SCEPA and INET are proud to present an online, semester-long 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 14: Social Coordination Problems in the economics of Keynes (Part B)
At first, the lecture presents the social interaction model of the product market which provides us with the price that ought to regulate the typical firm, in view of the respective prices of the competitor firms, so as for the former to effectively respond to the market challenges. The said model would also account for the markup and monopoly power. Subsequently, “the other side” of the market that comprises of the households and the way those households sell their labor is equally taken into account. Yet, in our account, one is expected to show how the households ought to decide on their own wages instead of simply determining the commodities’ prices. The narrative resembles the one of the previous prices which set the historical course of the typical firm. Finally, we shall demonstrate how these two models make an equilibrium, if put together, and how they form a general model of product and labor market. The lecture closes with a brief memorandum to the effective complexity theory and theory choice.
Advanced Microeconomics: Information and Behavior in Political Economy | Lecture 14 Social Coordination Problems in the economics of Keynes (Part B) | Duncan Foley | Leo Model Professor of Economics at the New School for Social Research | Spring 2016