Fall 2016
Class Time: MWF 9:00-9:50 am
Class Room:
Office: WM 317
Email: rasha.ahmed@trincoll.edu
Office Phone: 860 297 2446
Office Hours: MW 12:15-2:30 pm or by appointment
Teaching Assistant: Nia Vogel
Course Description and objectives
The course introduces students to the basic elements of Policy Analysis rooted in the microeconomics of externalities (social, economic, and political), public goods, common property, information failure, absence of competition, and distributional concern.
The course analyzes different situations where the market system fails to achieve the socially desired outcome, and hence policy intervention is needed. The policies considered range from command and control mechanisms to market based approaches. The course analyzes how effective public policy has been in addressing several real world economic problems.
Textbooks and Reading Material:
The textbook for this course is:
Sharp, Ansel M., Charles A. Register and Paul W. Grime. Economics of Social Issues. 21st edition
Grading
The grade for this class will be calculated as follows:
Exam 1 () 25%
Exam 2 () 25%
Final Exam 30%
Quizzes 10%
Participation &Class work 10%
Class Work
1. Book Chapters: You are required to review the chapters that will be covered beforehand. This will help you better understand and follow the material covered in class. The lecture slides for each chapter are posted on my website. You are expected to print the lecture slides and bring them to class. This will help you prepare for the class and save you some time taking notes.
2. Practice Sheets: I will give out a set of practice questions every week on the material we cover. The Practice sheets will not be collected or graded, however I expect you to do them all and bring them to class.
3. Reading articles: There are reading articles assigned every week. You are required to carefully read those articles and relate them to the concepts covered in class.
4. Discussion Sheets: Whenever a reading article is assigned I will email the class a list of discussion questions. The questions will highlight the most important parts of the readings and prepare students for class discussions. Discussion sheets will be collected when we finish discussing the article in class (on or after the date listed on the discussion sheet).
5. Class Discussion: You are required to participate in class discussion. Participation in class discussion by asking or answering questions or commenting on the material will greatly enhance your understanding. To be able to actively participate in class discussion you should come to class prepared. Students who participate in class discussions typically do better.
6. Weekly Quizzes: There will be one weekly quiz every Monday on the material covered the week before. The quiz will be 10 minutes long.
Policies
1. I expect you to be in class on time and to attend every class
2. No cell phones, laptops or electronic devices can be used in class
3. I expect you to check your email regularly
4. If you accumulate more than two unexcused absences, 1% will be deducted from your final grade for every class missed. Excused absences are those absences for which I receive a note from the Dean of Students’ office
5. I do not give makeup exams except when an emergency situation arises and I get notified by the Dean of Students’ office. The format of the make-up exam will be at my discretion. Having a cold or wanting more time to prepare are not considered emergency situations.
6. It is your responsibility to collect your assignment or quiz from the TA
7. There are no “extra credit” assignments given any time during the semester to substitute for a poor grade
8. Dishonest conduct or disruptive behavior will not be tolerated. Please refer to the Student Handbook for a review of requirements
9. Students with Academic Accommodations- Trinity College complies with the Americans with Disabilities Act and Section 504 of the Rehabilitation Act. If you have a documented disability and require academic accommodations, please email me your accommodation letter during the first week of the semester and cc Lori Clapis. If you do not have a letter but have a disability requiring academic accommodations, or if you have questions about applying for academic accommodations, please contact Lori Clapis, Coordinator of Accommodation Resources, at 860-297-4025 or at Lori.Clapis@trincoll.edu.
Finally, students are encouraged to speak with me directly should any concerns or difficulties arise. I am happy to work with students who need extra help. Please feel free to drop by during office hours, send an email or speak with me following class time.
Course Outline
The following is an outline of the chapters that will be covered. The outline and dates are intended as a guide and may be changed during the semester.
Week 1: Sept 7, 9
Free Markets vs. Central Control
Week 2: Sept 12, 14, 16
Government Control and Unintended Consequences
- Chapter 3
- Wilson, Mark. (2012) “The Negative Effects of Minimum Wage Laws,” Policy Analysis, The Cato Institute, No. 701, June 21
- Neal R. Peirce. On Rent Control. Cato Institute publications
- Portney, Paul (2002). “Penny-Wise and Pound-Fuelish? New Car Mileage Standards in the United States,” Resources, spring issue 147.
Week 3: Sept 19, 21, 23
Efficiency of Markets
- Welfare Economics
- Cohen, R. (2008). “Economist Dissect the Yuck Factor,” The New York Times.
- Bastiat, Frederric (1845). The Candlemakers’ Petition, Sophismes Economiques
- Evensky, J. (1993), “Ethics and the Invisible Hand,” Journal of Economic Perspectives, 7(2): 197 – 205
Week 4: Sept 26, 28, 30
Environmental Problems and Public Policy
- Chapter 4
- Portney, Paul (2002). “Penny-Wise and Pound-Fuelish? New Car Mileage Standards in the United States,” Resources, spring issue 147
Week 5: Oct 3, 5, 7
Education and Public Policy
- Chapter 6
- Palmisano, Joseph (2014) “No Child Left Behind: Where is it Now?” Law Street, The Princeton Review
- Inskeep, Robert (2010) “Former No Child Left Behind Advocate Turns Critic,” NPR Books
- Taylor, Lori (1999) “Government’s Role in Primary and Secondary Education,” Economic Review — Dallas, 15 – 23
Week 6: Oct 12, 14
Crime and Public Policy
- Chapter 5
- Miron and Zwiebel (1995). “The Economic Case against Drug Prohibition,” Journal of Economic Perspectives, 9(4): 175-192.
- Laux, Fritz L. (2000). “Addiction as a Market Failure: Using Rational Addiction results to Justify Tobacco Regulation,”Journal of Health Economics, 19: 421-437
Exam 1, Oct 17
Week 7: Oct 17, 19, 21
Imperfect Competition: Monopoly Power
- Chapter 8
- Lynn, Barry C. (2006). “Breaking the Chain: The Antitrust Case Against Wal-Mart,” Harper’s Magazine.
- Lutz, Matthias (2000). “EU Commission versus Volkswagen: New Evidence on Price Differentiation in the European Car,” Review of Industrial Organization, 17(3): 313-323.
- Kimes, Mina (2011). “Railroads: Cartel or Free Market Success Story?” CNN Money, Sept 13.
Week 8: Oct 24, 26, 28
Imperfect competition: Oligopoly and strategic behavior
- Oligopoly
- McAuliffe R. (1988). “The FTC and the Effectiveness of Cigarette Advertising Regulations,”Journal of Public Policy and Marketing, 7:49-64
- Blowing Smoke: The Lost Legacy of the Surgeon General’s Report
- Paba, Sergio (1991). “Brand Reputation, Efficiency and the Concentration Process: A case Study,” Cambridge Journal of Economics, 15: 21-45
Week 9: Oct 31, Nov 2, Nov 4
Trade Policy
- Chapter 10
- Dornbusch, Rudiger (1992). “The Case for Trade Liberalization in Developing Countries,” Journal of Economic Perspectives, 6(1): 69-85
Week 10: Nov 7, 9, 11
Development Economics and Policy
- Endangered Species
- Begley, Sharon (2007). “Cry of the Wild,” Newsweek
- Kremer, M. (2002). “Pharmaceuticals and the Developing World,” Journal of Economic Perspectives, 16(4): 67-90.
- Sen, A. (1999). Development as Freedom. Oxford University Press
Exam 2, Nov 11
Week 11: Nov 14,16, 18
Private Solutions to Market Failure
- Coase R. (1960). “Problem of Social Cost,” Journal of Law and Economics, 3(1): 1-44
- Heal, G. (2008). Corporate Environmentalism: Doing Well by Being Green.
- Rosenbloom, Stephanie and Michael Barbaro (2009). “Green-Light Specials, Now at Wal-Mart,” New York Times Business Feed, Jan 25
- Demsetz, H. (1967). “Towards a Theory of Property Rights,” American Economic Review, 57(2): 347- 359.
- Krueger, Anne O. (1994). “Economists’ Changing Perceptions of Government,” published in Comparative Economic Systems Models and Cases. 7th edition.
- Soto, H. (2000). The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else. Basic Books
- Begley, Sharon (2007). “Cry of the Wild,” Newsweek.
Week 12: Nov 21 (Nov 23- 25 Thanksgiving break)
Week 13&14: Nov 28, 30, Dec 2
The Economics of Information and Financial Crises
- Chapter 12
- Crisis of credit visualized, youtube
- Inside the meltdown, Frontline
- Akerloff, G. (1970). “The Market for Lemons: qualitative uncertainty and the Market Mechanism,” Quarterly Journal of Economics 84, 488-500.
- Mishkin, Frederic S. (1999). “Global Financial Instability: Framework, Events, Issues,” Journal of Economic Perspectives, 13(4): 3 – 20.
- Rauh, Joshua and Zingales, Luigi (2009) “Bankruptcy is Best to Save GM,” The Economists’ Voice, 6(4), Article 3
- Bhidé, Amar (2009) “In Praise of More Primitive Finance,” The Economists’ Voice, 6(3), Article 8
- Rogoff, Kenneth “Don’t Blame the Federal Reserve for not Predicting the Financial Crisis,”
Week 15: Dec 5, 7, 9
Week 16: Dec 12
Review
Final Exam, Dec 19 @ 12:00pm*
* If you would like to get back your final exam, you may give me a self-addressed, stamped postcard or envelope and I will mail you the final exam and course grade.