316-468 General Equilibrium and Welfare Economics

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Objectives:

On completion of this subject students should be able to:

• understand the main theories used in the study of general equilibrium and welfare economics;

• judge the usefulness and the limitations of advanced theory in the area of general equilibrium and welfare economics;

• critically evaluate economic policy debates with reference to general equilibrium and welfare economics;

• extend their knowledge of general equilibrium and welfare economics via independent study and by taking advanced subjects in this area.

Content:

Exchange with price-taking behaviour (utility and non-utility approaches), exchange without price-taking, the role of numbers in competition, Nash bargaining solutions, social welfare functions, expenditure functions and compensating variations, production of a general equilibrium model, the effects of income and commodity taxes in general equilibrium, labour supply with taxes and transfers, general equilibrium with variable labour supply supply.

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