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Haverford College

Course Catalog

Economics: 2009-2010

DescriptionFacultyMajor RequirementsMinor RequirementsRequirements for HonorsCoursesDepartment Homepage


The study of economics provides a basis for understanding and evaluating economic behavior and relations at all levels of society. Microeconomics focuses on the behavior of individuals and firms and how they interact in markets for goods, services, labor, and assets. Macroeconomics focuses on the behavior of aggregate economic variables, such as GNP, the inflation rate, the unemployment rate, the interest rate, and the budget deficit, and how they relate at the economy-wide level. Other areas of economics focus on specific aspects of micro- and macroeconomics as they are applied to diverse situations and economies around the world.

Most of modern economics is structured around a common set of theoretical ideas and analytic methods that unify the field. These tools aid in understanding both how the economic world works and how it can be affected by public policies and world events. The introductory course, Economics 105, introduces and develops these ideas and methods at an elementary level while also presenting information about markets, economies, and governmental policy that is important to a liberal education. This course provides an overview of economics and a strong foundation for more advanced work in economics.

The intermediate (200 level) courses offer material on many different economic topics. These courses require Economics 105 as a prerequisite, and are designed to be useful to non-majors as well as minors and majors. The advanced theory courses of Economics 300 and Economics 302 follow up on the introductory theory course but offer more in-depth and mathematical treatments of these theoretical concepts which are the building blocks for modern economic thought and research. Statistical methods used in empirical research are important for students who will be reading original economics articles and conducting their own research. Economics 203 (Statistical Methods in Economics) or Economics 204 (Economics Statistics with Calculus) followed by Economics 304 (Introduction to Econometrics) give students the necessary methodological training. The advanced (300 level) courses involve a much more technically sophisticated approach to analyzing many of the same economic topics. These normally require some combination of Economics 203, 300, 302 and 304 as prerequisites and are designed primarily for economics minors and majors and those who expect to make use of economics in their professional careers. In most of the advanced courses, a substantial paper is an important part of the requirements. A small number of the 300 level courses are “junior research seminars” designed to develop the student’s research skills through exploring topical cutting edge research and conducting related original projects. Economics 396 is a two semester Senior Research Seminar. The first semester is a group seminar in which students learn salient research skills, listen to and critique work of guest economics speakers, and develop their own research questions. During the second semester students conduct original and independent economics research under the guidance of one of the economics faculty members.

Most courses offered by the Bryn Mawr economics department may be counted toward the Haverford economics minor and major (with the exception of courses at the 100 level, excluding Economics 105). Similarly most Haverford economics courses may be counted toward the Bryn Mawr economics major. The two economics departments plan their course schedules jointly so that the maximum variety of economics courses can be offered across the two campuses.

Modern economics continues to expand in its use of mathematically sophisticated models and statistical techniques. Economics majors are required to take at least two semesters of college level calculus. In addition, students who are planning to apply to graduate programs in public policy or business are encouraged to take mathematics through at least Mathematics 121 (Multivariable Calculus) and at least one computer science course. Those who are planning to apply to Ph.D. programs in economics are strongly advised to take mathematics through at least Mathematics 215 (Linear Algebra) and Mathematics 317 (Analysis I). Economics majors also have the option of pursuing an area of concentration in mathematical economics which is described under its own heading in this catalog.

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Associate Professor Richard Ball
Visiting Professor Biswajit Banerjee
Visiting Assistant Professor Julie Becher
Provost and Professor Linda Bell (on leave)
Professor Vernon J. Dixon, Emeritus
Assistant Professor Indradeep Ghosh
Assistant Professor Saleha Jilani
Professor Vladimir Kontorovich
Assistant Professor David Owens
Professor Anne E. Preston, Chair

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Major Requirements

Economics 105, 203 or 204, 300, 302, 304, 396; four other semester courses above the 100 level, one of which is at the 300 level and one of which is a junior research seminar; two semesters of college-level calculus or equivalent. With departmental approval, Math 203 can replace Economics 203 or 204 and Math 286 can replace Economics 304. Prospective majors are advised to take Economics 105, 203 or 204, and either Economics 300 or 302 by the end of their sophomore year.

Note: Because the curriculum is changing in the 2009-2010 academic year, requirements for majors graduating in 2010, 2011, and 2012 are slightly different. The requirements listed above hold for all majors graduating in 2012. Majors graduating in 2011 have the option of taking a two semester introductory sequence of Economics 101, Introduction to Microeconomics, and Economics 102, Introduction to Macroeconomics, or simply Economics 105. Those students taking Economics 101 and 102 will only be required to take 3 electives, with two being at the 300 level. Students graduating in 2010 will adhere to the previous requirements (not listed here) which included the two semester introductory sequence, only three electives, one of which is 300 level, and a one semester senior research seminar.

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Minor Requirements

Requirements for a minor in economics are: Economics 105, 203 or 204; 300 or 302; three other Economics courses at the 200 and/or 300 levels. The chair of the department serves as the minor advisor.

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Requirements for Honors

An economics major whose grade point average in economics courses at the beginning of the second semester of the senior year is 3.6 or higher is invited to become a candidate for the degree with Honors in economics. Honors or High Honors are awarded on the basis of a student’s performance in (a) all his or her economics courses, including those taken in the second semester of senior year and (b) an oral examination by department faculty focused on the student’s senior thesis.

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  • 105 Introduction to Economics SO
    An introduction to microeconomic topics --opportunity cost, supply and demand, consumer decision making, the theory of the firm, market structures, and efficiency and market failure--and macroeconomic topics --the determination of GDP, money and interest rates, unemployment and inflation, and fiscal and monetary policy.

    203 Statistical Methods in Economics SO/QU
    Frequency distributions, probability and sampling theory, simple correlation and multiple regression, and an introduction to econometric terminology and reasoning. Three class hours and two lab hours. Prerequisite: Economics 105.

    204 Economic Statistics with Calculus SO/QU
    An introductory course in statistics aimed primarily at students in economics and other social sciences. The course develops the theoretical groundwork of statistical inference and investigates the application of theoretical principles and methods to real data. Three hours of class plus two hours of lab per week. Prerequisite: Math 114 or 115 and Economics. 105.

    205 Corporate Finance SO
    Theories and practices of corporate finance with a focus on investing and financing decisions of business firms. Topics include financial instruments and markets, valuation and risk measures, financial analysis and planning, cost of capital, capital budgeting, and financial management. Prerequisite: Economics 105.

    207 Monetary Economics SO
    How money, the banking system and financial markets interact and affect the macroeconomy. We will study asset markets and asset returns, the determination of equilibrium rates of return and interest rates, and the risk-return trade off in asset markets and its influence on portfolio allocation. We will also cover how monetary policy is implemented through the Federal Reserve System. Prerequisite: ECON 105 and/or 302.

    209 Law and Economics SO
    Why do rational people follow fixed rules (laws) instead of doing what is best for them in a specific situation? Can there be order without law? Should the government compensate people when it issues environmental and wildlife protection regulations which reduce the value of their property? The lady who burned herself with a cup of McDonalds coffee won several million dollars in compensation. Does that make sense? These and many other questions are addressed as we look at property law, contracts, and torts. Prerequisite: Economics 101 and 102 or Economics 105 and one other economics course. Economics 100 can be applied with approval of Chair, and conditional on a grade of 3.0 or higher.

    210 Linear Optimization and Game Theory NA/QU (Cross-listed in Computer Science and Mathematics)
    Prerequisite: MATH 215 or MATH 115 and concurrent registration in MATH 215. Typically offered in alternate years.

    211 The Soviet System and Its Demise SO (Cross-listed in Political Science and Russian)
    The Soviet system was inspired by some of the loftiest ideals of humanity. The entire society was redesigned so as to pursue common goals, rather than conflicting private objectives. The economy was run for people, not profits. The Soviet system is no more, but the ideas on which it was founded will probably always be with us. What does the largest social and economic experiment in history teach us? The course is 1/3 political science and 2/3 economics. Prerequisite: Econ 105 or Two one-sem courses in PoliSci or Hist.

    220 The Economics of Immigration SO/QU
    This course examines the economic impact of immigration using theoretical economic models to evaluate a large body of empirical economic research. Particular emphasis is on the most recent experience of the US. Prerequisite: Econ 105.

    224 Women in the Labor Market SO (Cross-listed in Gender and Sexuality Studies)
    This course examines the experiences of American women in the labor market over the last 50 years. After an examination of the historical trends of female labor force participation, the course will investigate such important issues facing women in the labor market as: investments in education; participation decisions and the relation between participation and family responsibilities; occupational location; salary growth and salary determinants. Supporting material on institutional factors such as equal employment opportunity legislation and on theoretical concepts in areas such as labor supply, human capital investment, and discrimination will be presented to help understand the empirical labor market outcomes. Comparisons of labor market races will be made throughout the course with the hope of increasing our understanding of why differences arise and whether policy initiatives might be helpful in reducing these differences.

    225 Developing Economies SO
    Analysis of the structural transformation of developing economies; causes and roles of saving, investment, education, and health care; technological change and trade in the development process; strategies and methods of economic planning; income distribution issues. Prerequisite: Economics 105.

    230 Privatization of State and Local Government SO
    This course deals with a phenomenon which is of current interest in the U.S., Western Europe, South Africa, and the nations which created from the former Soviet Union. The field of public finance has grown over the period of increased government intervention in the marketplace. Privatization is a new trend which was initiated by the Prime Minister Margaret Thatcher of Great Britain on the early 1980s and has spread internationally in the 1990s and is expected to intensify in coming years. Services which were traditionally within the domain of governments are transferred to private entities. Prerequisite: Economics 105.

    231 Public Health Economics SO
    Prerequisite: Econ 105.

    237 Games and Strategies in Economics SO/QU
    A survey of the major equilibrium concepts of non-cooperative game theory, with an emphasis on applications to economics and related fields. Prerequisite: Completion of HC MATH 113 with a grade of 2.7 or above or equivalent preparation in calculus.

    240 Economic Development and Transformation: China vs. India SO (Cross-listed in East Asian Studies)
    A survey of the economic development and recent transitional experience in China and India, giant neighboring countries, accounting for roughly one third of total world population. The course will examine the economic structure and policies in the two countries, with a focus on comparing China and India's recent economic successes and failures, their development policies and strategies, institutional changes, and factors affecting the transformation process in the two countries. Prerequisite: Economics 105.

    241 Economics of Transition & Euro Adoption in Central and Eastern Europe SO
    The aim of this course is to provide an understanding of the process of transition of former socialist countries from centrally-planned to market economies and their accession into the European Union (EU) with the eventual goal of adopting the euro as the currency. Special emphasis will be given to the experiences of the Czech Republic, Slovakia, Hungary, Poland, Slovenia, Latvia, Estonia, and Lithuania. In the context of transition, the course will cover issues related to political transformation, macroeconomic stabilization, privatization, and structural reforms in the fiscal sector, banking and financial sectors, and the labor market. Prerequisite: Economics 105.

    247 Financial Accounting SO
    Theory and practices of financial accounting for business firms. Topics include measuring and reporting results of business activities; preparation of financial statements for external users; evaluation of operations and financial status of firms with particular reference to problems of valuation and periodic income measurement.

    251 Empirical Macroeconomics SO
    The aim of this course is to provide students with an understanding of the design and implementation of macroeconomic and financial policies. The course will cover the principal features of accounts used in macroeconomic analysis, the diagnosis of macroeconomic performance, and the preparation of an internally consistent macroeconomic policy program that will move an economy toward internal and external balance. Actual case studies will be used. Teams will be formed, and each team will collectively prepare an analysis of economic background and formulate a policy program for a given country. Prerequisite: Economics 105 and proficiency in the use of spreadsheets.

    297 Economic Sociology SO (Cross-listed in Sociology)
    Prerequisite: Soc 155a or b, Econ 105, or consent of the instructor. Typically offered in alternate years.

    300 Intermediate Microeconomic Analysis SO
    Microeconomic theory has developed around the analysis of Adam Smith's ""invisible hand"" conjecture. To test this conjecture, we model the behavior of economic actors (consumers and firms) and their interaction in different markets (for goods, capital and labor). These models allow us to investigate the conditions under which these markets work well, less well, or not at all. In the process, basic tools and concepts used in other areas of economics are developed. Many of the topics covered I Introductory Microeconomics (Econ 101) are studied more rigorously and in greater depth. New Topics, such as behavior under risk, insurance, and imperfect information, are introduced. Prerequisite: Economics 105 and Math 114 (or equivalent).

    302 Intermediate Macroeconomic Analysis SO
    Analysis of the behavior of aggregate economic variables such as GDP, inflation, unemployment, interest rates, and the budget and trade deficits. Structured around the development of a New Keynesian/Neoclassical general equilibrium model which relates the markets for goods, money, and labor. Specific topics include: determinants of the business cycle, effects of fiscal and monetary policies, supply shocks, inflationary expectations. Prerequisite: Economics 105 and Mathematics 114 (or equivalent).

    304 Introduction to Econometrics SO
    Development of econometric theory introduced in Economics 203. Includes topics such as ordinary least squares estimation, weighted least squares estimation, estimation of models with nonlinear forms, instrumental variables, and maximum likelihood estimation. Emphasis will be on application of econometric techniques to real economic and social policy issues such as the optimality of speed limit control, AIDS awareness and behavior modification, labor market discrimination, and worker productivity. Students will be expected to use data sets to evaluate policy issues and will be required to make a final presentation of findings in class. Prerequisite: Economics 203 or Economics 204.

    311 Theory of Non-Cooperative Games SO
    Provides a rigorous development of the theory of non-cooperative games, with applications to economic, political, social and legal problems. Topics will include normal form games and the concept of Nash equilibrium, extensive form games, repeated games and reputation effects, games of incomplete information, Bayesian equilibrium and refinement concepts, and market signaling. Prerequisite: Economics 203 or 204, 300 and two semesters of college level calculus (or equivalent).

    312 General Equilibrium Theory SO
    An examination of the Arrow-Debreu model of general competitive equilibrium, one of the foundations of neo-classical microeconomic theory. The course focuses on sufficient conditions for existence and uniqueness, welfare properties, and stability of equilibrium prices. Prerequisite: Econ 300 and either Math 216 or 317.

    314 Behavioral Economics SO
    This course explores systematic departures of behavior from the predictions of neoclassical economic theory, and when possible, proposes alternative theories to explain this behavior. The course will begin with a study of reference-dependent preferences, based on Kahneman and Tversky’s seminal paper Prospect Theory. Further topics will include, but not be limited to, present-biased preferences, social preferences and behavioral finance. Students should be comfortable with microeconomic theory, and have some exposure to game theory. The course will have a heavy research component, and students should be prepared for critical reading of scholarly articles, and to write and present a research paper of their own. Prerequisite: Econ 300.

    321 Derivative Securities SO

    332 Managerial Economics SO
    Prerequisite: Economics 300 and 302 (or equivalent) or consent of the instructor.

    340 Policy Research in Labor Economics SO
    The starting point for this course will be current academic research as it contributes to labor market policy debate and change. Current policy relevant issues will dictate precise content and the emphasis of the course will be on understanding a body of academic economic discourse and how it helps to prioritize, influence, and ultimately set into motion national economic policy. Possible topics may include: workplace discrimination, minimum wage policy, economic inequality, poverty and welfare, international labor market comparison and performance, executive compensation, education policy and access, and the life-cycle of employment. Prerequisite: Econ 300 and 304.

    345 Advanced Topics in Finance SO
    Prerequisite: Econ 300 and Econ 203.

    347 Advanced Seminar in Macroeconomics: Open Economy Macroeconomics SO
    This course will explore topics in international macroeconomics, focusing on the determination and behavior of unemployment, interest rates and national income, as well as exchange rates, trade balance, and capital flows within an "open economy" framework. Applications will include the European Monetary Union, the Asian and Latin American financial crises, and the sustainability of the US Current Account Deficit. Prerequisite: Econ 302 or equiv.

    348 International Trade: Theory and Policy SO
    This advanced theory and policy course will examine recent theoretical developments in the area of international trade, in particular as they apply to key current international economic policy concerns. The topics analyzed will include international factor movements, foreign direct investment, the role of multinationals and trade in developing economies, regional integration, and preferential trade agreements. Prerequisite: Econ 300 or equivalent.

    365 Computational Methods in Economics and Finance SO
    This course will introduce numerical methods commonly used in the fields of macroeconomics and finance. It will introduce computational and programming techniques that can be used to solve finite-dimensional optimization problems. Such problems commonly arise in economics--how much to spend as opposed to save; and in finance--how to distribute the saved amount across different assets. Prerequisite: Math 218 or 116 or 216 or 317 or 215 or Econ 302, Intermediate Microeconomics. No prior programming experience is required.

    370 Advanced Theory Seminar SO
    Application of mathematics to economics including advanced topics in optimization and static and dynamic analysis of systems of simultaneous equations. Second half of semester is devoted to one specific topic to be announced. Prerequisite: Economics 203, 300 and 302.

    396 Research Seminar SO
    R.Ball, B.Banerjee, I.Ghosh, S.Jilani, V.Kontorovich, D.Owens

    480 Independent Study SO

    206 International Economics
    213 Taming the Modern Corporation
    214 Public Finance
    216 International Finance
    221 United States Economic Development
    222 History of Economic Thought
    224 Economic History and Growth, 1750-1970
    306 Advanced International Economic Policy
    313 Industrial Organization and Public Policy
    314 Economics of Poverty and Discrimination
    316 Transition of the European Economy
    326 Open-Economy Macroeconomics

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