MATHEMATICAL ECONOMICS – II

Paper Code: 
ECO 423 (A)
Credits: 
4
Contact Hours: 
60.00
Max. Marks: 
100.00
Objective: 

Course Objectives:

The objectives of this course are-

  1. To help students to understand the application of mathematical techniques in the determination of price and quantity under duopoly.
  2. To help students to understand the factors, which determine the pattern of trade cycles and economic growth of a country.
  3. To help students to understand the application of the techniques of linear programming, input-output and game theory in economics.

 

Course Outcomes (COs):

Course

Outcome (at course level)

Learning and teaching strategies

Assessment Strategies 

Paper Code

Paper Title

ECO 423(A)

Mathematical Economics-II

CO60: Understand the mathematical analysis of duopoly market models, trade cycles and growth models.

CO61: Comprehend the applications of techniques of linear programming, input output analysis and game theory in economic analysis.

Approach in teaching: Interactive Lectures and Discussions.

 

Learning activities for the students:

Practice Modules and

Assignments.

Class activity, Assignments and Semester end examinations.

 

12.00
Unit I: 
Microeconomic Models

Existence and uniqueness of equilibrium, Stability of equilibrium, Static stability- Marshallian & Walrasian Stability Conditions, dynamic stability- Lagged adjustment- Cobweb model; Duopoly market models-quasicompetitive solution, Collusion solution,  Cournot solution, Stakelberg solution and  market share solution

12.00
Unit II: 
Macroeconomic Models

Multiplier- Static and Dynamic, IS-LM Curves, Multiplier-Accelerator interaction trade Cycle models of Samuelson and Hicks. Growth Models- Harrod-Domar, Solow, Meade, and Kaldor.

12.00
Unit III: 
Linear Programming

Simplex method; problem of Degeneracy and mixed constraints, Duality theorems.

12.00
Unit IV: 
Input-Output Analysis

Concepts of static & dynamic, closed & open input - output models. Hawkins-Simon conditions of viability, Determination of gross output, price and value added.

12.00
Unit V: 
Theory of Games

Two-person constant sum games, Maximin and Minimax, dominant strategies, Pure and Mixed strategies, Saddle point solution, conversion of game theory into linear programming.

Essential Readings: 
  1. James. M. Henderson and Richard E. Quandt, Microeconomic Theory: A Mathematical Approach, McGraw-Hill Inc., US; 3rd Revised edition,1980.
  2. R.G.D Allen, Mathematical Economics, Macmillan; 2nd Revised edition, 1959.
  3. B.C. Mehta: Mathematical Economics: Microeconomic Models, Sultan Chand & Sons, New Delhi.
  4. Alpha C Chiang, Fundamental Methods of Mathematical Economics, McGraw-Hill Education.
  5. B.C. Mehta and G.M.K. Madnani, Mathematics for Economists, Sultan Chand & Sons, New Delhi.
Academic Session: 
2019-20
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