Unit information: Intermediate Microeconomics in 2014/15

Unit name	Intermediate Microeconomics
Unit code	ECON21133
Credit points	20
Level of study	I/5
Teaching block(s)	Teaching Block 4 (weeks 1-24)
Unit director	Professor. Jolivet
Open unit status	Not open
Pre-requisites	ECON10010 Introduction to Microeconomics, ECON11122 Quantitative Methods 1 and ECON12122 Quantitative Methods 2 or equivalent
Co-requisites	None
School/department	School of Economics
Faculty	Faculty of Social Sciences and Law

Description including Unit Aims

The course introduces uncertainty and game theory in the first term. In the second term, these tools are used to study asymmetries of information in general equilibrium models (adverse selection and moral hazard problems).

Unit aims:

To understand and be able to use the basic concepts of game theory in applied economic problems where agents interact strategically and information may not circulate perfectly.

Intended Learning Outcomes

1. Good formal understanding of the notions of strategies, equilibrium and beliefs in games.
2. Ability to solve formal games, from standard static full-information problems to dynamic games with asymmetric information.
3. Ability to formalize an economic problem using the tools of game theory and then solve it using the techniques shown in class.

Teaching Information

• 42 hours of lectures (split 67% / 33% between lectures and exercise lectures)
• 8 hours of tutorials
• 4 one-hour essay lectures
• 1 two-hour revision lecture

Assessment Information

Summative assessment:

• Three-hour closed book exam.

• Students are presented with four questions and have to answer three of them (each question should take one hour on average)

• No specialization. Whilst the course is divided into four topics (uncertainty, game theory, adverse selection and moral hazard), there could be more than one of the four questions on a specific topic. Also, one question can cover more than one topic.

• Each question starts with a series of items aiming at assessing learning outcomes 1 and 2 and the end of the question tends to depart from standard settings in order to assess learning outcome 3.

Formative assessment:

• Students are asked to prepare questions for each of the nine tutorials. Their work is assessed by the tutor in class.

• Four essay lectures (two per term, one per topic). During each of these essay lectures, students are asked to solve a one-hour exam question in class. All scripts are collected and marked by the tutors. Marked scripts are returned to the students at the next tutorial.

Reading and References

• J. Perloff, Microeconomics. Pearson.

• R. Gibbons, A Primer in Game Theory, Prentice Hall.

• F. Cowell, Microeconomics, Oxford University Press.

• E. Rasmusen, Games and Information, Blackwell.

• K. Binmore, Playing for Real – A Text on Game Theory, Oxford University Press.