Microeconomics (2225.YR.006719.1)

General information

Type:	OPT	Curs:	1	Period:	S semester
ECTS Credits:	3 ECTS

Teaching Staff:

Managerial Economics course

None

Lecturing
Group discussions
Practical sessions

The objective of the course is to provide an introduction to the main analytical tools that are used to conduct microeconomics research: how to deal with the modelling of uncertainty, an introduction to game theory in strategic settings and a presentation of the main problems when dealing with asymmetric information (adverse selection and signaling).
The course will provide the basics to be able to read academic papers using these tools in order to provide research ideas for the students.

1. Choice under Uncertainty:
a. Understanding how to introduce probabilities in economic decision making.

b. Learning how to theoretically and empirically deal with different attitudes towards risk.

c. Introduce a first example of economic modelling through the insurance problem.

2. Game Theory:
a. Understanding the foundations of game theory, i.e., of multiperson decision theory applied to startegic situations.
b. Introducing students to the representation of games
c. Learning about the various solution concepts for predicting how the game will be played.
d. Applying game-theoretic models to various applied fields.

3. Information Econnomics

a. Introduce students to the information economics (strategic interactions between agents in cases of asymmetric information).
b. Introduce the asymmetric information problems.
c. Understanding the implications of frictions such as asymmetric information for the equilibrium allocation and risk sharing.
d. Study different applications of asymmetric information problems

1. Introduction

2. Individual Decision Making - Types of Uncertainty - Traditional Vs Behavioral Approach to Uncertainty - Theoretical and Empirical measures of attitudes towards risk - The Insurance problem

3. Game Theory - Static games of complete information - Static games of incomplete information - Dynamic games of complete and incomplete information

4. Information Econnomics - Asymmetric Information Problems - Adverse selection - Signaling - Screening

Expository sessions
Participatory sessions
Active participation in the debate on research
Tutoring sessions
Readings
Preparation before class

ASSESSMENT BREAKDOWN

Gibbons, R. (1992). A Primer in Game Theory. Harvester Wheatsheaf.

Macho-Stadler, I and D. Pérez-Castrillo, An Introduction to the Economics of Information: Incentives and Contracts, Oxford University Press, 1997.

Mas-Colell, A., Whinston, M. D., & Green, J. R. (1995). Microeconomic theory (Vol. 1). New York: Oxford university press.