MICROECONOMICS 1

This course belongs to the core teaching activities of the Master program in "Economics, Finance, and Sustainability" curriculum "Economics - QEM". In line with the educational objectives of the program, this course focuses on the analysis of microeconomic behavior and presents the main conceptual tools necessary for the analysis of microeconomic phenomena. A particular attention will be devoted to the use of formal language and methodological rigor. More specifically, the course presents individual decision making by consumers and producers, and analyzes the properties of the ensuing competitive equilibria.

Students are expected to become familiar with advanced microeconomic methods for analysis of consumption and production decisions, choice under uncertainty, and the analysis of competitive markets.

The course is attended by QEM students and first-year doctoral students. Lectures deal only with the common part. Doctoral students are expected to study on their own more advanced material indicated at lectures.

Knowledge and competences:
- sound knowledge of the theoretical and behavioral foundations of consumer theory
- sound knowledge of the theoretical foundation of production theory
- ability to integrate consumption and production decisions into the formulation of a competitive equilibrium
- sound knowledge of the welfare theorems, of their limits and their implications

Application of acquired knowledge and skills:
- ability to investigate, understand, and interpret stylized economic and financial phenomena by means of microeconomic analysis
- ability to use the tools of microeconomic analysis in order to asses positive and normative statements
- ability to build formal models of competitive equilibrium under different market structures.

Judgement and interpretation skills:
- ability to asses the typical trade-offs in optimal consumption and production choices
- ability to interpret market equilibrium outcomes in terms of behavioral and technological assumptions
- ability to relate market equilibrium efficiency to behavioral and technological assumptions

Students are expected to be familiar with material in the mathematical appendix in Mas-Colell, Andreu, Michael Dennis Whinston, and Jerry R. Green (1995), Microeconomic theory. New York: Oxford University Press.

Contents of the course are divided in two parts, A and B

Part A
1) Theory of consumer’s behavior: preference relations, choice rules, consumption set, competitive budget, demand function, preference and utility, the utility maximization problem, the expenditure minimization problem.
2) Theory of production: productions sets, production and cost functions, profit maximization and cost minimization, efficient production.

Part B
3) Introduction to general equilibrium: the Edgeworth Box and the Robinson Crusoe Economy
4) Pareto optimality, competitive equilibrium and its welfare properties (I and II welfare theorem)
5) Choice under uncertainty: expected utility theory, money lotteries and risk aversion

The textbook for both parts is:
Mas-Colell, Andreu, Michael Dennis Whinston, and Jerry R. Green (1995), Microeconomic theory. New York: Oxford University Press. The course covers material from chapters: Ch. 1-6, 10, 15-17, 19

For the introductory part:
Hausman, Daniel M. (2003), "Philosophy of Economics" https://stanford.library.sydney.edu.au/entries/economics/
Sandmo, Agnar. Economics evolving: A history of economic thought. Princeton University Press, 2011.
Stigler, George H. (1950), “The development of utility theory. I”, Journal of Political Economy, vol. 58, pp. 307-327.
Stigler, George H. (1950), “The development of utility theory. II”, Journal of Political Economy, vol. 58, pp. 373-396.
Varian, Hal R. (1998), "Microeconomics"In J. Eatwell, M. Milgate, and P. Newman, editors, The New Palgrave Dictionary of Economics. Palgrave Publishers Ltd., 1998.

- A webpage for the course will be active on the e-learning platform at moodle.unive.it. The page will contain references for additional readings from scientific journals, exercises, details on the weakly program and lectures and other materials.

In each academic year, there are 4 exam sessions. The first session takes place during the first semester. It is articulated in a midterm partial written examination on the contents of Part A, administered at the end of the first teaching period, and a final written examination on the whole content of the course, administered at the end of the second teaching period. The final evaluation is obtained as a weighted average of the two examinations (30% and 50%, respectively) and of attendance (20%). The remaining sessions (from January until September) present a single comprehensive examination on the full contents of the course.

Both written exams consist of exercises similar to those solved during the course and theoretical questions, each with its own score. All written exams are closed-note and closed-book. Students are allowed to use a pocket calculator.

Questions and exercises are chosen to test whether students have acquired the knowledge about the foundations of the microeconomic analysis of competitive markets and the ability to apply to concepts to the analysis of microeconomic phenomena.

The course follows a conventional teaching approach, based on lectures, exercise sessions, and discussions.

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Accessibility, Disability and Inclusion
Accommodation and support services for students with disabilities and students with specific learning impairments

Ca’ Foscari abides by Italian Law (Law 17/1999; Law 170/2010) regarding support services and accommodation available to students with disabilities. This includes students with mobility, visual, hearing and other disabilities (Law 17/1999), and specific learning impairments (Law 170/2010). If you have a disability or impairment that requires accommodations (i.e., alternate testing, readers, note takers or interpreters) please contact the Disability and Accessibility Offices in Student Services: disabilita@unive.it.

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This subject deals with topics related to the macro-area "Human capital, health, education" and contributes to the achievement of one or more goals of U. N. Agenda for Sustainable Development