Economics 521b
Advanced Microeconomic Theory

Spring 2009
9:00-10:20 T TH, 28 Hillhouse, Room B1

Dirk Bergemann
30 Hillhouse Avenue, #24
432-3592
Email
Office hours 1:00-2:30 T

Juuso Valimaki
30 Hillhouse Avenue, #6
432-6519
Email
Office hours 1:00-2:30 T

---

Topic: This course covers selected topics in the economics of information and uncertainty. The first part of the course will cover the theory of mechanism design and some of its applications. The second part of the course will cover some recent papers in communication, learning and networks..

Course Requirements:  This course has four basic requirements. They are: (i) reading the assigned papers before the presentation in class, (ii) solving the problem sets, (iii) presenting one or two research paper and (iv) writing a term paper. The assignments will be given weekly or biweekly. Class participation, assignments, and the term paper will jointly determine the final grade.

Readings: The current reading list will be completed as the class proceeds.

Syllabus: The complete syllabus.

---

Schedule

Tuesday, January 13:
Introduction into Mechanism Design

• Lecture 1
  
  

Thursday, January 15:
VCG, Pivot, D’Aspremont-Gerard-Varet

• Lecture 2
• Homework 1
• Homework 1 Solution
  

Additional Reading:

• Boergers (2008)
• Rochet (1987)
• Roberts (1979)
• Green and Laffont (1986)
  

Tuesday, January 20:
First and Second Price Auctions

• Lecture 3
• Chapter 2 and Chapter 3 of Krishna (2002)
• Matthews (1988)

Thursday, January 22:
Optimal Auctions

• Lecture 4
• Homework 2
• Homework 2 Solution
  
• Chapter 5 of Krishna (2002)
• Myerson (1981)
  
  

Tuesday, January 27:
Bilateral Trade, Single Crossing

• Myerson and Satterthwaite (1983)
• Hagerty and Rogerson (1987)
  
  

Thursday, January 29:
Implementation

• Lecture 6
• Homework 3
• Homework 3 Solution

Tuesday, February 3
Matching Theory

• A. Roth and M. Sotomayor (1990); Two-SidedMatching: A Study in Game-Theoretic Modeling and Analysis, Econometric Society Monograph Series, Cambridge University Press.
• Lecture 7
  
  

Thursday, February 5
Large Matching Markets

• A. Roth and E. Peranson (1999) "The Redesign of the Matching Market for American Physicians: Some Engineering Aspects of Economic Design," American Economic Review, 89 (4) September, 748-780
• F. Kojima and P. Pathak (2008), "Incentives and Stability in Large Two-Sided Matching Markets," forthcoming, American Economic Review.
• Lecture 8

Tuesday, February 10
Implementation Theory

• Maskin (1999)
• Jackson (2001)
• Homework 4
• Homework 4 Solution

Thursday, February 12
class cancelled, make-up class Tuesday, April, 28th

Tuesday, February 17
Correlated Values and Surplus Extraction

• Lecture 13
  
  

Thursday, February 19
Common Value Auction

• Lecture 14
  
  

Tuesday, February 24
Information Aggregation and Large Auctions

Thursday, February 26
Information Aggregation and Large Auctions

· Lectures 15+16

· Homework 5

· Homework 5 Solution

Tuesday, March 3:

Information Orders

Thursday, March 5:

Information Orders

· Lectures 17+18

Tuesday, March 24:

Auctions and Information Acquisition

Thursday, March 26:

Auctions and Information Acquisition

· Lectures 19+20

Tuesday, March 31:

Bayesian Learning

Thursday, April 2:

Multi-Armed Bandits

· Lectures 21+22

· Homework 6

· Homework 6 Solution

Tuesday, April 7:

Social Learning

Thursday, April 9:

Social Learning

· Lectures 23+24

Tuesday, April 14:

Camilo Dominguez

· Local Information Transmission a, Local Information Transmission b,

Thursday, April 16:

Anne Guan

· Two-Sided Markets

Tuesday, April 21:

Eric Lu

· Dynamics and Stability of Constitutions, Coalitions, and Clubs

Thursday, April 23:

Muneeza Alam

· Dynamic Moral Hazard and Incentives

Friday, April 24: Make-Up

Douglas Norton

· Learning in Networks