Department of Economics
Director of Graduate Studies
Visiting Associate Professor
Jan DeLoecker, also Woodrow Wilson School
Jakub W. Jurek
Greg W. Kaplan
Benjamin Moll, also Woodrow Wilson School
Eduardo Morales, also Woodrow Wilson School
Tom S. Vogl, also Woodrow Wilson School
Visiting Assistant Professor
Amanda D. Pallais
Victoria L. Prowse
Will Dobbie, also Woodrow Wilson School
Michal Kolesar, also Woodrow Wilson School
Juan Pablo Xandri
Lecturer with Rank of Professor
Smita B. Brunnermeier
Jean Baldwin Grossman, also Woodrow Wilson School
Thomas C. Leonard, also Council of the Humanities
Jean-Christophe de Swaan
Silvia Weyerbrock, also Woodrow Wilson School
Marco Del Negro
O. Griffith Sexton
Associated Faculty (Emeritus)
Thomas J. Espenshade, Sociology
Graduate instruction in the Department of Economics is designed to lead to the degree of Doctor of Philosophy (Ph.D.) in economics. The general purpose of the graduate program is to provide thorough training in both the techniques and the applications of economic analysis. Generally, courses are small in size and conducted in an informal manner. Reading courses that treat subjects not covered in the regular courses listed below may be arranged with individual faculty members. In addition, students are encouraged to do independent work and to participate in the several workshops sponsored by the department. Students may also take courses in the Woodrow Wilson School of Public and International Affairs, or other departments.
Satisfactory performance in the six first-year courses is required for passing the first part of the general examination. Students need to demonstrate competency in basic mathematics by passing a written examination. A course in mathematics for economists (ECO 500) is offered annually by the department and entering students with inadequate preparation are advised to take this course.
Students are expected to take at least six advanced courses during their second year. At the end of the second year, they are required to take examinations in two fields that are usually chosen from among the following list: (1) advanced macroeconomic theory, (2) advanced microeconomic theory, (3) behavioral/experimental, (4) demography, (35) econometrics, (46) economic development, (57) financial economics, (68) health economics, (7) industrial organization, (89) international money and finance, (910) international trade, (101) labor economics, (112) political economy, and (123) public finance. Students may also participate in the Program in Political Economy. Participation in this program requires that students take two designated graduate courses in politics and that they choose political economy as one of the two fields for the examination. Students are advised to consult with appropriate faculty members on the extent and the coverage of the fields.
In the thirdsecond year, students are also required to write a research paper on a topic of their choice. They must complete this paper with a grade of B or better by the end of their third year in order to continue in the program.
All students are encouraged to attend weekly seminars in their area of interest. Students who have passed their generals are expected to regularly attend one weekly seminar, and present their job market paper in a relevant seminar when it is ready.
There is no language requirement.
Students are granted an incidental master’s degree provideding they pass the six first-year courses with an average of 2.5 or better and two field examinations, or six courses beyond the first-year core. To obtain the Ph.D., the qualified candidate must also submit an acceptable written dissertation and pass a final public oral examination.
As a normal part of graduate training, students are required to serve as Assistants in Instruction (AI) during their third, and fourth and fifth years, teaching class sections or grading papers for either graduate or undergraduate courses. Experience gained in being an AI is very valuable for those seeking academic jobs. AI's are remunerated by the University.
Choice of Adviser Requirement
Students are required to choose an adviser before the end of their fifth semester of study in the program . The adviser must agree to supervise the student’s research for (at least) the remainder of that year. Though this initial adviser does not necessarily become the chair of the student's dissertation committee, students are required to have an adviser who agrees to chair the committee by the beginning of the seventh semester of study. This latter deadline is an outer limit, not a recommendation. Ideally students should find a dissertation committee chair during the third year.
Requirements for Post-Generals Students
Post-generals students must enroll in (at least) one of the graduate research seminars. Faculty in charge of the seminar will be responsible for awarding a P/F grade to each such enrolled student at the end of the academic year according to criteria deemed by them to be appropriate for that field. The student’s adviser may be consulted before the grade is awarded. A passing grade will be required for enrolled students to be readmitted and for students to be recommended for the non–enrolled status of ETDCC (enrollment terminated, degree candidacy continuing).
ECO 500 Mathematics for Economists
Juan Pablo Xandri
An exposition of those parts of mathematics necessary to equip the graduate student in economics with modern techniques of analysis and empirical investigation. (This is a service course.)
ECO 501 Microeconomic Theory I
Dilip Abreu, Faruk Gul
First term of a two-term sequence in microeconomic theory. Topics include consumer and producer theory, choice under uncertainty, and an introduction to game theory.
ECO 502 Microeconomic Theory II
Roland Benabou, Sylvain Chassang
Second term of a two-term sequence in microeconomic theory. Topics include static and intertemporal general equilibrium theory, public goods and externalities, auctions, mechanism design, bargaining, repeated games, social choice, and implementation.
ECO 503 Macroeconomic Theory I
This course is the first term of a two-term sequence in macroeconomics. Topics include consumption, saving, and investment; real interest rates and asset prices; long-term economic growth; money and inflation; and econometric methods for macroeconomics.
ECO 504 Macroeconomic Theory II
Greg Kaplan, Nobuhiro Kiyotaki
This course is the second term of a two-term sequence in macroeconomics. Topics include classical and Keynesian theories of cyclical fluctuations; the determination of employment and real wages; credit markets and financial stability; and stabilization policy.
ECO 505 Responsible Conduct of Research in Economics
This seminar is designed to help graduate students in economics cultivate ethical research practices they may apply in future work at or beyond the University. Students are encouraged to discuss concerns that may arise during the conduct of their research with experienced faculty and devise solutions for dealing with these concerns. The course provides necessary training for newly mandated RCR training for graduate students supported by government grants, and is required for successful completion of the program.
ECO 506 History of Economic Thought
Development of economic analysis from the 17th century to the end of the 19th, with special emphasis on the economic role of the state and other institutions and the philosophical background of economic doctrines is studied.
ECO 509/WWS 509 Generalized Linear Statistical Models
The analysis of survey data using generalized linear statistical models. The course begins with a review of linear models for continuous responses and then considers logistic regression models for binary data and log-linear models for count data, including rates and contingency tables and hazard models for duration data. Attention is given to the logical and mathematical foundations of the techniques, but the main emphasis is on the applications, including computer usage. The course assumes prior exposure to statistics at the level of WWS507c and familiarity with matrix algebra and calculus.
ECO 511 Advanced Economic Theory I
Topics vary from year to year reflecting, among other things, current developments and the instructor's interests. Topics covered in past years have included expected and nonexpected utility theory, intertemporal general equilibrium theory, evolutionary game theory, dynamic games, contract theory, theory of organizations, and bounded rationality.
ECO 512 Advanced Economic Theory II
Faruk Gul, Wolfgang Pesendorfer
Topics vary from year to year. See 511.
ECO 513 Advanced Econometrics: Time Series Models
Concepts and methods of time series analysis and their applications to economics. Time series models to be studied include simultaneous stochastic equations and VAR, ARIMA, and state-space models. Methods to analyze trends, second-moment properties via the auto covariance function and the spectral density function and methods of estimation and hypothesis testing and of model selection are presented. Kalman filter and applications as well as unit roots, cointegration, ARCH, and structural breaks models are also studied.
ECO 514 Game Theory
Qingmin Liu, Juan Pablo Xandri
Course provides a broad treatment of game theory and its applications, particularly in economics. Coverage includes topics such as common knowledge and rationality, refinements of the Nash equilibrium, auctions, bargaining, mechanism design, dynamic games, and reputation. This follows up on the introduction to game theory provided in the microeconomic sequence.
ECO 515 Econometric Modeling
Christopher A. Sims
The construction, estimation, and testing of econometric models as a process, from theory to model formulation to estimation and testing and back again to theory. Bridging the gap between theory and applied work. A series of topics in macroeconomic time series and microeconomic cross-sectional analysis that include consumption at the household and aggregate level, commodity prices, and nonparametric and parametric estimation.
ECO 517 Econometric Theory I
Christopher A. Sims
A first-year course in the first-year econometrics sequence, it is divided into two parts. The first gives students the necessary background in probability theory and statistics. Topics include definitions and axioms of probability, moments, some univariate distributions, the multivariate normal distribution, sampling distributions, introduction to asymptotic theory, estimation and testing. The second introduces the linear regression model and develops associated tools. Properties of the ordinary least squares estimator will be studied in detail and a number of tests developed.
ECO 518 Econometric Theory II
Bo Honoré, Ulrich Mueller
This course begins with extensions of the linear model in several directions: (1) predetermined but not exogenous regressors; (2) heteroskedasticity and serial correlation; (3) classical GLS; (4) instrumental variables and generalized method of moments estimators. Applications include simultaneous equation models, VAR's and panel data. Estimation and inference in nonlinear models are discussed. Applications include nonlinear least squares, discrete dependent variables (probit, logit, etc.), problems of censoring, truncation and sample selection, and models for duration data.
ECO 519 Advanced Econometrics: Nonlinear Models
Economics 519 is half of the second-year sequence in econometrics methodology (Economics 513 is the other). The course covers nonlinear statistical models for the analysis of cross-sectional and panel data. It is intended both for students specializing in econometric theory and for students interested in applying statistical methods to statistical data. Approximately half of the course is devoted to development of the large-sample theory for nonlinear estimation procedures, while the other half concentrates on application of the methods to econometric models for discrete and limited dependent variables.
ECO 520/POL 577 Economics and Politics
Focused on analytical models of political institutions, this course is organized around canonical models and their applications. These include voting models, menu auctions, models of reputation, and cheap talk games. These models are used to explain patterns of participation in elections, institutions of congress, lobbying, payments to special interest groups, and other observed phenomena.
ECO 521 Advanced Macroeconomic Theory I
Nobuhiro Kiyotaki, Ezra Oberfield
Topics vary from year to year, reflecting current developments and the instructor's interests. Topics covered in the past years have included methods of numerical analysis and econometric testing of equilibrium business cycle models, the role of monetary and fiscal policy in inflation determination, the nature of optimal monetary policy, and dynamic games and time consistency in macroeconomic policy formation, central banking, and theories of price stickiness.
ECO 522 Advanced Macroeconomic Theory II
Greg Kaplan, Esteban Rossi-Hansberg
A continuation of Economics 521. Topics vary from year to year.
ECO 523 Public Finance I
A microeconomic examination of the role of government in the economy. Topics include the theory and measurement of excess burden, optimal tax theory, the analysis of tax incidence, and an examination of the effects of taxation on behavior.
ECO 524 Public Finance II
The course examines the collective-decision mechanisms through which government policy is formulated, with an emphasis both on theoretical models of social choice and positive studies of governmental decision making. Additional topics include social insurance and the study of intergovernmental fiscal relations, with attention given to the division of functions among levels of government and basic issues in state and local finance.
ECO 525/FIN 525 Asset Pricing
Valentin Haddad, Markus Brunnermeier
Asset pricing in competitive markets where traders have homogeneous information as well as empirical tests of asset-pricing models and associated "anomalies" are also surveyed. Measures of riskiness and risk aversion; atemporal asset-pricing models; dynamic portfolio choice; option pricing; and the term structure of interest rates, corporate investment and financing decisions, and taxation are studied.
ECO 526/FIN 52696 Corporate Finance
Hyun Shin, David Sraer
Theories and empirical evidence regarding financial markets and institutions that focus on asymmetric information, transaction costs, or both; and rational expectation models of asset pricing under asymmetric information, dynamic models of market making, portfolio manager performance evaluation, principal-agent models of firm managerial structure, takeover bids, capital structure, and regulation of financial markets are studied.
ECO 527/FIN 527 Financial Modelling
Yacine Aït-Sahalia, Jean Jacod
Advanced asset pricing and corporate finance including a selection from: models of financial crises and bubbles; interaction between finance and macroeconomics, derivative pricing in incomplete markets; tests of asset pricing models and associated anomalies; models of investor behavior; financial econometrics, including tests of asset pricing models and methods for high frequency data. Pre-requisites: ECO 525 and 526 (526 may be taken concurrently).
ECO 531 Economics of Labor
Alexandre Mas/, Henry FarberStaff
An examination of the economics of the labor market, especially the forces determining the supply of and demand for labor, the level of unemployment, labor mobility, the structure of relative wages, and the general level of wages.
ECO 532 Topics in Labor Economics
Henry S. FarberWill Dobbie, , Cecilia E. Rouse, Alexandre Mas
The course surveys both the theoretical literature and the relevant empirical methods and results in selected current research topics in labor economics.
ECO 535 Urban Economics
StaffEdwin S. Mills
Theoretical and empirical analyses of growth, structure, and resource allocation in the urban economy are studied. Special attention is given to the efficiency of markets in a spatial context. The final part of the course deals with selected urban problems, such as slums and blight, transportation, and the finance of public services.
ECO 541 Industrial Organization and Public Policy
Methods for empirical and theoretical analysis of markets composed of productive enterprises and their customers are studied. Analyses are applied to modern market structures and practices and the public policy toward them. Topics include the roles of technology and information; the structure of firms; modes of interfirm competition; determination of price, quality, and research and development investment; and criteria for government intervention.
ECO 542 Industrial Organization and Public
Jan De Loecker, Eduardo Morales
Theoretical and empirical study of the public regulation and deregulation of rate of return, prices, and entry in public utilities and franchise oligopolies. Theory and practice of antitrust policy is examined, including some elements of antitrust law. In addition, regulation of product quality, advertising, and safety is examined. This course draws heavily on material developed in 541.
ECO 551 International Trade I
Stephen Redding, Gene Grossman
The determinants of foreign trade: (1) intercountry differences of factor endowments and technologies and (2) scale economies and imperfect competition are studied. Dynamic comparative advantage; innovation and growth; factor movements and multinational corporations; gains from trade; tariffs and quantitative restrictions on trade and their role in dealing with market failures and oligopolies; the political economy of trade policy; international negotiations on trade policy; and economic integration are studied as well.
ECO 552 International Trade II
Eduardo Morales, Esteban Rossi-Hansberg
A continuation of Economics 551, with emphasis on current research issues. Topics vary from year to year.
ECO 553 International Monetary Theory and Policy I
Course develops core models of international finance and open-economy macroeconomics and surveys selected current research topics in the field. Topics include investment and the current account, international capital market integration, international transmission of business cycles, international borrowing and default, the determination of nominal and real exchange rates, monetary and fiscal policy in the open economy, alternative exchange rate arrangements, and policy interdependence and coordination.
ECO 554 International Monetary Theory and Policy II
Advanced topics in monetary economics, with an emphasis on open economies. Price-level and exhange-rate determination under alternative monetary policy rules; money demand and currency substitution; real effects of monetary disturbances; exchange-rate policy and macroeconomic stability; welfare effects of exchange rate stability; advantages and disadvantages of monetary union.
ECO 562 Economic Development I
Anne Case, Thomas Fujiwara
An examination of those areas in the economic analysis of development where there have been recent analytical or empirical advances. Emphasis is given to the formulation of theoretical models and econometric analysis and testing. Topics covered include models of household/farm behavior, savings behavior, equity and efficiency in pricing policy, project evaluation, measurement of poverty and inequality, and the analysis of commodity prices.
ECO 563 Economic Development II
Anne Case, Angus Deaton
Selected topics in the economic analysis of development beyond those covered in 562. Topics are selected from theoretical and empirical models of economic growth, trade, and international finance; health and education policy; innovation in agriculture in developing countries; private and social security systems; and the political economy of development. Prerequisite: 562.
ECO 565 Health Economics I
Examines health issues in the developed world. Specific topics include the evolution of health over the life course; the fetal origins hypothesis; the two-way links between socioeconomic status and health; the impact of social safety nets on health outcomes; environmental threats to children’¿s health and development; health insurance and its effects on health; the industrial organization of health care delivery. Prerequisites: PhD-level microeconomics and econometrics.
ECO 566 Health Economics II
Examines issues in global health. Specific topics include effects of health on growth and development; health, nutrition and productivity; the relationship between health and height; the relationship between education and health; structural problems in health service delivery in developing countries; and the impact of the AIDS crisis on economic wellbeing; measurement of health and well-being around the world. Prerequisites: PhD-level microeconomics and econometrics.
ECO 571/POP 501 Survey of Population Problems
Survey of past and current trends in the growth of the population of the world and of selected regions. Analysis of the components of growth and their determinants. The social and economic consequences of population change.
ECO 572/POP 502 Research Methods in Demography
Georges R. Reniers
Source materials used in the study of population; standard procedures for the measurement of fertility, mortality, natural increase, migration, and nuptiality; and uses of model life tables and stable population analysis and other techniques of estimation when faced with inaccurate or incomplete data are studied. Prerequisite: 571 or instructor's permission.
ECO 573/WWS 567 Population and Development
Determinants of demographic behavior in developing countries and the economic consequences of population change. Participants investigate areas such as high fertility as a peasant economic strategy; the relationship between fertility, children's education, and household savings; the impact of population growth rates on wages, rents, the distribution of income, aggregate savings, and technical change; models of internal and international migration. Prerequisite: 507c and 511c, or their equivalents.
ECO 576/POL 584 Foundations of Political Economy
Course focuses on modeling the interaction of politics and economics, with applications to a variety of substantive areas. Topics include: poltics of taxation and redistribution; governmental structure, political economy of constitutional arrangements, development, and growth. Familiarity with microeconomic theory and POL 575 or the equivalent are prerequisites.
ECO 577/POL 588 Laboratory Experiments in Economics and Political Science
Introduction to laboratory experimentation in economics and political science for graduate students. Topics include: auctions, markets, bargaining, voting, abstract games, collective action, and decision theory. Students will design an experiment. Prerequisites: ECO 501 and 502 or equivalent.
ECO 581 Seminars on Research in Progress
Drafts of papers, articles, and chapters of dissertations or books, prepared by graduate students, faculty members, or visiting scholars, are exposed to critical analysis by a series of seminars organized by field. The chief objectives are for the writers to receive the benefit of critical suggestions, for all participants to gain experience in criticism and uninhibited oral discussion, and for students and faculty members to become acquainted with the research work going on in the department. Third-, and fourth- and fifth-year graduate students are expected to attend; first- and second-year students and faculty members are invited to attend.
ECO 581A Microeconomics Theory Workshop
See ECO 581.
ECO 581B Microeconomic Policy Workshop
See ECO 581.
ECO 581C Macroeconomics/International Finance Workshop
See ECO 581.
ECO 581D Labor Economics/Industrial Relations Seminar
See ECO 581.
ECO 581E Research Program in Development Studies
See ECO 581.
ECO 581F Trade Workshop
See ECO 581.
ECO 581G Econometric Research Seminar
See ECO 581.
ECO 581H Civitas Foundation Finance Seminar
See ECO 581.
ECO 581I O.P.R. Seminars
See ECO 581.
ECO 581J Behavioral Economics Workshop
Seminar led by different guest professors each week to discuss their current research in the field of Behavioral Economics.
ECO 581K Political Economy Workshop
ECO 581L/WWS 590A Economic Perspectives on Inequality (Half-Term)
Janet M. Currie
Economics is centrally concerned with models of human capital development, educational attainment, labor market dynamics, unemployment, labor turnover, job duration, wage setting institutions, the role of unions, human capital formation, the relationship between economic status and other aspects of well-being (including health). Economists are essential partners in the behavioral study of preferences and decision making, mobility and redistribution, and the institutions of industrial relations that govern the labor market.
ECO 585 Extramural Summer Research Project
Summer research project designed in conjunction with a faculty advisor and an industrial, NGO, or governmental sponsor that will provide relevant research experience. A final paper is required.
ECO 591 Portfolio Theory and Asset Management
This course studies the asset allocation decisions and overall management of the risk and return characteristics of portfolios. It focuses on quantitative approaches to portfolio optimization, including dynamic strategies to control risks and to achieve investment goals; empirical studies of asset returns; and the money management industry. Although the material is similar to that covered in Eco 415, Eco 591/Fin 515 will go into greater depth, requiring greater technical and mathematical skills, and successful completion will require deeper understanding of the material.