Microeconomics: When Markets Fail

Start Date: 02/23/2020

Course Type: Common Course

Course Link: https://www.coursera.org/learn/microeconomics-part2

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About Course

Perfect markets achieve efficiency: maximizing total surplus generated. But real markets are imperfect. In this course we will explore a set of market imperfections to understand why they fail and to explore possible remedies including as antitrust policy, regulation, government intervention. Examples are taken from everyday life, from goods and services that we all purchase and use. We will apply the theory to current events and policy debates through weekly exercises. These will empower you to be an educated, critical thinker who can understand, analyze and evaluate market outcomes.

Course Syllabus

In the first part of the course we learnt that if we allow market forces to work we reach an efficient outcome: the maximum benefit that can be generated by a market. The second part of the course explores cases where the markets fail to accomplish our goals. This week sets up the benchmark case of the perfectly competitive market: a model we will modify in the next few weeks. We define Perfect Competition, learn to model it graphically and discuss some key results in terms of long run profits and implications for efficiency.

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Course Introduction

Microeconomics: When Markets Fail An introduction to the microeconomics of markets in action. We explore what happens to individuals or groups of individuals who do not have access to the most efficient market price. We also examine supply and demand and discuss equilibrium. We end by looking at the optimal price and the imperfect information that is required to make a price-demand trade-off clear. What you’ll learn: • What is Microeconomics? • The basic concept of prices and prices-demand curves • How prices are set by and maintained at equilibrium • How information and information requirements are introduced • The Nash equilibrium price-demand curve • How firms compete • How to maximize returns • The optimal price and optimal information-gathering strategies • How firms compete when prices are high and profits are low--and how to maximize profits • How firms can price-trap • How information-gathering and firm control are necessary to an equilibrium • How information-intensive markets work • How firm strategies can affect market outcomes • How firms can price-trap • How firms can abuse their power of market exaction • How competition among firms can lead to market failure • What can be done about it? Recommended Background: To gain in-depth knowledge in the microeconomics of markets, it is necessary to have mastered basic economics topics in

Course Tag

Externality Economics Microeconomics Market (Economics)

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