Advanced Microeconomics 10 credits

This course provides you with a rigorous and analytical understanding of modern microeconomic theory and its applications. It helps you further develop the mathematical and analytical tools needed to analyse complex economic problems and to understand how individuals, firms, and institutions make decisions. The course strengthens your ability to think formally about economic relationships and equips you with techniques required for advanced economic modelling, preparing you for applied research and data-driven analysis in policy or business contexts. The course begins with a review of the standard models of consumer and producer theory, basic optimisation and comparative statics. You will apply these tools to model and interpret market structures, welfare outcomes, and efficiency implications. The course also explores externalities, public goods, and state intervention, showing how theory informs real-world policy design and resource allocation. Strategic interaction is examined through game theory, focusing on Nash equilibrium, market power, markets with asymmetric information and social choice. Numerical and computational methods are introduced to complement theoretical analysis and strengthen your ability to implement and interpret models in practice. By the end of the course, you will be able to formulate and solve advanced microeconomic models, critically evaluate theoretical and empirical research, and apply analytical tools to interpret complex market outcomes. You will also be prepared to use mathematical and computational techniques to connect theory with applied econometric and data analysis work in the wider programme. **Connection to Research ** The course is closely connected to research in economics through its emphasis on formal modeling, equilibrium reasoning, and the disciplined use of simplified theoretical frameworks. The analytical approach developed in the course mirrors the way economic research - both theoretical and applied - builds insight by isolating key mechanisms, making assumptions explicit, and deriving implications in a transparent and logically consistent manner. Familiarity with the material covered in the course is essential for applied work in economics. The models and equilibrium concepts studied form the conceptual backbone of applied fields such as applied microeconometrics, public economics, political economy, development economics and industrial organisation. In these areas, empirical analysis and policy evaluation rely critically on theoretical models to guide identification strategies, interpret empirical results, and assess counterfactual outcomes. **Connection to Practice ** The course provides you with a strong foundation for practical applications of economics by training you to analyse realworld problems using clear, structured, and internally consistent economic models. Although the course is theoretical in nature, the concepts and methods you learn are essential for applied work in areas such as policy analysis, regulation, competition and market design, business strategy, and institutional evaluation. In practice, economists do not apply theory mechanically; instead, you learn to use simplified models to clarify incentives, constraints, strategic interactions, and equilibrium effects in complex environments. By formalising economic situations, identifying relevant assumptions, and reasoning through equilibrium outcomes, you acquire tools that are directly transferable to applied settings, including the evaluation of market outcomes, policy interventions, and organisational or strategic decisions. **Connection to Ethics, Responsibility, Sustainability (ERS) ** The course integrates ethics, responsibility, and sustainability directly into its core content and assessment by providing you with analytical tools to understand how individual decisions, incentives, and institutional arrangements generate outcomes with ethical and societal consequences. These perspectives are embedded in the economic models and problems you work with, through concepts such as incentives, external effects, strategic interaction, information asymmetries, and collective decision making. Through lectures, problem sets, and written assessments, you analyse how markets and institutions perform under different assumptions and rules, and learn when decentralised decision making leads to socially desirable outcomes and when it does not. This approach allows you to assess responsibility and sustainability in settings where private incentives diverge from social objectives, where actions affect third parties or future generations, and where institutional design shapes outcomes. By engaging with these issues as part of the core analytical work of the course, you develop the ability to reason systematically about efficiency, fairness, accountability, and the trade-offs involved in policy and organisational decisions.