Fall 2007/Spring 2008 Course Catalog
11. An Introduction to Economics. 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. Each section limited to 25 Amherst College students.
Three hours of lecture and one hour of discussion per week. First semester: Professors Ishii, Rivkin (Course Chair), and Woglom.
One lecture and three hours of discussion per week. Second semester: Professors Barbezat (Course Chair), Ishii, Kingston, and Rivkin.
23. Poverty and Inequality. (Also Black Studies 16.) 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. First semester. Professor Rivkin.
24. Industrial Organization. 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. Second semester. Professor Ishii.
25. Environmental and Natural Resource Economics. 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. Omitted 2007-08.
26. Economics of Education. 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 2007-08. Professor Rivkin.
28. Economic History of the United States, 1600-1860. 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. First semester. Professor Barbezat.
29. Economic History of the United States, 1865-1965. 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. Second semester. Professor Barbezat.
30. Current Issues in the United States’ Economy. This course examines the contemporary economic development of the United States. Rather than starting at some time and asking “What happened next?” the course proceeds in reverse chronological order and asks “From where did this come?” Current structures, policies and problems will be analyzed and explained by unfolding the path of their sources. Among the topics covered will be the savings and loan crisis, the boom-bust of the 1980s, health care policies, foreign economic policy, as well as topics that particularly interest the group of students taking the course.
Requisite: Economics 11. Limited to 50 students. Omitted 2007-08. Professor Barbezat.
31. The Economics of the Public Sector. Public Finance examines the role that the government plays in the economy. We will discuss the role of government in the allocation of resources, including efficiency and equity arguments for government intervention, as well as economic theories of government decision making. Topics include welfare economics, the evaluation of public expenditures, and taxation. The course addresses many current public policy issues, including environmental policy, health policy, expenditure programs for the poor, social security, and tax reform.
Requisite: Economics 11. Limited to 50 students. Omitted 2007-08. Professor Reyes.
32. International Trade. 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. Omitted 2007-08. Professor B. Yarbrough.
33. Open-Economy Macroeconomics. 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. Omitted 2007-08. Professor B. Yarbrough.
34. Money and Economic Activity. 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. First semester. Professor Woglom.
36. Economic Development. 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. First semester. Professor Kingston.
40. Health Economics and Policy. 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. Second semester. Professor Reyes.
53. Macroeconomics. 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.
Requisites: Economics 11 and Mathematics 11 or equivalent. First semester: Professor Barbezat. Second semester: Professor TBA.
54. Microeconomics. 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.
Requisites: Economics 11 and Mathematics 11 or equivalent. First semester: Professor Reyes. Second semester: Professor TBA.
55. An Introduction to Econometrics. A study of the analysis of quantitative data, with special emphasis on the application of statistical methods to economic problems.
Requisites: Economics 11 and Mathematics 11 or equivalent. First semester: Professor Westhoff. Second semester: Professor Rivkin.
57. Advanced Macroeconomics. 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.
Requisites: Economics 11 and Mathematics 12 or equivalent, or consent of the instructor. Second semester. Professor Woglom.
58. Advanced Microeconomics. 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.
Requisites: Economics 11 and Mathematics 13 or equivalent, or consent of the instructor. First semester. Professors Ishii and Nicholson.
60. Labor Economics. An analysis of the labor market and human resource economics. Issues concerning labor supply and demand, wage differentials, the role of education, investment in human capital, unemployment, discrimination, income inequality, and worker alienation will be discussed utilizing the tools of neoclassical economics. In addition, we shall examine the major non-neoclassical explanations of the perceived phenomena in these areas.
Requisite: Economics 54 or 58. Omitted 2007-08. Professor Rivkin.
63. The Economics of Finance. 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. Limited to 35 students. Second semester. Professor Woglom.
64. Evaluating Social Policy. 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. Limited to 20 students. Second semester. Professor Reyes.
65. Topics in Econometrics. A continuation of Economics 55 that uses statistics, general economic theory and mathematics to understand empirical relations in economics. The course introduces matrix algebra and uses it to develop a careful treatment of the multiple linear regression model and refinements. Also includes an introduction to methodological developments in econometric modeling of time series data, and extensive practice in the use of statistical packages for computation.
Requisite: Economics 55. Omitted 2007-08. Professor Alpanda.
66. Law and Economics. 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. First semester. Professor Nicholson.
67. Advanced Economic Theory. This course is designed as a sequel to Economics 54, Microeconomics. The objective of the course is to provide students with a mathematically rigorous foundation in microeconomic theory. Topics may vary from year to year and will be chosen from among the following: revealed preference; relationship among demand, indirect utility, and expenditure functions; duality; profit maximization and cost minimization; uncertainty; game theory; externalities and public goods; oligopoly models; adverse selection, signaling, and screening; principal-agent problems; general equilibrium theory; computation of economic equilibria; efficiency, the core, and the second best; dynamic programming; etc.
Requisite: Economics 54 or 58. Omitted 2007-08. Professor Westhoff.
70. Seminar in International Monetary Economics. 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. Second semester. Visiting Lecturer Truman.
71. Economic History Seminar. 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. Omitted 2007-08. Professor Barbezat.
73. Game Theory and Applications. 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. First semester. Professor Kingston.
75. Economic Growth. 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 53 or 57. First semester. Professor TBA.
76. Topics in Open-Economy Macroeconomics. 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. Omitted 2007-08. Professor Honig.
77. Senior Departmental Honors Seminar. A seminar preparing senior economics majors to undertake independent research for their honors projects. Five or six topics of current interest will be studied.
Requisites: An average grade of 11.00 or higher in Economics 53/57, 54/58, and 55. First semester. Professor Reyes.
78. Senior Departmental Honors Project. Independent work under the guidance of an advisor assigned by the Department.
Requisite: Economics 77. Second semester.
79. New Institutional Economics. 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. Admission with consent of the instructor. Second semester. Professor Kingston.
97, 97H, 98, 98H. Special Topics. Independent Reading Course. A full course or half course.
Admission with consent of the instructor. First and second semesters.