Microeconomics 1

Main course materials

The main reference for my half of the course is my lecture notes. Please regularly check that you have the latest version. I last updated the notes at 12:00AM, Tuesday 21 of March. You can see what changed using Adobe Acrobat Pro on the uCreate computers. Choose Tools -> Compare Documents, and select the PDFs containing the old and new versions of the notes. You can download the Latex source if you want to annotate or contribute improvements to the notes.

You can read the Assessment guide with practice exam questions and sample solutions with commentary.

To watch lecture videos, first log into Learn, and then select "Watch Lecture Recordings" on the Microeconomics 1 page

You can browse last year's course materials.

News

• 15 January: Your exams have been marked, and you will receive your provisional marks shortly. You can check the sample solutions with commentary, and you can get feedback on your exam script during my office hours throughout the rest of the year. The provisional mark distribution for Part A was 0-39:1, 40-49:22, 50-59:29, 60-69:18, 70-79:13, 80-89:2, and overall was 0-39:1, 40-49:8, 50-59:27, 60-69:20, 70-79:19, 80-89:10. Please note that Part A was harder than usual, and Part B was easier than usual.
• Mathematical Microeconomics 1 students: the assessment guide has been updated to explain how the mathematics exam will be marked.
• Week 5:   lecture whiteboard notes
  • We will do 4.6 and 4.7.
  • We have a different room.
  • Homework: practice exam questions 6, 10, 26.
• Week 4:   lecture whiteboard notes
  • We did 3.6, 4.1, 4.2, 4.3, 4.4 and 4.5.
  • Homework: 3.10, 4.1, 4.2, 4.3.
• Week 3:   lecture whiteboard notes
  • We did 2.4, 2.5, 3.1 - 3.5.
  • Homework: read about time preference (3.2), and do questions 2.14, 2.17, 3.1, 3.6, and past exam question 11.iii.
  • From now on, lectures will start at 9am.
• Week 2:   lecture whiteboard notes
  • We finished 2.3 and started 2.4.
  • Homework: 2.9, 2.10, 2.11, 2.12.
• Week 1:   lecture whiteboard notes
  • We did Chapter 1, sections 2.1, 2.2, Appendix D and started 2.3.
  • This course uses quite a lot of mathematics notation and terminology. I will explain the notation in lectures, but you might also want to reading Appendix B this week.
  • Homework: Read Examples 2.1, 2.2, 2.3 and answer Questions 2.1, 2.2, 2.6, 2.7 and 2.8.
• 10 September: If you want to learn more mathematics, you can take Mathematical Microeconomics 1 instead.

Assessment

Details on the assessment (including the marking criteria) are included in the practice question file. Two students kindly donated their marked exam scripts in 2017-8. Note that the December and May exams are marked on the same scale.

Extra Reference

Some students like an extra reference, although it is unnecessary. I will only test knowledge from my notes. The references below are also available as a clickable reference list via the library.

Material marked with a star in the notes will only be tested in bonus questions; it is possible to get a distinction in the class without learning the starred material. My notes are closer to Varian and Kreps than MWG, but quite different from all of them. Ambitious students who would like a strong background in mathematics might want to read Maxwell Rosenlicht's (1968) "Introduction to Analysis" or Luenberger's (1969) "Optimization by Vector Space Methods". Angel de la Fuente's (2000) "Mathematical Methods and Models for Economists" is also helpful.

MWG means Mas-Colell, Whinston and Green's (1995) "Microeconomic Theory". V means Varian's (1992) "Microeconomic Analysis". K means Kreps' (1990) "A Course in Microeconomic Theory". KK means Kreps' (2013) "Microeconomic Foundations 1: Choice and Competitive Markets". SL means Stokey and Lucas (1989), "Recursive Methods in Economic Dynamics". Debreu (1960) is Topological methods in cardinal utility theory.

1. Introduction
2. Production
   1. Production Functions   See: V1, MWG5, K7.1
   2. Profit Maximization   See: V2, MWG5, K7.2
   3. Upper Envelopes and Value Functions   See: V3, SL4, MWG5, K7.2
   4. Cost Functions and Dynamic Programming   See: V4, SL4, MWG5, K7.3, K.A.2
   5. Upper Envelopes with Constraints   See: V5, SL4, MWG5, K7.3
3. Consumption
   1. Utility Functions   See: V7, MWG3, K2.1
   2. Time Preference   See: Debreu (1960), V19, SL4, SL5, MWG20, KK2.5
   3. Utility Maximization   See: V7, MWG3, K2.2
   4. Consumer’s Value and Policy Functions   See: V7, MWG3, K2.2, K2.3
   5. Expenditure Function and Policy Functions   See: V7, MWG3, K2.2, K2.3
   6. Slutsky Decomposition   See: V8, MWG3, K2.3
4. Equilibrium
   1. Economies   See V17, V18, V19, MWG16, K6.1, K6.2
   2. Efficient Allocations   See V17, V18, V19, MWG16, MWG22, K5.2
   3. Equilibrium   See V17, V18, V19, MWG16, K6.1
   4. Characterising Equilibria   See V17, MWG15, MWG16, MWG20, K2.2
   5. Efficiency of Equilibria   See V17, MWG16, K6.3
   6. *Existence of Equilibria   See V17, MWG17, K6.4
   7. Implementation of Efficient Allocations   See V17, MWG16, K6.3