经典经济学门教材英文讲义1(Principles of Economic).pptx

Lesson 1: UtilityMankiw, pp. 460 – 464Economics is……the study of the production, distribution, and consumption of goods and services.…the study of the division of finite resources given infinite wants…a way of mathematically modeling happinessRecent papers in economics (from American Economic Review , September 2009)“Can News about the Future Drive the Business Cycle?”“Why Do Sellers (Usually) Prefer Auctions?”“Spousal Control and Intra-Household Decision Making: An Experimental Study in the Phillipines”Recent papers“One Chance in a Million: Altruism and the Bone Marrow Registry”“The Effects of High Stakes High School Achievement Awards: Evidence from a Randomized Trial”Branches of EconomicsMicroeconomics is the study of how households and firms make decisions and how they interact in specific markets.Macroeconomics is the study of the economy at the community, national, regional, or world level.Branches of EconomicsEconometrics is the application of statistics to the study of economic phenomenaEconomics ConceptsNormative economics is the study of how economic systems are.Positive economics is economic analysis which makes or supports policy recommendationsEconomics conceptsA closed economy is an economy which does not interact with other economies outside itself.An open economy is an economy which does.Utility TheoryUtility is the degree of a preference an individual assigns to a state. If situation A is preferred to B, we say that A offers a higher utility than B.A good is something which increases utility.A bad is something which decreases utility.Utility notationCeteris ParibusIn real life, a person’s utility is a function of at least thousands of factors.Economics problems are generally studied ceteris paribus, which means “everything else being equal”Assumptions of Utility TheoryPeople are rational – they optimally use all the information they have to maximize utility.AssumptionsCompleteness – Given any two situations, an individual can specify which is prefe