A study of the central problem of scarcity and of the ways in which the U.S. economic system allocates scarce resources among competing ends and apportions the goods produced among people.
Requisite for all other courses in economics.
One lecture and three hours of discussion per week. Each section is limited to 25 Amherst College students. Fall semester: Professors Alpanda, Honig, Rivkin (Course Chair), Sims, and Woglom.
Professor Sims' section is designed for students interested in environmental studies. See Environmental Studies 23 for more information.
One lecture and three hours of discussion per week. Each section is limited to 40 Amherst College students. Spring semester. Professors Alpanda, Rivkin (Course Chair), and Sims.
2020-21: Offered in Fall 2020, Spring 2021
(Offered as Economics 23 and Black Studies 16 [US].) Highly politicized debate over the determinants of poverty and inequality and the desirability of particular government responses often obscures actual changes over time in social and economic conditions. Information on the true impact of specific government policies and the likely effects of particular reforms becomes lost amid the political rhetoric. In this course we shall first discuss the concepts of poverty, inequality, and discrimination. Next we shall examine trends over time in the poverty rate, inequality of the earnings distribution, family living arrangements, education, crime, welfare recipiency, and health. We shall focus on the U.S., but also study a small number of less developed countries. In the final section of the course, basic economic principles and the evidence from experience with existing government programs will be used to analyze the likely impacts of several policy reform proposals.
Requisite: Economics 11. Limited to 50 students. Fall semester. Professor Rivkin.2020-21: Not offered
This course examines the determinants of and linkages between market structure, firm conduct, and industrial performance. Some of the questions that will be addressed include: Why do some markets have many sellers while others have only few? How and why do different market structures give rise to different prices and outputs? In what ways can firms behave strategically so as to prevent entry or induce exit of rival firms? Under what circumstances can collusion be successful? Why do firms price discriminate? Why do firms advertise? Does a competitive firm or a monopoly have a greater incentive to innovate? In answering these and other questions, the consequent implications for efficiency and public policy will also be explored.
Requisite: Economics 11. Limited to 50 students. Omitted 2009-10. Professor Ishii.2020-21: Offered in Spring 2021
Students in this course will explore society’s use of the natural environment as a component of production and consumption. The allocation of exhaustible and renewable resources and the protection of environmental quality from an economic standpoint will be examined. Public policy avenues for controlling natural resource management and the environment will also be explored. Case studies include air pollution and acid rain, depletion of the ozone layer and the greenhouse effect, the solid waste crisis, and deforestation, among others.
Requisite: Economics 11. Limited to 50 students. Spring semester. Professor Sims.2020-21: Not offered
Investments in education benefit individuals and society in a variety of ways. Education affects the productivity of the labor force, economic growth, the earnings of individuals, social mobility, the distribution of income, and many other economic and social outcomes. In 1990 educational expenditures exceeded seven percent of the Gross Domestic Product of the United States. A sector this large and important poses a number of serious policy questions-especially since it lacks much of the competitive discipline present in profit-making sectors of the economy. Should we increase expenditures? Are resources allocated efficiently? Equitably? How should the sector be organized? Who should bear the costs of education? Which policy changes will be effective? Many of these questions are part of the national policy debate. This course will use economic principles to study these and other issues which have been central to discussions of education policy.
Requisite: Economics 11 or consent of the instructor. Limited to 50 students. Omitted 2009-10. Professor Rivkin.2020-21: Not offered
The economic development of the United States provides an excellent starting point for an understanding of both this nation’s history and its current economic situation. We begin with the colonial period and the creation of the nation and end with the Civil War and the breakdown of the Union. Throughout we provide an economic reading of the events and try to explain the conflicts and resolutions in economic terms.
Requisite: Economics 11. Limited to 35 students. Omitted 2009-10. Professor Barbezat.2020-21: Not offered
The economic development of the United States provides an excellent starting point for an understanding of both this nation’s history and its current economic situation. We begin with the reconstruction period after the Civil War and end with the Civil Rights Era and the War on Poverty. Throughout we provide an economic reading of the events and try to explain the conflicts and resolutions in economic terms.
Requisite: Economics 11. Limited to 35 students. Omitted 2009-10. Professor Barbezat.2020-21: Not offered
This course uses microeconomic analysis to examine economic relationships among countries. Issues addressed include why nations trade, the distributional effects of trade, economic growth, factor mobility, and protectionism. Also included are discussions of the special trade-related problems of developing countries and of the history of the international trading system.
Requisite: Economics 11. Limited to 50 students. Fall semester. Professor B. Yarbrough.2020-21: Not offered
This course uses macroeconomic analysis to examine economic relationships among countries. Issues addressed include foreign exchange markets, the balance of payments, and the implications of openness for the efficacy of various macroeconomic policies. Also included are discussions of the special macroeconomic problems of developing countries and of the history of the international monetary system. Not open to students who have taken Economics 76.
Requisite: Economics 11. Limited to 50 students. Fall semester. Professor B. Yarbrough.2020-21: Not offered
This course studies the monetary systems that facilitate exchange. Such systems overcame the limitations of barter with commodity monies such as gold, and gradually evolved into financial intermediaries that issue paper notes and bank deposits as money. Intermediaries in markets for insurance, debt, and equity are studied too. Also, the effects of financial markets on aggregate economic activity and the level and term structure of interest rates are studied. Not open to students who have taken Economics 63.
Requisite: Economics 11. Limited to 50 students. Omitted 2009-10. Professor Woglom.2020-21: Not offered
In the Declaration of Independence, the Founders called the “pursuit of happiness” an “inalienable right,” yet both psychologists and economists have noted that we do not well understand the determinents of the attainment of happiness or contentment. In this course, we will examine the literature on well-being in both micro- and macroeconomic contexts. We will review the neoclassical model of utility maximization and contrast it to other modes of understanding how and why people make the decisions they do, as they pursue their happiness. On the macroeconomic side, we will attempt to understand what factors (e.g., growth, unemployment, inflation) seem most important for policy-makers to focus on in order to sustain their citizens' well-being. The course will also include opportunities for students to examine their own consumption decisions and assumptions about the attainment of happiness.
Requisite: Economics 11. Limited to 50 students. Spring semester. Professor Barbezat.2020-21: Not offered
An introduction to the problems and experience of less-developed countries, and survey of basic theories of growth and development. Attention is given to the role of policies pursued by LDCs in stimulating their own growth and in alleviating poverty. Topics include population, education and health, industrialization and employment, foreign investment and aid, international trade strategy and exchange rate management.
Requisite: Economics 11. Limited to 50 students. Omitted 2009-10. Professor Kingston.2020-21: Not offered
This course surveys the recent wave of financial globalization and assesses both its merits and potential risks. In particular, we will examine the most important potential benefit of financial globalization, an increased rate of economic growth that can be a powerful tool in alleviating poverty. We will analyze the theoretical arguments for a growth-enhancing effect of globalization and discuss the empirical evidence. We will then turn to the most important potential drawback: the risk of a devastating financial crisis, particularly in emerging market economies that have only recently opened to international capital movements. Throughout the course we will emphasize the conditions and policies under which financial globalization is likely to be successful. The course will conclude with an analysis of the effect of financial globalization, as well as increased trade openness, on inflation and the conduct of monetary policy.
Requisite: Economics 11. Limited to 50 students. Consent of the instructor is required for those students who have taken Economics 38 or 76. Spring semester. Professor Honig.
2020-21: Offered in Fall 2020
Health care poses many pressing public policy issues: Why do we spend so much on health care? Does it actually produce significantly better health? What is the appropriate role of government? Should the U.S. have a system of national health insurance? This course provides insight into these questions. We will start by assessing the important role of health care in the national economy (health care costs exceed 15% of the Gross Domestic Product of the United States) and by applying economic models to the production of health and health care. We will then study the structure of the health care market and the role of key institutions. Next, we will devote substantial time to the role of government, placing emphasis on the status of the uninsured population and on public provision of care to the disadvantaged. Finally, we will use this acquired knowledge to consider possibilities for national health care reform and to discuss the relative merits of current state reform efforts. Throughout this analysis, we will pay particular attention to the nature of health care markets, the anatomy of market failures, and the implications for current policy. Empirical results, current issues, and public policy will be discussed throughout the course.
Requisite: Economics 11. Limited to 50 students. Spring semester. Professor Reyes.2020-21: Offered in Fall 2020
This course develops macroeconomic models of the determinants of economic activity, inflation, unemployment, and economic growth. The models are used to analyze recent monetary and fiscal policy issues in the United States, and also to analyze the controversies separating schools of macroeconomic thought such as the New Keynesians, Monetarists and New Classicals. A student may not receive credit for both Economics 53 and Economics 57.
Requisite: Economics 11 and Mathematics 11 or equivalent. Fall semester: Professor Barbezat. Spring semester: Professor Honig.2020-21: Offered in Fall 2020, Spring 2021
This course develops the tools of modern microeconomic theory and notes their applications to matters of utility and demand; production functions and cost; pricing of output under perfect competition, monopoly, oligopoly, etc.; pricing of productive services; intertemporal decision-making; the economics of uncertainty; efficiency, equity, general equilibrium; externalities and public goods. A student may not receive credit for both Economics 54 and Economics 58.
Requisite: Economics 11 and Mathematics 11 or equivalent. Fall semester: Professor Reyes. Spring semester: Professor B. Yarbrough.2020-21: Offered in Fall 2020, Spring 2021
A study of the analysis of quantitative data, with special emphasis on the application of statistical methods to economic problems.
Requisite: Economics 11 and Mathematics 11 or equivalent. Fall semester: Professor Westhoff. Spring semester: Professor Alpanda.2020-21: Offered in Fall 2020, Spring 2021
This course covers similar material to that covered in Economics 53 but is mathematically more rigorous and moves at a more rapid pace. A student may not receive credit for both Economics 53 and Economics 57.
Requisite: Economics 11 and Mathematics 12 or equivalent, or consent of the instructor. Spring semester. Professor Woglom.2020-21: Offered in Spring 2021
This course covers similar material to that covered in Economics 54 but is mathematically more rigorous and moves at a more rapid pace. A student may not receive credit for both Economics 54 and Economics 58.
Requisite: Economics 11 and Mathematics 13 or equivalent, or consent of the instructor. Fall semester. Professor Nicholson.2020-21: Offered in Fall 2020
This course studies the specification, estimation, and testing of econometric models based on the maximum likelihood and method of moments principles. It builds from mathematical statistics and utilizes matrix algebra, the rudiments of which will be introduced in the course. The course will also review applications of econometric models to various areas of micro and macroeconomics. A student may not receive credit for both Economics 55 and Economics 59.
Requisite: Economics 11, Mathematics 13, and Mathematics 17 or equivalent. Spring semester. Professor Rivkin.2020-21: Offered in Fall 2020, Spring 2021
A study of the role of financial markets in the efficient allocation of resources. We look at how financial markets: (1) enable the transfer of resources across time and space; (2) facilitate the reduction and management of risk; and (3) provide information about the future, which is important to public policymakers as well as private firms and individuals. The financial theories studied include: (1) the theory of present discounted values; (2) the capital asset pricing model; (3) the efficient markets hypothesis; and (4) the Black-Scholes model for the pricing of contingent claims.
Requisite: Economics 54 or 58 or equivalent, Mathematics 13 or equivalent or consent of the instructor. Spring semester. Professor Woglom.2020-21: Not offered
This seminar in social policy examines a number of social programs in the United States, including Medicaid, the Earned Income Tax Credit, and Temporary Aid to Needy Families. The course will introduce you to the operation of these programs and will illustrate how economic and econometric tools can be used to evaluate them. A significant portion of the course will be devoted to careful reading and discussion of empirical research papers, including discussion of the relative merits of various empirical and econometric techniques. Students will be asked to participate actively in class discussion, to make oral presentations, to evaluate empirical data, and to write one of more papers on specific social programs. Throughout the course, we will also think broadly about the goals of social policy and the practical challenges policymakers face in designing effective policies.
Requisite: Economics 55 or 59. Limited to 20 students. Spring semester. Professor Reyes.2020-21: Not offered
This course introduces students to the ways in which legal issues can be examined using the tools of economic analysis. Topics covered include: Property and contract law, accident law, family law, criminal law, financial regulation, and tax law. In all of these areas the intent is not to provide an exhaustive examination of the law, but rather to show how economic methods can contribute to an understanding of the basic issues that must be addressed by the law.
Requisite: Economics 54 or 58 or consent of the instructor. Fall semester. Professor Nicholson.2020-21: Not offered
This seminar examines the process of international macroeconomic policy coordination over the past three decades, for example, to deal with the large U.S. current account deficit and associated global imbalances. We begin by considering various concepts of international economic policy coordination and the level and distribution of benefits from such activity. We will discuss the various instruments (monetary, fiscal, and exchange rate policies) and forums (IMF, G-7) of policy coordination. We will review a dozen or so episodes of actual or potential policy coordination starting with 1970 and the breakdown of the Bretton Woods regime. We will consider whether the diagnosis was right, the policy framework was agreed upon, the policy actions or inactions were appropriate, and what lessons were learned. Students will make a presentation and write a paper on one of these episodes.
Requisite: Economics 33 or 53/57 or consent of the instructor. Limited to 20 students. Spring semester. Professor Truman.2020-21: Not offered
We will begin by examining contemporary growth and development models and then apply them to the sweep of global economic history over the past 300 years. The course is a seminar, so students will be assessed on their close reading and their responses to articles and books assigned in the course. Students will engage directly with economic history issues and will produce an original piece of research by the end of the course.
Requisite: Economics 53 or 57 and 54 or 58. Limited to 15 students. Spring semester. Professor Barbezat.2020-21: Not offered
Modern macroeconomic policy analysis relies heavily on dynamic models such as Vector Autoregressions (VAR) and dynamic stochastic general equilibrium (DSGE) models. This course will introduce the theory behind these models, their parameterization using maximum likelihood estimation and calibration, and their applications to specific macroeconomic issues. Topics covered will include, but will not be limited to, determinants of aggregate fluctuations, the lags associated with monetary policy, the effects of increased global demand for commodities, the risk premium associated with stock returns, and forecasting macroeconomic aggregates. Students will be asked to write a term paper employing these models to analyze empirical data of a specific country.
Requisite: Economics 53 or 57, 54 or 58, and 55 or 59. Limited to 20 students. Fall semester. Professor Alpanda.2020-21: Not offered
Game theory analyzes situations in which multiple individuals (or firms, political parties, countries) interact in a strategic manner. It has proved useful for explaining cooperation and conflict in a wide variety of strategic situations in economics, political science, and elsewhere. Such situations can include, for example, firms interacting in imperfectly competitive markets, auctions, arms races, political competition for votes, and chess. This course will provide an introduction to the tools and insights of game theory. Though mathematically rigorous, emphasis will be on applications rather than on formal theory.
Requisite: Economics 54 or 58. Omitted 2009-10. Professor Kingston.2020-21: Offered in Fall 2020
Income in the United States has increased more than tenfold over the last century, and incomes in the United States and most of Western Europe are at least 30 times higher than incomes in much of sub-Saharan Africa. This course explores what economists know about the process of economic growth that generated such outcomes. We will examine both formal theories of economic growth and the empirical literature on comparative economic growth, as well as examples of individual countries’ growth experiences.
Requisite: Economics 55 or 59 and at least one of Economics 32, 33, 36, 53, 54, 57, 0r 58. Omitted 2009-10. Professor B. Yarbrough.2020-21: Not offered
A seminar in international macroeconomics, with an emphasis on emerging market economies. We will read and discuss empirical research papers. Topics covered will include financial globalization, banking and currency crises, exchange rate regimes, dollarization, and institutions and governance.
Requisite: Economics 33, 53 or 57. Limited to 20 students. Fall semester. Professor Honig.2020-21: Offered in Spring 2021
A seminar preparing senior economics majors to undertake independent research for their honors projects. Five or six topics of current interest will be studied.
Requisite: An average grade of 11.00 or higher in Economics 53/57, 54/58, and 55/59. Fall semester. Professor Reyes.2020-21: Offered in Fall 2020
Independent work under the guidance of an advisor assigned by the Department.
Requisite: Economics 77. Spring semester.2020-21: Offered in Spring 2021
All economic activity is embedded in a framework of institutions including both formal laws and contracts, and informal norms and conventions. Institutions constrain individual behavior and thereby affect resource allocation, income distribution, learning, and economic growth. This course introduces recent approaches to the study of institutions in economics and political science. Particular emphasis will be placed on recent applications to economic history and development, and to theories of institutional stability and change.
Requisite: Economics 73 or instructor consent required. Omitted 2009-10. Professor Kingston.2020-21: Not offered
Independent Reading Course. Full course.
Admission with consent of the instructor. Fall semester.2020-21: Offered in Fall 2020, Spring 2021