ECC2400

Current issues in applied microeconomics

Dr Keith Jakee and Dr He-ling Shi

6 points · Two 1-hour lectures and one 1-hour tutorial per week · Second semester · Clayton · Prerequisites: ECC1000 and ECC1010 or equivalent

Objectives On completion of this subject students should be familiar with the way in which economists apply economic theory and institutional knowledge of relevant parts of the economy to analyse government microeconomic policy options, and to make recommendations on policy actions; be able to understand and critically evaluate current policy debate on issues of microeconomic policy; and be able to evaluate the contributions and limitations of economic analysis for helping to understand and to evaluate microeconomic policy options.

Synopsis The subject builds on the first-year microeconomics subject to provide an applied microeconomic analysis of issues drawn both from the public and private sectors of the economy. Sectors of the economy that are often left in their more 'aggregate' form in other courses will be broken down into their microeconomic components in this subject. For example, we will turn our attention to areas such as the microeconomics of firm, the microeconomics of the welfare state, and even the microeconomics of transitional economies, such as China. Moreover, while many of the issues which we will examine have typically been treated as market 'failures' - and hence assumed to be solved by the government sector - we will consider the microeconomics of many government activities as well. Considering the numerous microeconomic difficulties that the government faces, we shall see that government may not be the panacea many observers assume. An important component of the subject will be in-class group presentations by students. These presentation will give students an opportunity to apply the tools, which we will cover in the subject, to specific issues of the firm, the modern welfare state, or modern transitional economies. For example, we are likely to draw our presentation topics from the following areas: microeconomics of health care, microeconomics of pensions, microeconomics of income distribution, microeconomics of education, etc.

Assessment In-class group presentation: 30% · Examination (2 hours): 70%

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