M.Sc. (Economics)

Sem. I (Paper: I)

Sr. No.

Subjects of Study

I

Demand Analysis: Utility theory – Ordinal approach-Indifference curve (income and substitution effects, Slutsky theorem, compensated demand curve) and their applications; Revealed preference theory; Revision of demand theory by Hicks; Characteristics of goods approach (Lancaster); consumer’s choice involving risk (N-M hypothesis) – Friedman-Savage, Markowitz hypotheses; indirect utility functions (duality theory); Recent developments in demand analysis (pragmatic approach and linear expenditure systems); Inter-temporal consumption; Elementary theory of price formation – demand and supply equilibrium; Cobweb theorem; lagged adjustment in interrelated markets.

II

Theory of Production and Costs Production function – short period and long period; law of variable proportions and returns to scale; Isoquants – Least cost combination of inputs; Returns to factors; Economies of scale; Multi-product firm; Elasticity of substitution; Euler’s theorem; Technical progress and production function; Cobb-Douglas, CES, VES and Translog production functions and their properties; Empirical work on production functions; Traditional and modern theories of costs – Empirical evidence; Derivation of cost functions from production functions; derived demand for factors.

III

Price and Output Determination–Perfect competition and Monopoly Marginal analysis as an approach to price and output determination: perfect competition–hort  run  and  long  run equilibrium of the firm and industry, price and  output  determination,  supply  curve; Monopoly–short   run   and   long   run equilibrium, price discrimination,  welfare aspects, monopoly control and regulation.

IV

Monopolistic Competition and Oligopoly Models Monopolistic competition – general and Chamberlin approaches to equilibrium, equilibrium of the firm and the group with product differentiation and selling costs, excess capacity under monopolistic and imperfect competition, criticism of monopolistic competition; Oligopoly – Non-collusive (Cournot, Bertrand, Edgeworth, Chamberlin, kinked demand curve and Stackelberg’s solution) and collusive (Cartels and mergers, price leadership and basing point price system) models; Price and output determination under monopsony and bilateral monopoly; Workable competition – Structure, conduct and performance norms – Concept of Contestable Market and global competition Baumol).

V

Alternative Theories of the Firm Critical evaluation  of  marginal  analysis; Baumol’s   sales   revenue   maximization model; Williamson’s model of managerial discretion; Marris model of managerial enterprise;  Full  cost  pricing  rule;  Bain’s limit pricing theory and its recent developments    including Sylos-Labini’s model;  Behavioural  model  of  the  firm; Game theoretic models.

Sem. I (Paper II)

I

National Income Circular flow of income in two, three- and four-sector economy; National income aggregates – measurement and interrelationship; National income and welfare.

II

Classical Macro Economics Simple Classical model –equilibrium output and employment; Quantity Theory of Money; Classical theory of interest rate; policy implications of the Classical equilibrium model; Classical model with savings and investment.

III

The Keynesian System Equilibrium in the Product Market – The aggregate demand and aggregate supply approach, Savings- Investment approach; Changes in equilibrium income – the Multiplier; The Keynesian theory of interest rate and money demand.

IV

Consumption Function Keynes’ psychological law of consumption; short run and long run consumption function; Income consumption relationship – absolute income, relative income, life cycle and permanent Income hypothesis; consumption function puzzle; Kuznets’ consumption function and Kuznets’ findings.

V

Investment Function Components of investment; marginal efficiency of capital and investment; accelerator and investment behaviour.

Sem. I (Paper III)

I

Terminology, Concepts and tools Constants, variables, parameters, intercepts Coefficients-Functions-inverse, general and specific functions-Equations-Applications-Demand and supply functions-Cost and revenue functions- Consumption function-IS & LM functions- Multivariable Functions-Market equilibrium.

II

Differential Calculus Rules of differentiation-slopes-linear and nonlinear functions-partial derivatives-higher order derivatives-Young’s Theorem-Constrained & unconstrained optimization- Lagrangian Multiplier- Interpretation-Use  of  derivatives  in  economics  – Maximization,  minimization, elasticities - Utility function – production function – revenue, cost and profit functions (simple problems).

III

Integration Concept-simple rules of integration-application to Consumer’s surplus & producer’s surplus-Costs & revenues.

IV

Matrices Fundamentals of linear algebra-matrix, solving equations-Crammer’s rule-Uses-Input-output analysis.

 V

Linear Programming Basic Concepts, formulation of an LP problem-feasible, basic and optimal solution graphic and simplex methods formulation of the dual of a programme and its interpretation applications of LP technique.

Sem. I (Paper IV)

I

Economic development and its Determinants: -
• Economic Growth & Economic Development
• Characteristics of Developing Economies
• Role of Economic & Non-Economic Factors in Economic Development
• Human Development: PQLI, Human Development Index, Gender Related Development Index, Gender Empowerment Measure & Human Poverty Index

II

Demographic Features & Infrastructure: -
• Population Growth
• Occupational Structure
• Rural-Urban Migration
• National Population policy (2000)
• Energy
• Social Infrastructure-Education and Health

III

Important Issues: -
•  Poverty
•  Inequality
•  Unemployment
•  Regional Imbalances
•  Parallel Economy

IV

Foreign Trade: -
•  Composition and Direction
•  Balance of Payments
•  Foreign Capital and Aid
•  Export Import policy
•  Foreign Trade policy

V

National Income, Planning and Economic Reforms:-
•  National Income : Growth & Structure
•  Planning In India : Objectives, Strategy, Failures & Achievements
•  Tenth and Eleventh Five Year Plans
•  Economic Reforms

Sem. I (Paper V)

I

Introduction:-
•  Nature and scope of Public finance
•  Role of Government Changing Perspective
•  Role of the Government in a Capitalist, Mixed and Socialist Economy
•  Fiscal functions of the government : Allocation, Distribution & Stabilization
•  Government as an agent for Economic Planning  and Development
•  Private and Public sector : Cooperation or Competition
•  Private goods, Social goods & Merit goods

II

Public choice and rationale for public policy:-
• Market failure: Imperfections, Decreasing costs, externalities, Uncertainty
• Problems for allocating resources: Problems of preference revelation, voting systems, Arrows impossibility theorem, An economic theory of democracy, political-eco-bureaucracy, Rent seeking and directly Unproductive profit seeking (DUP) activities.
•  Allocation of resources: Provision of public goods, Voluntary exchange models, Impossibility of decentralized provision of public goods( Contributions of Samuelson and Musgrave)
•  Demand revealing schemes for public goods (Tie bout model), Theory of clubbed goods

III

Taxation I: -
•  Taxation: Meaning, canons, classification
•  Tax ratio, Buoyancy, Elasticity
•  Optimal Taxation, Excess Burden of Taxes, Tax Neutrality

•  Effects of Taxation, Trade-off between Equity and Efficiency
•  Taxable Capacity : Meaning, Types, Measurement & Determinants

IV

Taxation II: -
• Double Taxation
• Incidence of Taxation
1.   Meaning & Distinction between Impact & Incidence
2.   Types & Theories of Tax Incidence
3.   Shifting of tax under different Cost conditions
4.   Shifting of tax under different market conditions (Perfect Competition & Monopoly)
5.   Forward & backward shifting
•  Principles of taxation: The Benefit approach, Ability to pay approach
•  Trends of Taxation in India

V

Public Expenditure:-
•  Public expenditure: Meaning, nature & classification
•  Wagners Law of Increasing State Activities
•  Wiseman Peacock Hypothesis
•  Pure Theory of Public Expenditure
•  Effects of Public expenditure
•  Trends of Public expenditure in India

Sem. I (Paper VI)

Objective: To create awareness regarding current trends, issues and research as related to various aspects of economics. Students will be assigned a topic in the beginning of the semester. They will be required to prepare and submit a project report on the same. A panel of external examiners will evaluate the same.

Sem. II (Paper I)

Unit 

Subjects of Study

I

Distribution Neo-classical approach – Marginal productivity theory; Product exhaustion theorem; Elasticity of technical substitution, technical progress and factor shares; Theory of distribution in imperfect product and factor markets; Macro theories of distribution – Ricardian, Marxian, Kalecki and Kaldor’s.

II

Welfare Economics Pigovian welfare economics; Pareto optimal conditions; Value judgement; Social welfare function; Compensation principle; Inability to obtain optimum welfare – Imperfections, market failure, decreasing costs, uncertainty and non-existent and incomplete markets; Theory of Second Best – Arrow’s impossibility theorem; Rawl’s theory of justice, equity- efficiency trade off.

III

General Equilibrium Partial and general equilibrium, Walrasian excess demand and input-output approaches to general equilibrium, existence, stability and uniqueness of equilibrium and general equilibrium, coalitions and monopolies; Production without consumption – one sector model, homogeneous functions, income distribution; Production without consumption – two sector model, relationship between relative commodity and factor prices (Stolper- Samuelson theorem), relationship between output mix and real factor prices, effect of changes in factor supply in closed economy (Rybczynski theorem), production and consumption – Introduction of contributions of Arrow and Debreu to General equilibrium analysis.

IV

Economics of Uncertainty Individual behaviour  towards  risk,  expected utility  and  certainty  equivalence  approaches, risk  and  risk  aversion  –  sensitivity  analysis, gambling  and   insurance,   the  economics  of insurance, cost and risk, risk pooling and risk spreading, mean-variance analysis and portfolio selection,      optimal      consumption      under uncertainty.

V

Competitive Firm under Uncertainty Factor demand under-price uncertainty, the economics  of  search  –  different  models,  the efficient  market  hypothesis, stochastic models of inventory demand; Market with incomplete information,  search  and  transaction  costs, the economics of information.

Sem. II (Paper II)

I

Neo Classical and Keynesian Synthesis the IS LM model; factors that affect the equilibrium income and interest rate; relative effectiveness of monetary and fiscal policies.

II

Macroeconomics in an open economy Mundell - Flemming model, imperfect capital mobility, perfect capital mobility.

III

Inflation and unemployment Inflation –Unemployment trade off - The Phillips Curve; The natural rate of unemployment hypothesis and Adaptive expectation hypothesis; Relationship between short run and long run Phillips’ Curve; Sacrifice Ratio and Policy of disinflation.

IV

Business Cycles Theories of Kaldor, Samuelson and Hicks; Goodwin’s model; Control of business cycles –relative efficacy of monetary and fiscal policies.

V

New Classical Macroeconomics the Keynesian Theory and the New Classical (Lucas) critique; Rational Expectations Model and its policy implications; A critical evaluation of Rational Expectations Model.

Sem. II (Paper III)

I

Univariate Analysis Measures of central tendency, dispersion - standard deviation, coefficient of variation, Lorenz curve, Gini concentration ratio – Skewness (simple problems).

II

Regression Analysis Correlation, regression, simple, multiple, linear (simple problems) – OLS-assumptions-violation of assumptions - heteroscedasticity, autocorrelation and multicollinearity (concepts only). Interpretation of Co-efficient -Introduction to non-linear regression.

III

Probability and distributions
Elementary probability theory, concepts, binomial, Poisson and normal distribution.

IV

Sampling Distributions Sampling distribution, standard error-testing of hypothesis:
χ2, F-ANOVA, testing correlation and regression coefficients.

V

Index numbers and Time Series Uses, selection of number of items, base year price relatives-Fisher’s ideal index-Factor reversal test-Time reversal test- Chain index-Base shifting –conversion of current price data into constant price data- price index numbers in India – Components of time series - Moving averages-Straight line trend- Seasonal Index.

Sem. II (Paper IV)

I

Agricultural Sector I:-
•  Progress in Agriculture under the Five year Plans
•  Land Reforms
•  Green Revolution
•  New Green Revolution
•  Irrigation & Other Agricultural Inputs

II

Agricultural Sector II:-
•  Rural Credit in India
•  Agricultural Marketing & Warehousing
•  Agricultural Prices
•  Food Security in India

III

Industrial Sector I:-
•  Growth & Pattern of Industrialization
•  Industrial Policy 1956, 1977, 1980 & 1991
•  Public Sector Enterprises & their Performance
•  Small Scale Enterprises

IV

Industrial Sector II:-
•  Disinvestment of Public Enterprises
•  Privatization
•  Industrial Sickness in India
•  Labour Relations & Social Security

V    

Prices, Money & Banking:-
•  Analysis of Price Behaviour In India
•  Commercial Banking In India
•  Review of Monetary Policy of RBI
•  Money & Capital Markets in India
•  Working of SEBI in India                                                  

Sem. II (Paper V)

I

Public Debt:-
•  Classical View, Sources, Classification & Effects of Public Debt
•  Burden of Public Debt on Future Generation
•  Redemption of Public Debt
•  Public Debt Management: objectives & Principles
•  Trends of Public Debt in India

II

Fiscal Policy:-
•  Fiscal Policy: Meaning, Objectives & Instruments
•  Fiscal Policy for  stabilization: Automatic Stabilizers & Discretionary Stabilizers
•  Interdependence of Fiscal & Monetary policies
•  Fiscal Policy in a developing economy
•  Balanced budget multiplier

III

Deficit Financing:-
•  Deficit Financing: Objectives, Role, Effects & Limits
•  The budgetary process in India: Preparation, legislation and execution
•  Budgetary Deficits
•  Central Government deficits since 1990-91
•  Fiscal Crisis & Fiscal Sector Reforms in India

IV 

Investment Evaluation:-
 •  Criteria for Public Investment
 •  Project Evaluation
 •  Cost benefit Analysis: Meaning, Criteria & Limitations
 •  Planning & Programme Budgeting system(PPBS)
 •  Zero Base Budgeting, performance budgeting, outcome budgeting, gender budgeting

V

Federal Finance:-
•  Essential Features,  & Principles  of Federal Finance
•  The Rationale of Fiscal Federalism
•  Vertical & Horizontal Imbalance
•  Finance Commission & Planning Commission
•  Centre State Financial Relations in India

Sem. II (Paper VI)

 1

Objective:
To create awareness regarding current trends, issues and research as related to various aspects of economics. Students will be assigned a topic in the beginning of the semester. They will be required to prepare and submit a project report on the same. A panel of external examiners will evaluate the same.