Professors Murray, Williams, and Aschauer, Chair; Associate Professors Schwinn and Hughes (on leave, fall and winter semesters), Assistant Professor Maurer-Fazio; Ms. Mechner, Mr. Margolis, and Mr. Farber

Intelligent citizenship makes increasing demands on an individual’s knowledge of economics. Policy makers in business, government, and the nonprofit sector must frequently evaluate complex economic issues. The goal of the economics curriculum is to educate students, both majors and non-majors, about the ideas of economics and how they apply to today’s world.

Introductory economics courses at Bates (courses numbered 100-199) emphasize a broad non-technical understanding of economic institutions, policy, and analysis. Two hundred- level courses numbered between 200 and 249 provide non- technical introductions to more specialized topics. Two hundred-level courses numbered between 250 and 299 cover intermediate economic theory and introduce students to the methods of empirical analysis. Three hundred-level courses integrate practical economic issues with empirical and theoretical analyses, enabling students to develop sophisticated insight into both contemporary and historical economic problems.

There are five requirements for the economics major. Economics majors must take:

1. Economics 101, 103, 250, 255, 260 and 270. (Mathematics 315 is an acceptable substitute for Economics 250.) At least three of these four 200-level courses must be taken at Bates.

2. Mathematics 105 or Mathematics 106 (or the equivalent). (This course is a prerequisite for Economics 255, 260, and 270).

3. Three 300-level electives in economics.

4. A fourth economics elective, that may be numbered 220-249, 253, or 300-399.

5. Economics 457 or Economics 458.

   A pamphlet describing the major in more detail is available from the department. Students planning on off-campus study in the junior year should consult with the economics department chair as early as possible during the sophomore year.

Because of the numerous vital and constantly developing interconnections between economics and other social sciences, economics majors are urged to take as many courses as possible in related disciplines such as anthropology, history, political science, psychology, and sociology.

Secondary Concentration. The department offers a secondary concentration in economics. The secondary concentration consists of seven courses: Economics 101, Principles of Microeconomics; Economics 103, Principles of Macroeconomics; Economics 250, Statistics (or a substitute course approved by the department chair); and any four other economics offerings, only one of which may be a short term.

General Education. The following sets are available: Economics 101-103, or either Economics 101 or 103 and any of the following Economics courses: 220, 221, 222, 225, 226, 228, 229, 230, 233 or 239. The quantitative requirement may be satisfied through Economics 250, 255, or s40.

101. Principles of Microeconomics: Prices and Markets. A study of competition and monopoly, anti-trust policy and public-utility regulation, determination of wages and other sources of income, income distribution, and pollution and public policy. Not open to students who have received credit for Economics 102. Enrollment limited to 45. Staff.

103. Principles of Macroeconomics: Income and Employment. A survey of major problems confronting the United States, such as economic growth, employment, and inflation. Discussion of the causes and consequences of fluctuations in income, employment, and inflation, and an analysis of fiscal and monetary policies designed to correct them. Not open to students who have received credit for Economics 100. Enrollment limited to 45. D. Aschauer, Staff.

217. Introduction to Accounting. The theory of accounting presented to the beginner as knowledge fundamental to understanding any business enterprise. Practice with accounting methods. Exposure to financial statement relationships. Not open to students who have received credit for Economics s21. Open to first-year students. B. Farber.

220. American Economic History. Economic history teaches that events of the distant past continue to shape our lives today. This course examines several important questions in American economic history from colonial times through the 1930s. For example, what factors account for the tremendous growth and development of the United States? Do we know enough about the causes of the Great Depression to prevent another one? Did the New Deal save American capitalism or undermine it? Other topics include the legacy of slavery for the American South, the changing economic role of women, the economic impact of immigration and trade, and the changing distribution of income and wealth over time. Recommended background: Economics 101 or 103. Open to first-year students. Staff.

221. The World Economy. Trends and patterns in international trade and finance are discussed in relation to topics such as trade and growth, tariffs and trade restrictions, economic integration, and international economic cooperation and policy. Not open to students who have received credit for Economics 334. Prerequisite(s): Economics 103. Staff.

222. Environmental Economics. The preservation of environmental quality and the struggle of people to improve their economic circumstances are often in conflict. This course explores the economic basis of environmental problems and examines alternative policies aimed at reducing environmental degradation. Among the topics are the deficiencies in the market system and existing property-rights system that contribute to environmental problems, cases where public intervention offers the potential for improvement, cases amenable to market- based approaches, and the public-policy tools available to promote environmental goals. Prerequisite(s) or Corequisite(s): Economics 101. Not open to students who have received credit for Economics s36. Open to first-year students. J. Hughes.

225. Economics of Health Care. This course focuses on two fundamental problems of health care and health-care reform: the need to allocate scarce medical resources to where they are most needed, and the difficulty in providing incentives to providers and patients to accomplish this goal. Topics covered include the production of and demand for health, the health-insurance market, medical malpractice, and the markets for physicians, nurses, hospitals, drugs, and long-term care. The course pays special attention to issues of competition, regulation, and government health- care policy, both in the United States and in other countries. Not open to students who have received credit for Economics s33. Prerequisite(s): Economics 101, which may be taken concurrently with permission of the instructor. Open to first-year students. Written permission of the instructor is required. J. Hughes.

226. History of Economic Thought. This course examines the development of contemporary neoclassical economic theory from Adam Smith to John Maynard Keynes. The focus is on the evolution of economic thought through the contributions of individual thinkers. Prerequisite(s): Economics 101 and 103. Staff.

228. Antitrust and Regulation. This course analyzes economic policy issues of government intervention in the private sector through antitrust and regulatory policies. Specific topics examined include theories of monopoly and competition, the evolution of United States antitrust policy, key issues and cases in United States antitrust policy, regulation of natural monopoly and oligopoly, capture theory, and comparative antitrust and regulatory policies. Prerequisite(s): Economics 101. Open to first-year students. C. Schwinn.

229. Economics of Greater China. The Chinese are among the world’s leading experimentalists in economics. The twentieth-century economic history of China, Taiwan, Hong Kong and the overseas Chinese diaspora spans the entire gamut of economic regimes from virtually unrestricted competition to rigid state management. This course surveys economic development in Greater China with emphasis on understanding how institutions and institutional change affect economic and social development. Not open to students who have received credit for Economics 227. Open to first-year students. Enrollment limited to 45. M. Maurer-Fazio.

230. Economics of Women, Men, and Work. An examination of the changing roles of women and men in the market economy. Introductory topics include the family as an economic unit, discrimination, and occupational segregation. Other topics include the economics of marriage, fertility, divorce, child care, and the growing feminization of poverty. The final section of the course examines the feminist critique of the assumptions and methodology of neoclassical economics, and the potential for incorporating these insights into the practice of economics. Prerequisite(s): Economics 101. Open to first-year students. Enrollment limited to 45. J. Hughes.

231. The Economic Development of Japan. This course surveys the development of Japan's economy. A brief historical introduction focuses on the preconditions for economic modernization and the role of the government in Japan's late nineteenth- and early twentieth-century experience. The course then concentrates on an overview of Japan's post-World War II experience of recovery, explosive growth, slowdown, and attempted reform. It also addresses the debate and controversies concerning whether the Japanese economy operates according to principles, objectives, and structures which are substantially different from those of the West. Japan's economic impact on other East Asian countries and relatedness with the world economy are also explored. Prerequisite(s): Economics 101 or 103. M. Maurer-Fazio

233. Economic Policy Debates. Both citizens and policy makers need to understand complex issues when making informed policy choices. This course focuses on five or six current policy controversies. The topics studied vary from year to year. They may include, among others: management of limited natural resources and the environment; impacts of immigration; job markets and discrimination; free trade; health care financing; anti-poverty and welfare programs; consumer protection; and deregulation. Prerequisite(s): Economics 101. Open to first-year students. Enrollment limited to 40. A. Williams.

239. Linear Programming and Game Theory. Linear programming is an area of applied mathematics that grew out of the recognition that a wide variety of practical problems reduces to the purely mathematical task of maximizing or minimizing a linear function whose variables are restricted by a system of linear constraints. A closely related area is game theory, which provides a mathematical way of dealing with decision problems in a competitive environment, where conflict, risk, and uncertainty are often involved. The course focuses on the underlying theory, but applications to social, economic, and political problems abound. Topics include the simplex method of solving linear programming problems and two-person zero-sum games, the duality theorem of linear programming, and the min-max theorem of game theory. Additional topics will be drawn from such areas as n-person game theory, network and transportation problems, and relations between price theory and linear programming. Computers are used regularly. Prerequisite(s): Computer Science 101 and Mathematics 205. This course is the same as Mathematics 239. Staff.

250. Statistics. Topics include probability theory, sampling theory, estimation, hypothesis testing, and linear regression. Prospective economics majors should take this course in or before the fall semester of the sophomore year. Prerequisite(s): Economics 101 or 103. Open to first-year students. C. Schwinn.

255. Econometrics. Topics include multiple regression using time series and cross-sectional data, simultaneous equation models, and an introduction to forecasting. Prerequisite(s): Economics 250 and Mathematics 105. M. Murray.

260. Intermediate Microeconomic Theory. Compares models of perfect competition and market failure, with emphasis on the consequences for efficiency and equity. Topics include consumer choice, firm behavior, markets for goods and inputs, choice over time, monopoly, oligopoly, monopolistic competition, externalities, and public goods. Prerequisite(s): Economics 101 and 103. A. Williams.

270. Intermediate Macroeconomic Theory. A study of national income determination. It includes movements involving consumption, saving, investment, demand for money, supply of money, interest rates, price levels, wage rates, and unemployment. Monetary policy, fiscal policy, inflation, and growth models are considered. Prerequisite(s): Economics 101 and 103 and Mathematics 105. Staff.

309. Economics of Less-Developed Countries. Causes of the poverty of nations. Analysis of various potential paths to economic growth. Effects of policies of the rich countries on less- developed countries. Included are such topics as industrialization, the green revolution, population growth, environmental degradation, trade policies, debt, multinational corporations, and foreign aid. The development of individual countries is examined, in light of the great diversity of experiences among developing economies. Prerequisite(s): Economics 255 and 260 and 270. Staff.

310. Economic History of the Americas. Understanding today's world and current economic issues requires an appreciation of the past and of historical economic change. This course surveys the history of the American economy from colonial times to the twentieth century. Latin America, the Caribbean, and Canada are included alongside the United States for both comparative and topical purposes. Topics include conquest and settlement, population growth and demographics, migration and immigration, slavery throughout the Americas, trade and trade policy, economic growth, industrialization and technological change, urbanization, and the economic roles of governments. Prerequisite(s): Economics 255, 260, and 270. E. Mechner

311. Public Economics. An analysis of basic issues in the field of public finance. The course covers a wide range of topics, including the welfare implications of expenditure and taxation policies of governments, the economic rationale of governmental provision of goods and services, fiscal institutions in the United States, efficiency and distributive aspects of taxation, effects of taxation on household and firm behavior, intergovernmental fiscal relations, and the public debt. Prerequisite(s): Economics 255, 260, and 270. M. Murray

318. Advanced Macroeconomics. Theories and empirical studies of business cycles: fixed-investment behavior, inventory activity, monetary fluctuations. The course examines recent work on inflation, expectations, economic growth theory, and techniques in current use for forecasting general economic activity. Prerequisite(s): Economics 255 and 270. D. Aschauer.

321. Monetary Policy and Financial Markets. An analysis of money supply, money demand, alternative theories of the monetary mechanism, central banking, and the conduct of monetary policy. Prerequisite(s): Economics 255 and 270. Staff.

324. Corporate Finance. The cost of capital, dividend policy, security valuation, portfolio theory, capital budgeting, and the efficient-markets hypothesis are among the topics investigated. Emphasis is on the testing of hypotheses derived from economic theory. Prerequisite(s): Economics 255 and 260. C. Schwinn.

331. Labor Economics. A study of human resources and the labor market. Topics include racial and sexual discrimination, theories of unemployment and job search, income distribution and poverty, Becker’s new household economics, unions and collective bargaining, and government intervention in the labor market. Prerequisite(s): Economics 255 and 260. J. Hughes.

333. International Trade. Classical and modern theories of international trade analyzed in light of current trends and patterns in the world economy. Attention is focused on the gains from trade, the impact of tariffs and other types of trade restrictions on national economic welfare, the trade problems of less- developed countries, and the theory of economic integration. Prerequisite(s): Economics 255 and 260. Staff.

334. International Macroeconomics. Study of the impact of international trade; international capital movements; and balance of payments policies on domestic output, employment, and price levels. Prerequisite(s): Economics 255 and 270. Staff.

336. Population Economics. Interrelations between the economy and population. Effects of population on the economy include issues of economic growth and development, resource use, immigration, aging, and the social- security system. Effects of the economy on population trends include topics such as health and mortality as they relate to income levels, economic roles of women and other determinants of birth rates, and economic causes of migration decisions. Prerequisite(s): Economics 255 and 260. A. Williams.

339. Industrial Organization. Theories of the firm are used to explain the organization of economic activity across markets and within firms. The effects of pricing behavior, merger activity, advertising, and research and development on efficiency and social welfare are examined. Prerequisite(s): Economics 255 and 260. C. Schwinn. 348. Urban Economics. Microeconomic tools are applied to analyze cities. Among the topics are the spatial structure of cities, trends in urban development in the United States, urbanization and African development, industrial and residential location choices, rent control, housing subsidies, squatter settlements, racial segregation, and urban finance. Prerequisite(s): Economics 255 and 260. M. Murray.

360. Independent Study. Independent research by an individual student under the direction of a faculty member. A detailed report is required at the end of each semester of work. May be taken more than once for credit. May count toward the economics major if so stated by the department chair. Students must submit a research proposal to both the faculty sponsor and the department chair prior to registration. Students are limited to one independent study per semester. Staff.

457. 458. Senior Thesis. Prior to entrance into Economics 457 or 458, students must submit for approval a thesis proposal based on work done in a nonintroductory course. Students register for Economics 457 in the fall semester and for Economics 458 in the winter semester. Majors writing an honors thesis register for both Economics 457 and 458. Prerequisite(s): at least two 300-level economics courses. Written permission of the department chair is required. Staff.

Short Term Units

s21. Principles and Applications of Accounting. An introduction to the concepts and uses of accounting utilizing case studies. Emphasis is on the accounting cycle, construction and analysis of financial statements, asset valuation, and corporate accounting. Not open to students who have received credit for Economics 217. B. Farber.

s23. Strategic Behavior. This unit introduces students to the basic concepts of game theory, engages them in stylized games to highlight selected aspects of strategic behavior, and leads them through a series of case studies of strategic interactions. Recommended background: a liking for quantitative reasoning. Open to first-year students. M. Murray.

s25. Women and Work in Taiwan. This off-campus unit examines how women in Taiwan lead their daily work lives. It goes behind the statistics to ask women what they do and what issues trouble them. In it students learn to interview women and listen to them as they speak about their job experiences and perceptions of job-related issues. This unit addresses the debate of whether economic development improves women’s status by increasing their access to resources, increasing their autonomy and power, and enhancing their general well-being, or whether such improvements are illusory or offset by a worsening of other aspects of women’s status. It gives students an opportunity to employ feminist methods of social research; it provides a cross-cultural perspective on women in the workplace; and it allows students to form their own judgments about how development affects the status of women in an historically patriarchal society. Enrollment limited to 9. Written permission of the instructor is required. Staff.

s26. Forest Ownership and Treatment. Does the ownership of natural resources affect the way they are treated? Elementary economic theory assumes that it does notĐĐany owner will manage any resource in the one way that maximizes profitsĐĐbut news accounts and activists generally assume otherwise. This unit subjects the question to careful examination in the context of Maine forests. In particular, students ask whether it matters where a forest-owning firm is headquartered, what other businesses it is in, and how it is financed. Lectures and readings cover basic forest economics and agency theory. In addition, students are required to participate in field trips to gather data on forest health, plant diversity, and services provided by the forests to neighboring communities. This data is analyzed in class at the end of the term. Prerequisite(s): Economics 101. Recommended background: Economics 222. E. Margolis

s27. Sustaining the Masses. Students in this unit investigate the contradictions and complementarities between economic development and global economic integration, on the one hand, and environmental protection on the other. Students spend up to four weeks in China visiting farming communities, large and small scale industrial enterprises, reforestation sites, nature reserves, and pollution control facilities. They also meet with villagers, workers, and government officials. Linkages between local and international economics, politics, history, culture, and the environment are explored using China as a case study. Recommended background: one or more of the following: Economics 101, 222, 227, 229 or Environmental Studies 201. Written permission of the instructor is required. Open to first-year students. Enrollment is limited to 10. This course is the same as Environmental Studies s27. M. Maurer Fazio and J. Hughes

s28. The New England Economy in Historical Perspective. The economic history of New England both mirrors the experience of the rest of the country and diverges from it. This unit explores New England's peculiar demographic, commercial, industrial, and institutional development from precolonial times to the present. Topics include the Native American and early colonial economy; the agricultural sector and its transformation; New England's foreign trade; the industrial revolution; immigration and urbanization; industrial decline; and economic rebirth. Lectures and readings are supplemented by trips to museums and archeological and historic sites around New England. Prerequisite(s): Economics 101 and 103. Open to first-year students. E. Mechner

s29. Generational Equity. The government plays a large role in transferring resources between generations. Taxes are collected and transfers are paid throughout a generation’s lifetime. This unit examines how and why transfers take place. First, the unit explores the need for intergenerational transfers. Next, a history of age-targeted programs in the United States and other countries, including developing economies, is presented. Tools for calculating the magnitude of intergenerational transfers are developed and used to determine which birth cohort is the “Winning Generation.” Finally, students look at current reform proposals for Social Security and Medicare and discuss notions of “generational fairness.” Prerequisite(s): Economics 101 or 103. Open to first-year students. Enrollment limited to 30. Staff.

s30. The International Monetary System. The international monetary system changed markedly in the twentieth century. This unit surveys various “institutions” such as the gold standard, the International Monetary Fund, the Brady plan, and the European Monetary Agreement, which played major roles in the implementation of international monetary policy during this period. The unit also investigates the impact of various international economic developments such as oil price shocks, Third World debt, economic integration, and the bankruptcy and collapse of central economic planning, on international monetary affairs. Prerequisite(s): Economics 221 or 334. Staff.

s31. Economic Growth and Productivity Enhancement. An intensive study of economic growth from theoretical and empirical perspectives. Theories of economic growth: the Solow growth model; the Ramsey optimizing model; theories emphasizing imperfect competition and increasing returns to scale. Empirical studies of economic growth: factors found to be important determinants of growth in real output, with particular emphasis on productivity growth. Extensive reading of professional journal articles. Prerequisite(s): Economics 255 and 270. Enrollment limited to 15. D. Aschauer.

s32. Seminar on the Role of Public Policy in East Asian Development. Japan, Taiwan, and South Korea have experienced sustained growth with equity, that is, the fruit or benefits of the growth have been shared amongst their citizenry in a relatively equal fashion. Neoclassical economists claim the success of these nations is attributable to policies of openness, limited government intervention, and 'getting prices right.' Others claim that their success is due to government leadership and intervention in deliberately “getting prices wrong” to aid industries, important for future growth, which would not otherwise thrive. These competing claims about the role of public policy in the 'East Asian Miracle' are explored in this seminar by analyzing the development experience of Japan, Taiwan, and South Korea in a case-study format. Prerequisite(s): Economics 101 and 103. Open to first-year students. M. Maurer-Fazio.

s34. Democratic Enterprises. Decisions of democratically run enterprises in matters of income distribution, pricing, and investment are compared theoretically and empirically with the decisions of capitalist firms. Additional topics include the behavior of Yugoslavian firms, the Mondragon community in Spain, case studies in the United States, and employee stock ownership plans. Prerequisite(s): Economics 101 and 103. Open to first-year students. C. Schwinn.

s35. Law and Economics. This unit introduces students to the use of economic analysis in the study of legal rules and legal institutions. Economists believe that the constraints on behavior imposed by legal rules create implicit prices for various individual actions. This insight allows us to use microeconomic analysis to predict the effects of changes in the law. Class meetings and fieldwork focus on the areas of property law, contract law, and tort law to uncover the purpose and unity of various common law rules. Prerequisite(s): Economics 101. Open to first-year students. Enrollment limited to 20. J. Hughes.

s36. The Economics of Environmental Problems. What are the major environmental problems facing us? What are their causes and consequences, economic or otherwise? How can economic theory be used to analyze these problems and to suggest possible solutions? Answers to these and other questions are sought using economic analysis, empirical studies, and classics of the environmental movement. Prerequisite(s): Economics 101 or 103. J. Hughes.

s37. The Great Depression. The Great Depression of the 1930s was a watershed in the American experience, bringing transformations along many dimensions of life, such as unemployment, poverty, agriculture, unions, financial markets, leisure, and the role of government. A major focus of this unit is to examine economic and social issues of the 1930s by collecting oral histories and studying the experiences of individuals who lived in Maine during the crash of 1929 and the ensuing decade. After transcribing their interviews, students analyze the Maine experience in comparison with that of the nation as a whole. Prerequisite(s): Economics 101 or 103. Open to first- year students. Not open to students who have received credit for First-Year Seminar 187. A. Williams.

s38. Environmental Issues in Developing Economies. Is poverty a cause of environmental degradation in developing countries? Or, is the quest for economic growth to alleviate poverty the source of these countries’ environmental problems? How does the interaction between the developed and developing worlds affect the environment? What role can developing countries play in addressing global environmental problems? Can a modern economy develop in a sustainable way? In this unit, students examine the link between economic development and the environment from a number of perspectives. Using case studies of particular countries, and cross-country comparisons of certain industries, students examine the prospects and problems facing the developing world. Prerequisite(s): Economics 101. This unit is the same as Environmental Studies s38. Enrollment limited to 20. J. Hughes.

s39. Dynamite Economics. The Nobel Prize in Economic Science is the world’s most prestigious award for contributions to the field of economics. It has been awarded annually since 1969 by the Royal Swedish Academy of Sciences for specific discoveries or breakthroughs as well as for the impact of these on the economics discipline. This unit examines the lives and work of the recipients of the Nobel Prize in Economic Science. For each recipient, students ask questions such as: What was the central idea (or ideas) that merited the prize? How did the idea impact the profession? How did the idea change the way that economic policy is conducted? Prerequisite(s): Economics 101 and 103. Open to first-year students. Enrollment limited to 15. D. Aschauer.

s50. Individual Research. Registration in this unit is granted by the department only after the student has submitted a written proposal for a full-time research project to be completed during the Short Term and has secured the sponsorship of a member of the department to direct the study and evaluate results. Students are limited to one individual research unit. Staff.

© 1998 Bates College. All Rights Reserved. Last modified: 1/29/99 by mkm