethics of international trade and finance, and ex post redefinitions of the legal status of de facto business practices. These issues are related to long cycles in religiosity in the United States, to the long-term factors influencing political images of business, and to the factors influencing domestic conceptions of the proper economic relationships between the United States and the rest of the world. R. Fogel. Winter.

22500/32200. Population and the Economy. PQ: GSBC 30000 or consent of instructor. This course deals with the effects of swings in population on the stability of the economy and opportunities for business. In both the short run and the medium run, shifts in the demographic rates probably have been more destabilizing than unwise macroeconomic policy or abrupt political realignments. Population change is thus a major challenge to policy makers in business and in government. Topics include the effects of demographic changes on markets for labor and capital, on savings rates and the structure of investment, on taxes and government expenditures, and on household behavior. Problems of planning for the consequences of population changes, including methods of forecasting, are also considered. R. Fogel. Autumn.

22700/32400. Economics and Demography of Marketing. PQ: ECON 20000 and 20100, or equivalent. This course does not meet the economics history requirement. This course examines the factors that influence long-term, intermediate-term, and short-term variations in the demand for both consumer and producer commodities and services: the evolution of markets and methods of distribution in America since 1800, variations in the life cycles of products, the role of demographic factors in analysis of product demand, and the influence of business cycles on product demand. Much attention is given to the use of existing online databases for the estimation of a variety of forecasting models. R. Fogel. Spring.

22900. Topics in Monetary History. PQ: ECON 20300. This course covers selected topics in European and U.S. monetary history from the Middle Ages to the twentieth century. It traces the evolution of money from a simple commodity chosen to measure value, into the intrinsically worthless fiat money of today. This evolution stretched over centuries, and involved learning the best way to manage a currency. Monetary policy being linked to fiscal policy and constraints, this course examines money in the broad context of government revenues, spending, and borrowing over time and in different political regimes. F. Velde. Winter.

23100. Topics in Macroeconomics and Finance. PQ: ECON 20100 and 20300 required. ECON 21000 and 21100 recommended. The goal of the course is for students to use and analyze data to verify or refute an economic hypothesis. Lecture topics include the formulation of an economic hypothesis; the translation of an economic hypothesis into a statistical hypothesis; the gathering of data from the Internet and other sources; and the analysis of counter-arguments using regression, instrumental variable, and dummy variable techniques. Examples are drawn mainly from macroeconomics. Writing the term paper can be an excellent start on a senior honors paper. C. Mulligan. Autumn.

24000. Introduction to Labor Economics. PQ: ECON 20100 and 21000. Course topics include the theory of time allocation, the payoffs to education as an investment, detecting wage discrimination, unions, and wage patterns. Most of the examples are taken from U.S. labor data, although we discuss immigration patterns and their effects on U.S. labor markets. In addition, some attention is given to the changing characteristics of the workplace. G. Tsiang. Autumn.

24100. Applications of Microeconomics. PQ: ECON 20100. This course examines observed patterns in the labor market, including compensation, occupational choice, entrepreneurship, and self-sorting on the basics of job characteristics. The emphasis is on the application of economic principles to the particular features of each problem (e.g., productivity, costs of working, incentives, varying skills, and tastes of workers). S. Rosen. Winter.

25000. Introduction to Finance. PQ: ECON 20100 and 20300, STAT 22000, and completion of or concurrent registration in ECON 21000. This course develops the tools to quantify the risk and return of financial instruments. These are applied to standard financial problems faced by firms and investors. Topics include arbitrage pricing, the capital asset pricing model, and the theory of efficient markets and option pricing. Staff, Autumn; F. Alvarez, Winter; Staff, Spring.

25100. Topics in Finance and Uncertainty. PQ: Basic knowledge of probability theory, and ECON 20100 and STAT 22000. This course describes the foundations of decision theory under uncertainty: the notion of expected utility, the definition and measure of risk aversion, and the formalization of demand for insurance. It analyzes the role of markets in the efficient allocation of risk within an economy with a special emphasis on financial assets. Finally, a brief introduction to the literature on asymmetric information is provided. P. Chiappori. Autumn.

25500. Topics in Economic Growth and Development. PQ: ECON 20200 and 21000. This class examines current issues in the economics of developing countries. The focus is on macroeconomic models of economic growth and technological change. We also cover some microeconomic studies of land, labor, and credit markets in less-developed countries. M. Ghatak. Autumn.

25600. Problems of Economic Policy in Developing Countries (=ECON 25600, PBPL 28600, PPHA 37500). PQ: ECON 20100 and 20200, or consent of instructor. This course focuses on the application of economic analysis to economic policy issues frequently encountered in developing countries. Topics include sources of economic growth, commercial policy, regional economic integration, inflation and stabilization, fiscal deficits, the choice of an exchange rate regime, and the international debt problem. L. Sjaastad. Spring.

25700. Topics in Chinese Economy. PQ: ECON 20100 and 20200 required. ECON 21000 recommended. In this course, students learn to apply standard economic theory to study the Chinese economy. It includes a review of economic policies from 1949 to 1978, and a study of the Chinese economic reforms since 1978 and their contribution to economic growth, with emphasis on the difficulties preventing further reforms. Staff. Spring.

25800. Korean Economy. PQ: ECON 20100 and 20300, or consent of instructor. This course is concerned with understanding the nature of the Korean economy by studying five of its aspects: (1) current status, (2) patterns of transformation since the Korean War, (3) current problems, (4) projected evolution, and (5) relevance to the understanding of other economies. Staff. Spring.

26000. Introduction to Public Finance. PQ: ECON 20100. This course examines the theory of taxation and the application of this theory to the U.S. tax system, with an emphasis on recent research and on the entire economy, not just on individual markets. Staff. Autumn.

26500. Environmental Economics (=ECON 26500, ENST 26500, PBPL 32800). PQ: ECON 20100 and 21000, or consent of instructor. ECON 26500 may be taken concurrently with ECON 21000. This course applies theoretical and empirical economic tools to a number of environmental issues. The broad concepts discussed include externalities, public goods, property rights, market failure, and social cost-benefit analysis. These concepts are applied to a number of areas including nonrenewable resources, air pollution, water pollution, solid waste management, and hazardous substances. Special emphasis is devoted to analyzing the optimal role for public policy. M. Greenstone. Spring.

26600/36500. Economics of Urban Policies (=ECON 26600/36500, GEOG 26600/36600, PBPL 24500). PQ: ECON 20100. This course covers tools needed to analyze urban economics and address urban policy problems. Topics include: a basic model of residential location and rents; income, amenities, and neighborhoods; homelessness and urban poverty; decisions on housing purchase versus rental, housing taxation, housing finance, and landlord monitoring; models of commuting mode choice; and congestion and transportation pricing and policy, urban growth, urban environmental externalities, and Third World cities. G. Tolley. Winter.

26900. Public Choice (=ECON 26900, PBPL 25800, PLSC 23500). PQ: Knowledge of microeconomics. This course is an introduction to major ideas in the literature that seeks to apply the economic notion of rational choice to the context of politics and social choice. Some of the authors covered are Samuelson, Arrow, Buchanan, Olson, and Downs. H. Margolis. Winter.

27000. Introduction to International Economics (=ECON 27000, PBPL 27000). PQ: ECON 20100 and 20200, or consent of instructor. This course deals with the pure theory of international trade: the real side of international economics. Topics include the basis for and gains from trade; the theory of comparative advantage; and effects of international trade on the distribution of income, tariffs, and other barriers to trade. L. Sjaastad. Autumn.

27100. Introduction to International Finance. PQ: ECON 27000. This course examines international monetary problems and policies, and introduces the techniques with which economists analyze macroeconomic interactions between countries. Topics include open economy macroeconomics, exchange rates, and assessment of monetary policy regimes over recent history. We also discuss the problems of international policy coordination, capital market integration, international debt, and reform in Latin America and Eastern Europe. Staff. Spring.

27200. Topics in International Economics. PQ: ECON 20300. This course deal with the relation between international trade and economic growth. We survey mathematical models of growth in which the diffusion of technology and the wealth of nations are affected by the quantity and quality of trade. R. Lucas. Winter.

27300. Regulation of Vice (=ECON 27300, PBPL 27300). PQ: ECON 20000. This course concerns government policy with respect to the traditional vices of drinking, smoking, gambling, illicit sex, and the recreational use of drugs. Among the policies that are considered are prohibition, taxation, treatment, decriminalization, and legalization. The intellectual framework employed to evaluate various policies is primarily economic, though other disciplines are also drawn upon. J. Leitzel. Spring.

27700. Health Economics and Public Policy (=ECON 27700, GSBC 85700, PBPL 28300/38300, SSAD 47700). PQ: ECON 20300 and 21000 with grades of B or higher, and consent of instructor. This course analyzes the economics of health care in the United States with particular attention paid to the role of government. D. Meltzer. Spring.

27800. Public Policy Analysis (=ECON 27800, PBPL 22200). PQ: ECON 20000. PBPL 22100-22200-22300 may be taken in sequence or individually. This course reviews and augments the basic tools of microeconomics developed in ECON 20000, and applies these tools to policy problems. We examine situations in which private markets are likely to produce unsatisfactory results, suggesting a potential rationale for government intervention. The goal is to allow students to comprehend, develop, and respond to economics arguments (both their strengths and their weaknesses) when formulating or evaluating public policy. J. Leitzel. Winter.

27900. Economies in Transition: China, Russia, and Beyond (=ECON 27900, PBPL 27100). PQ: ECON 20000 or consent of instructor. The ongoing postsocialist transitions are discussed in this course, particularly those of Russia and China. The basic tool of analysis is the emerging "economics of transition." Various programs of macroeconomic stabilization, price liberalization, and privatization are analyzed, and their effects on inflation, unemployment, and living standards are assessed. We cover issues highlighted in the "post-Washington consensus" (e.g., corporate governance, competition policy, and the role of the state). J. Leitzel. Winter.

28000. Introduction to Industrial Organization. PQ: ECON 20100. This course extends the analysis from ECON 20100 to examine the structure and behavior of firms within industries. Topics include oligopolistic behavior, the problems of regulating highly concentrated industries, and the implementation of U.S. antitrust policy. Staff. Winter, Spring.

28100. The Economics of Sports. PQ: ECON 20100. This is a course in microeconomics that applies traditional product and factor market theory and quantitative analysis to contemporary economic issues in professional and college athletics, including: the sports business; market structures and outcomes; the market for franchises; barriers to entry, rival leagues, and expansion; cooperative, competitive, and collusive behavior among participants; labor markets, and player productivity and compensation; racial discrimination; public policies and antitrust legislation; and financing of stadiums. A. Sanderson. Spring.

28600. Introduction to Economic Analysis of Law. PQ: ECON 19900 or 20100. This course examines the structure of law from an economic basis. Topics include property rights, contracts, torts, the Coase theorem, and criminal law. Staff. Spring.

28700. The Economics of Crime (=ECON 28700, PBPL 23200). PQ: ECON 19900 or 20100, and ECON 21000 or STAT 22000 strongly recommended. This course uses theoretical and empirical economic tools to analyze a wide range of issues related to criminal behavior. Among the topics discussed are the police, prisons, gang behavior, guns, drugs, capital punishment, labor markets and the macroeconomy, and income inequality. Special emphasis is devoted to analyzing the optimal role for public policy. S. Levitt. Spring.

29700. Undergraduate Reading and Research. PQ: Consent of directors of the undergraduate program. Students are required to submit the College Reading and Research Course Form. Available for either Pass or letter grading. D. G. Johnson, G. Tsiang. Autumn, Winter, Spring.

29800. Undergraduate Honors Workshop. PQ: Consent of instructor. D. G. Johnson, A. Sanderson. Autumn, Winter, Spring.