University of the Philippines

SCHOOL OF ECONOMICS

Economics 11
Markets and the State

E. de Dios/J. Gapay/ E. Guido/M. Melchor II. 2016-2017

There is no more important function of a first course

in economics than to make the student see that the
whole problem of social management is a value
problem;
that mechanical or technical efficiency
is a meaningless combination of words.

m
er as
-- Frank Knight
“The ethics of competition”

co
eH w
SYLLABUS

o.
Principal references: rs e
Mankiw, N. G. [2015] Principles of economics. 7. Edition. Stamford, CT:
ou urc
Cengage Learning. [You may use earlier editions by noting the chapter
titles corresponding to the latest edition.]
Other references and useful material:
o

Miller, R., D. Benjamin, and D. North [2016] The economics of public issues.
aC s

19. Edition. Pearson. [MBN]

vi y re

Levitt, S. and S. Dubner [2005] Freakonomics: a rogue economist explores

the hidden side of everything. New York: William Morrow-Harper
Collins.
Easterly, W. [2006] The white man’s burden: why the West’s efforts to aid the
ed d

Rest have done so much ill and so little good. New York: Penguin
ar stu

Books.
Lecture notes and other materials are available at the SE Library or at:
http://www.yahoogroups.com/group/unang_econ
is

1. Introduction
Th

Games: coordination, competition, government (see notes)

Ten principles of economics
Interdependence and the gains from trade
*Mankiw, Chs. 1 (Ten principles of economics), 2 (Thinking like an economist), 3
sh

(Interdependence and the gains from trade)

MBN, Chs. 3 (Flying the friendly skies?), 5 (The economics of exclusion)
*Levitt and Dubner, Ch. 1 (“What do schoolteachers and sumo wrestlers have in
common?)
Hardin, G. [1968] “The tragedy of the commons”, Science 162: 1243-1248. (under
Files at yahoogroup site).

https://www.coursehero.com/file/28967318/-Econ-11-syllabus216-17pdf/ -1-
 PART I. MICROECONOMICS

2. Markets and how they work

Supply and demand
Elasticity and its application
Government policies in markets
The efficiency of markets
Applications: taxes, bans and prohibitions, floors and ceilings, trade;
*Mankiw, Chs. 4 (The market forces of supply and demand) , 5 (Elasticity and its
applications), 6 (Supply, demand, and government policies), 7 (Consumers,
producers, and the efficiency of markets), 8 (The costs of taxation),
9 (International trade)
*MBN, Ch. 4 (Sex, booze, and drugs), 9 (Kidneys for sale), 10 (Are we running out
of water?), 15 (The (dis)incentives of higher taxes)
*Sicat, vol. 1: Ch. 5 (Applications of supply and demand analysis)

m
Read, L.E. [1958] “I, pencil” (See group page.)

er as
co
FIRST EXAMINATION

eH w
3. Market failures and the state

o.
Externalities
rs e
ou urc
Public goods and common resources
Designing the tax system
Poverty, inequality, and agrarian reform
o

*Mankiw, Chs. 10 (Externalities), 11 (Public goods and common resources), 12 (The

design of the tax system)
aC s

*Sicat, vol. 3: Chs. 32 (Poverty and income distribution), 36 (Land reform)

vi y re

*MBN Ch. 6 (“For whom the road is tolled”), 12 (Das Kapital in the twenty-first
century),14 (The effects of the minimum wage)
*Fabella, R. [2009] “CARP without Coase: redistributing poverty?” Philippine
ed d

Review of Economics.
ar stu

4. Competition, monopoly, and technology

Production costs
Firms in competitive markets
is

Monopoly
Oligopoly and its problems
Th

*Mankiw, Chs. 13 (The costs of production), 14 (Firms in competitive markets),

15 (Monopoly), 16 (Monopolistic competition), 17 ()ligopoly)
*Sicat, vol. 3: Ch. 30 (Monopoly, regulation, and competition)
sh

*MBN Ch. 16 (Net neutrality), 17 (Contracts, combinations, and conspiracies),

18 (Coffee, tea, or tuition-free)

SECOND EXAMINATION

PART II, MACROECONOMICS, GROWTH, AND DEVELOPMENT

5. Macroeconomic data
Product, income, spending, foreign demand
Inflation

https://www.coursehero.com/file/28967318/-Econ-11-syllabus216-17pdf/ -2-
 Unemployment and underemployment
*Mankiw, Chs. 23 (Measuring a nation’s income), 24 (Measuring the cost of living),
28 (Unemployment)
*Sicat, vol. 2: Ch. 12, pp. 12-19 (Philippine national income accounts)
*Sicat, vol. 3: Ch. 31 (Labour and wages)

6. Long-run growth
Productivity and technology
Saving, investment, and the financial system
Finance
*Mankiw, Chs. 18 (Markets for factors of production), 20 (Income inequality,
poverty). 25 (Production and growth), 26 (Saving and investment)
*Sicat, vol. 2: Ch. 30 (Saving and the financial system)
*Easterly, Chs. 2 (The legend of the big push); 3 (You can’t plan a market)
Sicat, vol. 3: Ch. 34 (Agriculture and development), 38 (Commercial and industrial

m
progress).

er as
co
THIRD EXAMINATION

eH w
7. Money and prices

o.
rs e
Origin and functions of money
ou urc
The monetary system
Effects of money on output and prices
*Mankiw, Chs. 29 (The monetary system), 30 (Money growth and inflation);
o

27 (Basic tools of finance)

*Sicat, vol. 2: Ch. 9 (The regulation of money)
aC s
vi y re

8. The world
Basic open-economy concepts
A macroeconomic theory of the open economy
ed d

*Mankiw, Chs. 31 (Open-economy macroeconomics), 32 (A macroeconomic theory

of the open economy)
ar stu

*Sicat, vol. 2: Ch. 22 (Exchange rate, money and output, macroeconomic stabilisation)

9. Economic fluctuations and crises

is

Aggregate demand, aggregate supply

Fiscal and monetary policy
Th

Inflation versus unemployment

Six debates over macroeconomic policy
*Mankiw, Chs. 33 (Aggregate demand and aggregate supply), 34 (The influence of
sh

monetary and fiscal policy on aggregate demand), 35 (The short-run tradeoff

between inflation and unemployment), 36 (Six debates over macroeconomic
policy)
*Sicat, vol. 2: Chs. 23 (Public expenditure and the budget); 24 (Taxation and fiscal
policy).

https://www.coursehero.com/file/28967318/-Econ-11-syllabus216-17pdf/ -3-
 FOURTH EXAMINATION

Notes:

• Each of the four examinations counts for a maximum of 50 points

(a total of 200 points).
• Unannounced quizzes and recitation sessions shall be given occasionally and
added to the examination scores (the denominator remaining at 200);
• The following students shall receive a grade of 5.0 at the end of the course:
(a) Students who fail to score more than 120 points (60% of 200).
(b) Students who are absent from two (2) or more examinations without
excuse.

END

m
er as
co
eH w
o.
rs e
ou urc
o
aC s
vi y re
ed d
ar stu
is
Th
sh

https://www.coursehero.com/file/28967318/-Econ-11-syllabus216-17pdf/ -4-

Powered by TCPDF (www.tcpdf.org)