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What you will learn
By taking this free microeconomics course, you’ll be exposed to the economic way of thinking. You’ll understand how to use economics in your life and, ultimately, see the world differently.
We’ll cover fundamental microeconomics concepts like supply and demand and equilibrium. We’ll also answer questions such as: How are prices determined? What did Adam Smith mean when he said the market process works like an “invisible hand”? How is it that we have access to fresh roses in very chilly cities every Valentine’s Day? We will cover all the key topics including competition, monopoly, price discrimination, externalities, public goods and more.
There are no prerequisites to this course and it is accessible to a beginner.
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1. Introduction
Introduction to Microeconomics
2. Supply, Demand, and Equilibrium
The Demand Curve
The Supply Curve
The Equilibrium Price and Quantity
A Deeper Look at the Demand Curve
The Demand Curve Shifts
Change in Demand vs. Change in Quantity Demanded
A Deeper Look at the Supply Curve
The Supply Curve Shifts
Exploring Equilibrium
Supply and Demand Terminology
Does the Equilibrium Model Work?
3. Elasticity and Its Applications
Elasticity of Demand
Calculating the Elasticity of Demand
Office Hours: Elasticity of Demand
Elasticity of Supply
Elasticity and Slave Redemption
Applications Using Elasticity
4. Taxes and Subsidies
Commodity Taxes
Who Pays the Tax?
Tax Revenue and Deadweight Loss
Subsidies
Wage Subsidies
5. The Price System
I, Rose
A Price Is a Signal Wrapped up in an Incentive
Markets Link the World
The Great Economic Problem
Information and Incentives
Speculation
Prediction Markets
6. Price Ceilings and Price Floors
Price Ceilings
Price Ceilings: Shortages and Quality Reduction
Price Ceilings: Lines and Search Costs
Price Ceilings: Deadweight Loss
Price Ceilings: Misallocation of Resources
Price Ceilings: Rent Controls
Rent Control in Mumbai
Price Floors: The Minimum Wage
Price Floors: Airline Fares
Why Do Governments Enact Price Controls?
Price Controls and Communism
7. Trade
The Big Ideas of Trade
Comparative Advantage
Another Look at Comparative Advantage
Comparative Advantage Homework
Tariffs and Protectionism
Arguments Against International Trade
Avengers: The Story of Globalization (Optional)
8. Externalities
An Introduction to Externalities
External Benefits
Command and Control Solutions
The Coase Theorem
Trading Pollution
A Deeper Look at Tradable Allowances
Externalities and Incentives: The Economics of COVID
9. Costs and Profit Maximization Under Competition
Introduction to the Competitive Firm
Maximizing Profit Under Competition
Maximizing Profit and the Average Cost Curve
Entry, Exit, and Supply Curves: Increasing Costs
Entry, Exit, and Supply Curves: Constant Costs
Entry, Exit, and Supply Curves: Decreasing Costs
10. Competition and the Invisible Hand
Minimization of Total Industry Costs of Production
The Balance of Industries and Creative Destruction
11. Monopoly
Maximizing Profit Under Monopoly
Office Hours: Calculating Monopoly Profit
The Monopoly Markup
The Costs and Benefits of Monopoly
12. Price Discrimination
Introduction to Price Discrimination
The Social Welfare of Price Discrimination
Tying
Bundling
13. Labor Markets
The Marginal Product of Labor
Econ Duel: Is Education Signaling or Skill Building?
Human Capital and Signaling
The Tradeoff Between Fun and Wages
Compensating Differentials
Do Unions Raise Wages?
14. Public Goods and the Tragedy of the Commons
Public Goods and Asteroid Defense
A Deeper Look at Public Goods
Club Goods
The Tragedy of the Commons
15. Asymmetric Information
Asymmetric Information and Used Cars
Asymmetric Information in Health Insurance
Moral Hazard
Solutions to Moral Hazard
Signaling
16. Consumer Choice
Introduction to Consumer Choice
Budget Constraints
Indifference Curves
Consumer Optimization
17. Bonus Topics
Office Hours: Game Theory
