ADVANCED MICROECONOMIC THEORY – Part 2
Instructor: Andy Newman
270 Bay State Rd,
Rm 507, 8-4354, firstname.lastname@example.org (use subject line EC 703)
Office Hours: Mo 12:30-1:30, Fr 2-4
TA: Yao Shu, whose details you already have.
This portion of the course serves as an introduction to information economics, which for the most part deals with situations in which the actors are asymmetrically informed about each other and/or their actions. The consequences for the functioning of markets can be quite dramatic, leading to behavior quite different from what is depicted, say, in a typical intermediate micro course. Moreover, information asymmetries can account for all kinds of economic institutions that are otherwise difficult to explain.
Requirements: The course will be run largely as it was in the first half of the semester with (almost) weekly problem sets and a final exam (the latter is currently scheduled for Thursday May 9, 12:30-2:30 in CAS 225).
Schedule note: Lectures will meet Mondays 11-12:30 in Mugar 205 and Fridays 11-12:30 in CAS 325. TA sessions will meet Wednesdays 11-12:30 in Mugar 205.
Readings: The text is Mas-Colell, Whinston and Green, Microeconomic Theory. Occasionally (particularly if we get to any of the optional topics), I might mention a reading or two that is not in that bookÕs reference list. The course will cover the following topics, with relevant chapter sections as indicated, though not necessarily strictly in the order given.
Markets with adverse selection (13A-B)
Competitive Screening (13D)
Principal-Agent problems (14A-B): Moral Hazard
Nonlinear Pricing (14C)
Implementation and Mechanism design (23)
Cheap Talk (TBD)
Assignment games, matching, market design (TBD)