微觀經(jīng)濟(jì)學(xué) Ch01.ppt

1、Chapter 1,The Market - Appreciating Economic Modeling,2,The Purpose of this Chapter,To begin to understand the art of building an economic model To begin to understand three basic elements of modeling in economics: Purpose Simplification through assumptions Value judgment,3,The Purpose of an Economi

2、c Model,The purpose of an economic model is to help provide precise insights (精確的洞察力）on a specific economic phenomenon. Thus: Different phenomena needs different model; Simplification by assumption is necessary,4,An Illustration: Modeling the Apartment Market,Purpose: How are apartment rents determi

3、ned? Are rents “desirable”? Simplifying assumptions: apartments are close or distant, but otherwise identical distant apartments rents are exogenous (外生變量） and known many potential renters and landlords,5,Two Very Common Modeling Assumptions,Rational Choice （理性選擇）: Each person tries to choose the be

4、st alternative available to him or her. Equilibrium （均衡）: economic agents interact with each other, resulting in an equilibrium, in which each person reaches an optimal decision given others decisions.,6,Modeling Apartment Demand,Demand: Suppose the most any one person is willing to pay to rent a cl

5、ose apartment is $500/month. Thenp = $500 QD = 1. Suppose the price has to drop to $490 before a 2nd person would rent. Thenp = $490 QD = 2.,7,Modeling Apartment Demand,The lower is the rental rate p, the larger is the quantity of close apartments demandedp QD . The quantity demanded vs. price graph

6、 is the market demand curve for close apartments.,8,Market Demand Curve for Apartments,p,QD,9,Modeling Apartment Supply,Supply: It takes time to build more close apartments so in this short-run the quantity available is fixed (at say 100).,10,Market Supply Curve for Apartments,p,QS,100,11,Competitiv

7、e Market Equilibrium(競爭性市場均衡）,Quantity demanded = quantity available price will neither rise nor fall so the market is at a competitive equilibrium.,12,Competitive Market Equilibrium,p,QD,QS,pe,100,People willing to pay pe for close apartments get close apartments.,People not willing to pay pe for c

8、lose apartments get distant apartments.,13,Comparative Statics（比較靜態(tài)分析）,What is exogenous in the model? price of distant apartments quantity of close apartments incomes of potential renters. What happens if these exogenous variables change? Note： We are not analyzing the transition process or dynamic

9、 process.,14,Comparative Statics,Suppose the price of distant apartment rises. Demand for close apartments increases (rightward shift), causing a higher price for close apartments.,15,Market Equilibrium,p,QD,QS,pe,100,Higher demand causes highermarket price; same quantitytraded.,16,More Comparative

10、Statics (Do Them Yourself),Suppose there were more close apartments. Or, renters income rises.,17,Elaboration of the Basic Model: Taxation Policy Analysis,Local government taxes apartment owners. What happens to price quantity of close apartments rented? Is any of the tax “passed” to renters?,18,Tax

11、ation Policy Analysis,Market supply is unaffected. Market demand is unaffected. So the competitive market equilibrium is unaffected by the tax. Price and the quantity of close apartments rented are not changed. Landlords pay all of the tax.,19,Imperfectly Competitive MarketCase 1： A Monopolistic Lan

12、dlord,Landlord sets a rental price p he rents D(p) apartments. Revenue = pD(p). He chooses p to maximizes p D(p), subject to D(p) = S (total number of apartments in his hands) Typically, his optimal p is such that D(p) S, that is, there are vacant apartments.,20,Monopolistic Market Equilibrium,p,QD,

13、QS,Middleprice,Middle price, medium quantitydemanded, larger revenue.Monopolist does not rent all theclose apartments.,100,Vacant close apartments.,21,Imperfectly Competitive Market Case 2： Perfectly Discriminatory Monopolistic Landlord,Imagine the monopolist knew everyones willingness-to-pay. Charg

14、e $500 to the most willing-to-pay, charge $490 to the 2nd most willing-to-pay, etc.,22,Discriminatory Monopolistic Market Equilibrium,p,QD,QS,100,p1 =$500,1,23,Discriminatory Monopolistic Market Equilibrium,p,QD,QS,100,p1 =$500,p2 =$490,1,2,24,Discriminatory Monopolistic Market Equilibrium,p,QD,QS,1

15、00,p1 =$500,p2 =$490,1,2,p3 =$475,3,25,Discriminatory Monopolistic Market Equilibrium,p,QD,QS,100,p1 =$500,p2 =$490,1,2,p3 =$475,3,26,Discriminatory Monopolistic Market Equilibrium,p,QD,QS,100,p1 =$500,p2 =$490,1,2,p3 =$475,3,pe,Discriminatory monopolistcharges the competitive marketprice to the las

16、t renter, andrents the competitive quantityof close apartments.,27,Rent Control(房租管制）,Local government imposes a maximum legal price, pmax pe, the competitive price.,28,Market Equilibrium,p,QD,QS,pe,100,pmax,Excess demand,The 100 close apartments are no longer allocated bywillingness-to-pay (lottery

17、, lines,large families first?).,29,Value Judgment（價值判斷）,Which of the following is better? Rent control Perfect competition Monopoly Discriminatory monopoly But, what do you mean by “better”?,30,Pareto Efficiency（帕累托效率）,Vilfredo Pareto; 1848-1923. A Pareto outcome allows no “wasted welfare” i.e. the

18、only way one persons welfare can be improved is to lower another persons welfare.,31,Pareto Efficiency,A Pareto inefficient outcome means there remain unrealized mutual gains-to-trade. Any market outcome that achieves all possible gains-to-trade must be Pareto efficient.,32,Pareto Efficiency,Competi

19、tive equilibrium: all close apartment renters value them at the market price pe or more all others value close apartments at less than pe so no mutually beneficial trades remain so the outcome is Pareto efficient.,33,Pareto Efficiency,Discriminatory Monopoly: assignment of apartments is the same as

20、with the perfectly competitive market so the discriminatory monopoly outcome is also Pareto efficient.,34,Pareto Efficiency,Monopoly: not all apartments are occupied so a distant apartment renter could be assigned a close apartment and have higher welfare without lowering anybody elses welfare. so the monopoly outcome is Paret