Economics 0105
Introduction to Microeconomics

Semester: Fall 2011
Instructor: George Berger
Office: 120 Biddle
Phone: 269-2982/2990 or 2991
Office Hours: MWF 2-3, TH 2:00-3:20 or by appointment

TEXTS

Edward G. Dolan Introduction to Microeconomics, 3rd Edition, 2008    

George Berger, Supplementary Readings, Fall 2011.

ORGANIZATION OF THE COURSE

I. What Is Economics?

           A. No Text reading.     

          B. Supplementary Reading

                      1. George Berger, "Introduction to Microeconomics"

2. Glen Whitman, “Slavery, Snakes and Switching: The Role of Incentives in Creating Unintended Consequences,” The Library of Economics and Liberty, May 7, 2007, pp. 1-6

II. Supply and Demand

A.   Text (32 pages)

Chapter 2, pp. 39-58: Demand, Supply and Equilibrium
Chapter 5, pp. 128-132: Consumer and Producer Surplus and Taxes
 Chapter 2, pp. 58-64: Price Ceilings and Floors

          B. Supplementary Readings (48 pages)

1. David Laband, "Singing the Ticket Scalping Blues" The Freeman, 44:9, September 1994, pp. 514-15.

2. John Wenders, "Government Policies Lead to Hunting Quality Decline," The Margin, Fall 1992, pp. 52-53.

3. Stephen Shmanske, “The Bay Bridge Blunder,” Regulation, 19:4, 3pp.

4. John Attarian, "Smuggled Cigarettes, Unteachable Politicians'" The Freeman, September 1998, pp. 560-63.

5. Art Woolf, “A River Divides It: Executive Summary” Northern Economic Consultants, Inc., January 27, 2001, 2pp.

6. Paul Gessing, “Public Funding of Sports Stadiums: Ballpark Boondoggle” National Taxpayer Union Foundation Policy Paper 133,  4pp.

7. John Semmens, “Public Transit: A Worthwhile Investment?” (Revised and Expanded)  Arizona Issue Analysis 144, Goldwater Institute, December 1999, pp 1-7.

8. Peter Salins and Gerard Mildner, "Does Rent Control Help the Poor?" The City Journal, Winter 1991, pp. 39-45.

9. Devon Herrick and  John Goodman, “The Market for Medical  Care” NCPA Policy Report No. 296, February 2007, pp. 1-5, 8-12, 14-15.

EXAM 1

III. Elasticity

A.   Text (20 pages)

Chapter 3, pp. 69-88: Elasticity-Formulas, Determinants and Applications

          B. Supplementary Readings (31 pages)

1. Roger Leroy Miller, Daniel Benjamin, and Douglas North, "The Social Costs of Drug Wars," Economics of Public Issues,  9th edition, Harper Collins, 1993, pp. 124-32.

2. Roger Leroy Miller, Daniel Benjamin, and Douglas North, "Sex, Booze, and Drugs," Economics of Public Issues, 9th edition, Harper Collins, 1993, pp. 33-37, 38-41.

3. Bruce Benson and David Rasmussen, "The Opportunity Cost of Crime," in Michael Parkin, Economic Times: An Economic Journal of World Events, 4:1, Spring 1995, pp. 15-18.

4. "The Wages of Prohibition," The Drug Policy Letter, 26 Spring 1995, pp. 7-11.

5. "Going to Pot," Reason, July 1993, p. 14.

6. Ed Carson, "Purging Bingeing," Reason, December 1995, pp. 61-63.

IV. Market Failures

A.   Text (17 pages)

Chapter 4, pp. 102-109: Externalities and Public Goods
     Chapter 6, pp. 150-155, 159-163: Controlling Externalities Through                   Voluntary Exchange and Environmental Policy and Public Choice  

          B. Supplementary Readings (15 pages)

1. Jonathan Adler, "Making the Polluter Pay," The Freeman, March 1995, pp. 167-70.

2. Peter J. Hill, "The Proof is in the Pollution," Econ Update, May 1992, pp. 6-9.

3. Matt Ridley, “Natural Resilience,” Rational Optimist Blog, July 19, 2010, 3 pp.

4. Terry Anderson, “Why It’s Safer to Drill in the ‘Backyard’” Wall Street Journal, June 25, 2010, 2 pp.

V. Government Failures: Public Choice.

          A. Text (4 pages)

Chapter 4, pp. 109-112

          B. Supplementary Readings (31 pages)

1. David Johnson, "Voting, Rational Abstention, and Rational   Ignorance," Public Choice: An Introduction to the New Political Economy, Bristlecone Books, 1991, pp. 127-31, 133-49.

2. Loren Lomasky, "The Booth and Consequences: Do Voters Get What They Want?" Reason, November 1992, pp. 31-34.

3. Jeffrey Friedman, "Public Ignorance and Democracy," Cato Policy Report, 21:4 (July/August 1999), pp. 1, 10-12.

EXAM 2

VI. Perfect Competition

          A. Text (no reading)

          B. Supplementary Readings (45 pages)

1. E.C. Pasour, Jr. and Randal R. Rucker, "Comparing Farm and Non-Farm Incomes," Plowshares and Pork Barrels: The Political Economy of Agriculture, Independent Institute, 2005, pp. 76-79.

2.  E.C. Pasour, Jr. and Randal R. Rucker, "Effects of Agricultural Commodity Programs," Plowshares and Pork Barrels: The Political Economy of Agriculture, Independent Institute, 2005, pp. 181-93.

3. Laura Sayre, “Farming Without Subsidies: Some Lessons from New Zealand,” Rodale Institute , March 20, 2003, 6 pp.

4. Jayne Thomisee, “The Cotton Debate: A Global Industry Argues over Government Subsidies,” Worldview Magazine Online, Fall 2005, vol. 18:3, 6 pp.

5. Daniel Griswold, Stephen Slivinski, and Christopher Preble, “6 Reasons to Kill Farm Subsidies and Trade Barriers,” Reason, February 2006, pp. 42-49

6. "How Brazil Subsidizes the Destruction of the Amazon," The Economist, March 18, 1989, p. 69.

7.  Robert Zimmerman, "New York's War Against The Vans," The Freeman, 42:4, April 1992, pp. 150-51.

8. James Taranto, "Breaking Mr. Maynard," Reason, June 1988, pp. 31, 33, 34.

9. Howard Baetjer, "Beauty and the Beast," Reason, December 1988, pp. 28-31.

VII. Monopoly

          A. Text (19 pages)

                   Chapter 10, pp. 255-268: The Theory of Monopoly
                   Chapter 13, pp 335-341: Antitrust Policy

          B. Supplementary Readings (28 pages)

1. Edward Lopez, "Breaking Up Antitrust," The Freeman, 47:1, January 1997, pp. 23-26.

2. Donald Boudreaux, "Predatory Pricing Laws: Hazardous to Consumers' Health," The Freeman, 44:12, December 1994, pp. 664-67.

3. Stan Liebowitz and Stephen Margolis, "Microsoft, Monopoly, and Consumer Harm," Excerpt from their book Winners, Losers, and Microsoft, 4 pp.

4. Barry Fagin, "The Case Against the Case Against Microsoft" CEI Antitrust Reform Project, April 1999, pp. 8-15.

5. Burt Folsom, "Herbert Dow and Predatory Pricing," The Freeman, May 1998, pp. 307-11.

EXAM 3 (Final)

 

 

 

OBJECTIVES OF THE COURSE

1. Learn the basic concepts of economics. (Students who master these concepts should be able to earn a C in this course.)

2. Learn how to connect the basic concepts of economics to one another in chains of reasoning. (Students who master the basic concepts and learn how to connect some of these concepts together should be able to earn a B in this course.)

3. Learn how to apply economic reasoning to real world cases. (Students who master the basic concepts, learn how to connect most of these concepts together, and learn how to apply these concepts to real world cases should be able to earn an A in this course.)

EXPECTATIONS

1. I expect students to read assigned text material BEFORE coming to lecture. That way, students will be familiar with the ideas presented in lecture and will take better class notes as a result.

2. I expect students to memorize the assigned definitions. But please note that I do not ask students just to memorize but also to understand the definitions. Like learning a foreign language, students must first memorize before they can understand.

3. I expect students to work the homework problems BEFORE coming to class. I will answer questions about the homework in class provided that students have made an attempt to work the problems first.

4. I expect students to be on time for class and to be courteous in their behavior at all times in the classroom.  Two points are of particular importance here:

a. I CONSIDER TEXTING IN CLASS RUDE AND DISTRACTING. THEREFORE IF I EVEN SEE A CELL PHONE DURING CLASS I WILL TAKE THAT PERSON’S CELL PHONE AND PUT IT ON THE PODIUM ( IT MAY BE  RECLAIMED AFTER CLASS).  FOR EVERY CLASS AFTER THIS OCCURS, THIS PERSON MUST PUT HIS/HER CELL PHONE ON THE PODIUM BEFORE CLASS BEGINS. IF THIS PARTICULAR PERSON IS LATE, HE/SHE MUST PUT THEIR CELL PHONE ON THE PODIUM BEFORE TAKING A SEAT IN THE BACK OF THE CLASS.

b. IN THE PAST STUDENTS IN MY CLASS HAVE OFTEN LEFT DURING CLASS (TO GO TO THE BATHROOM, TO TAKE A PHONE CALL, WHATEVER) AND RETURNED SHORTLY.  I ALSO CONSIDER THIS RUDE AND DISTRACTING. SO THIS BEHAVIOR MUST STOP. IF ANYONE LEAVES IN THE MIDDLE OF CLASS: (i) I WILL MARK YOU ABSENT AND (ii) ASK THAT YOU NOT COME BACK FOR THE REMAINDER OF THE CLASS. IF YOU ARE ILL BY ALL MEANS LEAVE CLASS IF YOU NEED TO ( ALTHOUGH IN THIS CASE IT MIGHT BE WISE NOT TO COME TO CLASS IN THE FIRST PLACE).

COURSE POLICIES

1. The course grade will be based on a total point score with points distributed as follows:

        Exam 1 100 points
        Exam 2 100 points
        Exam 3 100 points

          Total:  300 points

Although I cannot spell out how many points are needed for an A, how many for a B, etc., at this time, I will provide you with a grade distribution after each exam.

2. Your grade can be calculated as follows: (1) Assume you earned a 73 on the first exam and that all scores falling into the range 70-79 are Cs and all scores falling into the range 80-89 are Bs. (2) Assume you earned an 83 on the second exam with Bs and Cs having the same range as Exam 1. Your total number of points earned after the second exam add to 156. What is your letter grade? Add together the minimum scores for a B which in this case is 160 points. Since your point total is less than the minimum score to earn a B, you have a C+ in the course after the second exam. (NOTE: The ranges used in this example are not necessarily the ranges that I will use during the course of the semester.)

3. I will use +'s and -'s for the final course grade.

4. Exams are NOT cumulative but cover only the material after the previous exam.

 

5. All exams will be a combination of definitions and multiple choice questions. A typical test will include 8 definitions (40 points) and 12 multiple choice questions (60 points). These exams will draw on material selected from the definition sheets, assigned homework exercises, supplementary readings and designated lecture material. Extra credit questions will be included on all exams. This is the only place extra credit can be done.

6. Exams will be given in two stages. In the first stage, students must match the correct term with the correct definition BY MEMORY (no note-cards allowed). In the second stage, students may consult an unlimited number of note-cards to complete the multiple choice section of the exam. NOTE: THESE NOTECARDS MUST BE HANDWRITTEN. YOU MAY NOT USE XEROXED OR TYPED NOTECARDS OR NOTECARDS WITH XEROXED OR TYPED MATERIAL PASTED ON THEM. I WILL REQUIRE ALL STUDENTS TO TURN IN THEIR NOTECARDS TO ME AFTER THE EXAM. THAT MEANS YOUR NAME MUST APPEAR ON YOUR TOP NOTECARD YOU TURN IN.  IF I DISCOVER THAT SOMEONE HAS USED XEROXED OR TYPED NOTECARDS THAT PERSON WILL RECEIVE A ZERO ON THE EXAM.

7. Exams 1 and 2 will have very tight time constraints so you must be prepared to deal with them. This means writing short summaries of the supplementary reading articles; these summaries should answer all of the questions asked on the supplementary readings questions which are listed on my website.

8. Exam dates will be as follows:

Exam 1 –  Sep 30 (approximately)
Exam 2 –  Nov 09 (approximately)
Exam 3 – MWF 1-1:50,  Friday, Dec 16 @ 9 AM
Exam 3 – MWF 3-3:50,  Monday, Dec 12 @ 12:30                                                                                                               

Please note that you must take Exam 3 when scheduled; exceptions will be allowed only if students provide evidence of one other exam on the scheduled date.

 

 

 

 

 

 

 

9. Make-up exam policy.

 

a. In the event of a prolonged absence (more than a single class or single day), students must immediately contact the Office of the Assistant to the Vice President of Academic Affairs, Blackington 248, (814-269-2078) to be excused from classes. For all other absences on the test date students must (1) notify me before the exam and (2) obtain a doctor’s excuse. Students who satisfy these requirements will be able to take a make-up exam.

 

b. If the student does neither of these things the instructor may allow a make-up exam with a penalty to be determined by the instructor or may assign the student a zero depending on the nature of the excuse. Students should note that the exams increase in difficulty throughout the course. 

10. Homework exercises will be periodically assigned throughout the semester but not collected. Two assignments per exam will be made for each of the three exams. These assignments should not be turned in. Students, however, should treat these assignments as quizzes and attempt to do them without looking at the answers. If you cannot do the assignments without looking at the answers you should seek help from tutors or from me. Such help will take the form of exercise drills.

NOTE: MY APPROACH IN THIS COURSE TO HOMEWORK RELIES ON STUDENTS TO TAKE THE INITIATIVE AND ATTEMPT TO WORK THE HOMEWORK PROBLEMS BY THEMSELVES. I CANNOT DO THIS FOR YOU. I CAN HELP THESE WHO DO TRY AND GET STUCK.

11. Answers to the homework exercises may be found online.

12. I have all the crucial Graphs and Tables from my Powerpoint slides posted online. I suggest you print these out and bring them to class as a note-taking aid.

13. CLASS ATTENDANCE IS REQUIRED. Students who miss more than FOUR classes will have 3 points deducted from their final point total for each class missed.

14. Although there are no formal points granted for class participation, anyone demonstrating a knowledge of the course concepts during class discussions will earn informal points. These points will help push students whose point totals are close to a grade borderline to the next highest grade.

15. Anyone cheating on any exam will receive an automatic zero on that test.

16. FYI: THE DEADLINE FOR DROPPING ONE CLASS IS OCTOBER 28 WITH A W ON YOUR TRANSCRIPT. If you are earning a grade in this course that is unsatisfactory to you (a D or an F), you may drop this course on or before this date and your grade will NOT be recorded in your transcript. If you drop this course after this drop deadline, your grade at the time of the drop will be recorded on your transcript.

17.  Any student receiving a D or an F in the course on either of the first two exams should seek help immediately either from me or tutors at the Academic Success Center, located in Owen G-16. These tutors can assist you in staying on track academically. You may complete an on-line request for an individual tutor at the ASC’s website, where you may also access information regarding drop-in tutoring and Supplemental Instruction (SI) sessions. Tutoring and other ASC services are free to all students.

 

In the event you receive notification from the ASC regarding your performance in class, be sure to follow-through to obtain assistance. The Academic Counselors are committed to helping all students maximize academic potential.

 

18. If you have a disability for which you are or may be requesting an accommodation, you are encouraged to contact both your instructor and the Office of Health & Wellness (OHW), G-10 Student Union Building, (814) 269-7119 to schedule an appointment as early as possible in the term. OHW will verify your disability and determine reasonable accommodations for this course.