MICROECONOMIC ANALYSIS

SHE Level 3
SCQF Credit Points 20.00
ECTS Credit Points 10.00
Module Code M3L122501
Module Leader Lutfi Ucal
School Glasgow School for Business and Society
Subject Economics
Trimester
  • A (September start)

Pre-Requisite Knowledge

Normally, successful completion of Principles of Microeconomics or equivalent Level Two module with a significant microeconomics' component

Summary of Content

The module is designed to provide a strong theoretical underpinning in microeconomics for students graduating in economics. It develops micro theory with particular emphasis on consumer welfare and choice and market failure and the application of game theory. Summary of how PRME-related issues / topics are covered in this module: Gives insight into the theories of consumer and producer (firm) behaviours [Principles 3 & 4] and the need for regulation of Markets [Principles 5 & 6]

Syllabus

-360b7 Constrained optimisation and consumer/producer behaviour -360b7 Indifference curve revision b7 the axioms of choice, changes in income and price, demand curves, income and substitution effects of price changes, isoquants and iso-cost lines, elementary duality, effects of factor price changes. b7 Factor market analysis Supply and demand of factors of production, profit maximisation and factor demand, firm/market demand. b7 General Equilibrium and welfare analysis Partial/general equilibrium, the Walrasian general equilibrium system, perfect competition, welfare and general equilibrium, compensation tests, Arrow's General Impossibility Theorem, intergenerational equity and social discount rates. b7 Market failure. Optimality in imperfect markets, imperfect information, imperfect competition, externalities, public goods, asymmetric information, theory of the second best. b7 Cost Benefit Analysis. Decision making in the public sector, private and public investment appraisal and discounting, shadow prices, applications of CBA. b7 Game Theory An introduction to the theory of games. Actions, strategies, payoffs, players defined. Meaning of Equilibrium of a game; Dominant Strategy and Nash Equilibria. Repeated games, Bargaining and Smash and Grab Games. Continuous Strategies applied to Oligopoly. b7 Classic Models of Oligopoly; in a Game Theoretic Framework: Cournot, and Stackleberg (Follower, Leader models)

Learning Outcomes

On successful completion of this module, the student should be able to:" demonstrate a substantive working knowledge of microeconomic theory at an intermediate/advanced level. [Principles 3 ,4 5 & 6]" apply appropriate microeconomic techniques of analysis with greater rigour and understanding in specialist (micro-based) options, such as Labour Market and Environmental/Development Economics" evaluate evidence and maintain/develop an argument, thesis or hypothesis." work independently." work as part of a team.

Teaching / Learning Strategy

A programme of lectures, student-led seminars and tutorials encompassing both group work and individual analysis. Key concepts are also explored via a series of spreadsheet-based computer models. GSBS will ensure that all modules are GCU Learn enabled and with the support of the Learning Technologists at the cutting edge of development of online materials. Academic staff and the Learning Technologists will continue to work together to develop and operate all modules on GCULearn to ensure student support and information sharing. Students are provided with formative and summative feedback via a variety of mechanisms. Feedback on coursework is provided within 3 working weeks of submission.

Indicative Reading

-360b7 Varian, Hal R. Intermediate Microeconomics: A Modern Approach, Eighth Edition (International Student Edition), 2010, Norton -360b7 Bergstrom, T.C. & Varian, Hal R. Workouts in Intermediate Microeconomics Approach, Eighth Edition (International Student Edition), 2010, Norton b7 Begg D., Fisher S., Vernasca, G. and Dornbusch R., Economics , 10th Edition 2010 McGraw-Hill b7 Griffiths A. & Wall S., Applied Economics , 12th Edition, 2011, Pearson b7 Rasmusen, E., Games and Information, 4 th ed, 2006, Wiley- Blackwells, b7 Rasmusen, E. (Ed.), Readings in Games and Information, 2001, Prentice-Hall

Transferrable Skills

By the end of this module students will have gained competence in the following key areas: -360b7 Analytical and critical thinking skills b7 Communication skills (oral and written) b7 Discussion skills b7 Essay writing b7 Problem solving skills b7 Interpersonal skills b7 Time management skills b7 Team working skills -360b7 Economic literacy, Research Skills, IT skills, Time Management, Ability to learn independently

Module Structure

Activity Total Hours
Tutorials (FT) 12.00
Assessment (FT) 30.00
Practicals (FT) 11.00
Lectures (FT) 22.00
Independent Learning (FT) 125.00

Assessment Methods

Component Duration Weighting Threshold Description
Course Work 01 n/a 30.00 35% Group Seminar Paper - Based on In-Class presentation of selected topic. Written up 1 week after presentation
Exam (Exams Office) 3.00 70.00 35% Unseen written exam