Universitas Faculty of Economics

Indonesia and Business

Master of Economics Planning and Development Policy

SYLLABUS
MICROECONOMIC FOR POLICY 2
First Semester of 2018/2019

Lecturers
No. Name E-mail

Tutors
No. Name E-mail
1. (to be announced) -

Subject Code ECEM 800103

Subject Title MICROECONOMIC FOR POLICY 2
Credit Value 2
Year/Semester 1/2
Day/Hour -
Subject Type Study Program Compulsory
Pre-requisite Microeconomic for Policy 1
Role and This course teach about the principles of economy, especially the concept and application
Purposes of microeconomics needed to understand and analyze public policy. By studying how
individual (household and firm) make decisions and interact in the market, students can
gain a better understanding of the potential and limitations of a public policy. Within this
course, students will be taught a variety of microeconomic tools that useful in explaining
the real world and its relation to public policy, including analytical framework to resolve
economic problem. As the continuation of Microeconomics for Policy 1, major theories of
microeconomics discussed in Microeconomics for Policy 2 is Market Structure and Market
Failure.This course can be followed properly if the students have been able to master the
basic knowledge of calculus and understanding of the diagram, because the majority of
teaching activities will use diagrams and mathematical language other than verbal
language.

Subject Learning Course Objectives:

Outcomes Hard Skills (related to increased cognitive ability)
a. Able to calculate the social cost that ocuur in the society as the effect of the
monopoly and monopsony practice (C4, A3)
b. Able to analyze government policies related to the practice of monopoly and
monopsony in the economics framework (C4, A3)
c. Able to analyze the concept of pricing on industry or company who has some
monopoly power (C4, A3)
d. Able to analyze the practice of price discrimmination, bundling, and tying
(C4, A3)
e. Able to analyze government policies related to monopolistic market practices
within economics framework (C4, A3)

1
 f. Able to solve calculations of nash equilibrium, cournot equilibrium, bertrand
equilibrium, and stackelberg equilibrium (C4, A3)
g. Able to analyze pricing and output strategy in oligopoly market (C4, A3)
h. Able to analyze market strategy based on game theory (C4, A3)
i. Able to analyze government policies related to the labor market and labor
unions (C4, A3)
j. Able to compare the concept of general equilibrium and partial equilibrium
within economic framework (C5, A4)
k. Able to analyze government policies in the conditions of market failures:
externalities, imperfect market, assymmetric infomation, and public goods.
(C6, A4)
Soft Skills
a. Developing qualitative analytical skill
b. Developing quantitative analytical skill
c. Developing presentation skills
d. Developing group collaboration skills
e. Developing confidence
AACSB Learning Goal (LG) and Learning Objective (LO):
Assessed LG and LO:
a. LG Knowledge in Applied Economics (KNO): Students are able to apply
economics theory in policy
LO: Able to explore economic issues and relevant policies using appropriate
economic theories (LG KNO – LO1)
[1] Students demonstrate an understanding of economic theories
[2] Identify the element of economic problem and policy issues
[3] Students are able to explore economic issues and its relevant policies
using appropriate economic theories
LG and LO for Teaching and Learning Activities (TLA):
a. LG Critical Thinking (CT): Students are able to demonstrate critical and
integrative thinking in policy design
LO: Students are able to provide policy recommendations to solve economic
problem (LG CT – LO1)
[1] Students are able to identify problems
[2] Students are able to analyze problems

Subject Synopsis/ Session Topics Subtopics Readings

Indicative Syllabus 1,2,3 Review: Analysis  Efficiency analysis of the P = 9, 16
of Competitive competiive market NS = 9, 10
Market and the  Evaluating gains and losses M = 6, 7
Concept of General from government policies
Equilibrium  General Equilibrium and
Economic Efficiency
Monopoly and  Sources of monopoly power P = 10, 11
Pricing with  Social cost of monopoly NS = 13
Market Power power M = 5, 6
 Monopoly vs Monopsony
 Price discrimmination: 1st,
2nd, and 3rd degree price
discrimmination,
intertemporal price
discrimmination, peak load
pricing
 The two part tariff
 Bundling and tying
4 Monopolistic, Monopolistic Competition: P = 12, 13
Oligopoly, and  Characteristic of the NS = 5, 12
Game Theory monopolistic competition M = 16, 17
 Monopolistic price and
quantity in the short run and

2
 long run equilibrium
 Excess capacity theorem

Oligopoly competition:
 Characteristic of oligopoly
 Kinked Demand Curve
 Cournot, Bertrand, and
Stackelberg model

The concept of game theory and

competitive strategy

5 Market for factor  Competitive factor markets P = 14

input  Equilibrium in competitive NS = 13, 14
factor market M = 18
 Factor market with
monopsony power
 Factor market with monopoly
power
Mid Term Examination

6,7 Market Failure  Why markets fail P = 17, 18

 Externalities: Positive and NS =15, 16
negative externalities M = 10, 11
 Public Goods
 Markets with Asymmetric
Information: adverse selection
and moral hazard
 Ways of correcting market
failure

8,9,10 Paper Writing  Outline paper Borang

 Draft Paper Paper
 Presentation

Final Examination

Teaching method uses active lecturing and class discussions, in which students achieve
the study objectives by discussing and completing related problems or cases under the
guidance of lecturer and tutor. The problems and cases are taken from the textbook
and other sources. Students are expected to read required readings for a particular
session. There are several sessions that use collaborative learning and case study.

Participation:
Individually, each student is required to participate actively in teaching and learning,
in the form:
1. Ask questionsin accordancewith thetopic.
2. Preparingto answerquestions.
3. Discuss issuesrelated to thetopic.
To be eligible, students must read textbooks and other materials provided.
Attendance:
Minimum 80% of Total Lecture:
1. A maximum of 3 (three) times absent, for no reason.
2. Students who came 15 minutes after class begins is considered not present.

3
Teaching/Learning
Methodology Description
Assessment Group Assessment LG LG LG
Method in Percentage of KNO – KNO – KNO –
TLA
Alignment with evaluation* LO1** LO1** LO1**
Intended Learning Trait 1 Trait 2 Trait 3
Outcomes
*) Students grading
**) AACSB
Mid Examination 40% 30%
Assessment
Quiz 20%
Paper 40% 40% 30%
Total 100%
The specific learning
methods used in this subject
are:
1. Class Discussion
2. Lecture
3. Discussion and
Presentation for
paper writing.
Details of learning 4. Tutorial will be held four (4) times in one semester (3 before Mid exam, 1
methods after final exam)
Assistance Class Contacts
Schedule
Student study Lectures
effort expected Tutor 16 Hours
Collaborative learning 8 Hours
Case study and presentation 10 Hours
Other student study effort outside the class 17 Hours
Preparation for assignment/tests
[1] Pindyck, Robert S. & Rubinstein, Daniel L., 28 Hours
(2013). Microeconomics, 8th edition, Upper
Saddle River, NJ: Pearson. [P]
Additional Reference :
[2] Nicholson, Walter and Snyder, Christopher,
(2007), Intermediate Microeconomics and Its
Application, 11th Edition. Mason, OH: South-
Western. [NS]
[3] Mankiw, Gregory, (2012), Principles of
Economics, 7th edition, Cengage Learning. [M]

Reading list and Students should maintain originality and respect intellectual property rights. Therefore,
references students should avoid conducting any act of plagiarism when doing written
assignments (if any), which may take a form of short individual / group paper and / or
summary.
The followings are acts of plagiarism:
 Copying paragraphs, sentences, a single sentence, or even a significant part of a
sentence directly without enclosing them in quotation marks and appropriately
footnoted;
 Using and / or developing other’s ideas found in printed materials or film elsewhere
without explicitly referencing them to the respective author or the source of the
idea.
[4] Plagiarism is a serious infringement of intellectual property rights. Any
assignment that contains presumed plagiarism will be marked 0 (zero).
Plagiarism