The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.

                                                                                                                                                                             ~Friedrich Hayek

Economics is an often misunderstood and sometimes maligned subject. For instance, economics is often called the "dismal science (Links to an external site.)". The wisdom of economists is nearly proverbial, but in a negative sort of way. Despite this prevailing prejudice, economics does have useful lessons for understanding the world around us and the purpose of the two-course series is to contribute to this understanding. The two courses in the economic sequence are aimed at providing a basic level of sophistication in economic matters that will help explain both the U.S. and the increasingly important global economies. The sequence is divided into two parts or courses. One is the macroeconomics part, emphasizing the aggregate or overall national economy. The second part of the sequence deals with the topics of microeconomics and how individuals and businesses operate in the context of supply and demand, the results of which affect macroeconomics.

The topics of the two courses combine to explain, and relate to one another, the terms you frequently encounter in newspapers, not only in the business section but often on the front page: supply and demand, interest rates, wages, financial markets, public goods versus private interests, regulation and deregulation, unemployment, the poverty level, inflation, fiscal policy, monetary policy, stimulus programs, trade balances, budgets and deficits, taxation, exchange rates, and the "global economy". At the macroeconomic level it is a method of analysis that helps us understand things that affect real people in real and often tragic ways. For instance, in New York City there are abandoned buildings containing four times as many dwelling units as there are homeless people. Yet, homeless people sleep on the sidewalks in winter. In many third-world countries, people are hungry despite vast amounts of the rich farmland. Why, despite hundreds of billions of dollars of foreign aid, are many countries still mired in abject poverty? Why did unemployment reach 25% and American corporations as a whole operate in the red for two consecutive years during the Great Depression of the 1930s? Why is the current unemployment rate at approximately 3.7% by one measure and 6% or greater by another, and what is the difference? Why does the Federal debt exceed $22 Trillion and what should the Federal government be doing to reduce it?

 

What will be the effects of the recent tax cuts by Congress? Should Congress raise minimum wages? How much? What about the Social Security program? Should we privatize it as some other countries have done? Should we have enacted the Affordable Care Act (Obamacare)? Is it a good idea to repeal it? What are the economic consequences of the War on Drugs? What have been the economic consequences of 9/11, the War on Terrorism, the increase in gas prices, the recent decrease in gas prices, and illegal immigration? What caused the great financial crash of 2008 and the subsequent recession? How have they affected you and why? What do these changes portend for you as a college student soon to become a working professional? As a citizen? These and many other problems can be analyzed from an economic perspective. Indeed, they must be analyzed, in part, from an economic perspective if we, as a society, are to arrive at solutions that will be effective.

An important thing to keep in mind as you complete this course is the fact that economics is about much more than the relatively "dry" sounding topics mentioned above. Economics is a social science that studies human behavior and human action (Links to an external site.). Economics is about a way of thinking. It is a structured and disciplined way of looking at our world and the behavior of the people in it with whom we must interact. The principles of economics can be applied in many areas other than business or making money (See Freakonomics (Links to an external site.)). Your understanding of the basic economic principles that are used to analyze these issues and others is the goal of this course. I want you to become an economic thinker! Becoming an economic thinker will help you make wiser decisions, not only economically, but in every other area of your life, as well.

The above cartoons prove that there can be some humor in thinking about economics. It is often dark humor but makes very important points about why the study of economics is something you should take seriously and, possibly, consider them the most important courses you will take in your college experience. Why? Because virtually every analysis and decision you make beginning when you wake up in the morning and throughout the day until you go to bed in the evening will be made, consciously or unconsciously, using the principles you will be exposed to in this class.

“Practical men who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back” J. M. Keynes

1976 Nobel Prize Winner - Dr. Milton Friedman

 

Following an initial introduction to important general economic concepts, including demand and supply, the course examines the U.S. economy from a microeconomic perspective.  It includes an analysis of (1) the theory of consumer behavior, (2) elasticity, (3) costs and supply, (4) market structure, (5) anti-trust law and regulation, and (6) factor markets. Prerequisite: MA103 (or ACT Math subscore ≥ 22)