Class 9: Advanced Microeconomics

September 18, 2016

Learn Smith’s division of labor, Marx’s barter economy and explore the creation and use of commodity and non-commodity money.

SCEPA and INET are proud to present an online economics class - advanced microeconomics - taught by Duncan Foley, the Leo Model Professor of Economics at The New School. The series includes videos of 14 class lectures, including Professor Foley's presentations and discussions with students.

Class 09: Social Coordination Problems in Classical Political Economy (Part B)

Barter economy is fraught with several impediments. An individual willing to engage in barter transaction, must identify a counterparty willing to exchange a valuable product for the former’s merchandise. The lecture looks into barter trade-related disadvantages giving rise to the necessity for the introduction of a common mean of exchange, i.e. “money” – the one we have accustomed to. Money has the tendency to reduce the cost of transaction and the more producers decide to accept the money in excess of their need in exchange for their own product, the higher the payoff to any other producer from making similar decision – a case for strong strategic complementarity. At the end of the lecture, an introduction into the next discussion is taking place by investigating the sale and purchase building on the above money analysis.

Advanced Microeconomics: Information and Behavior in Political Economy | Lecture 09 Social Coordination Problems in Classical Political Economy (Part B) | Duncan Foley | Leo Model Professor of Economics at the New School for Social Research | Spring 2016