General Economics and Theory
14.003 Microeconomic Theory and Public Policy
 ( ,  )
(Subject meets with 14.03)
Prereq: 14.01
Units: 4-0-8
 Lecture: TR11-12.30 (1-190) Recitation: F11 (24-121) or F12 (24-121) or F1 (24-121) +final
Applies microeconomic theory to analysis of public policy. Builds from microeconomic model of consumer behavior; extends to operation of single and multiple markets and analysis of why markets sometimes fail. Empirical examples to evaluate theory, focusing on the casual effects of policy interventions on economic outcomes. Topics include minimum wages and employment, food stamps and consumer welfare, economics of risk and safety regulation, the value of education, and gains from international trade. Graduate students are expected to complete additional assignments.
Fall: D. Autor
Spring: S. Ryan
14.01 Principles of Microeconomics
 (, ) 
Prereq: None
Units: 3-0-9
Lecture: MW1 (54-100) or NO LECTURE FOR RECS 07-11 Recitation: F10 (66-154) or F11 (66-154) or F12 (12-122) or F1 (12-122, 1-190) or F2 (12-122) or MWF9 (12-142) or MWF10 (12-142) or MWF11 (12-142) or MWF12 (12-142) or MWF2 (12-142) +final
Introduces microeconomic concepts and analysis, supply and demand analysis, theories of the firm and individual behavior, competition and monopoly, and welfare economics. Applications to problems of current economic policy.
Fall: W. Wheaton
Spring: J. Harris
14.02 Principles of Macroeconomics
(, )
Prereq: None
Units: 3-0-9
Lecture: MW2 (54-100) or NO LECTURE FOR RECS 04-07 Recitation: F12 (5-233) or F1 (5-233) or F2 (5-233) or MWF10 (3-343) or MWF11 (3-343) or MWF1 (3-442) or MWF3 (66-154)
Provides an overview of macroeconomic issues: the determination of output, employment, unemployment, interest rates, and inflation. Monetary and fiscal policies are discussed. Important current policy debates such as the sub-prime crisis, social security, the public debt, and international economic issues are critically explored. Introduces basic models of macroeconomics and illustrates principles with the experience of the US and foreign economies.
Fall: V. Guerrieri
Spring: F. Giavazzi
14.03 Microeconomic Theory and Public Policy
(, )
(Subject meets with 14.003)
Prereq: 14.01
Units: 4-0-8
Lecture: TR11-12.30 (1-190) Recitation: F11 (24-121) or F12 (24-121) or F1 (24-121) +final
Applies microeconomic theory to analysis of public policy. Builds from microeconomic model of consumer behavior; extends to operation of single and multiple markets and analysis of why markets sometimes fail. Empirical examples to evaluate theory, focusing on the casual effects of policy interventions on economic outcomes. Topics include minimum wages and employment, food stamps and consumer welfare, economics of risk and safety regulation, the value of education, and gains from international trade.
Fall: D. Autor
Spring: S. Ryan
14.04 Intermediate Microeconomic Theory
()
Prereq: 14.01, Calculus II (GIR)
Units: 4-0-8
Analysis of consumer and producer decisions including analysis of competitive and monopolistic markets. Price-based partial and general equilibrium analysis. Introduction to game theory as a foundation for the strategic analysis of economic situations. Imperfect competition, dynamic games among firms. Failures of general equilibrium theory and their resolutions: externalities, public goods, incomplete information settings, signaling, screening, insurance, alternative market mechanisms, auctions, design of markets.
P. Pathak
14.05 Intermediate Applied Macroeconomics
()
Prereq: 14.01, 14.02
Units: 4-0-8
Lecture: TR2.30-4 (6-120) Recitation: F2 (2-139) or F3 (2-139)
Uses the tools of macroeconomics to study various macroeconomic policy problems in depth. The problems range from economic growth in the long run to government finances in the intermediate run and economic stability in the short run. Many economic models used today are surveyed. Requires a 20-page paper on the economics of long-run economic growth.
G. M. Angeletos
14.06 Advanced Macroeconomics
 ()
Prereq: 14.05
Units: 4-0-8
Topics in advanced macroeconomics including growth, business cycles, monetary and fiscal policy, consumption and investment under uncertainty, asset pricing, financial intermediation, coordination problems, and crises. Emphasis on models and techniques.
Consult G. M. Angeletos
14.09 Reading Seminar in Economics
(,  , ,  ) 
Prereq: 14.04, 14.06
Units arranged [P/D/F]
TBA.
Reading and discussion of particular topics in economics. Open to undergraduate students by arrangement with individual faculty members. Consult Department Headquarters.
S. Ellison
14.10 Reading Seminar in Economics
(, , , )
Prereq: 14.04, 14.06
Units arranged
TBA.
Reading and discussion of particular topics in economics. Open to undergraduate students by arrangement with individual faculty members. Consult Department Headquarters.
S. Ellison
14.102 Mathematics for Economists
()
Prereq: Calculus I (GIR), Calculus II (GIR), 18.06
Units: 4-0-8
Covers some topics in mathematics that are frequently used in economic theory and in applications. Topics include: optimization theory (including optimal control and recursive methods); probability theory; topology (continuity, compactness); dynamical systems (including stability); convex analysis; and fixed point theory. Presentation of each topic self-contained.
Consult Department Headquarters
14.11 Special Topics in Economics
(, )
Prereq: 14.01
Units: 4-0-8
Considers issues of current research interest in economics.
Consult Department Headquarters
14.12 Economic Applications of Game Theory
()
Prereq: 14.01; 14.03, 6.041 or permission of instructor
Units: 4-0-8
Analysis of strategic behavior in multi-person economic settings. Introduction to solution concepts, such as rationalizability, backwards induction, Nash equilibrium, subgame-perfect equilibrium, and sequential equilibrium, with a strong emphasis on the assumptions behind these solution concepts. Issues of incomplete information, such as signaling and reputation formation. Applications drawn from microeconomics and political economy.
G. Ellison
14.121 Microeconomic Theory I
() 
Prereq: 14.04, permission of instructor
Units: 2-0-4
Consumer and producer theory. Markets and competition. General equilibrium. Tools of comparative statics and their application to price theory. Class size limited.
P. Pathak
14.122 Microeconomic Theory II
()
Prereq: 14.121, permission of instructor
Units: 2-0-4
Introduction to game theory. Normal form and extensive form games. Games with incomplete information. Class size limited.
G. Ellison
14.123 Microeconomic Theory III
()
Prereq: 14.121, 14.122, permission of instructor
Units: 2-0-4
Lecture: TR1-2.30 (ENDS MARCH 20) (E52-175) Recitation: F1-2.30 (E51-085)
Models of individual decision-making under certainty and uncertainty. Additional topics in game theory. Class size limited.
M. Yildiz
14.124 Microeconomic Theory IV
()
Prereq: 14.123, permission of instructor
Units: 2-0-4
Lecture: TR1-2.30 (BEGINS MARCH 31) (E52-175) Recitation: F1-2.30 (E51-085) +final
Decision-making under uncertainty, information economics, incentive and contract theory. Class size limited.
S. Baliga
14.126 Game Theory
()
Prereq: 14.122
Units: 3-0-9
Lecture: TR2.30-4 (E25-117) Recitation: F12 (E51-085) +final
Rigorous investigation of the evolutionary and epistemic foundations of solution concepts, such as rationalizability and Nash equilibrium. Covers classical topics, such as repeated games, bargaining, and supermodular games as well as new topics such as global games, heterogeneous priors, psychological games, and games without expected utility maximization. Applications provided when available.
M. Manea, M. Yildiz
14.129 Advanced Contract Theory
()
Prereq: 14.121, 14.281, or permission of instructor
Units: 4-0-8
Lecture: TR1-2.30 (E51-063) Recitation: F10.30-12 (E51-361)
Recent developments in contract theory. Includes advanced models of moral hazard, adverse selection, mechanism design and incomplete contracts with applications to theory of the firm, organizational design, and financial structure.
R. Townsend
14.13 Economics and Psychology
()
Prereq: 14.03
Units: 4-0-8
Introduction to theoretical and empirical literature in the new field of behavioral economics. Examines important and systematic departures from the predictions of the standard model in economics; covers intertemporal tradeoffs, risk preferences, social preferences, and intrinsic motivation; and applies theory to many different areas, such as credit card debt, addiction, portfolio choices, labor supply, and compensation policies of firms. Students review evidence from lab experiments, examine how the results can be integrated into models, and test models using field and lab data.
Consult Department Headquarters
14.137 Psychology and Economics
()
Prereq: None
Units: 4-0-8
Lecture: W EVE (4-7 PM) (E51-372)
Examines "psychology appreciation" for economics students. Aims to enhance knowledge and intuition about psychological processes in areas relevant to economics. Increases understanding of psychology as an experimental discipline, with its own distinct rules and style of argument. Topics include self-knowledge, cognitive dissonance, self-deception, emotions, social norms, self-control, learning, mental accounting, memory, individual and group behavior, and some personality and psycho-analytic models. Within each of these topics, we showcase effective and central experiments and discuss their role in the development of psychological theory. Term paper required.
D. Prelec
14.147 Topics in Game Theory
()
Prereq: 14.126
Units: 4-0-8
Advanced subject on topics of current research interest.
P. Pathak
14.15J Networks
(New)
()
(Same subject as 6.207J)
Prereq: 6.041 or 14.30
Units: 4-0-8
Highlights common principles that permeate the functioning of diverse technological, economic and social networks. Utilizes three sets of tools for analyzing networks--random graph models, optimization, and game theory--to study informational and learning cascades; economic and financial networks; social influence networks; formation of social groups; communication networks and the Internet; consensus and gossiping; spread and control of epidemics; control and use of energy networks; and biological networks.
D. Acemoglu, A. Ozdaglar
14.16 Strategy and Information
()
Prereq: 14.12 or permission of instructor
Units: 4-0-8
Lecture: TR10.30-12 (E51-393) Recitation: F3 (E51-393) +final
Models of individual decision making. Topics in cooperative and non-cooperative game theory. Various applications ranging from voting and mechanism design to auctions and market microstructure models in finance.
M. Manea
14.160 Experimental and Behavioral Economics
()
Prereq: 14.122
Units: 4-0-8
Introduction to choice theory and the techniques of experimental economics and their applications. Covers behavioral implications of alternative choice-theoretic models. Teaches students how to design and run experiments. Topics covered may include subjective/Choquet expected utility; models of preference for flexibility and commitment; intertemporal choice; social preferences; competitive experimental markets; bargaining behavior; labor market experiments; cooperation and public good provision; principal-agent experiments and contract enforcement; nominal inertia and money illusion.
E. Fehr
14.191 Independent Research Paper
(, , , )
Prereq: Permission of instructor
Units: 0-12-0
TBA.
Under supervision of a faculty member approved by Graduate Registration Officer, student writes a substantial, probably publishable research paper. Must be completed by the end of a student's second year to satisfy the departmental minor requirement.
E. Duflo
14.193, 14.194 Seminar: Topics in Economics
()
Prereq: 14.121, 14.451
Units arranged
Reading and discussion of special topics in economics. Open to advanced graduate students by arrangement with individual members of the staff.
Consult Department Headquarters
14.195, 14.196 Reading Seminar in Economics
(, )
Prereq: 14.121
Units arranged [P/D/F]
14.196: Lecture: T12 (E52-398)
Reading and discussion of special topics in economics. Open to advanced graduate students by arrangement with individual members of the staff.
Consult Department Headquarters
14.198, 14.199 Teaching Introductory Economics
(, )
Prereq: None
Units: 2-0-2 [P/D/F]
14.198: TBA.
14.199: TBA.
Required of teaching assistants in introductory economics (14.01 and 14.02), under supervision of the faculty member in charge of the subject.
14.198: W. Wheaton, J. Harris
14.199: V. Guerrieri, F. Giavazzi
Industrial Organization
14.20 Industrial Organization and Competitive Strategy
()
Prereq: 14.01
Units: 4-0-8
Lecture: MW1-2.30 (E51-395) Recitation: F1 (E51-335) +final
Analyzes the behavior and performance of firms in markets, with a particular focus on strategic interactions. Topics include monopoly power, behavior of firms in oligopoly markets, static and dynamic measurement of market performance, pricing and product choice decisions, advertising, research and development, and theory of the firm. Requires team participation in a Competitive Strategy Game.
N. Rose
14.21J Health Economics
()
(Same subject as HST.901J)
Prereq: 14.01
Units: 3-0-9
URL: http://web.mit.edu/14.21j/www/
Applies theoretical and empirical tools of economics to problems of health and medical care delivery. Concentrates on selected problems such as the welfare economics of "health" as a commodity, hospitals and the nonprofit sector, human capital and medical manpower, and innovation in medicine.
J. E. Harris
14.26 Economics of Incentives: Theory and Applications
()
Prereq: 14.04
Units: 4-0-8
Rigorous introduction to the economic theory of incentives, including moral hazard, adverse selection, and dynamic incentive problems. Applications include the design of optimal sales and CEO compensation schemes; the analysis of venture capital and other forms of financing; and the study of joint stock companies, co-operatives, and other types of organizations viewed as optimal adaptations to information and incentive problems.
Consult B. Holmstrom
14.271 Industrial Organization I
()
Prereq: 14.04
Units: 4-0-8
Covers theoretical and empirical work dealing with the structure, behavior, and performance of firms and markets and core issues in antitrust. Topics include: the organization of the firm, monopoly, price discrimination, oligopoly, and auctions. Theoretical and empirical work are integrated in each area.
G. Ellison
14.272 Industrial Organization II
()
Prereq: 14.271
Units: 4-0-8
Lecture: MW9-10.30 (E52-398) Recitation: F9-10.30 (E52-398)
A continuation of 14.271. Topics covered include horizontal mergers and demand estimation, vertical integration and vertical restraints, natural monopoly and its regulation, public enterprise, political economy of regulation, network access pricing, deregulation of telecommunications, electric power, cable television, transportation sectors, and risk and environmental regulation.
N. Rose, S. Ryan
14.273 Advanced Topics in Industrial Organization
()
Prereq: 14.271
Units: 4-0-8
Lecture: MW4-5.30 (E52-232)
Introduction to current research in industrial organization, focusing on a specific set of issues that varies from year to year.
P. Jia, S. Ryan
14.281 Contract Economics
()
Prereq: 14.124
Units: 4-0-8
Covers theoretical and empirical research on contracts. The presentation is organized around different types of models (agency, property rights, transaction costs, relational contracts), but with serious attention paid to applications and empirical studies of these models. Potential applications include executive compensation, insurance, transfer pricing, internal labor and capital markets, vertical and horizontal integration, alliances and joint ventures, entrepreneurship and liquidity demand.
B. Holmstrom
14.282 Introduction to Organizational Economics
()
Prereq: 14.124
Units: 4-0-8
Begins with survey of contract theory for organizational economists, then introduces the main areas of the field, including the boundary of the firm; decision-making, employment, structures and processes in organizations; contracts between firms; and organizations other than firms.
R. Gibbons
14.283 Advanced Topics in Organizational Economics I
(New)
()
Prereq: 14.282
Units: 2-0-4
Lecture: TR9-12 (E52-244)
Builds on the work done in 14.282 to develop more in-depth analysis of topics in the field.
R. Gibbons
14.284 Advanced Topics in Organizational Economics II
(New)
()
Prereq: 14.282
Units: 2-0-4
Lecture: TR9-12 (E52-244)
Builds on the work done in 14.282 to develop more in-depth analysis of topics in the field.
L. Garicano
14.286J Health Economics Seminar
()
(Same subject as HST.903J)
Prereq: 14.04, permission of instructor
Units: 3-0-9
TBA.
Advanced subject in economics of health care sector. Considers selected topics in depth, such as design and financing of health insurance, behavior of nonprofit hospitals, role of competition in the medical care market, determinants of technological change, and effects of government regulations.
J. E. Harris
14.295J Collective Choice II
()
(Same subject as 17.814J)
Prereq: 17.812J or permission of instructor
Units: 3-0-9
Focuses on the relationship between the behavioral models developed by formal theorists and the statistical models used in empirical estimation. The main questions are: How do researchers make the link between theory and the data? How do they generate and estimate statistical models that allow careful testing of the behavioral models? What constitutes a good test of a model? Questions studied through reading and discussion of articles that combine both empirical and theoretical analysis.
J. M. Snyder, Jr.
14.296J Collective Choice I
()
(Same subject as 17.812J)
Prereq: None
Units: 4-0-8
An applied theory subject analyzing political institutions from a rational choice perspective. The chief focus is the burgeoning literature on elections, legislatures, bureaucracies, and courts. Pays some attention to institutions from a comparative perspective. Advanced undergraduates may take subject with permission of instructor.
J. M. Snyder, Jr.
Statistics and Econometrics
14.30 Introduction to Statistical Method in Economics
(, ) 
Prereq: Calculus II (GIR)
Units: 4-0-8
Lecture: MW2.30-4 (E51-361) Recitation: F10 (E51-063) +final
Self-contained introduction to probability and statistics with some economic applications. Elements of probability theory, sampling theory, statistical estimation, and hypothesis testing. May not count toward HASS requirement.
Consult Department Headquarters
14.32 Econometrics
(, )
Prereq: 14.30
Units: 4-0-8
Lecture: MW2.30-4 (E51-085) Recitation: F10 (E51-057) +final
Introduction to econometric models and techniques, simultaneous equations, program evaluation, emphasizing regression. Advanced topics include instrumental variables, panel data methods, measurement error, and limited dependent variable models. Includes problem sets. May not count toward HASS requirement.
Fall: S. Ellison
Spring: W. Newey
14.33 Research and Communication in Economics: Topics, Methods, and Implementation
(, ) 
Prereq: 14.04, 14.05, 14.32
Units: 3-4-5
Lecture: MW9-10.30 (E52-232)
Exposes students to the process of conducting independent research in empirical economics and effectively communicating the results of the research. Emphasizes econometric analysis of an assigned economic question and culminates in each student choosing an original topic, performing appropriate analysis, and delivering oral and written project reports.
Fall: S. Ellison
Spring: A. Finkelstein
14.36 Advanced Econometrics
()
Prereq: 14.30, 14.32
Units: 4-0-8
Lecture: M12-2 (E51-385) Recitation: TBA
Covers a range of topics including duration models, discrete choice models, differentiated product models, count models and other advanced models that are used in a wide variety of applications in applied microeconomics, financial economics, and business economics. Mastery of one or more techniques taught in class demonstrated through the completion of an econometrics paper.
J. Hausman
14.381 Statistical Method in Economics
()
Prereq: Calculus II (GIR), permission of instructor
Units: 4-0-8
Introduction to probability and statistics as background for advanced econometrics and introduction to the linear regression model. Elements of probability theory; sampling theory; asymptotic approximations; decision-theory approach to statistical estimation focusing on regression, hypothesis testing; and maximum-likelihood methods. Simple and multiple regression, estimation and hypothesis testing. Illustrations from economics and application of these concepts to economic problems. Class size limited.
V. Chernozhukov, A. Mikusheva
14.382 Econometrics
()
Prereq: 14.381 or permission of instructor
Units: 4-0-8
Lecture: MW2.30-4 (E51-372) Recitation: F2.30-4 (E51-372)
Regression analysis, focusing on departures from the standard Gauss-Markov assumptions, and simultaneous equations. Regression topics include heteroskedasticity, serial correlation, and errors in variables, generalized least squares, nonlinear regression, and limited dependent variable models. Covers identification and estimation of linear and nonlinear simultaneous equations models. Economic applications are discussed. Class size limited.
J. Hausman
14.384 Time Series Analysis
()
Prereq: 14.382 or permission of instructor
Units: 4-0-8
Theory and application of time series methods in econometrics, including spectral analysis, estimation with stationary and non-stationary processes, VARs, factor models, unit roots, cointegration, estimation of DSGE models, Bayesian methods. Class size limited.
A. Mikusheva
14.385 Nonlinear Econometric Analysis
()
Prereq: 14.382 or permission of instructor
Units: 4-0-8
Micro-econometric models, including large sample theory for estimation and hypothesis testing, generalized method of moments, estimation of censored and truncated specifications, quantile regression, structural estimation, nonparametric and semiparametric estimation, panel data, bootstrapping, and simulation methods. Methods illustrated with economic applications. Class size limited.
V. Chernozhukov, W. Newey
14.386 New Econometric Methods
()
Prereq: 14.382
Units: 4-0-8
Lecture: T EVE (4-6 PM) (E51-057)
Focuses on recent developments in econometrics, especially structural estimation. Topics include nonseparable models, models of imperfect competition, auction models, duration models, and nonlinear panel data. Results illustrated with economic applications.
W. Newey
14.387 Topics in Applied Econometrics
()
Prereq: 14.382
Units: 2-0-4 [P/D/F]
Lecture: MW10.30-12 (ENDS APRIL 13) (E51-361)
Covers core econometric ideas and empirical modeling strategies widely used in contemporary applied microeconomic research. Topics vary from year to year but typically include the interpretation and use of regression models, matching and the propensity score, instrumental variables methods, and statistical inference problems such as clustering. May also cover areas of special interest to class participants.
J. Angrist
14.389 Econometrics Paper
()
Prereq: 14.382 or 14.32
Units: 0-0-3
Paper in econometrics required of all PhD candidates. Paper due at the end of IAP.
J. Hausman
14.391 Workshop in Economic Research
()
Prereq: 14.124, 14.454
Units: 2-0-10 [P/D/F]
14.392 Workshop in Economic Research
()
Prereq: 14.124, 14.454
Units: 2-0-10 [P/D/F]
Recitation: M4-6 (E51-376) or T4-6 (E52-244) or M2.30-4 (E52-244) or R4-6 (E51-372) or R4.30-6 (E52-244) or W2.30-4 (E52-244) or M4-6 (E52-244) or R2.30-4 (E52-244)
Develops research ability of students through intensive discussion of dissertation research as it proceeds, individual or group research projects, and critical appraisal of current reported research. Workshops divided into various fields, depending on interest and size.
Consult E. Duflo
For additional related subjects in Statistics, see:
Civil and Environmental Engineering: 1.151, 1.155, 1.202J, 1.203J, 1.205J
Electrical Engineering and Computer Science: 6.041, 6.231, 6.245, 6.262, 6.431, 6.432, and 6.435
Management: 15.034, 15.061, 15.065, 15.070, 15.075, 15.076, 15.098, and 15.306
Mathematics: 18.05, 18.175, 18.177, 18.440, 18.441, 18.443, 18.445, 18.458, and 18.465
See also: 2.061, 2.830, 5.70, 5.72, 7.02, 8.044, 8.08, 10.816, 11.220, 11.221, 16.322, 17.872, 17.874, 22.38, HST.191, and MAS.622J.
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