Econ 604, Graduate Micro IV – Spring 2008

 

Wednesdays: 2.40-5.30pm NN 202

 

 

This is the second part of the Theory Field of the PhD program in Economics.

Econ 601 and Econ 602 are prerequisites for the course. Econ 603 is highly recommended, but because of scheduling problems it is not a formal prerequisite for the class.

Your final grade will be based on class presentations (50%) and a final exam (50%).

The complete syllabus for this class is not finalized yet. Much of the organization of the course will depend on how many students register and how many come along without registering. The material covered will be a combination of topics in Bounded Rationality and Contract Theory.

Last, but NOT LEAST, a word of caution about MATH. This Class DOES involve some hard math. Though not all topics covered require it, the math used in some parts of the course exceeds that used in Econ 601, 602 and 603. This does not mean that I expect students to know the mathematical tools involved; we will pick them up as we go along. However, you must be willing to make some fairly heavy investments in this sense.

 

Here are some relevant readings (where possible with links). Please note that this list may expand as we go along.

 

OD Hart (1995): “Firms Contracts and Financial Structure.” Oxford University Press.

    P Bolton and M Dewatripont (2005): “Contract Theory.” MIT Press.

 

L. Anderlini and L. Felli (1994): “Incomplete Written Contracts: Undescribable States of Nature.” Quarterly Journal of Economics. Available from JSTOR.

N Al-Najjar, L. Anderlini and L. Felli (2006): “Undescribable Events.” Review of Economic Studies. Click here.

 

    L. Anderlini and L. Felli (2001): “Costly Bargaining and Renegotiation.” Econometrica. Click here.

 

L. Anderlini and L. Felli (2006): “Transaction costs and the Robustness of the Coase      Theorem.” Economic Journal, forthcoming.  Click here.

  

 

Below is the schedule of presentations by students in class.

Notice that there will be No Class on Wednesday March 26th .

Notice also that Class on Wednesday April 9th will start at 12.15pm and will be held in STM 111. You are welcome to bring lunch.

 

Helena Poon, Wednesday March 12th. Maskin, E. and Tirole, J. (1990): “The Principal-Agent Relationship with an Informed Principal: The Case of Private Values,” Econometrica, 58, 549-569. Available from JSTOR.

Maskin, E. and Tirole, J. (1992): “The Principal-Agent Relationship with an Informed Principal, II: Common Values,” Econometrica, 60, 1-42. Available from JSTOR.

Masaki Higurashi, Wednesday March 19th. Hart, O. and More, J. (1990): “Property Rights and the Nature of the Firm,” Journal of Political Economy, 98, 1119-58. Available from JSTOR.

Anastasiya Denisova, Wednesday April 2nd. Hart, O and Moore, J. (1988): “Incomplete Contracts and Renegotiation,” Econometrica, 56, 755-86. Available from JSTOR.

Danielle Monnier, Wednesday April 9th. Aghion, P., Dewatripont, M. and Rey, P (1994): “Renegotiation Design with Unverifiable Information,” Econometrica 62, 257-282. Available from JSTOR.

Karen Otto, Wednesday April 16th. Grossman, S. and O. Hart (1986): “The Costs and Benefits of Ownership: A Theory of     Vertical and Lateral Integration,” Journal of Political Economy, 94, 691-719. Available from JSTOR.

Jorge Fernandez, Wednesday April 23rd. Maskin, E. and Tirole, J. (1999): “Unforeseen Contingencies and Incomplete Contracts,” Review of Economic Studies, 66, 83-114. Available from JSTOR.

 

 

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