Economics

Professors Murray, Aschauer, Hughes, Maurer-Fazio, and Lewis (chair); Associate Professor Schwinn; Assistant Professors Riera-Crichton, Tefft, and Dellachiesa; Lecturers Farber and Perkins

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 nonmajors, 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 nontechnical understanding of economic institutions, policy, and analysis. Courses numbered between 200 and 249 provide nontechnical introductions to more specialized topics. 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. More information on the economics department is available on the website (www.bates.edu/ECON.xml).

Major Requirements. There are five requirements for the economics major:

1) ECON 101, 103, 250, 255, 260, and 270. The following statistics courses may be substituted for ECON 250, (statistics): BIO 244, MATH 215, or PSYC 218. At least three of these four 200-level courses must be taken at Bates.

2) MATH 105 or 106 or the equivalent. MATH 105 is a prerequisite for ECON 255, 260, and 270.

3) Three 300-level electives in economics. At least two of these 300-level electives must be taken at Bates.

4) A fourth economics elective, which may be numbered 220–249 or 300–399. The following courses may substitute for a 200-level elective for purposes of the major only:

ANTH 339. Production and Reproduction.
PLTC 222. International Political Economy.
SOC 260. Economic Sociology.

5) ECON 457 or 458. Senior Thesis.

Students are not permitted to declare the economics major during their senior year.

Students planning to study abroad are strongly urged to consult the study-abroad section of the economics department website. Most basic questions concerning departmental study-abroad requirements are answered there. Students should then consult with the department chair concerning the acceptability of particular courses for the major.

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, politics, psychology, and sociology.

Pass/Fail Grading Option. Pass/fail grading may not be elected for courses applied toward the major except for Economics 101 and 103.

Minor (for Class of 2012 only). The minor consists of seven courses: Economics 101, Principles of Microeconomics; Economics 103, Principles of Macroeconomics; Economics 250, Statistics (or a substitute course from the list on the department website); and any four other economics offerings, only one of which may be a Short Term course.

Pass/Fail Grading Option. Pass/fail grading may not be elected for courses applied toward the minor except for Economics 101 and 103.

Non-Bates Credit. Students receiving scores of four or five on the Economics AP exam receive credit for Economics 101 or 103. Students receiving a score of four or five on the Statistics AP exam receive credit for Economics 250. A-Level credit: Students receiving a grade of A or B on the A-Level Economics examinations may receive credit for Economics 101 and 103. No credit is given for the O-Level examinations. International Baccalaureate credit: Students receiving a grade of six or seven in the IB HL program may receive credit for Economics 101 and 103. No credit is given for the IB SL program.

Students who have failed a core economics course (ECON 101, 103, 250, 255, 260, or 270) at Bates may not receive major or minor credit for an equivalent course taken at another institution.

Courses

ECON 101. Principles of Microeconomics: Prices and Markets.

A study of competition and monopoly, antitrust policy and public-utility regulation, determination of wages and other sources of income, income distribution, and pollution and public policy. Enrollment limited to 35. Normally offered every semester. J. Hughes, M. Maurer-Fazio, Staff.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 103. Principles of Macroeconomics: Income and Employment.

A survey of major economic issues in the United States, such as economic growth, employment, and inflation. Students discuss the causes and consequences of fluctuations in income, employment, and inflation, and analyze fiscal and monetary policies designed to correct them. Economics 101 is helpful preparation, but not required. Enrollment limited to 35. Normally offered every semester. D. Riera-Crichton, G. Perkins, Staff.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 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 101 and 103. Enrollment limited to 25. D. Riera-Crichton.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 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 or 103. Open to first-year students. Enrollment limited to 25. Normally offered every year. L. Lewis.
ConcentrationsInterdisciplinary Programs

This course counts toward the following Interdisciplinary Program(s)

ECON 223. Law and Economics.

This course introduces the use of economic methods to examine laws and legal institutions. The fundamental concepts of economics-scarcity, maximization, and marginal analysis are used to predict the effect of legal rules on behavior, and to evaluate how well a particular rule achieves its intended end. At another level, civil law may be viewed as another system of resource allocation and wealth distribution, as the legal system is often used to craft a remedy when markets fail in their allocative role. Topics may include property law, contract law, accident law, family law, criminal law, and copyright and trademark law. Prerequisite(s): Economics 101. Not open to students who have received credit for Economics s35. Enrollment limited to 20. J. Hughes.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 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 antitrust issues and cases, 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.
Concentrations

This course is referenced by the following General Education Concentrations

AS/EC 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. Students consider whether the Japanese economy operates according to principles, objectives, and structures that 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. Open to first-year students. Enrollment limited to 30. [W2] M. Maurer-Fazio.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 233. Economics of Unhealthy Behaviors.

People regularly engage in risky and unhealthy behaviors. This course examines the underlying economic concepts and social implications for such behaviors in the context of the U.S. health care system and other government policies. As they gain a firm understanding of public and private health insurance and health care delivery systems, students explore the economics of behaviors that contribute to the demand for health care. Such behaviors may include overeating, under-exercising, drug abuse, drunk driving, unsafe sex, suicide, and compulsive gambling. Prerequisite(s): Economics 101. Enrollment limited to 25. Normally offered every year. N. Tefft.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 237. Introduction to Behavioral Economics.

An introduction to the frontier region between economics and psychology as explored by economists. The course examines intertemporal choices, choices made under uncertainty, choices shaped by altruism, financial choices, and choices to punish. The course also considers applications of behavioral economics to public policy. Prerequisite(s): Economics 101 and one of the following: Biology 244, Economics 250, Mathematics 315, or Psychology 218. Enrollment limited to 22. M. Murray.
Concentrations

This course is referenced by the following General Education Concentrations

AS/EC 241. China's Economic Reforms.

China's economy, now among the world's largest, has grown more rapidly than any other nation's over the last three decades. In this course, students explore the dynamism of China's recent economic transformation and the challenges it faces in the context of the enormous structural changes China has experienced in the twentieth and twenty-first centuries. They address fundamental questions about the transition from socialism, the nature of market systems, and how institutions and institutional change affect economic development. Prerequisite(s): Economics 101 or 103. Enrollment limited to 25. [W2] M. Maurer-Fazio.
Concentrations

This course is referenced by the following General Education Concentrations

AS/EC 242. Work and Workers in China.

In this course students investigate how China's economic reforms are affecting the working lives and well-being of its immense work force. Over the last three decades, China has experienced rapid structural change as tens of millions of Chinese have moved out of the agriculture sector and into the industrial and service sectors. The concomitant migration of workers from the countryside to urban areas is the largest migration in human history. Students focus on the distributional implications of China's reform experience. They consider which institutional legacies are shaping emerging labor markets, how far China has moved toward a market-determined labor system, and which segments of China's enormous population have benefited and which have been harmed by the reforms. Prerequisite(s): Economics 101 or 103. Enrollment limited to 25. M. Maurer-Fazio.
Concentrations

ECON 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. Open to first-year students. Enrollment limited to 36. [Q] Normally offered every semester. C. Schwinn, N. Tefft, J. Hughes.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 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. [Q] [W2] Normally offered every semester. M. Murray, C. Schwinn.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 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 Mathematics 105. [Q] Normally offered every semester. J. Hughes, N. Tefft.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 270. Intermediate Macroeconomic Theory.

This study of national income determination 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. [Q] Normally offered every semester. D. Aschauer, D. Riera-Crichton.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 305. International Financial Stability.

Global financial stability is an essential requirement to ensure sustainable world economic growth and the successful development of emerging markets. This course provides an in-depth understanding of the mechanisms and institutions that rule our international financial system. First, students take a historic look at the evolution of the international monetary system during the last century. Then they study recent failures of the system leading to global financial crises. Special attention is paid to currency, debt, and balance of payments crises. Finally, they review current policy challenges faced by developed and developing nations. Prerequisite(s): Economics 255 and 270. Recommended background: Economics 221. Normally offered every year. D. Riera-Crichton.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 309. Economics of Less-Developed Countries.

The course examines the causes of the poverty of nations, various potential paths to economic growth, and the 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, 260, and 270. M. Maurer-Fazio, M. Murray.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 310. Economics of Not-for-Profit Firms.

This course studies the not-for-profit (NFP) firm as an institutional form that society has used in response to market failures, such as those caused by the presence of jointly consumed goods, asymmetric information, or principal-agent problems. Examples are taken from industries where the NFP form is prevalent: health care, education, museums, performing arts, and public radio and television. Issues related to the financing of NFPs, including their capital structure and their reliance on donations as opposed to commercial revenues, are also explored. Prerequisite(s): Economics 255 and 260. Enrollment limited to 20. G. Perkins.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 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.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 315. Energy Economics.

In this course students develop and use tools of economic analysis to understand contemporary policy issues related to energy. This course focuses on the relationship among economics, science, technology, and energy in the public policy process. Students examine the political economy of global climate change to study this relationship. The goal is to establish a reasonable basis for understanding the science and politics of global climate change. Prerequisite(s): Economics 255, 260, and 270. A. Dellachiesa.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 318. Advanced Macroeconomics.

Theories and empirical studies of business cycles: fixed-investment behavior, inventory activity, and 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, 260, and 270. D. Aschauer, Staff.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 320. Advanced Econometrics.

Econometric estimation techniques beyond least squares, including instrumental variables, maximum likelihood, the generalized method of moments, and both nonparametric and simulation methods are introduced. Models for panel data, stochastically trending variables, and limited dependent variables are also discussed. Students' choice of projects determines which topics are considered in detail. Prerequisite(s): Economics 255. Enrollment limited to 22. M. Murray.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 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. D. Aschauer, Staff.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 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. Normally offered every year. C. Schwinn.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 325. Prices, Property, and the Problem of the Commons.

An analysis of water resources and fisheries economics. Topics include water allocation, scarcity and pricing, water rights, cost-benefit analysis, valuation, water markets, and problems related to common-property resources such as underground aquifers and fisheries. Economic incentives for pollution control including tradable pollution permit programs for water quality maintenance are also covered. Prerequisite(s): Economics 255 and 260. Enrollment limited to 25. Normally offered every year. L. Lewis.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 327. Game Theory.

Strategic interaction is a part of everyday life, and so are the situations that can be explained using game theory. Game theory considers decision problems in a competitive environment where conflict, risk, and uncertainty are often involved; it is a powerful tool for understanding individual actions and social institutions in economics, business, and politics. The course focuses on the underlying theory as well as applications to social, economic, and political problems. Topics include Nash equilibrium, subgame perfection, auctions, and incomplete information. In-class games are used to illustrate the concepts. Prior knowledge and understanding of basic calculus and probability theory are essential to success. Prerequisite(s): Economics 250, 255, and 260. Enrollment limited to 25. Staff.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 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. Enrollment limited to 25. J. Hughes.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 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.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 335. Health Economics.

The health care industry represents a rapidly growing proportion of government expenditures and the U.S. economy as a whole. This course offers theoretical and empirical analyses of health care markets and individual decisions with respect to health and health care. These issues require special consideration due to asymmetric information in insurance markets and the physician-patient relationship; uncertainty in health shocks and expenditures; and interactions between health care providers, insurers, employers, and public health insurance programs. The class considers these issues primarily in a microeconomic framework and explores econometric techniques commonly used in the study of health and health care. Prerequisite(s): Economics 255 and 260. Enrollment limited to 25. Normally offered every year. N. Tefft.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 337. The Economics of Intellectual Property.

Intellectual property rights (IPR) are the means by which innovators may receive a reward for their inventions. In the twenty-first century, control of these rights is the basis for many of the worlds's most valuable companies (e.g., Apple, Google, Microsoft). Ironically, the rules governing the intellectual property of the twenty-first century were themselves devised hundreds of years earlier. Advances in information technology over the past fifty years have rendered many of these rules obsolete. In addition, the role of IPR in the creation and distribution of wealth within and among nations has given rise to profound questions of equity regarding access to the benefits of innovation by disadvantaged groups. This course examines the theory and practice of IPR around the world using case studies and empirical analysis. Prerequisite(s): Economics 255 and 260. J. Hughes.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 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.
Concentrations

This course is referenced by the following General Education Concentrations

EC/MA 342. Optimal Control Theory with Economic Applications.

Optimal control theory unifies numerous economic problems related to the creation and use of physical capital. This course introduces optimal control theory as a tool for dynamic optimization and applies that theory to a variety of classic economic problems involving capital. Among the economic problems examined are optimal use of a renewable resource, optimal use of a nonrenewable resource, and optimal economic growth when growth begets pollution. The course includes formally proving Pontryagin's maximum principle, which characterizes dynamic optima, in the special case context of common economic problems. Prerequisite(s): Mathematics 206 and one economics course. M. Murray.
Concentrations

ECON 349. The Economics of Taxation.

Governments finance their activities by taxing or borrowing. Do taxes promote economic efficiency? Are taxes fair? In this context and with a focus on the U.S. tax structure, students examine taxes on personal and corporate income as well as taxes on consumption and wealth, considering these questions: Should we repeal the "death" tax? Should we reduce taxes on capital gains? Should we eliminate double taxation on dividends? Should we replace our income tax with a flat tax plus a negative-income tax? Would a value-added tax be better than an income tax? Are deficits a tax on future generations? Prerequisite(s): Economics 255, 260, and 270. G. Perkins.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 350. Microeconomics of Banking.

Financial intermediation is a sine qua non for exchange in any but the simplest of barter economies. The course explains why banks and other financial intermediaries exist and how they facilitate exchange. A balance is struck between institutional aspects of intermediation and the theory of banking. Topics include the lender-borrower relationship, equilibrium and rationing in the credit market, bank runs and systemic risk, managing risks in the banking firm, regulation of intermediaries, and the macroeconomic consequences of financial imperfections. Prerequisite(s): Economics 255, 260, and 270. G. Perkins.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 360. Independent Study.

Students, in consultation with a faculty advisor, individually design and plan a course of study or research not offered in the curriculum. Course work includes a reflective component, evaluation, and completion of an agreed-upon product. Sponsorship by a faculty member in the program/department, a course prospectus, and permission of the chair are required. Students may register for no more than one independent study per semester. Normally offered every semester. Staff.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 457. Senior Thesis.

Prior to entrance into Economics 457, students must submit for approval a thesis proposal based on work done in a nonintroductory course. Economics 457 is for fall theses and Economics 458 is for winter theses. Honors thesis writers enroll for both Economics 457 and Economics 458. Prerequisite(s): at least two 300-level economics courses. [W3] Normally offered every year. Staff.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 457, 458. Senior Thesis.

Prior to entrance into Economics 457, students must submit for approval a thesis proposal based on work done in a nonintroductory course. Economics 457 is for fall theses and Economics 458 is for winter theses. Honors thesis writers enroll for both Economics 457 and Economics 458. Prerequisite(s): at least two 300-level economics courses. [W3] Normally offered every year. Staff.
Concentrations

This course is referenced by the following General Education Concentrations

ECON 458. Senior Thesis.

Prior to entrance into Economics 457, students must submit for approval a thesis proposal based on work done in a nonintroductory course. All majors take Economics 457; honors candidates take Economics 458 after completing Economics 457. Prerequisite(s): at least two 300-level economics courses. Department chair permission is required. [W3] Normally offered every year. Staff.
Concentrations

This course is referenced by the following General Education Concentrations

Short Term Courses

ECON 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. Enrollment limited to 30. Normally offered every year. B. Farber.
Concentrations

This course is referenced by the following General Education Concentrations

EC/ES s30. Visualizing Environmental Justice Using GIS.

This course offers experience with spatial environmental and economic analysis by using geographical information systems technology (GIS) to explore case studies on environmental and social change. Topics in environmental justice such as hazardous waste facility sitings, urban density, poverty, disaster management, and others are examined. Students use mapping technology and available data sources including census and landuse data to learn to apply visual technology for economic analysis. They study how the visualization and presentation of data can inform economic decision making and policy making. Prerequisite(s): Economics 101 or 103 and 250. Enrollment limited to 20. L. Lewis.
Concentrations

This course is referenced by the following General Education Concentrations

ECON s32. International Ecotourism: Picasso, Parks, and Picadillos.

This course focuses on the economics of international ecotourism. Students consider both the international-trade aspects of international ecotourism as well as the envrionemtnal externalities arising from tourism in the context of environmental economics. Students explore the differences between the local versus the macro impact of tourism. Additionally, they address the differences and similarities among types of tourism such as recreational tourism, adventure tourism, ecotourism, cultural tourism, and culinary tourism. Several short field trips are required. Prerequisite(s): Economics 221 or 222. Enrollment limited to 20. L. Lewis, D. Riera-Crichton.
Concentrations

This course is referenced by the following General Education Concentrations

EC/ES s33. Valuation of Human-Altered Ecosystems.

How is the value of an ecosystem altered by human development? Answering this question requires an understanding of both economics and ecosystem structure and function. In this interdisciplinary course, students explore the structure and function of ecosystems before and after human modification and the relationship of these characteristics to their economic value. Students focus on river systems in Maine from source to sea. This course involves many day trips and two longer trips off campus. Prerequisite(s): Environmental Studies 203 or Economics 222. Enrollment limited to 12. Instructor permission is required. H. Ewing, L. Lewis.
Concentrations

This course is referenced by the following General Education Concentrations

ECON s50. Independent Study.

Students, in consultation with a faculty advisor, individually design and plan a course of study or research not offered in the curriculum. Course work includes a reflective component, evaluation, and completion of an agreed-upon product. Sponsorship by a faculty member in the program/department, a course prospectus, and permission of the chair are required. Students may register for no more than one independent study during a Short Term. Normally offered every year. Staff.
Concentrations

This course is referenced by the following General Education Concentrations