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Haverford College

2011-12 Course Catalog

Social Sciences: Economics, 2011-2012

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 III) 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
Provost and Professor Linda Bell (on leave)
Visiting Assistant Professor Paul Cichello
Assistant Professor Indradeep Ghosh
Professor Holland Hunter, Emeritus
Assistant Professor Saleha Jilani
Professor Vladimir Kontorovich, Chair
Visiting Assistant Professor Shannon Mudd
Assistant Professor David Owens (on leave 2011-12)
Professor Anne E. Preston

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Major Requirements

Economics 105, 203 or 204, 300, 302, 304, 396 (a year-long 2 semester course); four other semester courses above the 100 level, two of which are at the 300 level, of which one must be 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 changed in the 2009-2010 academic year, requirements for majors graduating in 2012 can be slightly different. The requirements listed above hold for all majors graduating in 2013 and after. Majors graduating in 2012 who have taken Economics 101 and 102 are only required to take 3 electives, two of which are at the 300 level, of which one must be a Junior 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.

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Requirements for Honors

An economics major whose grade point average in economics courses taken at Haverford College, Bryn Mawr College or Swarthmore College at the beginning of the second semester of the senior year is 3.60 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. Because Economics 105 requires graphical and algebraic competency, students are strongly encouraged to take a college-level calculus course either before or concurrently with this course.

106 Introduction to Economics with Calculus 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. This section of Intro to Economics is intended to be more mathematical in its treatment of the material than Economics 105. Therefore, prior mathematical knowledge is a prerequisite for this course. Before taking this class, students must have taken Math 113 or have been placed at Math 114 or higher in their freshman Math placement tests. Prerequisite: Mathematics 113 or 114 or higher required.

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: Econ 105 (or 101 and 102).

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: Economics 105 (or 101 and 102) and Math 116, or equivalent background in probability and integral calculus.

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 (or 101 and 102).

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 that 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 105 (or 101 and 102).

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.

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; the relation between labor force 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.

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 (or 101 and 102).

231 Public Health Economics SO

Prerequisite: Economics 105 (or 101 and 102).

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: Economics 105 (or 101 and 102) and Math 113 with a grade of 2.7 or higher 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 an failures, their development policies and strategies, institutional changes and factors affecting the transformation process in the two countries. Prerequisite: Economics 105 (or 101 and 102).

241 Economics of Transition & Euro Adoption in Central and Eastern Europe SO

One highlight of this course is a study field trip during the Fall Break, Oct. 7-15, 2011, to the European Commission in Brussels & the European Central Bank in Frankfurt. Participation in the field trip, sponsored by the Center for Peace & Global Citizenship and the Provost's Office to cover the costs for travel, accommodations and meals will be mandatory for students enrolled in the course. Enrollment will be limited to 17 students. If the course is oversubscribed, the Professor will select students on the basis of enrollment and performance in other economics courses and the declared major/minor. Prerequisite: Economics 105 (or 101 and 102).

249 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: Two one-semester courses in Economics, Political Science or History.

250 Sports Economics SO

An examination of organized team sports from the perspective of the economist and public policy maker. Tools of labor economics and industrial organization are used to analyze economic problems arising from opportunities for monopoly and monopsony rents and piecemeal regulation. Prerequisite: Economics 105 (or 101 and 102).

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 (or 101 and 102) and proficiency in the use of spreadsheets.

255 Crises SO

This course will study the many dimensions of the 2008 Financial Crisis, and the ensuing macroeconomic recession in much of the industrialized world, through a variety of different perspectives, involving economic history the history of economic thought, and also modern macroeconomic theory. Prerequisite: Economics 105 (or 101 and 102) or Economics 106.

297 Economic Sociology SO (Cross-listed in Sociology)

Prerequisite: Sociology 155a or b, Economics 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 (or 101 and 102) 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 (or 101 and 102) and Math 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 105 (or 101 and 102), Economics 203 or 204.

306 Advanced Corporate Finance SO

This course examines theories and practices of corporate finance and how they have informed each other in their development. The focus is on financing at the firm level. Topics include valuation and risk measures both at the level of individual securities and the level of firms, project analysis, cost of capital, capital budgeting and financial statement analysis. Prerequisite: Economics 203 or 204, Economics 300. Offered occasionally.

307 Money and Banking SO

This course will focus on the basic features of asset market equilibria and the nature of interactions between private sector agents, the banking system and the central bank. The course will begin with a description of how asset prices are determined in stock and bond markets, and then move on to a study of more sophisticated financial assets such as forwards, futures and options. The course will ultimately facilitate a discussion of the 2008 financial crisis. Prerequisite: Economics 302 and Math 121. Course not open to anyone who has already taken Economics 207 at either Haverford or Bryn Mawr.

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: Economics 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: Economics 300.

321 Derivative Securities SO


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: Economics 300, 304.

345 Advanced Topics in Finance (International Finance) SO

Prerequisite: Economics 203, 300, 302.

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: Economics 300 or equivalent.

349 Africa Through an Economic Lens SO

This course will primarily focus on a series of microeconomic issues within the framework of African economies and social structures. Topics may include the following: the influence of culture, religion, kinship networks and intra-household bargaining on economic outcomes; health and nutrition outcomes and the challenges to future progress; moving beyond primary education for all; child fostering and its impact on human capital formation; the genesis of civil strife and its lasting impact on societies; risk and its influence on economic choices; methods of combating corruption; and government service delivery failures and ideas for future improvement. Prerequisite: Economics 300.

350 Impact Evaluation in Developing Countries SO

This course helps students identify market failures, recognize incentive structures embedded within programs intended to overcome these market failures and properly evaluate the impact of such policy interventions in developing country settings. The course will cover instrumental variable, difference-in-difference, natural experiment and randomized experiment estimation techniques for evaluating program impacts across a variety of topic areas, including health, education, agricultural insurance and micro-finance programs. Prerequisite: Economics 203, 300.

371 Junior Research Seminar: Psychological Biases and Economic Decisions SO

A seminar-based course covering current research on the role of psychological biases in economic decision-making. The focus is on critical reading of recent work and developing students' own research. Prerequisite: Economics 300, 304.

372 Junior Research Seminar: Advanced International Trade SO

This advanced seminar-based course covers topics in international trade theory and policy, with an emphasis on current research topics and developments. Determinants of international trade and foreign investment will be analyzed, and we will examine the motivations for and consequences of tariffs and quantitative restrictions on trade. Topics will include dynamic comparative advantage, factor movements and multinational corporations, effects of trade on economic growth and income inequality, international trade policy negotiations, agreements and disputes, and economic integration. Prerequisite: Economics 300 (Intermediate Microeconomic Analysis) and Economics 304 (Econometrics) or permission. Math 121 or 216 (Calculus or Advcanced Calculuss) recommended.

373 Junior Research Seminar: Labor in the Developing Countries SO/QU

This course reviews current academic research on the structure of labor markets in developing countries and how this structure impacts economic growth and poverty alleviation. Possible topics may include: the informal economy and how governments and microfinance institutions might impact the informal economy; labor demand and hindrances to growth of the private sector; child labor; problems of youth unemployment; labor market segmentation; agricultural employment; urban-rural migration; the implications of demographic change and changing educational attainment of the labor force; and what one can learn by following individuals and their labor market outcomes over time. Prerequisite: Economics 300, 304.

374 Junior Research Seminar: Access to Finance SO

This seminar examines the determinants of access to finance with particular emphasis on small business financing. The primary focus will be on commercial banking. We will examine such issues as banking structures, lending technologies, regulatory issues and problems of asymmetric information, all with a focus on access to finance. We will also examine microfinance as an alternative approach for providing financial services to the poor. Prerequisite: Economics 203, 300 and 304 (may be concurrent).

376 Junior Research Seminar: Measuring Discrimination SO

A research seminar examining how economists define and measure discrimination against minorities. Original texts will highlight the historical evolution of economic thinking about measuring discrimination mostly in the context of the labor market but in other scenarios as well. Prerequisite: Economics 300, 304.

396 Research Seminar 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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