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- My name's Kory Kroft.
I'm on faculty in the
Department of Economics
in the Munk School of Global
Affairs & Public Policy.
This year, I will be
co-teaching Microeconomics
for Policy Analysis with Stephan Heblich.
Microeconomics is a foundation course
with a focus in economic theory.
The course objectives are twofold.
On the one hand, the course
aims to provide students
with the tools in order
to better understand
and predict the effects of public policies
on individual behavior.
Secondly, the course
aims to provide students
with economic literacy
and improve comfort level
with economic language and arguments.
The course itself is
divided into four sections.
In the first section, we
review the theory of consumers
and consumer demand.
In the second section, we
review the theory of firms
and how firms make their
production decisions.
In the third section of the course,
we bring together consumers and firms,
allowing them to interact
in a market setting
and focus on the market outcome
or the allocation of resources.
And then finally, in the
last part of the course,
we focus on the normative
properties of the market outcome,
in particular, whether the market reaches
a desirable outcome on its
own or whether their scope
for government to improve
welfare on top of the market.
Okay, so one example where
the tools in microeconomics
could be very useful is in understanding
the trade-offs in government policies.
So take, for example,
the Canada Child Benefit.
As we discussed in the course,
there's a trade off
associated with such a policy.
On the one hand, the Canada Child Benefit,
which is a cash transfer
to low-income households,
is good from an equity perspective
because it reduces poverty at the margin.
On the other hand, there's a
potential cost to the program,
which is that because households
have more cash on hand,
they might have less incentive to earn
and they might cut back
on their labor supply
and reduce the earnings, which drives up
the cost of the government.
So this is a nice example
of a policy application
where the tools of
microeconomics can be used
to understand that fundamental trade off.
Okay, so now is a time more than ever
where government is very much involved
in the day-to-day decisions of households
and it's therefore evermore
important to understand
how government policies are impacting
both individual decisions
and affecting their welfare
and this is precisely
why it's a good time now
to study economics at Munk.
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