JOHN GRUBER: Why did the
gas price controls of 1973
cause long lines at the pump?
Why does Disneyland charge
less if you live nearby?
At what price are people
willing to risk their life?
Hi.
I'm John Gruber.
I'm professor of economics at MIT, and
I study why we do the things we do,
why we buy the things we buy, and how
we can improve our quality of life
in a world of limited resources.
In this course, we'll
explore these topics
through the three fundamental
questions of economics--
what goods and services get
produced, how are they produced,
and who gets them.
And all these three
questions are going to be
answered by understanding
the mechanism of prices--
the price of food, education, labor,
insurance, health care, and so on.
We'll spend the first third of the
course learning about consumers,
the next third about
producers, and the last third
about applications and special topics.
I think micro economics is a
little bit like engineering.
But instead of trying to minimize
the amount of steel in a bridge
or maximize the safety
of a car, we're trying
to optimize collective well-being.
To achieve this, we use mathematical
models of human behavior
that give shape and weight to
slippery concepts such as happiness.
Throughout the course, we'll check
these models against empirical results
from history and research, and we'll
consider how our new insights can
inform the creation of good policy.
MIT has a special history
in the field of economics.
Around the time of the Second World
War, the economist Paul Samuelson
developed a revolutionary new
curriculum for microeconomics, one
with a foundation of formal mathematics.
He developed it right here at MIT,
perhaps in the very lecture hall
that I use today.
We'll use the mathematical
models he developed,
the models that make economics
such a powerful tool.
Since marginal change is
at the heart of economics,
you should come into the class
with a solid understanding
of high school-level calculus.
By the end of the course, you'll
have a deeper understanding
of the complexities of public
policy and a mental toolkit
to help you make informed decisions
whenever you face a tradeoff.
You'll also be prepared to take further,
more specialized courses in economics.
I hope you'll join me in 14.100x as
we learn the tools to answer some
of the fundamental questions of the
human experience using microeconomics.
