Economics 431: Advanced Theory
Dr. J. Barkley Rosser
Office: Zane Showker Hall 444
Objectives: To undertake an in-depth study of the foundations of microeconomic analysis at an advanced level as well as its more recent applications, extensions, and developments. This will include historical aspects as well as certain critiques and complications of the theory.
Texts: Microeconomic Analysis by Hal R. Varian, Third Edition, Norton Press.
From Catastrophe to Chaos: A General Theory of Economic Discontinuities by J. Barkley Rosser, Jr., Kluwer Academic Publishers (on reserve at Carrier Library).
Grade: The grade will be based on three exams and five homework assignments. Each of the exams will count 25% as will the homework assignments in total. Regular class attendance is expected and classparticipation will count on the margin. If a student cannot take a test, then he or she must inform me or the program office prior to the time of the test.
Honor Code: Ail students are expected to understand and adhere to the JMU Honor Code.
Outline of Readings
I. Mathematical and Methodological Introduction
Varian, Chapters 26, 27.
Paul A. Samuelson, "Maximum Principles in Analytical Economics," American Economic Review, June 1972, 249-262.
Philip Mirowski, "The When, the How and the Why of Mathematical Expression in the History of Economic Analysis," Journal of Economic Perspectives, Winter 1991, 145-157.
J. Barkley Rosser, Jr., "On the Complexities of Complex Economic Dynamics," Journal of Economic Perspectives, Fall 1999, pp. 169-192.
II. The Law of Supply
Varian, Chapters 1-6.
Oliver E. Williamson, "The Modern Corporation: Origins, Evolution, Attributes," Journal of Economic Literature, December 1981, 1537-1568.
Masahiko Aoki, "Toward an Economic Model of the Japanese Firm," Journal of Economic Literature, March 1990, 1-27.
III. The Law of Demand
Varian, Chapters 7-10.
Robert Cooter and Peter Rapaport, "Were the Ordinalists Wrong About Welfare Economics?" Journal of Economic Literature, June 1984, 507-530.
Matthew Rabin, "Psychology and Economics," Journal of Economic Literature, March 1998, 11-46.
IV. The Theory of Market Structures
Varian, Chapters 12-16.
William J. Baumol, "Contestable Markets: An Uprising in the Theory of Market Structure," American Economic Review, March 1982, 1-15.
William G. Shepherd, "Contestability vs. Competition," American Economic Review, September 1984, 572-587.
George J. Mailath, "Do People Play Nash Equilibrium? Lessons from Evolutionary Game Theory," Journal of Economic Literature. September 1998, pp. 1347-1374.
V. The Theory of General Equilibrium
Varian, Chapters 17, 18, 21.
Rosser, Chapter 3.
Joan Robinson, "What Are the Questions?" Journal of Economic Literature, December 1977, 1318-1339.
Israel Kirzner, "Entrepreneurial Discovery and the Competitive Market Process," Journal of Economic Literature, March 1997, 60-85.
VI. Intertemporal Optimization and Financial Economics Varian, Chapters 11, 19, 20.
Rosser, Chapters 4, 5.
Peter M. Garber, "Famous First Bubbles," Journal of Economic Perspectives, Spring 1990, 35-53.
Myron S. Scholes, "Derivatives in a Dynamic Environment," American Economic Review, June 1998, 350-370.
VII. Welfare Economics and Public Choice Theory
Varian, Chapters 22-24.
Joseph E. Stiglitz, "Distinguished Lecture on Economics in Government: The Private Uses of Public Interests and Institutions," Journal of Economic Perspectives, Spring 1998, 3-32.
W. Michael Hanneman, "Valuing the Environment Through Contingent Valuation," Journal of Economic Perspectives, Fall 1994, 19-43.
Angmar Sandmo, "Buchanan on Political Economy: A Review Article," Journal of Economic Literature, March 1990, 50-65.
VIII. The Economics of Information
Varian, Chapter 25.
Roy Radner, "Hierarchy: The Economics of Managing," Journal of Economic Literature, September 1992, 1382-1415.
Amartya Sen, "The Possibility of Social Choice," American Economic Review, June 1999, pp. 349-378.