Class notes
EPS notes for 1st year IRO
- Course
- Institution
the class notes for EPS in 1st year IRO. Including definitions and schemes. Grade 8.5
[Show more]
Seller
Follow
miaprobst
Content preview
MiaProbst
1st year class notes : Economics for Political Scientists
Overview
1. Lecture 1: introduction, growth and inequality
2. Lecture 2 : game theory
3. Lecture 3 : modeling
4. Lecture 4 : institutions, production and inequality
5. Lecture 5 : firms, principal-agent problem and transaction costs
6. Lecture 6 : firms, supply and demand
7. Lecture 7 : monopoly redux and macro labor market
8. Lecture 8 : time travel (credit and borrowing)
9. Lecture 9 : money and financial assets
10. Lecture 10 : market failures
11. Lecture 11 : governments and markets
12. Lecture 12 : globalization of commerce
13. Lecture 13 : environmental economics
,lecture 1 (02/11): intro & growth & inequality
what is the study of economics
- centers on the study of human behavior
- but w focus: eco incentives & eco outcomes
eco incentive: choose outcome that improves your economic welfare & how those choices
are shaped by markets & other circumstances
how ppl make choices under scarcity : eco vs sentiment
eco outcomes:
study indiv incentives = microeconomics
study of aggregated outcomes = macroeconomics
what eco does not tell → no moral judgment
⇒ study of the world as it is
pol scientists need to understand eco
- who gets what, where, when and how
- pol can shape eco incentives
1. key concepts
- nominal GDP (or GDP growth)
- GDP measured in current currency amount
- does not account for inflat° or diff in purchasing power across country
- “sticker price”
- real GDP (in constant price)
- important to measure change over time
- growth adjusted for changes in inflat°
- applies to any type of price measure
- translate current nominal prices → consistant baseline
- PPP
- change across countries & time
- adjust for differences in currencies & what they purchase
- generally translate local eco activity in $ of a particular year
- consumer price index (CPI)
2. nominal vs constant
, 3. economic growth
how to measure it ?
- GDP : compare size of ecos across time & countries
4. where do eco growth come from?
= learning to produce more w the same amount of stuff
increase: techno, human K, natural resources, law & creat institut° to make eco actv easier,
short term: ex:rainfall, war
5. what does GDP measure
gdp: measure the market value of all finished goods produced within a country (usually per
y).
finished good: good that will not be sold again as a part of another good
intermediate goods: goods that will be used to make something else that will be sold
capital goods: goods that are used to produce other goods but not a part of other goods
does not include: things imported from other countries
includes: exports
Y= C+I+G+(X-M)
y= gdp
c= consumer spending on finished goods
I= investment in capital goods
G= gov spending
X= exports
M= imports
GDP per capita
how wealthy a country is
GDP/populat°
6. calculate eco growth (tx de variat°)
7. wealth & health of nat°
gdp : calculates material values
BUT good indicator of “dev” bc correlated w health, happiness…
hockey stick : rapid, sustained growth in average living standards
8. faults of GDP
inequality across countries
1000 y ago world was flat: small diff between countries
1980 & since: skyscrapers increased
, 9. local & global inequality
eco → techno & capitalism
pol → demo & property rights
eco systems :
explosion growth rates correlate w development of diff eco systems (+ capitalist)
BUT no pure eco system
increase in eco growth likely starts w capitalism
capitalism: en eco system in which pv property markets & firms play an important role
⇒ eco system based on individualism & eco incentives
3 elements of capitalism
- pv property
- can keep gains of their labour protected from gov & others
- markets : allocat° of goods & services are determined by buying & selling, not govs
- firms (pv & organized)
what capitalism gives us
- division of labour
- specializat°
- entrepreneurial innovators
- new technology
incentives (incentive to work in smt you good at & being + compensated) & eco organizat°
→ leads to specializat° & division of labor : leads to + eco growth
self sufficiency road to poverty
every step of the way = someone specialized in a particular element
resources wasted to do everything by oneself → someone can do it + effiently
specializat°: when entity produces a + narrow range of goods and services that it consimes
aquiring the goods and services that is not producced by trade
division of labour: specializat° of producers to carry out diff tasks in the product° process
gains increased when individuals incentivized to do what they do best
techno innovat°
techno innovat° tied to improving eco & improving living standards
where do techno innvovat° comes from → incentives matter
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller miaprobst. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $5.14. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
52355 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now