Lec 6(1)

UNIV BEIJING TECHNOLOGY UNIV BEIJING POSTS & TELECOM Tsinghua UNIVERSITY SAMSUNG
HANGZHOU HUASAN 118 COMMUNICATION TECHNOLOGY UNIV NANJING POSTS&TELECOM TENCENT TECHNOLOGY 102 110 102
all given a . Then M(a) is an indirect objective function. Q: M(a)
a j ? j 1,..., m
Constrained maximization problem:
max f ( X；a ) s.t.g ( X；a ) 0 L f (X；a ) g (X；a ) M (a ) f ( X * (a ), a ) M (a ) a j L a j ，j 1,..., m
LECTURE 6 PREFERENCE AND CHOICE Ⅳ
吴建峰 复旦大学中国经济研究中心 2010 秋学期
First-10-mins
《自由人的平等政治》，周保松著，生活 •读书• 新知 三联书店 ，2010
年6月
罗尔斯(John Rawls, 1921-2002)的正义社会的定义： （1）每个人具有平等权利，在与所有人相类似的自由体系兼容的情况 下，享有最广泛的总体自由体系所赋予的相同的基本自由。 （2）不平等的安排： （a）在和公正的储蓄原则一致前提下，对社会中最弱势的人最为有 利； （b）在公平的平等的机会条件下，职位和工作向社会所有人开放。
First-10-mins
The growth of patent filings in Japan and the United States is slowing, while Chinese patent filings are surging in categories as varied as natural products and polymers and digital computers.
Recap from last lecture
There are two effects of a change in the prices of a good on the
demand: Income & Substitution effects.
Two approaches in analyzing the income and substitution effects:
Source: DAVID BARBOZA , China Poised to Lead World in Patent Filings, Economix, NYT, Oct 6th, 2010
Intermediate Microeconomics WU JIANFENG
2010 秋学期 Autumn Semester 2010
Intermediate Microeconomics WU JIANFENG
First-10-mins
Recent flows of private capital to
emerging markets.
--- Flows into 20 big emerging countries are now running at a faster pace than before the crisis (Brooks 2010). --- Policymakers in emerging economies fret that the upward pressure on exchange rates from the surge in foreign capital will cause their currencies to appreciate too much. --- The currencies of emerging Asian countries face the strongest upward pressure because of changes in the destination of private capital. --- Taking stronger controls in preventing or dampening private capital : China, Taiwan, South Korea, and Brazil, but India not. --- Despite the headlines China is not the
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ZHONGXING COMMUNICATION 1566 (ZTE COMMUNICATION) HUAWEI TECHNOLOGIES 1119
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UNIV BEIJING 604 AERONAUTICS&ASTRONAUTIC Zhejiang University Shanghai University YINGYEDA Tsinghua University INVENTEC CORP NANJING University H3C TECHNOLOGIES CO LTD 399 377 304 301 222 208 201
2010 秋学期 Autumn Semester 2010
Intermediate Microeconomics WU JIANFENG
Recap from last lecture
The Slutsky’s equation: the total effect
MWG: The derivative of the Hicksian demand function is equal to the alternative Slutsky’s compensation demand.
2010 秋学期 Autumn Semester 2010
Intermediate Microeconomics WU JIANFENG
Recap from last lecture
Demand curve
2010 秋学期 Autumn Semester 2010
Intermediate Microeconomics WU JIANFENG
Intermediate Microeconomics WU JIANFENG
2010 秋学期 Autumn Semester 2010
Recap from last lecture
Duality Endowment and labor supply Hicksian compensation and Slutsky’s compensation
Recap from last lecture
Duality Endowment and labor supply Hicksian compensation and Slutsky’s compensation
2010 秋学期 Autumn Semester 2010
Intermediate Microeconomics WU JIANFENG
2010 秋学期 Autumn Semester 2010
Intermediate Microeconomics WU JIANFENG
Endowment and demand (Cont’d)
Budget constraint revisited
• Given p1 and p2, the budget constraint for a consumer with an endowment (ω1, ω2) is p1x1+p2x2=p1 ω1+p2 ω2. • The budget set is {(x1,x2)∣ p1x1+p2x2≤p1 ω1+p2 ω2, x1≥0, x2≥0}
2010 秋学期 Autumn Semester 2010
Intermediate Microeconomics WU JIANFENG
Recap from last lecture
A case of normal goods: Slutsky’s approach
Substitution effect: the change in the consumption of the good when the consumer’s income is adjusted so that, at the new prices, he can only just buy the original bundles. Income effect:
most aggressive intervener in currency markets
Source: Flood barriers, The Economist, Oct 7th, 2010
2010 秋学期 Autumn Semester 2010
Intermediate Microeconomics WU JIANFENG
--- Hicks approach --- Slutsky apporach
2010 秋学期 Autumn Semester 2010
Intermediate Microeconomics WU JIANFENG
Recap from last lecture
A case of normal goods: Hicks approach
Substitution effect: the change of the consumption a good associated with a change in the price of that good, with the level of utility held constant. When the price of a good falls, the substitution effect leads to an increase in the consumption of that good. Income effect: the change of the consumption of a good brought about by the increase in the purchasing power, with the price of the good held constant. When the income increases, the change of the consumption of that good depends on whether it is a normal good or inferior good.