Syllabus for IEcoS: General Economics-I

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Part A

Theory of Consumer's Demand

Cardinal Utility analysis, Marginal utility and demand, Customer's surplus, Indifference Curve analysis, Price Income Income and Substitution Effects, the Slutsky theorem, derivation of demand curve, revealed Preference approach. Duality and indirect utility function, and expenditure function, choice under risk and uncertainty. Simple games of complete information, concepts of Nash equilibrium.

Theory of Production

Factors of Production - Production Functions - forms of Production Function: Cobb-Douglas, CES and Fixed Co-efficient type, Trans log production function. Laws of returns - Returns to scale and returns to a factor. Duality and cost function, Measures of productive efficiency of firms, technical and allocative efficiency. Partial equilibrium versus general equilibrium approach - Equilibrium of the firm and the Industry.

Theory of Value:

Pricing under different market structures, public sector pricing, marginal cost pricing, peak load pricing, cross-subsidy free pricing and average cost pricing. Marshallian and Walrasian stability analysis. Pricing with incomplete information and moral hazard problems.

Theory of Distribution

Neo classical distribution theories; Marginal productivity theory of determination of factor prices, Factor shares and adding up problems. Euler’s theorem, Pricing of factors under imperfect competition, monopoly and bilateral monopoly. Macro distribution theories of Ricardo, Marx, Kaldor, Kalecki.

Welfare Economics

Inter-personal comparison and aggregation problem, Public goods and externalities, divergence between social and private welfare, compensation principle. Pareto optimality, Social choice and other recent schools, including Coase and Sen.

Part B: Quantitative Methods in Economics

Mathematical Methods in Economics

Differentiation, and Integration and their application in economics. Optimization techniques, sets, Matrices and their application in economics. Linear algebra and linear programming in economics and input - output model of Leontief.

Statistical and Econometric Methods

Measures of central tendency and dispersions, Correlation and Regression. Time series. Index numbers. Sampling of curves based on various linear and non-linear function. Least square methods and other multivariate analysis (only concepts and interpretation of results). Analysis of Variance, Factor analysis, Principle component analysis, Discriminant analysis. Income distribution: Pareto law of Distribution, long normal distribution, measurement of income inequality. Lorenz curve and Gini coefficient. Univariate and multivariate regression analysis. Problems and remedies of Heteroscedasticity, Autocorrelation and Multicollinearity.

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