• A
  • A
  • A
  • ABC
  • ABC
  • ABC
  • А
  • А
  • А
  • А
  • А
Regular version of the site
Bachelor 2021/2022

Microeconomics 1

Area of studies: Economics
When: 2 year, 1-4 module
Mode of studies: distance learning
Open to: students of one campus
Instructors: Дашаев Муслим Исаевич, Попова Валерия Сергеевна, Татаринова Елизавета Сергеевна, Векилян Армине Вагенаковна, Попова Валерия Сергеевна, Albert Belkov, Steven Kivinen, Natalya Rakuta, Andrey Vorchik
Language: English
ECTS credits: 5

Course Syllabus


Microeconomics-1 is a two-semester course for second year students. The first part covers all topics of the syllabus and the second part is devoted to supporting lectures. In the course of Microeconomics-1 students are expected to deepen their understanding of basic concepts, add further tools of analysis and develop their skills in applying theory to economic problems. Intermediate Microeconomics is a core discipline under world standards. It forms the basis of further economic studies in applied disciplines such as: industrial organisation, public sector economics, labour economics, international economics, corporate finance, development economics, etc. The course is taught in English. The students are also studying for Russian degree in Economics, and knowing Russian terminology through reading in Russian is also required. Pre-requisites: Students are supposed to be competent in basic economic analysis(APTlevel) and Calculus. The course itself provides a basis (and so serves as a prerequisite) for Microeconomics 2.
Learning Objectives

Learning Objectives

  • to expand the students’ knowledge in the field of microeconomics and develop skills for analysis of real economic situations
  • to provide students with the knowledge of basic microeconomic models' assumptions, internal logic and predictions, grounding the explanations on intuitive and graphical approach with addition of some algebra and calculus studied simultaneously in the course of Mathematics for Economists
  • to develop the students' ability to apply the knowledge acquired to the analysis of specific economic cases, recognising the proper framework of analysis and constructing the adequate economic models within this framework
Expected Learning Outcomes

Expected Learning Outcomes

  • Recollection of basic concepts, such as opportunity cost.
  • Ability to analyse the consumer’s problem. Understanding income and substitution effects.
  • Ability to analyse the firm’s profit maximisation problem in the short-run and the long-run, including cost minimisation. Ability to assess the effects of taxes and subsidies.
  • Understanding market behaviour under perfect competition. Ability to analyse efficiency, including economic surplus
  • Understanding the monopolist’s problem, and how it differs from perfect competition. Ability to analyse equilibrium, efficiency, and policy in a monopolistic market
  • Understanding monopolistically competitive and oligopolistic markets. Ability to analyse simple games, and determine their Nash equilibrium.
  • Understanding the difference between input and output markets. Ability to analyse perfectly competitive and monopsonistic labour markets.
  • Understanding issues with analysing multiple markets simultaneously, and the fundamental welfare theorems. Ability to solve for general equilibrium
  • Understanding how externalities and public goods create inefficiencies. Ability to analyse government interventions to correct inefficiencies
Course Contents

Course Contents

  • Introduction to microeconomics.
    Introduction to microeconomics. Brief review of basic concepts familiar from year 1: Scarcity. Rationality. The production possibility frontier and opportunity cost. Absolute and comparative advantage. Markets. Microeconomics vs. macroeconomics. Models and theory.
  • Consumer choice.
    Preferences, indifference curves and utility function. Utility maximisation and choice. Consumer choice and demand. Comparative statics: income and price changes. Substi-tution and income effects. The individual demand and elasticity. Complements and substitutes. Cash transfers versus transfers in kind. Inverse demand curve and consumer’s surplus.
  • The firm.
    Firm’s objective. Production function. Cost minimisation: isoquants and isocost lines. Costs in the short run and in the long run. Firm’s decision in the short run. Firm’s decision in the long run.
  • Perfect competition.
    Industry supply in the short-run. Market demand. Equilibrium in the short run. Entry and exit, short-run and long-run equilibrium. Comparative statics. Equilibrium and Efficiency.
  • Monopoly.
    Pure monopoly. Natural monopoly. Social cost of monopoly. Regulation of natural monopoly.
  • Market structure and imperfect competition.
    Monopolistic competition. Basic concepts of the game theory. Oligopoly: Cournot duopoly, Bertrand model, Stackelberg model. Strategic entry deterrence.
  • Inputs to production: the labour market.
    Utility maximisation and the supply of labour. Profit maximisation and the demand for labour. Economic rent. Monopsony. Factors affecting labour market equilibrium (unions, minimum wages and others).
  • General equilibrium and welfare economics.
    Exchange economy and Edgeworth box. General equilibrium. Efficiency in exchange economy. Pareto efficiency in economy with production. Equilibrium and efficiency: welfare theorems Equity and efficiency. Market failures: the problem of externalities and possible solutions.
  • Missing markets and the role of government.
    Market failures: the problem of externalities and possible solutions. Government interventions, public goods, taxation; Income distribution, the Gini coefficient and Lorenz curves
Assessment Elements

Assessment Elements

  • non-blocking written home assignments in Fall term
  • non-blocking midterm test in the middle of Fall semester
  • non-blocking exam at the end of the Fall semester
    Online format
  • non-blocking midterm test in the middle of the Spring semester
  • non-blocking final exam by the end of the Spring semester
    University of London exam grade for the students studying the course for both Internal and International degrees are available at https://london.ac.uk/sites/default/files/regulations/progregs-emfss-2021-2022.pdf; Internal exam grade for the students studying the course for HSE degree only
Interim Assessment

Interim Assessment

  • Interim assessment (2 module)
    0.55 * exam at the end of the Fall semester + 0.25 * midterm test in the middle of Fall semester + 0.2 * written home assignments in Fall term
  • Interim assessment (4 module)
    0.4 * final exam by the end of the Spring semester + 0.35 * Interim assessment (2 module) + 0.25 * midterm test in the middle of the Spring semester


Recommended Core Bibliography

  • Economics, Begg, D., 2011

Recommended Additional Bibliography

  • Lipsey, R., & Chrystal, A. (2015). Economics. Oxford University Press. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.b.oxp.obooks.9780199676835