Economics
28 Hillhouse, 432.3575
M.A., M.Phil., Ph.D.
Chair
David Pearce (28 Hillhouse, 432.3571)
Director of Graduate Studies
Truman Bewley (30 Hillhouse, Rm 36, 432.3719, truman.bewley@yale.edu)
Professors
Joseph Altonji, Donald Andrews, Dirk Bergemann, Steven Berry,
Truman Bewley, William Brainard, Donald Brown, Stephen Coate,
Eduardo Engel, Robert Evenson, Ray Fair, John Geanakoplos,
Pinelopi Goldberg, Timothy Guinnane, Philip Haile, Koichi
Hamada, Gerald Jaynes, Michael Keane, Alvin Klevorick, Richard
Levin, Robert Mendelsohn, Stephen Morris, Barry Nalebuff,
William Nordhaus, David Pearce, Peter Phillips, Benjamin Polak,
Gustav Ranis, John Roemer, Herbert Scarf, T. Paul Schultz,
Robert Shiller, Martin Shubik, T. N. Srinivasan, Christopher
Udry
Associate Professors
George Hall, Carolyn Moehling, Giuseppe Moscarini, Christopher
Timmins
Assistant Professors
Patrick Bayer, Hanming Fang, Donato Gerardi, Galina Hale,
Justine Hastings, Rohini Pande
Fields of Study
Fields include economic theory, including microeconomics,
macroeconomics, mathematical economics; econometrics; economic
history; labor economics; market organization; money and banking;
financial economics; economics of the public sector; international
trade and finance; economic development; demography; history
of economic thought; comparative economic systems.
Special Admissions Requirements
The GRE General Test is required of all applicants
to the program. Students whose native language is not English
must take the Test of English as a Foreign Language (TOEFL).
Special Requirements for the Ph.D. Degree
The following requirements must be satisfied in addition
to those prescribed by the Graduate School.
1. Prior to Registration for the Second Year. (a) Students
must have taken for credit and passed at least six economics
graduate courses. (b) Students must pass written comprehensive
examinations in micro- and macroeconomics. These examinations,
which are given in May and late August of each year, must
be taken in the spring term of the first year. Each exam will
be graded separately, and in the event of failure, students
will retake only the part of the exam they did not pass. Students
may take the comprehensive examination no more than two times.
2. Prior to Registration for the Third Year. (a) Students
must have met the two Honors requirement specified by the
Graduate School. (b) Students must have taken at least fourteen
term courses in Economics and have received a grade of at
least Pass– in each of them. With the permission of
the director of graduate studies, courses in related fields
and independent reading courses can be used to fulfill this
requirement. Workshops may not be used to satisfy it. (c)
Students must have received an average of at least High Pass
in the courses they have taken. The admissibility of courses
for this requirement is the same as for the fourteen-course
requirement mentioned above.
3. Admission to Candidacy. The Graduate School requires that
students be admitted to candidacy prior to registration for
the fourth year of study. Students are recommended to the
Graduate School for admission to candidacy by vote of department
faculty after having completed department requirements (1)
and (2) above, the Graduate School’s prospectus requirement,
and the following additional requirements: (a) Students must
have completed two one-term prospectus workshops. Prospectus
workshops have the word “prospectus” in their
title. (There are other workshops.) If students can find no
workshop corresponding to their interests, they may substitute
other workshops for this requirement. If students can find
no workshop whatsoever in their areas of interest, they may
substitute independent study guided by a faculty member, provided
the independent study leads to a dissertation prospectus that
is accepted. (b) Students must receive a grade of High Pass–
or better in ECON 551b (Econometrics II) or 552b (Econometrics
III). More advanced courses may be substituted for these with
special permission of the director of graduate studies. (c)
Students must receive a grade of Satisfactory on an applied
econometrics paper, which is evaluated by the faculty adviser
of the paper and another faculty member. In the paper, the
student should (i) specify an economic model useful for the
investigation of an interesting economic problem, (ii) select
data and econometric methods appropriate to the question,
(iii) conduct proper statistical analysis, and (iv) interpret
the results in an intelligent way. (d) Students must complete
with a grade of at least High Pass– a term of economic
history, drawn from a list of courses approved by the director
of graduate studies and economic history instructors. (e)
Students must pass an oral examination.
4. Submitting the Dissertation. A student’s dissertation
research is guided by a committee of two Graduate School faculty
members, at least one of whom must be a member of the Economics
department. One of the committee members is designated as
chair. When a first draft of the dissertation is completed,
the director of graduate studies appoints, on request of the
committee chair, a third reader.
Programs in Law and Economics
The Economics department participates in the J.D./M.A.
and J.D./Ph.D. programs.
Master's Degrees
M.Phil. The M.Phil. degree is awarded to students
in the Ph.D. program upon completion of fourteen term courses,
with at least two grades of Honors. In addition, students
must satisfy the qualifying requirements in economic theory,
econometrics, economic history, and two special fields, as
well as the oral examination.
M.A. (en route to the Ph.D.). The M.A. degree is awarded
upon completion of eight term courses with an average grade
of High Pass, and satisfactory completion of one of the following:
the comprehensive examination in economic theory, the course
requirement in econometrics, or the course requirement in
economic history.
The M.A. in International and Development Economics is described on page 206 of this publication.
Program materials are available upon request to the Director of Graduate Studies,
Economics Department, Yale University, PO Box 208268, New Haven CT 06520-8268.
See our Web site: www.econ.yale.edu/
Courses
ECON 500a, General Economic Theory: Microeconomics. Stephen
Morris.
Introduction to optimization methods and partial equilibrium.
Theories of utility and consumer behavior production and firm
behavior. Introduction to uncertainty and the economics of
information, and to noncompetitive market structures.
ECON 501b, General Economic Theory: Microeconomics. Dirk
Bergemann, Truman Bewley.
General equilibrium and welfare economics. Allocation
involving time. Public sector economics. Uncertainty and the
economics of information. Introduction to social choice.
ECON 510a, General Economic Theory: Macroeconomics. Robert
Shiller, Eduardo Engel.
Analysis of short-run determination of aggregate employment,
income, prices, and interest rates in closed and open economies.
Stabilization policies.
ECON 511b, General Economic Theory: Macroeconomics. George
Hall, Giuseppe Moscarini.
Theories of saving, investment, portfolio choice, and
financial markets. Longer-run developments; economic growth,
capital accumulation, income distribution.
ECON 520a, Advanced Microeconomic Theory I. Donato
Gerardi, Itzhak Gilboa.
A formal introduction to game theory and information
economics. Alternative noncooperative solution concepts are
studied and applied to problems in oligopoly, bargaining,
auctions, strategic social choice, and repeated games.
ECON 521b, Advanced Microeconomic Theory II. Stephen
Morris, Andrew Postlewaite.
Contracts and the economics of organization. Topics may
include dynamic contracts (both explicit and implicit), career
concerns, hierarchies, Bayesian mechanism design, renegotiation,
and corporate control.
ECON 522a and 523b, Topics in Game Theory. Stephen
Morris [F], Donato Gerardi [Sp].
A forum for advanced students to examine critically recent
papers in the literature and present their own work.
[ECON 524a, Behavioral Applied Theory.]
ECON 525a, Advanced Macroeconomics: I. Eduardo
Engel, Robert Shiller.
Aggregation, inventory models, externalities, spillovers,
information and adjustment. Time series models, expectations,
models of financial markets, risk management, monetary policy,
term structure of interest rates.
ECON 526b, Advanced Macroeconomics: II. William
Brainard, Giuseppe Moscarini.
Selected empirical topics.
ECON 530a, Mathematical Economics I. Truman
Bewley.
The focus of the class is intertemporal problems in general
equilibrium theory. One set of topics is the links between
the theories of general equilibrium, overlapping generations
models, and economic growth. Another topic is the link between
the permanent income hypothesis and general equilibrium analysis.
A third topic is the stability of equilibrium with and without
the permanent income hypothesis.
ECON 531b, Mathematical Economics II. John
Geanakoplos.
This course examines the foundations of money and finance
from the perspective of general equilibrium with incomplete
markets. The relevant mathematical tools from elementary stochastic
processes to differential topology are developed in the course.
Topics include asset pricing, variations of capital asset
pricing model, the “Hahn paradox” on the value
of flat money, default and bankruptcy, collateral equilibrium,
market crashes, adverse selection and moral hazard with perfect
competition, credit card equilibrium, and general equilibrium
with asymmetric information.
[ECON 532au, General Equilibrium under Uncertainty.]
[ECON 533a and b, Workshop on Discrete Mathematics and
Applications.]
ECON 537a and 538b, Microeconomic Theory Workshop. Staff.
Presentations by research scholars and participating
students.
ECON 540a and 541b, Student Workshop in Macroeconomics. Staff.
A course for third- and fourth-year students doing research
in macroeconomics to prepare their prospectuses and to present
their dissertation work. Each student is required to make
at least two presentations per term. For third-year students
and beyond, at least one of the presentations in the first
term should be a mock job talk.
ECON 542a and 543b, Macroeconomics Workshop. Staff.
A forum for presentation and discussion of state-of-the-art
research in macroeconomics. Presentations by research scholars
and participating students of papers in closed economy and
open economy macroeconomics and monetary economics.
ECON 544a, Economic Analysis. Cheryl Doss.
MW 9–10.15
An introduction for International Relations students
to more advanced concepts of micro- and macroeconomic analysis
in an applied context. Different economies in different stages
of development are used as illustrations of these concepts.
Areas covered include employment, income, and interest rate
determination as well as theories of consumption, investment,
pricing, money, and production. Also INRL 560a.
ECON 545a, Microeconomics. Michael Boozer.
A survey of the main features of current economic analysis
and of the application of the theory to a number of important
economic questions, covering microeconomics and demand theory,
the theory of the firm, and market structures. For IDE Students.
ECON 546a, Macroeconomics. Richard Agenor.
This course presents a basic framework to understand
macroeconomic behavior and the effects of macroeconomic policies.
Topics include consumption and investment, labor market, short-run
income determinations, unemployment, inflation, growth, and
the effects of monetary and fiscal policies. The emphasis
is on the relation between the underlying assumptions of macroeconomic
framework and policy implications derived from it. For IDE
students.
ECON 550a, Econometrics I. Donald Andrews.
Probability: concepts and axiomatic development. Data:
tools of descriptive statistics and data reduction. Random
variables and probability distributions; univariate distributions
(continuous and discrete); multivariate distributions; functions
of random variables and transformations; the notion of statistical
inference; sampling concepts and distributions; asymptotic
theory; point and interval estimation; hypothesis testing.
ECON 551b, Econometrics II. Michael Keane.
Provides a basic knowledge of econometric theory, and
an ability to carry out empirical work in economics. Topics
include linear regression and extensions, including regression
diagnostics, generalized least squares, statistical inference,
dynamic models, instrumental variables and maximum likelihood
procedures, simultaneous equations, nonlinear and qualitative-choice
models. Examples from cross-section, time series, and panel
data applications.
ECON 552b, Econometrics III. Donald Andrews.
The treatment of the subject is rigorous, attentive to
modern developments, and proceeds to research level in several
areas. Linear models from core curriculum. Topics include
linear estimation theory, multiple and multivariate regressions,
Kruskal’s theorem and its applications, classical statistical
testing by likelihood ratio, Lagrange multiplier and Wald
procedures, bootstrap methods, specification tests, Stein-like
estimation, instrumental variables, and an introduction to
inferential methods in simultaneous stochastic equations.
ECON 553a, Econometrics IV: Time Series Econometrics. Peter
Phillips.
A sequel to ECON 552, the course proceeds to research
level in time series econometrics. Topics include an introduction
to ergodic theory, Wold decomposition, spectral theory, martingales,
martingale convergence theory, mixing processes, strong laws
and central limit theory for weak dependent sequences with
applications to econometric models and model determination.
ECON 554a, Econometrics V. Guido Kuersteiner.
The first half of this course is about nonlinear parametric
models. Specification, estimation, and testing within the
Likelihood and Generalized Method of Moments frameworks. First-order
asymptotics for both smooth and non-smooth objective functions.
Efficiency and robustness. A short account of high-order asymptotics
for smooth problems. The second part is on nonparametric and
semiparametric methods. Nonparametric estimation by kernels,
series, splines, and other methods. Bias reduction and bandwidth
selection. The curse of dimensionality and additive models.
Specification and estimation of semiparametric models. U-statistics
and asymptotic properties. Efficiency and adaptation.
ECON 555a, Applied Econometrics II: Microeconometrics. Michael
Boozer.
This course develops the concepts needed to approach
empirical problems in microeconomics with econometrics. The
focus is less on developing a catalogue of econometric methods
than on developing a conceptual basis for understanding how
data, econometric methodology, and assumptions combine to
produce statistical inference.
ECON 557b, Time Series Econometrics II: Unit Roots and
Co-Integration. Peter Phillips.
This course is an introduction to nonstationary time
series and econometric applications covering the following
topics. Weak convergence and functional central limit theory
with unit root model illustrations. An introduction to stochastic
calculus, and weak convergence to stochastic integrals. Unit
root tests and applications. Testing stationarity. Spurious
regression. General regression asymptotics for integrated
processes with Hilbert projection geometry. Co-integration,
tests for co-integration and reduced rank regression. Regression
estimation of co-integrated systems and VARs with some unit
roots. Bayesian approaches to unit root and co-integration
analysis. Nonlinear functions of integrated processes and
econometric applications. Fractional processes and long memory.
Theory and empirical applications are discussed. Computer
exercises in Gauss. Credit is obtained from a take-home examination
and an empirical computer application.
ECON 558a, Statistics and Econometrics. Michael
Boozer.
Application of statistical analysis to economic data.
Basic probability theory, linear regression, specification
and estimation of economic models, time series analysis and
forecasting. The computer is used. For IDE students.
ECON 567a and 568b, Econometrics Workshop. Donald
Andrews, Peter Phillips.
A forum for state-of-the-art research in econometrics.
Its primary purpose is to disseminate the results and the
technical machinery of ongoing research in theoretical and
applied fields.
ECON 570a and 571b, Prospectus Workshop in Econometrics. Donald
Andrews, Peter Phillips.
A course for third- and fourth-year students doing research
in econometrics to prepare their prospectus and present dissertation
work.
ECON 580b, General Economic History: Western Europe. Timothy
Guinnane.
A survey of some major events and issues in the economic
development of Western Europe during the eighteenth and nineteenth
centuries, stressing the causes, nature, and consequences
of the industrial revolution in Britain and on the Continent,
and the implications of the historical record for modern conceptions
of economic growth. Prerequisites: simultaneous enrollment
in or successful completion of ECON 500a and ECON 510a; or
permission of the instructor.
[ECON 581a, American Economic History.]
[ECON 582b, General Economic History: Latin America.]
ECON 583a, Topics in Economic History. Valery
Lazarez, William Nordhaus.
The first part of the course discusses issues in American
macroeconomic history, focusing on the Gold Standard and the
Great Depression. The second part analyzes Russian economic
development since the 1850s in comparative perspective. Topics
include the impact of institutions on the patterns of industrialization;
labor incentives and productivity; centrally planned economy
(1929–1980s); economic analysis of autocracy/dictatorship
and political transitions.
ECON 588a and 589b, Economic History Workshop. Staff.
A forum for discussion and criticism of research in progress.
Presenters include graduate students, Yale faculty, and visitors.
Topics concerned with long-run trends in economic organization
are suitable for the seminar. Special emphasis given to the
use of statistics and of economic theory in historical research.
ECON 600a, Industrial Organization I. Steven
Berry, Philip Haile, Justine Hastings.
Begins by locating the study of industrial organization
within the broader research traditions of economics and related
social sciences. Alternative theories of decision making,
of organizational behavior, and of market evolution are sketched
and contrasted with standard neoclassical theories. Then turns
to a detailed examination of the determinants and consequences
of industrial market structure.
ECON 601b, Industrial Organization II. Steven
Berry, Philip Haile, Justine Hastings.
Examination of alternative modes of public control of
economic sectors with primary emphasis on antitrust and public
utility regulation in the U.S. economy. Public policy issues
in sectors of major detailed governmental involvement.
ECON 606a and 607b, Prospectus Workshop in Microeconomics. Staff.
For third-year students in microeconomics, intended to
guide students in the early stages of theoretical and empirical
dissertation research. Emphasis on regular writing assignments
and oral presentations.
ECON 608a and 609b, Workshop in Applied Microeconomics. Staff.
For advanced graduate students in applied microeconomics,
serving as a forum for presentation and discussion of work
in progress of students, Yale faculty members, and invited
speakers.
ECON 630a, Labor Economics. Joseph Altonji.
Topics include static and dynamic approaches to demand,
human capital and wage determination, wage income inequality,
unemployment and minimum wages, matching and job turnover,
immigration and international trade, unions, implicit contract
theory, and efficiency wage hypothesis.
ECON 631b, Labor Economics. Michael Keane.
Topics include static and dynamic models of labor supply,
human capital wage function estimation, firm-specific training,
compensating wage differentials, discrimination, household
production, bargaining models of household behavior, intergenerational
transfers, and mobility.
ECON 638a and 639b, Labor and Population Workshop. Staff.
A forum primarily for graduate students to exposit their
research plans and findings. Discussions encompass empirical
microeconomic research relating to both high- and low-income
countries.
ECON 670a, Financial Economics I. Zhiwu Chen.
Current issues in theoretical financial economics addressed
through the study of current papers. Focuses on the development
of the problem-solving skills essential for research in this
area. Also MGMT 740a.
ECON 671b, Financial Economics II. Jonathan
Ingersoll.
Current issues in theoretical financial economics are
addressed through the study of current papers. Focuses on
the development of the problem-solving skills essential for
research in this area. Also MGMT 741b.
ECON 680a, Public Finance: I. Patrick Bayer,
Christopher Timmins.
Theoretical and empirical topics in public finance. Some
emphasis on the relation between taxation and the following
problems: efficiency, equity, and income distribution, uncertainty
in capital markets, and aggregate capital accumulation.
ECON 681b, Public Finance: II. Patrick Bayer,
Christopher Timmins.
Topics include theory of public goods, an introduction
to preference revelation, the problem of externalities and
their control, and the methodology of cost-benefit analysis
and some applications.
ECON 702b, International Economics. Koichi
Hamada.International monetary theory and its implications
for economic policy. Topics include mechanisms of adjustment
in the balance of payments; fiscal, monetary, and exchange
rate policy for internal and external balance; international
movements of capital. For IDE students.
ECON 708b, International Economic Analysis. Guillermo
Mondino. M 1–3.20
A continuation of ECON 544a/INRL 560a. It extends the
use of economic analysis to international trade and monetary
policy including exchange rates and balance of payments with
an emphasis on their relation to international trade, cross-border
capital flows, and national economic policies. Introduction
to quantitative tools and analysis as a way to determine the
effects of various policies, building on concepts introduced
in
ECON 544a and the first part of this course. Also INRL
561b.
[ECON 709a, International Economics and Open Economy
Macroeconomics.]
ECON 720a, International Trade I. T.N. Srinivasan,
Pinelopi Goldberg, Irene Brambilla.
The course covers the theory of international trade,
policy, and institutions. Classical, Neo-classical, and more
recent Imperfect-Competition-Scale-Economies based static
models of trade are discussed. Dynamic extensions of some
of the models that explore the relations between trade, innovation,
and growth are presented. The analytics of trade policy issues,
such as gains from trade, tariffs and quotas, customs unions
and free trade areas, and political economy of trade policy
making, are discussed. The economic foundations of multilateral
institutions governing world trade, i.e. GATT and its successor
the WTO, are analyzed.
ECON 721b, International Trade II. T.N. Srinivasan,
Pinelopi Goldberg, Irene Brambilla.
This course covers empirical topics in International
Trade with particular emphasis on current research areas.
Topics include tests of international trade theories; studies
of the relationship between international trade, labor markets,
and income distribution; recent trade liberalization episodes
in developing countries; empirical assessment of various trade
policies, such as VERs and Anti-Dumping; productivity (and
its relation to international trade liberalization); exchange
rates, market integration, and international trade. Methodologically,
the course draws heavily on empirical models used in the fields
of Industrial Organization and to a lesser degree Labor Economics;
these courses are thus recommended (though not required).
ECON 724b, International Finance. Galina
Hale.
International monetary economics covering the following
topics: the balance of payments and the foreign exchange market;
the elasticities, absorption, and monetary approaches to the
foreign exchange market; the elasticities, absorption, and
monetary approaches to the adjustment mechanism; long-term
and short-term capital flows; Euro-dollars, portfolio and
asset market approaches, policies for internal balance, flexible
exchange rates, international reserves, and the monetary system.
ECON 730a, Economic Development. Rohini Pande.
Development theory at both aggregate and sectoral levels;
analysis of growth, employment, poverty, and distribution
of income in both closed and open developing economy contexts.
ECON 731b, Economic Development. Christopher
Udry.
Analysis of development experiences since World War II.
Planning and policy making across countries and time. Models
of development, growth, foreign trade, and investment. Trade,
capital, and technology flows and increasing interdependence.
The political economy of policy making and policy reform.
ECON 732b, Economic Development. Christopher
Timmins.
Examines the models of classical and modern economists
to explain the transition of developing economies into modern
economic growth, as well as their relevance to income distribution,
poverty alleviation, and human development. For IDE students.
[ECON 735bu, Economics of Agriculture.]
ECON 736au, Economics of Technology. Robert
Evenson.
Focus on an analysis of the microeconomic incentives
for the discovery and adoption of new technology and on the
macroeconomic implications of technical change. Topics include
the incentives to conduct research and development; patents
and other means of appropriating the returns from R&D
investment; measuring the effects of technical change; national
policies for directing technical change.
ECON 737au, Economics of Natural Resources. Robert
Mendelsohn.
Linking of abstract economic concepts to concrete policy
and management decisions. Application of theoretical tools
of economics to global warming, pollution control, fisheries,
forestry, recreation, and mining.
ECON 738a/b, Workshop on Environmental and Natural Resources.
William Nordhaus, Christopher Timmins, and Robert Mendelsohn.
ECON 749a and 750b, Trade and Development Workshop. Staff.
A forum for graduate students and faculty with an interest
in the economic problems of developing countries. Faculty,
students, and a limited number of outside speakers discuss
research in progress.
ECON 776bu, Economics of Population. T. Paul
Schultz.
Analysis of economic aspects of population change, including
fertility, mortality and health, composition of households,
migration, and labor force behavior. Microeconomic models
of household behavior and demographic measurement theory used
to account for economic and demographic behavior of persons
in low- and high-income countries.
[ECON 788a, Political Competition.]
ECON 790b, Political Economy. Stephen Coate.
Political economy is the study of public policy making from
an economics perspective. This course provides an introduction
to the field. The first part focuses on tools, providing an
overview of theories of policy determination via the political
process. Topics include voter behavior, electoral competition,
legislative decision making, and interest group influence.
The second part discusses applications, focusing on questions
of interest to public economists. Topics include political
failure, the implications of alternative electoral systems,
campaign finance reform, citizens’ initiatives, and
political transitions.
ECON 802au, Economic Development of Japan. Koichi
Hamada.
Economic performance of Japan: historical development
since Meiji Restoration, postwar reconstruction and rapid
growth including the industrial policy, government policy,
the political economy of U.S./Japan economic relations.
ECON 804au, Economic Policies in Latin America. Eduardo
Engel.
Study of historical and current economic problems of
Latin America, with particular attention to the most important
countries of the region: Argentina, Brazil, and Mexico. Focus
on the results of the implementation of economic reforms and
the impact of macroeconomic and trade policies adopted by
the different countries over time.
ECON 899a or b, Individual Reading and Research.
By arrangement with faculty.
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