Listed in: Economics, as ECON-441
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Stanislav Rabinovich (Section 01)
Information frictions are important for a wide variety of questions in macroeconomics and public finance. This course will develop tools from information economics and apply them, primarily to macroeconomic problems. We will study situations in which adverse selection, moral hazard, limited commitment, and strategic behavior create impediments to trade and prevent private markets from achieving efficient results. Applications can include credit constraints, default and collateral, bank runs, labor market contracts, unemployment, time inconsistency, and social insurance.
The approach of the course is rigorous and analytical, focusing both on providing students with very general modeling skills and on applying these skills to specific economic questions. Requirements will include solving analytical problem sets, as well as reading and discussing theoretical research papers. The course is especially suitable for students interested in mathematical modeling in economics and students considering doing research in economics.
Requisite: ECON 300/301, ECON 330/331, and MATH 211 (or MATH 121 with consent of instructor). This course will routinely use multivariable calculus. Limited to 15 students. Spring semester. Professor Rabinovich.
If Overenrolled: Give preference to economics majors