The goal of this course is to provide students with the tools necessary to understand the economics behaviours of consumers, producers and markets. Special emphasis will be given to the functioning and malfunctioning (market failures) of the markets mechanisms. By reviewing a collection of real-world examples and applications, students will develop economic intuition and be stimulated to think more deeply about the technical tools they learn, and to find more interesting ways to apply them. This enables students to not just understand microeconomics, but to think like economists themselves.

Knowledge and understanding: The course will offer key theoretical tools for the analysis of microeconomic phenomena: consumption decisions, production, markets and their limitations (market failure, asymmetric information, public goods). Applying knowledge and understanding: The students will be able to examine and understand basic economic phenomena with the appropriate frames, models and terminology. Making judgements: We expect students to be able to understand the current debate on microeconomic phenomena and related policies and assess the sustainability, effectiveness and implications of the latter. Communications Skills: This course will give the students the possibility to acquire and understand major terms and concepts in order to communicate their ideas, proposals, analysis and critical reasoning in an appropriate way, but at the same time being able to convey effectively insights and economic implications to a non-specialized audience. Learning skills: This course will contribute to empower learners giving them very versatile tools that can be applied to many social and economic contexts. They can also be combined with knowledge from other disciplines to provide more accurate or alternative analysis.

INTRODUCTION Thinking Like an Economist Supply and Demand THE THEORY OF CONSUMER BEHAVIOUR Rational Consumer Choice Individual and Market Demand Applications of Rational Choice and Demand Theories Choice under Uncertainty and the Economics of Information Explaining Tastes: The Importance of Altruism and Other Non-Egoistic Behaviour Cognitive Limitations and Consumer Behaviour THE THEORY OF THE FIRM AND MARKET STRUCTURE Production Costs Perfect Competition Monopoly Imperfect Competition EXTERNALITIES, PUBLIC GOODS AND WELFARE Externalities, Property Rights and the Coase Theorem

Frank, Robert H., and Edward Cartwright. Microeconomics and behavior, 3rd Edition McGraw-Hill, 2020.

Face-to-face teaching and case studies will be complemented by practical exercises and classroom experiments. Students’ participation during lectures is strongly encouraged.

The exam consists of (i) a first midterm written exam, (ii) a second midterm written exam based on the practices, and (iii) a final written exam. In the two midterm exams and in the final written exam students are required to demonstrate that: • they have a solid understanding of the economic concepts and technical tools; • they have developed a critical and solid comprehension of consumer behavior theory and the firm and market structure theory; • they have a critical mind about functioning and malfunctioning of the markets mechanisms; • they are able to distinguish pros and cons of the standard economic theory. Midterm written exam and final written exam will count for 35% of the grade each. The second midterm written exam, will count for 30% of the grade.

In this course covers crucial aspects concerning sustainability, such as market efficiency externalities or the importance of altruism and other non-egoistic behaviour in economics.