Economics 701: Advanced microeconomic theory, spring 2011
Instructor: Jeremy A. Sandford
Office hour: W 1-2pm 335L B&E, or by appointment
Lecture:
2:00-3:15
TH, BE 214
Midterm date:
Friday, March 4, 1-4pm
Final date: Friday, May
6, 8am-10am
Required text: Mas-Colell, Whinston, and Green, Microeconomic Theory, Oxford University Press
Homework 1,
answers
Homework 2,
answers
Homework 3, answers
Homework 4, answers
Homework 5, answers
Homework 6, answers
Homework 7, answers
Schedule
Thursday, January 13: deficiencies of GE, normal form
games, randomized strategies
readings: Mas-Colell, chapter 7
Gale,
D. (2000), Strategic Foundations of General Equilibrium, chapter
1
Tuesday, January 18: expected utility, extensive form games
readings: Mas-Colell, chapter 6B
Mas-Colell, chapter 7
Handout on expected
utility
handout on
extensive form game notation
Thursday, January 20: solution concepts for normal form
games: dominance, iterated strict dominance, rationalizability
reading: Mas-Colell, chapter 8
handout on
dominant/dominated strategies
Tuesday, January 25: solution concepts for normal form
games: Nash equilibrium
reading: Mas-Colell, chapter 8
Thursday, January 27: Interpretations of Nash
equilibrium, credibility of commitments in
extensive form games, refinements of Nash equilibrium for extensive form games
reading: Mas-Colell, chapter 9
handout on subgame perfect
equilibrium
Tuesday, February 1: subgame perfect equilibria, perfect
Bayesian equilibria
Handout on perfect Bayesian
equilibrium
reading: Mas-Colell, chapter 9
Thursday, February 3: sequential equilibrium
reading: Mas-Colell, chapter 9
Tuesday, February 8: extensive form perfection, calculating
sequential equilibria
reading: Mas-Colell, chapter 9
Example
problem about bargaining
Thursday, February 10: Asymmetric information, signaling
games
reading: Cho, I. and D. Kreps, 1987, "Signaling games
and stable equilibria," QJE, 52 pp. 179-222
Handout on
signaling games
Mas-Colell, chapter 8.E, 9.D
Tuesday, February 15: Equilibrium domination and the
intuitive criterion in signaling games, examples
reading: Cho, I. and D. Kreps, 1987, "Signaling games
and stable equilibria," QJE, 52 pp. 179-222
Handout on the
intuitive criterion
Thursday, February 17: minmax theorem, zero sum games
Tuesday, February 22: repeated games
reading: Mas-Colell, chapter 12, appendix A (nb. as Mas-Colell has
comparatively paltry material on repeated games, it may be helpful to consult
other game theory books for this portion of the course, such as books by
Gibbons, Myerson, Fudenberg and Tirole, Osborne, or Osborne and Rubinstein)
handout on repeated
games notation
Thursday, February 24: repeated games
Tuesday, March 1: oligopoly models: the basic Cournot model
reading: Mas-Colell, chapter 12
Thursday, March 3: oligopoly models: Cournot, collusion in
the Cournot model
reading: Mas-Colell, chapter 12
Friday, March 4: Midterm exam, answers (answers updated on 3/6 with a minor change to 2b)
Tuesday, March 8: No class
Thursday, March 10: No class
Friday, March 11, 9:30am: oligopoly models: Stackelberg
reading: Mas-Colell, chapter 12
Tuesday, March 15: No class
Thursday, March 17: No class
Tuesday, March 22: No class
Thursday, March 24: oligopoly models: Bertrand, capacity
constaints, strategic precommitments, entry
reading: Mas-Colell, chapter 12
Tuesday, March 29: Adverse selection
reading: Mas-Colell, chapter 13
Akerlof, G. 1970, "The Market for
Lemons", QJE, 84, pp. 488-500
Thursday, March 31: Adverse selection in a labor market
setting
reading: Mas-Colell, chapter 13
Tuesday, April 5: Education as a labor market signal
reading: Mas-Colell, chapter 13
Spence, M. 1973, "Job market signaling", QJE,
87, pp. 355-374
Thursday, April 7: Spence model ctd, screening
reading: Mas-Colell, chapter 13
Tuesday, April 12: Statistical discrimination and
pervasive discrimination
reading: Coate, S. and G. Loury (1993), "Will
affirmative-action policies eliminate negative stereotypes?" AER,
83, pp. 1220-1240
Thursday, April 14: Coate and Loury equilibria, numerical
example
reading: Coate, S. and G. Loury (1993), "Will
affirmative-action policies eliminate negative stereotypes?" AER,
83, pp. 1220-1240
Tuesday, April 19: Affirmative action in Coate and Loury
reading: Coate, S. and G. Loury (1993), "Will
affirmative-action policies eliminate negative stereotypes?" AER,
83, pp. 1220-1240
Thursday, April 21: Principal agent models: observable
effort and unobservable effort with risk neutral agents
reading: Mas-Colell, chapter 14.B
Tuesday, April 26: Principal agent models: unobservable
effort
reading: Mas-Colell, chapter 14.B
Thursday, April 28: principal-agent models: examples
reading: Mas-Colell, chapter 14
Friday, May 6: Final exam, answers