b.sc.(hons.) in economics

1

COURSE STRUCTURE

AND

SYLLABUS BOOK

FOR

B.Sc.(Hons.) in ECONOMICS

2017-20

2

Preamble

The School of Economics and Commerce under Adamas University, releases an aura of

smooth blending of knowledge of Economics with tools of Commerce required for Industry-

ready programmes. World economy today is dominated by industry and commerce. Expansion of

market within and across borders has given ample of opportunities for growth and development

of a country. Reduction in barriers has also widened the scope for an integrated economy through

trade and commerce. This has far reaching impact on employment generation both in industries

as well as services sector. The School of Economics and Commerce under Adamas University is

designed in such a way as to provide the necessary skills to the students such that they can

actively participate in modern era of globalized world and contribute to the society. Students

through active learning in this course will be able to understand the functioning of the dynamic

industrial world and provide efficient solutions to the challenging world of the twenty-first

century. Building a sound theoretical knowledge with practical applications are the building

blocks for the courses under school of Economics and Commerce.

The course for B.Sc. Economics Honours has been designed following the basic requirements

of University Grants Commission (UGC) under Choice Based Credit System (2010). The

minimum credit points which a student has to score is 150 to get the honours degree in

Economics, which is little ambitious as compared to UGC basic requirements, as it has strong

rationale too that will be discussed later. Besides, students will get opportunity to earn 12 credits

extra. Altogether, the total credit will not exceed more than 162, which is still lower than the

flooring of 180 at maximum, as prescribed by UGC.

The architecture of the course has made an attempt to keep the basic essence of the

fundamentals of Economics as a discipline, while complementing it with other subjects where it

has strong interface. Economics is about production-consumption, input-output, labour-industry,

state-policy, which ultimately ends up in one or other kind of ‘transaction’. The concept of

‘transaction’ is in core of economics, which has a debit and credit side to balance each other.

With that view in mind, some papers like ‘Principles of Accounting’, ‘Fundamentals of Finance’,

have been introduced in the very first year of the programme, to give undergraduate students the

basic understanding of accounting knowledge which will pave the ground to understand the logic

behind any economic transactions, as well as national income accounting, government budgeting

process, etc. Moreover, when macroeconomics posits the money market as a key instrument of

the system, the basic knowledge of time value of money and its application in different fields of

finance is complementary part of the knowledge set. When the students understand the

mechanics of interest rate determination, they must know the different sources of financing and

how interest rate plays a crucial role in that.

In the second year of the programme, another two papers like ‘Principles of Human Resource

Management’ and ‘Business Regulatory Framework’ has been incorporated in the structure as

Skill Enhancement Courses (SEC). The rationale is to just that, mere knowledge of labour

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market in Microeconomic perspective and their wage determination are not enough to understand

the practical field of labour market where actually the human resources are getting deployed and

being used. Their different incentive mechanism, employers-employee relation, ways to increase

productivity, should also be taught to give a holistic picture of the labour market of an economy.

At the same time, understanding the regulatory framework where business houses operate,

industry runs, the state functions, financial intermediaries work, and thereby an economy gets

functional in a manageable way, is also an inevitable part of learning economics.

The attempt behind the sequential trajectory of the courses is to ensure a smooth flow of the

learning process, with a notion to shape a contour of the knowledge. That is how, different tools

like mathematics, statistics, are put in order to facilitate the understanding of micro-macro

fundamentals of economics. While students will learn about consumption, production, behaviour

of market agents, pricing policy in different market structures, and finally about the market

failure in Microeconomics courses in first two years of the programme, the third year will take

them to an expedition to understand the real life cases of market failure in the courses like

‘Economics of Health and Education’, ‘Environmental Economics’, where information

asymmetry is the ground to take off. Similarly in the first two years, the two papers of

macroeconomics will help students to understand how an economy functions in aggregate level,

what role a government plays in a country, how money market and commodity market are inter-

twined, and different policy measures of government, the concept of open economy, foreign

trade, etc. In the third year the core course like ‘Open economy macroeconomics and its

governance’ will bring a plethora of ideas how the government operates in open economy set up,

why the monetary policy decisions are function of different transnational economic activities,

how interest rate of a country is linked with international market, etc. Still thereafter, a student

can choose to widen the silhouette of the knowledge by studying the courses like ‘Public

Finance’ and ‘International Trade and Finance’ as their elective courses.

Whereas microeconomics and macroeconomics are two building blocks of Economics as a

discipline, development economics has evolved as another major sphere of intervention in the

recent years, especially in the context of globalisation and trade. Hence enough endeavour has

been put to nurture that part of the discipline too. The course ‘Comparative Development

Experience’ is an attempt in this regard, which will complement the basic courses like

‘Development Economics’ and ‘Indian Economy’. Lastly, as a final topping of the deliverable,

the courses like ‘Money, Banking & Finance’, ‘Industrial Economics’, ‘Environmental

Economics’ have been added so as to make the students industry ready.

Currently Economics Department offers the following courses-

UG Degree:

a) B.A. in Economics Hons.

Eligibility: 10+2 passed from any recognized Board or equivalent

b) B.Sc. in Economics Hons.

Eligibility: 10+2 passed from any recognized Board or equivalent, with Mathematics in 10+2.

4

SCHOOL OF ECONOMICS &COMMERCE

UNDERGRADUATE COURSE STRUCTURE

UNDER CHOICE BASED CREDIT SYSTEM

B.Sc.(Hons.) in ECONOMICS

SEMESTER I

S

L.

N

o.

TYPE OF

COURSE

COURSE

CODE TITLE OF THE COURSE

CONTACT HOURS PER

WEEK Remarks

L T P C

1 CC CEC31101 INTRODUCTORY MICROECONOMICS 5 1 0 6

2 CC SMA31151 BASIC MATHEMATICS 5 1 0 6

3 AECC HEN31115 ENGLISH & WRITING SKILL (MIL) 2 0 0 2

4 AEEC CCO31121 PRINCIPLES OF ACCOUNTING 2 0 2 2

6 GE GENERIC ELECTIVE I 5 1 0 6

SUB TOTAL 22

SEMESTER II

S

L.

N

o.

TYPE OF

COURSE

COURSE


CONTACT HOURS PER

WEEK Remarks

L T P C

7 CC CEC31102 INTRODUCTORY MACROECONOMICS 5 1 0 6

8 CC SMA31152 BASIC STATISTICS 5 1 0 6

9 AECC CEC31104 ENVIRONMENTAL STUDIES 2 1 0 2

10 AEEC CEC31106 FUNDAMENTALS OF FINANCE 2 0 2 2

11 GE GENERIC ELECTIVE II 5 1 0 6

12 INT CEC31608 SUMMER SCHOOL /INDUSTRIAL TOUR One/ Two Weeks 2

SUB TOTAL 24

5

SEMESTER III

S

L.

N

o.

TYPE OF

COURSE

COURSE


CONTACT HOURS PER

WEEK Remarks

L T P C

13 CC CEC32101 MICROECONOMICS 5 1 0 6

14 CC CEC32103 INDIAN ECONOMY 5 1 0 6

15 CC CEC32105 MATHEMATICAL ECONOMICS 4 0 2 6

16 SEC MBA32121 PRINCIPLES OF HUMAN RESOURCE

MANAGEMENT 2 0 0 2

17 GE GENERIC ELECTIVE III 5 1 0 6

18 OE ELECTIVE (School of E& T/Science) 5 1 0 6

SUB TOTAL

26

SEMESTER IV

S

L.

N

o.

TYPE OF

COURSE

COURSE


CONTACT HOURS PER

WEEK Remarks

L T P C

19 CC CEC32102 MACROECONOMICS 5 1 0 6

20 CC CEC32104 DEVELOPMENT ECONOMICS 5 1 0 6

21 CC SMA32154 STATISTICAL METHODS 4 0 2 6

22 SEC LWJ32132 BUSINESS REGULATORY FRAMEWORK 2 1 0 2

23 GE GENERIC ELECTIVE IV 5 1 0 6

24 OE ELECTIVE

(School of Management/Law/Social Science) 5 1 0 6

25 INT CEC32608 SUMMER INTERNSHIP One Month 4

SUB TOTAL

30

SEMESTER V

S

L.

N

O.

TYPE OF

COURSE

COURSE


CONTACT HOURS PER

WEEK

Remarks L T P C

26 CC CEC33101 COMPARATIVE ECONOMIC DEVELOPMENT 5 1 0 6

27 CC CEC33103 BASIC ECONOMETRICS 4 0 2 6

28 DSE DISCIPLINE SPECIFIC ELECTIVE I 5 1 0 6

29 DSE DISCIPLINE SPECIFIC ELECTIVE II 5 1 0 6

SUB TOTAL

24

6

Discipline Specific Electives (DSE):

Students are required to study FOURelective Papers from the Honours discipline during semester V and

VI. The list of electives are given below.

Choose any Two in Semester-V Choose any Two in Semester-VI

1. Public Finance CEC33105 5. International Trade CEC33106

2. Industrial Economics CEC33107 6. Labour Economics CEC33108

3. Economics of Health and Education CEC33109 7. Environmental Economics CEC33110

ABBREVIATIONS:

CC : Core Course

AECC: Ability Enhancement Compulsory Course

AEEC: Ability Enhancement ElectiveCourse

SEC : Skill Enhancement Course

GE : Generic Elective Course

DSE : Discipline Specific Elective Course

OE : Open Elective Course

SEMESTER VI

S

L.

N

o.

TYPE OF

COURSE

COURSE


CONTACT HOURS PER

WEEK Remarks

L T P C

30 CC CEC33102 MONEY, BANKING & FINANCIAL MARKETS 5 1 0 6

31 CC CEC33104

OPEN ECONOMY MACRO AND ITS

GOVERNANCE 5 1 0 6

32 DSE DISCIPLINE SPECIFIC ELECTIVE III 5 1 0 6

33 DSE DISCIPLINE SPECIFIC ELECTIVE IV 5 1 0 6

34 CEC33412 PROJECT(in lieu of one DSE) 0 2 0 6

SUB TOTAL

24

TOTAL

(REQUIRED CREDIT) 150

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List of Disciplines for Generic Electives:

As part of the B.A.(Hons.) programme, it is mandate to study oneallied subject other than the Honours

subject in each semester of the first two years. This will be considered as Generic Elective.The list of

Electives are as follows:

1. Mathematics

2. Statistics

3. Computer Science

4. Geography

5. Political Science

6. Sociology

7. History

8. Psychology

List of Generic Electives offered from Department of Economics:

1. Introductory Microeconomics

2. Introductory Macroeconomics

3. Indian Economy

4. Development Economics

8

FIRST YEAR

Semester I

9

INTRODUCTORY MICROECONOMICS

[CEC31101: CC/Credit 6]

This paper introduces students to the terminology and analytic principles used in

microeconomics, which is broadly defined as the study of markets, and to the application of

these conceptual tools to several policy issues. The decisions of buyers and sellers and their

interaction in market transactions will be analyzed. This also explores how different market

structures can shape economic results, and how markets can sometimes (but not always) help

society achieve desirable outcomes.

Unit I: Demand and Supply

Determinants of Demand; Law of Demand; Demand Function, Demand Schedule and Demand

Curve; Determinants of Supply; Law of Supply; Supply Function, Supply Schedule and Supply

Curve; Shift and movement along the Demand & Supply Curve; Elasticity of Demand – Price,

Income, Cross; Elasticity of Supply; Substitutes & Complementary Goods, Normal & Inferior

Goods. Equilibrium Determination, Impact of changes in Demand and Supply, Change in

Equilibrium, Stability of Equilibrium; Consumer Surplus, Producer Surplus, Deadweight Loss,

Change in surplus, Incidence of Tax, Impact of Subsidy.

Unit II: Theory of Consumption

Budget Constraint: Composite goods, Budget Set, Properties of budget set, Budget Line, change

in budget line due to change in income and prices, Application: Taxes, Subsidies, Rationing

Preferences: Consumer Preferences, basic assumptions about preferences; Indifference Curves,

Indifference Map, Marginal Rate of Substitution; Shape of Indifference curves: Perfect

substitutes, perfect complements, Bads, Neutrals, Satiation, Discrete Goods

Utility: Cardinal Utility, Utility function, Total utility, Marginal Utility, Ordinal Utility,

Preference, MRS

Choice:Optimal Choice, Consumer’s Equilibrium, Change in Equilibrium due to change in

income, and prices, Income Consumption Curve, Engel Curve, Price Consumption Curve,

Individual Demand, From individual to market demand; Price Effect: Hicks, Slutsky approach,

Income Effect, Substitution Effect, Compensated Demand.

Unit III: Theory of Production

Technological relationship between output and inputs, Production decision of a firm; Production

function, short run versus long run production; Production with single variable input: TP, AP,

MP, Law of diminishing marginal return; Production with two variable inputs: Isoquant,

Economic region of production, Input flexibility, Input substitution; MRTS, Elasticity of

substitution; Expansion Path, Returns to scale; Effects of changes in input prices on output.

Special Cases: Homogeneous Production Function, Cobb-Douglas Production.

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Unit IV: Costs of Production

Different types of costs; opportunity cost, sunk cost; fixed cost, variable cost; Costs in the SR

production, TC, AC, MC, Cost curves; Costs in the LR production, LR cost curves, relation

between SR and LR cost curves; Shift in cost curves.

Input choices, Isocost line, Change in technology and change in input prices; optimal choice of

inputs, Economies of Scope, Economics of Scale, Learning Curve.

Unit V: Market: Perfect Competition

Profit Maximization by a firm, Competition in a market, Different forms of Competition;

Perfectly competitive market and its characteristics, Choosing output in Short Run, SR supply

curve, Choosing output in the Long Run, LR Industry supply curve: Increasing cost industry,

Decreasing cost industry, and Constant cost industry;

Efficiency of a competitive market: Effect of Tax, Minimum Prices, Price Support, Production

Quota, Impact of tax and subsidy.

Unit VI: Market: Imperfect Competition

Market Power, Sources, Monopoly, Monopsony, Bilateral Monopoly, Natural Monopoly;

Monopolist’s Output Decision, and pricing.

Monopolistic Competition: Characteristics, Equilibrium in Short and Long run, Economic

Efficiency; Branding

Oligopoly: market structure, collusion, competition, equilibrium.

Text:

1. Intermediate Microeconomics: A Modern Approach. H.R. Varian. East West Press; 8th

edition (2010).

2. Microeconomics. R. S. Pindyck, D.L. Rubinfeld, and P.L. Mehta. Pearson, India,

7thedition, 2013

References:

3. Microeconomics: Theory and Applications. G.S. Maddala, and E. Miller. McGraw Hill

Education (India) Private Limited; 3rd edition, 2004.

4. Modern Microeconomics. Koutsoyiannis. Palgrave Macmillan; 2nd edition, 2008.

5. Principles of Microeconomics. D. Salvatore. Oxford University Press (5th or later

edition).

6. Microeconomic Theory. Ferguson, and Gould. All India Traveler Book Sellers (6th

edition).

11

BASIC MATHEMATICS

[SMA31151: CC/Credit-6]

Knowledge of mathematics is pre-requisite to understand modern theoretical as well as applied

economics. This course is a review course to help students brush up their high school

mathematics and getting a foothold of basic mathematical tools needed for the beginners of

economics. This course will help them to understand the basics of linear algebra, different

functional forms, and graphical presentation. They will learn to solve linear equation system, and

its application in equilibrium determination. It will continue to strengthen the basic knowledge of

mathematics for Economics students. The objective is not to transmit any particular body of

economic theory, but to transmit the body of basic mathematics that enables the creation of

economic theory in general. The emphasis is on understanding and developing the skills for the

application of mathematical theorems and techniques in economics.

Unit-I: Basic Algebra

Representation, Evaluation, Logic and proof techniques; Solving simple equations, Inequality

signs, Basics of Trigonometry, Definition of a set, Different types of Set, Operations on sets;

Concepts of ‘range’, ‘domain’ and ‘mapping’;Nested sets, Number system, Real Line, The

Plane, Cartesian product; Concept of Euclidean Space, Points and lines in Euclidean space.

Unit-II:Graphs and Functions

Graphs- line, curves, slopes, tangent; Functions- Elementary types of functions: quadratic,

polynomial, power, exponential, logarithmic; Sequences and series: convergence, algebraic

properties and applications; Continuous functions: characterizations, properties with respect to

various operations and applications; Differentiable functions; Homogeneous functions, Convex

functions.

Graphs- Graphs of linear functions, non-linear functions, Geometric properties of functions:

convex functions, concave function.

Unit-III: Matrix Algebra

Introduction to matrix, Matrix operation- addition, subtraction, matrix multiplication, transpose;

Determinants- Minors, cofactors,adjoint, inverse,special kind of matrices- Diagonal,nonsingular,

symmetric,System of linear equations in matrix form, Cramer’s rule, Simultaneous linear

equation, solving simultaneous linear equations, Graphical solution, Equating to same variable-

Substitution, Row operations, Solving in case of more than two unknowns.

Application: Static Equilibrium Analysis.

Unit-IV: Differential Calculus

Concept of limit and continuity, Concept of differentiation, successive differentiation, Leibnitz

rule,Rolle’s Theoremand Lagrange mean value theorem,Derivatives of different functional

12

forms, Infinite series (Taylor and Maclaurin series), maxima and minima for single variable

calculus, Idea of partial derivatives, Jacobian, Taylor’s theorem for multi variable calculus, Idea

for maxima and minima for multi variable, Second derivative test for local maxima and

minima,Concept of total derivatives.

Applications: Marginal revenue and total revenue, Marginal cost and total cost, Point elasticity

of demand, Tax yield, The Keynesian multiplier.

Unit-V: Integral Calculus

Definite integral, Areas and distances, the definite integral, the fundamental theorem of integral

calculus, applications of integration, areas between curves,Reduction formula.

Applications: Consumer Surplus, Producer Surplus, from marginal function to a total function,

Investment to capital formation.

Unit-VI: Introduction to Linear Programming Problem

Statement of L.P.P., formulation of L.P.P. Slack and Surplus variables, L.P.P. is matrix form.

Convex set, Hyperplane, Extreme points, Convex Polyhedron, Graphical solution.

Readings:

1. Simon, Carl. P., Blume, Lawrence. (2010). Mathematics for Economists, Norton.

2. Rosser, Mike (2003), Mathematics for Economists, Second Edition, Routledge.

3. Chiang, Alpha and Kevin Wainwright (2013), Fundamental Methods of Mathematical

Economics, Fourth Edition, McGraw-Hill

4. Sydseater, K., Hammod, P. (2002). Mathematics for Economics Analysis. Pearson

Education India.

5. N,Piskunov, Differential and Integral Calculus, Vol. II, CBS Publishers & Distributors

6. Shanti Narayan, P.K. Mittal, Integral Calculus, S. Chand.

http://www.amazon.com/s/ref=dp_byline_sr_book_1?ie=UTF8&field-author=Piskunov&search-alias=books&text=Piskunov&sort=relevancerank

http://www.amazon.in/s/ref=dp_byline_sr_book_2?ie=UTF8&field-author=P.K.+Mittal&search-alias=stripbooks

13

ENGLISH WRITING SKILL

[HEN31112: AECC/ Credit: 2]

The basic learning objectives include providing the students with basic understanding of English

in the context of business and equipping them with the essential skill set for communication in

English such that they are able to implement the acquired communicative and analytical skillsas

per situations.

Unit-I: Language

Introduction – Importance of English Language – Characteristics of the Business English

Grammar – Parts of Speech – Tense – Subject Verb Agreement, Sentences – Types of Sentences,

Business Correspondence – Business letters – business reports, Comprehension and analytical

skills – Reading comprehension – Aural Comprehension.

Unit-II: Literature

G.B Shaw Spoken English and Broken English, Sherlock Holmes – The Five Orange Pips,

Somerset Maugham – The Luncheon, Katherine Mansfield – Fly, Film Appreciation –Source

Code – Usual Suspects – The Intern.

Readings:

1. Oliu, Walter, et. al.Writing That Works: How to Write Effectively on the Job. 7thed. New

York: St. Martin’s, 2001.

2. Piotrowski, Maryann V. Effective Business Writing. New York: Harper Collins, 1996.

3. Sant, Tom. Persuasive Business Proposals. New York: AMACOM, 1997.

14

PRINCIPLES OF ACCOUNTING

[CCO31121: AEEC/Credit-2]

Economics as a discipline does not deal with any free commodity, be it output or input. Every

output or input must command a price, explicit or implicit, in order to be studied in the

discipline of Economics. Hence Economics in its quantitative dimension deals with

transactions inside and outside the markets. Wherever transactions take place, there are two

sides – income (credit) and outgo (debit). Hence in the fields of business as well as

administration knowledge of accounting is imperative side by side with the knowledge of

economics like preparation of budget statement in public finance and preparation of balance of

payment statement in international trade. This is the first course in accounting. The course

begins with the definition of accounting, types of accounting, basic concepts of accounting and

covers basic accounting topics such as accounting cycle; accounts hierarchy (account classes,

account groups, accounts, subsidiary accounts), journal entries related to sales, purchases,

collections, payments, and expenses. Posting, accounting of depreciation, accounting of current

assets and current liabilities; trial balance, preparation of financial statements, and

closing/opening entries are also included in this course.

Unit 1:

Meaning And Scope Of Accounting- Introduction, Meaning Of Accounting, Objectives Of

Accounting, Book-Keeping, Distinction Between Book-Keeping And Accounting, Sub-Fields Of

Accounting, Users Of Accounting Information, Relationship Of Accounting With Other

Disciplines, Limitations Of Accounting, Use Of Mathematics In accounting, Accounting

Concepts, Principles And Conventions.

Unit 2:

Basic Accounting Procedures In Journal Entries, Accounting Equation Approach, Traditional

Approach, Ledgers, Trial Balance.

Unit 3:

Subsidiary Books- Other Than Cash Book, Cash Book, Bank Reconciliation Statement, Capital

And Revenue Expenditures, Capital And Revenue Receipts, Contingent Assets And Contingent

Liabilities.

Unit 4:

Preparation Of Final Accounts Of Sole Proprietors, Final Accounts Of Manufacturing Entities,

Accounting Of Non-Profit Organisations, Preparation Of Receipts And Payments Account,

Income And Expenditure Account And Balance Sheet.

Readings:

1. B. K Banerjee, Financial Accounting- Concept, Analysis, Methods and Uses, P.H.I

Learning pvt. Ltd.

2. Basu and Das, Financial Accounting (Vol.1), Rabindra Library.

15

3. Prof.Amitabha Basu, Financial Accounting (Vol.1), Tee Dee Publication pvt. Ltd.

4. Accounting for Non-Accounting Students, John R Dyson, Pearson Education,2010.

16

FIRST YEAR

Semester II

17

INTRODUCTORY MACROECONOMICS

[CEC31102: CC/Credit-6]

This course aims to introduce the students to the basic concepts of macroeconomics.

Macroeconomics deals with the aggregative aspects of the economy. This course discusses the

preliminary concepts associated with the determination and measurement of aggregate

macroeconomic variable like savings, investment, GDP, money, inflation, and the balance of

payments. It discusses various alternative theories of output and employment determination in a

closed economy in the short run as well as medium run, and the role of policy in this context. It

also introduces the students to various theoretical issues related to an open economy.

Unit 1: Introduction to Macroeconomics and National Income Accounting

Basic issues studied in macroeconomics; measurement of gross domestic product; income,

expenditure and the circular flow; real versus nominal GDP; price indices.

Unit 2: The Closed Economy in the Short Run

Classical and Keynesian systems; simple Keynesian model of income determination; ISLM

model; fiscal and monetary multipliers.

Unit 3: Aggregate Demand and Aggregate Supply Curves

Derivation of aggregate demand and aggregate and supply curves; interaction of aggregate

demand and supply.

Unit 4: Money and Inflation

Functions of money; quantity theory of money; determination of money supply and demand;

credit creation; tools of monetary policy, cost push and demand pull inflation.

Unit 5: Unemployment and Expectations

Aggregate supply- the Sticky-Price Model, the Imperfect Information Model; Okun’s Law; the

short-run trade -off between inflation and unemployment; Phillips Curve; Shifts in the Phillips

curve; the role of expectation; Natural Rate of unemployment ;The Phillips curve and the

Aggregate supply curve; The debate.

Readings:

1. Dornbusch, Fischer and Startz, Macroeconomics, McGraw Hill, 11th edition, 2010.

2. N. Gregory Mankiw. Macroeconomics, Worth Publishers, 7th edition, 2010.

3. Olivier Blanchard, Macroeconomics, Pearson Education, Inc., 5th edition, 2009.

4. Steven M. Sheffrin, Rational Expectations, Cambridge University Press, 2nd edition,

1996.

5. Andrew B. Abel and Ben S. Bernanke, Macroeconomics, Pearson Education, Inc., 7th

edition, 2011.

6. Errol D‘Souza, Macroeconomics, Pearson Education, 2009

7. Paul R. Krugman, Maurice Obstfeld and Marc Melitz, International Economics, Pearson

18

BASIC STATISTICS

[SMA31152: CC\Credit 6]

The main objective of this course is to train the students to use the techniques of statistical

analysis, which are commonly applied to understand and analyze economic problems. The paper

deals with simple tools and techniques, which will help a student in data collection, presentation,

and to understand the basic descriptive properties of the data. This paper introduces the concept

of bivariate data and their application in real life. A major emphasis is given on the fundamental

knowledge of probability where the true essence of statistics lies.

Unit 1: Introduction to Statistics

Basic concepts: Population, Sample, Parameter;Techniques of data collection- Sampling vs.

Population, primary and secondary data.Classification and presentation of data.Graphic and

diagrammatic representation of data. Frequency distribution and its diagrammatic representation.

Unit 2: Measures of Central Tendency

Arithmetic Mean, Median and Mode for grouped and ungrouped data, Comparison of Mean,

Median and Mode, Geometric and Harmonic Mean, Composite Mean.

Application: Index Numbers: Index number as weighted averages, Price and quantity index

numbers, Cost of Living Index Number, Wholesale Price Index, Stock market indices.

Unit 3: Measures of Dispersion

Range, Mean Deviation, Quartile Deviation and Standard Deviation, Measures of Relative

Dispersion, Curve of Concentration,Moments, Central and non-central moments, Skewness,

Kurtosis,different measures of skewness and kurtosis.

Application: Measurement of Economic Inequality: Gini Coefficient and Lorenz Curve.

Unit 4: Bivariate Data

Definition of bivariate data, scatter diagram,bivariate frequency distribution-Simple and multiple

correlation and regression. Covariance as a measure of association; Coefficient of Correlation;

Rank correlation; Difference between correlation and regression approach

Unit 5: Time series analysis and forecasting methods

Introduction and analysis of a time series, trend method, time series method, correlation

regression method, End–Use method, exponential smoothing method, Delphi method, demand

forecasting for industrial products.

Unit 6: Probability Theory

Elements of Probability Theory: Sample Space, Probability Space, Events, Classical Definition

of Probability. The Addition Rule, the Multiplication Rule, Theorems of Total Probability,

Conditional Probability and Statistical Independence,Limitations of the Classical definition,

Axiomatic Approach, total probability theorem, Bayes’ Rule and its applications.

19

Readings:

1. Goon, Gupta, Dasgupta – Fundamentals of Statistics, Vol I, World Press Private limited

(2016).

2. Gupta, S. C., and Kapoor, V. K. Fundamentals of Mathematical Statistics. Sultan Chand

& Sons (2014).

3. Lind, Marchal, Wathen. Basic Statistics for Business and Economics, McGraw Hill

Education; Seventh edition (2013).

4. Gupta, S.P. and Gupta, M.P. Business Statistics, Sultan Chand and sons

5. Gupta C B, Gupta V. An Introduction to Statistical Methods, Vikas Publishing House,

New Delhi.

6. T N Srivastava and ShailagaRego, Statistics for Management, McGraw Hill Education.

20

ENVIRONMENTAL STUDIES

[CEC31104: AECC/Credit-2]

This paper introduces the students to the crucial problems that human activity has caused to our own environment on a global scale, for their own purposes. It discusses the innumerous complex causes, effects and interrelations which has brought us to the brink of self-destruction. The remedies discussed in this paper are further emphasised to be not isolated phenomena, but constitutive of our own daily lives. Unit 1: The Multidisciplinary Nature of Environmental Studies Definition, scope and importance, Need for public awareness. Unit 2: Natural Resources Renewable and Non-renewable resources: Forest resources: Use and over-exploitation, deforestation, case studies. Timber extraction, mining, dams and their effects on forests and tribal people. Water resources: Use and over-utilization of surface and ground water, floods, drought, conflicts over water, dams-benefits and problems. Mineral resources: Use and exploitation, environmental effects of extracting and using mineral resources, case studies. Food resources: World food problems, changes caused by agriculture and overgrazing, effects of modern agriculture, fertilizer-pesticide problems, water logging, salinity, Case studies. Energy resources: Growing energy needs, renewable and non-renewable energy sources, use of alternate energy sources. Case studies. Land resources: Land as a resource, land degradation, man induced landslides, soil erosion and desertification. Natural resources and associated problems: Role of an individual in conservation of natural resources, Equitable use of resources for sustainable lifestyles. Unit 3: Ecosystems Concept of ecosystem. structure and function of an ecosystem, producers, consumers and decomposers, energy flow in the ecosystem, ecological succession, food chains, food webs and ecological pyramids: introduction, types, characteristic features, structure and function of the following ecosystem:Forest ecosystem, Grassland ecosystem, Desert ecosystem, Aquatic ecosystems (ponds, streams, lakes, rivers, oceans, estuaries)

Unit 4: Biodiversity and Its Conservation

Introduction, definition: genetic, species and ecosystem diversity, Biogeographical classification

of India, Value of biodiversity: consumptive use, productive use, social, ethical, aesthetic and

option values, Biodiversity at global, National and local levels, India as a mega-diversity nation,

Hot-spots of biodiversity, Threats to biodiversity: habitat loss, poaching of wildlife, man-wildlife

conflicts, Endangered and endemic species of India, Conservation of biodiversity: in-situ and ex-

situ conservation of biodiversity.

Unit 5: Environmental Pollution

Definition, Causes, effects and control measures of (a) air pollution, (b) water pollution, (c) soil

pollution, (d) marine pollution, (e) noise pollution, (f) thermal pollution (g) nuclear pollution,

Solid waste management: Causes, effects and control measures of urban and industrial wastes,

Role of an individual in prevention of pollution, Pollution case studies, disaster management:

Foods, earthquake, cyclone and landslides.

21

Unit 6: Social Issues and the Environment

From unsustainable to sustainable development, Urban problems related to energy, Water

conservation, rain water harvesting, watershed management, Resettlement and rehabilitation of

people; its problems and concerns. Case studies.Environmental ethics: Issues and possible

solutions.Climate change, global warming, acid rain, ozone layer depletion, nuclear accidents

and holocaust. Case studies.Wasteland reclamation.Consumerism and waste

products.Environment Protection Act.Air (Prevention and Control of Pollution) Act.Water

(Prevention and Control of Pollution) Act.Wildlife Protection Act.Forest Conservation

Act.Issues involved in enforcement of environmental legislation.Public awareness.

Unit 7: Human Population and the Environment

Population growth, variation among nations.Population explosion—Family Welfare

Programme.Environment and human health.Human rights.Value education.HIV/AIDS.Women

and Child Welfare.Role of Information Technology in environment and human health. Case

Studies.

Unit 8: Field Work

Visit to a local area to document environmental assets—river/forest/grassland/hill/

mountain.Visit to a local polluted site—Urban/Rural/Industrial/Agricultural.Study of common

plants, insects, birds.Study of simple ecosystems—pond, river, hill slopes, etc.

Readings:

1. Singh, J.S. (ed.) 1993. Restoration of Degraded Land: Concepts and Strategies.

Rastogi Publications, Meerut.

2. Smith, R.L. (1996). Ecology and Field Biology, Harper Collins, New York.

3. Botkin, D.B. and Keller, E.A. 2000. Environment Science: Earth as a living planet.

Third Edition. John Wiley and Sons Inc.

22

FUNDAMENTALS OF FINANCE

[CEC31106: AEEC/Credit-2]

This course starts with the concept of time value of money, continues with the risk literature and

ends at financing decisions by a firm. As a store of value money transmits the value to the assets

and that value accretes through trading and revenue earning. Depending on the nature and issuer

of the asset the speed and quantum of accretion varies. This is the risk element an asset is fraught

with. The concepts of risk and return in finance go hand in hand because higher risk means

discounting with a higher rate of return. Finance literature revolves around the concept of time

value of money that is based on present value or compound value of an asset or liability on case

to case basis. Consumption and investment are the two most important components of national

income. Finance comes to the picture when a consumer buys a product on credit, not on cash,

that attracts interest and other charges which has future implications unlike cash purchase where

the transactions end then and there. The credit purchase is financed by a third party who could be

different than the producer of the goods purchased. All investments have underlying financial

principles because investments aim at future earnings.

Unit 1: Time Value of Money

• Definition and Functions of Money

• Money as a store of value

• Concept of financial security and their classification in terms of liquidity

• Creation of Asset Out of Money - Issue of Securities - Securitization

• Concepts of Present Value and Compound Value of an asset

• Valuing Securities - Bonds and Common Stocks

• Net Present Value and Other Investment Criteria for making Investment Decisions

• Concepts of Projects and Project Finance

Unit 2: The Risk Literature

• Concepts of Financial Securities and their markets

• Concepts of Risk and Return

• Capital Budgeting and Portfolio

• Capital Asset Pricing Model

• Concept of Project Risk

Unit 3: Financing Literature

• Concept of Efficient Market

• Behavioural Finance

• Concept of Corporate Finance

23

• Concept of Derivatives

• Alternative Finance: Hire Purchase, Lease, Factoring

Reference:

1. Fundamentals of Financial Management, E F Brigham and J F Houston, Thomson South-

Western, 2007

2. Principles of Corporate Finance, R A Brealey, S. C. Meyers, Franklin Allen, McGraw-Hill

Irwin, New York, 10th Edition.

24

SUMMER SCHOOL / INDUSTRIAL TOUR

[CEC31608: INT/Credit-2]

Summer school/ industrial tour will be of one/ two weeks duration, during the summer vacation

after the end semester exams of Semester II. The students can go for a summer school to any

university in India or abroad to study courses of their choices for intensive knowledge in any

particular area. Otherwise, they may also take part in industrial tours that will provide them with

real life exposures and practical experiences.

25

SECOND YEAR

Semester III

26

MICROECONOMICS

[CEC32101: CC/Credit 6]

This paper will introduce students with more complicated issues of microeconomics around

different market structures under imperfect competition like monopoly, monopolistic

competition, and oligopoly. Different types of pricing strategies and market power adopted by

the producers. The theoretical concepts of theories of distribution will also be introduced. In

addition the conflicts of efficiency versus equity along with general idea of welfare are also

discussed. Finally the students will be introduced to major problems associated with market

failure.

Unit I: Market under Imperfect Competition: Monopoly and Monopsony

Monopoly: Average and Marginal Revenue; Monopolist’s output decisions – rule of thumb for

pricing – shifts in demand – effect of tax; Multi plant Firm, Monopoly power: measures, sources;

Social cost of monopoly power: rent seeking, price regulation; Natural Monopoly.

Monopsony: sources of monopsony power, comparison with monopoly; bilateral monopoly.

Unit II: Pricing with Market Power

Market Power: Sources, Capturing the consumer surplus; Price Discrimination: First Degree,

Second Degree, Third Degree; Intertemporal Price Discrimination, Peak Load Pricing, Two Part

tariff; Bundling; Advertising.

Unit III: Market under Imperfect Competition: Oligopoly

Oligopoly: Equilibrium in an oligopolistic market, the Cournot Model, First Mover’s Advantage-

Stackelberg Model, Pricing under Homogenous Products: the Bertrand Model, Pricing under

differentiated products;

Competition versus Collusion: Prisoner’s Dilemma; the Payoff Matrix of a Game, Nash

Equilibrium;

Implication of Game in oligopolistic pricing: Price Rigidity and Kinked Demand Curve Model,

Price signalling, Price Leadership, Dominant Firm model, Cartels.

Unit-IV: Market for Factor Inputs

Competitive factor markets: Demand for a factor input, Supply of inputs, Equilibrium in a

competitive factor market, Economic Rent;

Factor Market with imperfect competition: Input demand under monopoly, Input supply with

monopsony, Labour exploitation under monopoly and monopsony.

Unit V: Theory of Distribution

Product Exhaustion theorem; Distinction between Labour, Land, and Capital; Theory of

Economic Rent-genesis of rent, rent in a market economy; Theory of Profit; Theory Interest-

capital, interest, and user cost of capital; Theory of Wage-backward bending labour supply

curve.

27

Unit VI: Market Failure

General Equilibrium: Edgeworth Box Diagram, Efficiency and Equity.

Market Failure: Asymmetric Information, Uncertainty, Market Signalling, Moral Hazard,

Principal-Agent Problem;Externalities: Positive and Negative, Coase Theorem, Externality and

property rights; Public goods, private return and public return, private and public cost;

Government Intervention: Examples and Cases.

Text:

1. Microeconomics. R. S. Pindyck, D.L. Rubinfeld, and P.L. Mehta. Pearson, India,

7thedition, 2013

2. Microeconomics: Theory and Applications. G.S. Maddala, and E. Miller. McGraw Hill

Education (India) Private Limited; 3rd edition, 2004.

References:

3. Intermediate Microeconomics: A Modern Approach. H.R. Varian. East West Press; 8th

edition (2010).

4. Modern Microeconomics. Koutsoyiannis. Palgrave Macmillan; 2nd edition, 2008.

5. Principles of Microeconomics. D. Salvatore. Oxford University Press (5th or later

edition).

6. Microeconomic Theory. Ferguson, and Gould. All India Traveler Book Sellers (6th

edition).

28

INDIAN ECONOMY


This course will be relevant to the students in terms of the overall Indian economic experience

since independence. The basic trajectory of Indian economic (capitalist) development is to be

covered with special emphasis on the shift from a mixed economy towards market orientation.

Four economic spheres - production, distribution, trade and finance are to be followed to bring

out the major changes in the Indian economy.

Unit-1:Indian Economy at the time of Independence

Features of Indian Economy around 1947-1950 and characteristics of

economicunderdevelopment of India (with reference to colonial rule of India)

Unit-2: Planning: Evolution of India’s Development Goal and Strategy

The background and Structure of Indian Planning, Structural Constraints and India’s

development strategy – Choice of industrialization strategies – public vs. private sector, capital

goods versus consumer goods – Mahalanobis Plan Model (basic argument), import substitution

vs. export promotion strategy; Agriculture-industry relationship – demand side and supply side

linkages– agriculture-industry terms of trade - food crisis of the 1960s and imperatives for

agricultural growth, genesis of green revolution – fourth plan (basic argument); Poverty

Eradication, foreign aid and self-reliance – Fifth Five Year Plan Model (basic argument);

Regional inequality in India – causes; policies for balanced regional development; Planning

deficiencies and its abandonment– 7th five year plan and Indian economic crisis

Unit-3: New Reform Policy

Context, liberalisation, market and state (introduction), privatisation, disinvestment policy,

consequences, impact on growth and employment

Unit-4: Production and distribution

Agriculture- Characteristics, Land Reforms, Evaluation, Green Revolution, Agricultural policies

and pricing, rural credit and institutionalisation; Industry- Structure and composition of Industry

– issues of concentration, large vs small industry – industrial location, small scale reservation

policy, trends and patterns of industrial growth, industrial Policies – industrial licensing system,

Growth of the Service Sector, Inclusive development;; Food security, Food Procurement and

Public Distribution System

Unit-5:Trade and finance

Foreign trade regime, protection and foreign competition, Productivity; import substitution

versus export Competitiveness, effect on export competitiveness, foreign policy in the post-

liberalisation period; Finance- Nationalisation, fixed vs. Flexible exchange rate system,

Privatisation, foreign capital, land acquisition, SEZ

29

Unit- 6: Employment, Wages and Inflation

The trends and pattern of employment and wages in India – informalisation and tertiarisation of

employment - problems of unemployment and under-employment, Government policies on

employment and wages and employment – employment guarantee scheme – minimum wage,

Movement of prices in India – –trends and patterns – causes, consequences and policies adopted

Readings on India:

1. Contemporary Issues of Indian Economy. DhirendraNathKonar. Akansha Publishing

House; 1st edition (2009)

2. Indian Economy: Performance and Policies. Uma Kapila. Academic Foundation; 15th

Revised edition (2015)

3. The Indian Economy: Problems and Prospects. BimalJalan (ed.); Penguin

4. Indian Economy. A.C. Fernando. Pearson

5. S Chakraborty. 1987. Development Planning: The Indian Experience. Clarendon

Press.

6. Vaidyanathan A.1994. Performance of Indian Agriculture since Independence in

Kaushik Basu (ed.) Agrarian Question, Oxford University Press.

7. C D. Wadhwa. Some problems of India’s Economic Policy, Tata McGraw Hill.

8. J. Sachs, AVarshney and N Bajpai (ed). India in the Era of Economic Reforms.

Oxford University Press.

9. I, Judge Ahluwalia. 1985. Industrial Growth in India since the Mid-sixties. Oxford

University Press.

10. PC Joshi. 1975. Land Reforms in India: Trends and Perspectives. Allied Publishers:

New Delhi.

11. Pramit Chaudhuri. 1979. Indian Economy: Poverty and Development.George Allen

and Unwin, London.

30

MATHEMATICAL ECONOMICS


This course intends to equip the students with mathematical analysis of the economic problem

they are learning in fundamental courses like microeconomics and macroeconomics. The basic

mathematics course in first year has laid down the ground for this course where a higher level of

mathematics will be taught and students will learn to apply it with real life data. This course is a

mapping of mathematical tools into economic theories, where the students will be dealing with

more complex theorems and their formulation and interpretation. The concept of optimization, in

unconstrained and constrained set up, is the core of the course. Moreover, different economic

models in discrete and continuous time frame will be taught where the concept of difference

equation and differential equation has been applied.

Unit-I: Unconstrained Optimization

Concept of optimization. First-order conditions, Second-order conditions, Global maxima and

minima.

Applications- Profit maximization, Inventory control, Comparative static effects of taxes.

Unit-II: Constrained Optimization I

Constrained optimization and resource allocation, Equality Constraints, Inequality Constraints.

The Lagrangean technique for optimization: constrained optimizationwith two variables, first

order condition, second-order conditions;Constrained optimization with more than two variables.

Application: Consumer’s utility maximization, Firm’s cost minimization.

Unit-III: Constrained Optimization II

Kuhn-Tucker Formulation- Non-negativity restrictions, Inequality constraints, Interpretation;

Maximum Value Function, Envelope Theorem- for unconstrained optimization, for constrained

optimization. Interpretation of Lagrange Multiplier.

Unit-IV: First Order Difference Equation: Discrete Time

Discrete time, Differences, and Difference Equation; Solving a first order difference

equation;.Application: The Cobweb Model, Dynamic stability of equilibrium.

Unit-V: First Order Differential Equation: Continuous Time

Continuous time, Differential Equations. First order differential equation- with constant

coefficient, with variable coefficient. Solving linear differential equation. Application: Market

Model, Time path, Dynamic stability of equilibrium.

31

Text:

1. Chiang, Alpha and Kevin Wainwright (2013), Fundamental Methods of Mathematical

Economics, Fourth Edition, McGraw-Hill

Readings:

2. Simon, Carl. P., Blume, Lawrence. (2010). Mathematics for Economists, Norton.

3. Sydseater, K., Hammod, P. (2002). Mathematics for Economics Analysis. Pearson

Education India.

4. Rosser, Mike (2003), Mathematics for Economists, Second Edition, Routledge.

32

PRINCIPLES OF HUMAN RESOURCE MANAGEMENT

[MBA32121: SEC/Credit-2]

The objective of the course is to familiarise the students about the different aspects of managing

people in the organisations from the stage of acquisition to development and retention. To

acquaint the students with different strategies and legislations used in management of HR related

issues in the organization.

Unit I:

Introduction to Human Resource Management Evolution of HRM, Relevance of HRM, Human

Resource Functions and Objectives, Models of HRM Functions, The Indian Scenario of HRM

and it’s contemporary challenges, Strategic HRM vs. Conventional HRM.

Unit-II:

Manpower Management Human Resource Planning, Steps in HRP, Succession planning,

recruitment and selection, training and career development, job analysis -job description and job

specifications ,Employee Engagement and Empowerment.

Unit III:

Compensation, Benefits and Performance Management : Compensation Management - Job

Evaluation, Innovations in Compensation Management- ESOP, Flexi-time Schedules, etc. Wage

policy, Wage determination .Incentive Schemes in Indian Industries .

Unit IV:

Industrial Relations Industrial relations machinery; preventive and settlement machinery;

grievance and the procedure for the redressal of grievance; Roles, rights and responsibilities of

trade union; collective bargaining; worker's participation in management.

Unit V:

International Human Resource Management: Concept, importance, functions, and models of

International HRM. E-HRM, Green HRM, Managing ethical issues in HRM.

Suggested Readings:

1. Monoppa&Saiyadain, Personnel Management, Tata McGraw Hill, New Delhi.

2. Patnayak, Biswajeet, Human Resource Management, ed. iii, 2006, P.H., New Delhi.

3. T.V. Rao and Raju Rao, (ed) 360 degree Feedback and Performance Management

System,

Vol. I, ed. ii, 2003, Excel Books.

4. Garry Dessler and Biju Varkkey Human Resource Management, ed. x, 2006, Pearson

Education New Delhi.

5. Strauss & Sayles, Personnel Problems of Management, Prentice Hall of India.

6. PramodVerma, Management of Industrial Relations, VoraPrakashan, Ahmedabad.

7. Sinha, PRN, Sinha IB and Shekhar SP, Industrial Relations, Trade Unions and Labour

Legislation, Pearson Education, New Delhi 2004

33

8. Dessler, Gary, -Human Resource Management, Prentice – Hall India, New Delhi,

9. Cascio , Wayne F Managing Human Resources – Productivity, Quality of work

Life, Profits ,Tata- McGraw Hill (TMH) , New Delhi

10. Bhattacharyya, Dipak Kumar, Human Resource Management t , Excel Books, New

Delhi.

11. Decenzo and Robbins, Human Resource Management-Prentice Hall of India.

12. Michael Armstrong: Handbook of Human Resource Management, Kogan Page

34

SECOND YEAR

Semester IV

35

MACROECONOMICS


This course is a sequel to Introductory Macroeconomics. In this course, the students are

introduced to the long run dynamic issues like growth and technical progress. It also provides the

micro-foundations to the various aggregative concepts used in the previous course.

Unit 1: Open Economy Models

Short-run open economy models; Mundell-Fleming model; exchange rate determination;

purchasing power parity; asset market approach; monetary approach to balance of payments;

international financial markets.

Unit 2: Schools of Macroeconomic Thoughts

Classicals, Keynesians, New-Classicals and New-Keynesians.

Unit 3: Fiscal and Monetary Policy

Monetary policy objectives and targets; rules versus discretion: time consistency; the

government budget constraint; government debt and Ricardian equivalence.

Unit 4: Consumption

Keynesian consumption function; Fisher‘s theory of optimal intertemporal choice; life-cycle and

permanent income hypotheses; rational expectations and random-walk of consumption

expenditure.

Unit 5: Investment

Determinants of business fixed investment; residential investment and inventory investment.

Unit 6: Economic Growth

Harrod-Domar model, Solow model, golden rule, technological progress and elements of

endogenous growth.

Readings:

1. Dornbusch, Fischer and Startz, Macroeconomics, McGraw Hill, 11th edition, 2010.

2. N. Gregory Mankiw. Macroeconomics, Worth Publishers, 7th edition, 2010.

3. Olivier Blanchard, Macroeconomics, Pearson Education, Inc., 5th edition, 2009.

4. Charles I. Jones, Introduction to Economic Growth, W.W. Norton & Company, 2nd

edition, 2002.

5. Andrew B. Abel and Ben S. Bernanke, Macroeconomics, Pearson Education, Inc., 7th

edition, 2011.

6. Errol. D‘Souza, Macroeconomics, Pearson Education, 2009. 7. Robert J. Gordon,

Macroeconomics, Prentice-Hall India Limited, 2011.

36

DEVELOPMENT ECONOMICS


This course aims at a basic introduction to the ideas of growth and development. A chronological

development of the measures of development and the major theoretical works is to be attempted

to make it clear to the students that development is a multidimensional process and need to be

addressed accordingly. Finally, the recent advances in the direction of free trade as a vehicle of

development are to be discussed.

Unit-1: Concepts and measures of development

Nature, Questions and Values of Development, Meanings of development – economic growth,

redistribution form growth and capabilities approach to development, objectives of development;

measures of development- purchasing power parity and per capita income as an index of

development, difference between growth and development, human development index,

characteristics of a developing economy

Unit-2- Growth theories

Classical growth theory, Theories of transition – Clark and Fisher on change in sectoral share,

Rostow’s stages of growth; Kuznets’s characteristics of Growth; Industrialisation, Growth and

Kaldor’s growth laws; production-function approach - Harrod-Domar growth model, Neo-

classical growth theory, endogenous growth theories

Unit 3- Development theories

Underdevelopment as a coordination failure, multiple equilibria, different approaches- vicious

cycle of poverty, circular causation, the Big Push, balanced and unbalanced growth; Dual

economy Models- Lewis, Harris-Todaro, Trap models- Nelson and Leibenstein, Choice of

technique in a labour suplus economy, Two gap model, Dualism

Unit-4: International- dependence Revolution

The Neocolonial Dependence Model, the False paradigm model, the dualistic-development

thesis, the Marxian legacy

Unit-5: Development- Population, Inequality and Poverty

Concepts of Population: definitions of fertility, mortality, birth rates, death rates, fertility rate,

life expectancy, infant mortality rate, youth dependency ratio; Theory of demographic transition.

Meaning of inequality, Measures of Inequality - Lorenz Curve, Range, Coefficient of variation,

Gini-coefficient, Kuznet’s Inverted U hypothesis.

37

Poverty, relative and absolute deprivation with respect to income, Poverty line, Poverty measures

– Head count ratio, Poverty gap ratio, Income gap ratio, Human Poverty Index.

Readings:

1. Growth and Development. A.P. Thirlwall. Palgrave McMillan; 8th edition (2010)

2. Development Economics. Debraj Ray . Oxford University Press; 1st edition (1999)

3. Economic Development. M.P. Todaro, and S.C. Smith. Pearson India; 10th edition

(2011)

4. Recent Economic Growth in India: Contemporary Issues. S. Gupta, and A. K. Mohapatra.

Prateeksha Publications (2011)

5. Leading Issues in Economic Development. G.M. Meier and J.E. Rauch.. Oxford

University Press (2005)

6. India: Leading Issues in Economic Development. R. K. Mishra. Academic Foundation;

2nd edition (2014)

7. K. Basu. Analytical Development Economics: The Less Developed Economy Revisited.

Oxford University Press

38

STATISTICAL METHODS

[SMA32154: CC/Credit-6]

This course aims to build up the advanced knowledge on the basic statistics taught in the first

year. Here students will learn more tools and techniques which are useful for analyzing

economic issues in real life. Concept of random variable and their probability distribution are the

main focus of the paper. Students will learn the concept of statistical independence and joint

probability distribution in case of bivariate data. The difference between population and sample,

why sampling is required for any study, has to be understood clearly before one delves into

statistical analysis. In this paper students will get an idea of sampling theory and techniques and

also learn sampling distribution and its different forms.

Unit-I: Random Variables and Probability Distributions

Definition of random variable, discrete and continuous random variable, probability mass

function and probability density functions, Expectation and Variance of random variables,

Univariate Probability Distributions: Binomial, Poisson, Normal and Standard Normal

Distribution. Skewness and Kurtosis. Moment Generating Functions.

Unit-II: Bivariate Data and Joint Probability Distribution

Concept of Bivariate data,Joint Probability Distribution: Statistical Independence, Marginal and

Conditional Distribution. Descriptive statistics of the distribution.

Unit-IIII: Sampling Theory

Population and Sample, Parameter and Statistic, Random Sampling: Methods of Drawing

Random samples (with and without replacement), Circular systematic sampling. Basic Concepts

of different methods of sampling –Stratified Sampling, clustered sampling, multistage sampling,

purposive sampling

Unit – IV: Sampling Distribution and their uses

Sampling Distribution, Standard Error, Sampling Distributions associated with Normal

Population, Law of Large number. Derived Distributions: Chi-Square Distribution, Student’s t

Distribution, F Distribution, Fisher’s t distribution, concept of degrees of freedom.

Unit-V: Estimation theory

Elementary ideas of point estimation, estimating the mean of a single sample, standard error,

prediction interval, tolerance limits, estimating the difference between means of two samples,

estimating proportion and variance of a single sample, estimating the difference between two

proportions and variances of two samples, maximum likelihood estimation.

39

Unit-VI: Hypothesis Testing

Definition, one and two tailed test, critical region, test statistics, type-I and type-II error, test on a

single mean when variance is known and variance is unknown,test on two means, test on a single

mean population and test on two populations,one and two sample test for variance.

Readings:

1. Jay L. Devore, Probability and Statistics; Seventh Edition; Cengage Learning, 2010.

2. Goon, Gupta, Dasgupta – Fundamentals of Statistics, Vol I, World Press Private limited

(2016).

3. Gupta, S. C., and Kapoor, V. K. Fundamentals of Mathematical Statistics. Sultan Chand

& Sons (2014).

4. V.K. Rohatgi, Introduction to Probability and Mathematical Statistics. Wiley Eastem Ltd.

New Delhi.

5. T N Srivastava and ShailagaRego, Statistics for Management, McGraw Hill Education.

40

BUSINESS REGULATORY FRAMEWORK

[LWJ32140: SEC/Credit-2]

Unit I: Law of contract

Formation of Contract, Essentials, Classification, General Rules as to Offer and Acceptance,

Contractual Capacities, Free Consent, Wagering Agreement, Contingent Contract, Performance,

Discharge of Contract, Quasi Contracts, Breach of Contract, Remedies, Contract of Indemnity,

Contract of Guarantee, Bailment & Pledge, Contract of Agency.

Unit II: Sale of Goods Act, 1930:

Distinction between Sale and Agreement to Sell, Conditions and Warranties, Doctrine of Caveat

Emptor, Rights of an Unpaid Seller.

Unit III: Law of Partnership

Nature, Essentials, Who may be partners? Partnership & Firm, Partnership & Joint Hindu

Family, Duration, Registration and effect of non-registration, Rights and Duties of Partners,

Goodwill, Types of partners, Position of a minor in a partnership business, Reconstitution of a

Firm, Dissolution of a Firm, Limited Liability Partnership (LLP).

Unit IV: Negotiable Instruments Act, 1881

Definition, Characteristics, Notes, Bills and Cheques, Crossing of cheques, Escrow, Inchoate

Instrument, Indorsement, Dishonour of a Negotiable Instrument and penalties for such dishonor.

Unit V: Other important business related legislations

Consumer Protection Law, Company Law, Competition Law, Environmental Laws etc.

Readings:

1. Kumar, Ravinder: Legal Aspects of Business

2. Kapoor, N.D : Mercantile Law

3. Singh Avtar: The Principles of Mercantile Law; Eastern Book Company, Lucknow.

4. Bangia, R.K.: Principles of Mercantile Law

41

SUMMER INTERNSHIP

[CEC32608: INT/Credit-4]

Summer internship will be of one month duration, during the summer vacation after the end

semester exams of Semester IV. The students will be given a list of internship opportunities with

NGOs, civil society organisations, think tanks, governmental agencies and private companies. At

the successful completion of summer internship, students have to submit a detailed internship

report. Students will receive certificates both from the organisation and the University.

42

THIRD YEAR

Semester V

43

COMPARATIVE DEVELOPMENT EXPERIENCE


Capitalism, when compared with the other previous modes of production in the history of

mankind, is a comparatively recent phenomenon (originality in Western Europe since the 14th

century). It is marked by a continuous urge towards greater marketable productionand profit

motive, backed by technological advancements and specialized division of labour. In this paper,

we trace the development of capitalism in the West and the challenges that emerged in the post

World War II scenario, especially in relation to the third world economies (the developing

countries), both theoretically and practically. The shifts in the capitalist discourse in the recent

neo-liberal regime are finally attempted here for a better understanding of globalization.

Unit 1: Genesis of capitalism

Enlightenment, modernity, capitalist development and poverty eradication, different types of

social organization, feudalism, precapitalist societies other than feudalism, capitalism in the

West, Industrial revolution in Great Britain - Causes – Why Great Britain became the pioneer,

Mercantilism, physiocrats, Adam Smith and the labour theory of value, colonialism, imperialism

Unit 2: Industrialization Experiences in Early Part of 20th Century

Capitalism vs socialism, The Great Debate in Soviet Union on the assignment of priority on

development of heavy industry in the process of planned economic development;

The Great Depression of the 1930’s and recovery – Experiences of USA and Great Britain.

Unit 3: Post Second World War Development Scenario

The World Bank approach - Global Change, Welfare state and mixed economy, Post War global

institutions: International Monetary Fund, World Bank, United Nations Conference on Trade and

Development, Development as a programme, Trade- Infant industry argument, Import

substitution versus export promotion in less developed countries. Illustrations from South Asia,

Latin America and East Asia. FDI, MNCs, portfolio investment.

Unit 4: Development and underdevelopment as historical processes

Transition to capitalism as underdevelopment: Center-periphery, unequal exchange, Dependency

Approach., regulation theory on a world scale; world system theory. Transition beyond

capitalism- post-developmentalism

44

Unit 5: Evolution of New international economic order.

Neo liberalism, Washington consensus, North-South Divide, Recasting of IMF and World Bank,

General Agreements on Tariff and Trade (GATT) and the Dunkel Draft controversy-World

Trade Organization (WTO), Economic Integration

Readings:

1. A.P. Thirlwall. Growth and Development. Palgrave McMillan. (8th edition) 2. M.P. Todaro and S.C. Smith. Economic Development. Pearson Education. 3. G.M. Meier and J.E. Rauch. Leading Issues in Economic Development. Oxford

University Press. (8th edition or latest). 4. Sunanda Sen. 2007. Globalisation and Development, National Book Trust, India 5. C. Roe Goddard, Patrick Cronin and Kishore C. Dash. (ed). International Political

Economy. Viva Books Private Limited. (articles by Theotonio dos Santos and Samir Amin.

6. Maurice Dobb. Soviet Economic Development since 1917. Chap. 8. 7. A.K. Bagchi. The Political Economy of Underdevelopment. Orient Longman. 8. J. Stiglitz. Globalisation and its Discontents. Penguin. 9. SoumyenSikdar. Contemporary Issues in Globalisation. An Introduction to Theory and

Policy in India. Oxford University Press. 10. Schumpeter (1954): History of Economic Analysis, Harvard University Press

11. Screpanti&Zamagni (2005): An Outline of the History of Economic Thought, OUP 12. Snowdon and Vane (2005): Modern Macroeconomics, Edward Elgar Publishing Limited 13. Resnick, S. and R. Wolff. 2012. Contending Economic Theories. MIT Press.

45

BASIC ECONOMETRICS


Econometrics is concerned with the application of statistical theory to the analysis of economic

data and the estimation of economic relationships. This course intends to expose students to the

statistical techniques that economists use for estimating, testing, and forecasting economic

relationships. In this paper students will be introduced with what ‘Econometrics’ is about. The

basic concept of linear regression model under classical assumptions, statistical inference tools

and techniques in a regressed model will be taught in a lucid approach. Moreover, the

consequences of violations of classical assumptions will also be taught. This course covers a

range of applications through statistical software.

Unit I: Introduction to Econometrics

What is Econometrics? Steps in Econometric Analysis; Specification of Econometric Model and

Assumptions; Basic Concepts of Estimation and Desirable Properties of Estimators; Data for

Econometric Analysis.

Unit-II: Classical Statistical Inference

Basic concepts of estimation: Desirable properties of estimators, Methods of Point Estimation -

Maximum Likelihood Estimators and their properties.

Testing of Hypothesis: Confidence Intervals, p-values, Type-I and Type-II Errors, Simple

applications of tests for the Mean and Variance of a Univariate Normal Population.

Unit III: Classical Linear Regression Model

Stochastic and non-stochastic relationships; The concept of regression, Two Variable

Case,Specification of the relationship; Estimation- Method of Least Squares, Assumptions;

Gauss-Markov Theorem; Properties of Least Squares estimates; BLUE.

Unit IV: Statistical Inference in Classical Linear Regression Model

Statistical Inference in simple linear regression model- Confidence Intervals for parameters,

Testing of Hypothesis-Testing of regression coefficient; Test for regression as a whole,

Coefficient of determination, Goodness of Fit, F-test, Analysis of Variance.

Unit V: Violations of Classical Assumptions and Remedies

Problems of Heteroscedasticity; Auto correlation (first order) — their consequences, tests and

remedies.

Unit VI: Application of Econometric Methods

Estimation of demand and supply functions, production and cost functions and consumption

function and investment function.

46

Readings:

1. Damodar N. Gujarati, Dawn C. Porter, and SangeethaGunasekar. Basic Econometrics.

McGraw Hill Education (India) Private Limited; 5th edition (2011)

2. Jeffrey M. Wooldridge. Introductory Econometrics: A Modern Approach Cengage

Learning India Pvt. Ltd.; 5th edition (2014)

3. G. S. Maddala, KajalLahiri. Introduction to Econometrics. Wiley India Pvt Ltd; 4th

edition (2012)

47


Students are required to study TWOelective papers from the Honours discipline during semester

V. The list of electives for semester V are given below:

Choose any Two in Semester-V

1. Public Finance CEC33105

2. Industrial Economics CEC33107

3. Economics of Health and Education CEC33109

PUBLIC FINANCE

[CEC33105: DSE/Credit-6]

Public finance is the study of government policy from the points of view of economic efficiency

and equity.Inherently, this study involves a formal analysis of government taxation and

expenditures. The subject encompasses a host of topics including public goods, market failures

and externalities. The paper deals with the nature of government intervention and its implications

for allocation, distribution and stabilization. The paper is dealing with the theory of public

economics on one hand and the other with the public finances.

Unit 1: Introduction to public finance

Functions of Government - Economic functions -allocation, distribution and

stabilization;Regulatory functions of the Government and its economic significance;

Government budget and its structure – Receipts and expenditure; Concepts of current and capital

account, balanced, surplus, and deficit budgets;

Federal Finance: Different layers of the government; Inter governmental transfer—horizontal vs.

vertical equity;

Unit 2: Public Revenue and Tax structure

Concept of tax, optimal taxation; types of tax – direct tax and indirect tax;

Canons of Taxation; Principles of taxation -Ability to Pay principle; Benefit Approach of

Taxation;

Indirect tax – principles of commodity taxation; Demand elasticity and supply elasticity;

Efficiency in tax collection; VAT, GST, Subsidy and Transfer Policy;

48

Non-tax revenue resources- Earnings from public undertakings – Earnings from business of the

Govt. public services;

Unit 3: Public Expenditure and Public goods

Concept of public goods—characteristics of public goods; national vs. local public goods;

determination of provision of public good;

Externality, concept of social versus private costs and benefits; merit goods, club

goods;Provision versus production of public goods;

Market failure and public provision;

Unit 4: Deficit or surplus: Public debt

Concept of budget deficit vs. fiscal deficit; Functional classification of budget; Concept of

Revenue Deficit;Instruments for stabilization; Public Debt-internal and external – burden of

public debt;Elementary aspects of Public finance in an open economy;

Readings:

1. Musgrave and Musgrave: Public Finance in Theory and Practice (Fifth Edition).

2. Dorbusch, R.: Open Economy Macroeconomics.

3. Gruber J. (2011): Public Finance and Public. Worth publishers

4. AmareshBagchi (ed.). Readings in Public Finance. Oxford University Press.

Misra and Puri. Indian Economy.

INDUSTRIAL ECONOMICS

[CEC33107: DSE/Credit-6]

This course along with labour economics and industrial organizations will provide a thorough

understanding to the students regarding major developments in Industrial economics and it’s

allied issues. This course is a basic introduction to the Industrial Economics in terms how

structures of a industrial set up affects its functioning. Along with that the application of research

and development and the importance of location will be analyzed.

Unit I: Industrial Structure

Industrial structure and market structure; Industrial Concentration; Structure-Conduct-

Performance (S-C-P) model

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Unit 2: Expansion of firms

Mergers, acquisition and diversification; Foreign capital; MNC’s and Transfer pricing; Indian

experience

Unit 3: Research and Development in the process of Industrialization

Research and Development and international patent laws; Product and process patent; Diffusion

of technology;

Unit 4: Location of the Industrial development and Industrial Policy

Location of the particular plant; Regional Development; Industrial policy

Readings:

1. R.R.Birthwal, Industrial Economics, 2nd Edition

2. F.M. Scherer: Industrial Market Structure and Economic Performance. 2nd edition.

ECONOMICS OF HEALTH AND EDUCATION

[CEC33109: DSE/ Credit-6]

The importance of education and health in improving well-being is reflected in their inclusion

among the Millennium Development Goals adopted by the United Nations member states, which

include among other goals, achieving universal primary education, reducing child mortality,

improving maternal health and combating diseases. This course provides a microeconomic

framework to analyse, among other things, individual choice in the demand for health and

education, government intervention and aspects of inequity and discrimination in both sectors. It

also gives an overview of health and education in India.

Unit 1: A theoretical understanding

Health Economics: A new subject? - Health and health care; Market for health care and its

uniqueness: Introducing externality and uncertainty; Demand for health care: Can usual

neoclassical framework do?

Unit 2: Measurement of health

Morbidity & Mortality; Disability Adjusted Life Years; Epidemiological Transition Theory

50

Unit 3: Providers

Doctors and fee structure; Pharmaceutical Industry; Insurance Market

Unit 4: Issues related to health care policy

Health care reform and its experience; Health care finance; Public private partnerships;

Sanitation policy;

Unit 5: Economics of Education

Public expenditure in Education; Productivity, citizenship, Credit Market Failure, Failure to

maximize family utility; Redistribution; Govt. involvement in education: Free public education

and crowding out and solutions;

Unit 6: Market for Education

Direct expenditure on education; measuring returns on education on productivity; Market failure

and govt. expenditure on higher education;

References:

1. Gruber J. (2011): Public Finance and Public. Worth publishers

2. World Health Organisation (2000), Report of Commission on Macroeconomics and Health;

3. World Health Organization (2010), Socioeconomic Determinants of Health;

4. Cuyler A and J Newhouse (ed) (2000), Handbook of Health Economics. Elsevier.

5. Chattopadhyay Saumen (2012) Education and Economics: Disciplinary Evolution and

Policy Discourse. OUP;

51

THIRD YEAR

Semester VI

52

MONEY BANKING AND FINANCIAL MARKETS

[CEC33102: CC/ Credit 6]

This course demonstrates the role of banks in creation and circulation of money in the forms of

assets in the real sector as well as financial sector. The banks create money in the lending process

through the multiplier method. This money crystallizes in the forms of fixed capital and

consumer durables, which remain hypothecated with the banks during the life of the loan. This

loan in turn contributes to the aggregate demand in the form of investment products and thus

augments the economy's output. This output generates income in the hand of households,

corporates and the governrnent, a part of which is saved and channelized to the financial sector

towards acquisition of financial securities. This course starts with introduction to the functions of

the banks with special reference to lending, continues with the description of the financial

markets and their work profiles and ends with relevant regulations on Banks and Financial

Markets that affect determination of interest and income.

Unit 1: Introduction to Banking

• Concept of Financial Intermediaries

• Definition and Functions of Bank

• Structure of the Banking Industry

• Role of Banks in Creation of Money: The Lending Process

• The Money Multiplier Process

• Regulations on Lending

Unit 2: Introduction to Financial Markets

• Concept of Financial Market

• Money Market vis-à-vis Capital Market

• Concept of Financial Securities and their Credit Rating

• Concept of Issuer and Investor in the Financial Markets

• The role played by financial markets in determination of yields through price discovery

• The Concept and Construct of Yield Curve

• The Role of Yield in Income Determination

Unit 3: Regulator and Regulation

• Introduction to Central Banking and Monetary Policy

• RBI Regulations on Lending

• Role of CRR and SLR in determining the volume of loans

• Auction and buy back of government securities by RBI in open market operations

• Money Markets Operations by RBI - Repo, Reverse Repo and Marginal Standing Facility

• Role of RBI in creation of a vibrant debt market

53

Unit 4:International Finance and Monetary Policy

• The Foreign Exchange Market

• The International Financial System

• Monetary Policy Strategy: The International Experience

• Lessons from Banking and Financial Crises

Readings:

1. Frederic S Mishkin, The Economics of Money, Banking and Financial Markets, 7th

Edition, Pearson Addison Wesley

2. JagdishHanda, Monetary Economics, Routledge, Oxon, 2nd Edition

3. Glyn Davies, A History of Money, University of Wales Press, Cardiff, 1st Edition

4. Financial Institutions and Markets, Anthony Saunders and Mercia Cornett, MgGraw-

Hill, 6th Edition

Note: Study material may be supplied by faculty.

54

OPEN ECONOMY MACRO AND ITS GOVERNANCE

[CEC33104: CC/ Credit 6]

This course is designed to analyze the aggregate macroeconomic issues of price, output, and rate

of interest in the context of an open economy. The course is also designed for the undergraduate

students to get equipped with policy issues especially under open economy framework. The

course also provides theoretical insights into the issue of governance under open economy

framework.

Unit I: Macro economy in a small open economywithout money

Macroeconomic identities under open economy, multipliers in an open economy, foreign trade

multipliers, current account,the government sector.

Unit 2: Macro economy in a small open economywith money; policy analysis

Interest rate and prices in a open economy framework; Commodity and money market

equilibrium; money, exchange rates and prices; Fiscal and monetary policy under open economy

framework; fixed and flexible exchange rate; perfect and imperfect capital mobility; interest rate

parity; Mundell-Flemming model under fixed and flexible exchange rate; Impossible trinity.

Unit 3: Balance of Payment management under fixed and flexible exchange rate

Balance of payment adjustment under fixed exchange rate regime; the role of price in an open

economy; automatic adjustment; exchange rate management

Balance of payment adjustment under flexible exchange rate; Relative price and the trade

balance; the J-Curve, Monetary approach to balance of payment.

Unit 4: Governance in an open economy

Government budget deficit and it’s impact on open economy; Trade-off in deficit financing and

exchange rate management; Trade policy; political instability and capital flight;

55

Suggested Readings:

1. Mankiew, N.G,Principles of Macroeconomics. N. G. Mankiw. South-Western Cengage

Learning (6th edition),2012.

2. RodsethAsbjorn, Open Economy Macroeconomics,Cambridge University Press,

Cambridge.

3. Macro Economics, R Dornbusch, S Fischer ; Mc Graw Hill Education(Sixth Edition);

2005.

4. Dornbusch, Rudiger, Open Economy Macroeconomics (New York: Basic Books, 1980).

56


Students are required to study TWOelective papers from the Honours discipline during semester

VI. The list of electives for semester VI are given below:

Choose any Two in Semester-V

1. International Trade CEC33106

2. Labour Economics CEC33108

3. Environmental Economics CEC33110

INTERNATIONAL TRADE


This course is based on the international trade theory derived from the price theory in general. It

begins with the basics of price theory to advance to the different standard trade theories that

evolved over time. Once this is accomplished, the course then helps the students move to the

applications and techniques essential in the field of international trade policy. Finally, an

introduction to international finance is to be provided to the students, preparing them for the

contemporary debates from the perspective of the third world countries. International Finance

emerges from transactions in the capital account, which get place in multi-currency

balancesheets and income statements. In this context behaviour of exchange rates, risks in

fluctuations of the exchange rates

Unit 1: Classical theory of international trade

Introduction, Mercantilists’ views on trade, the labour theory of value, Adam Smith’s absolute

advantage, Ricardo’s comparative advantage, the opportunity cost theory, gains from trade

(constant costs)

Unit 2: Neoclassical theories

Production possibility frontier with increasing costs, community indifference curves, equilibrium

in isolation, gains from trade, incomplete specialization, partial equilibrium analysis- the

equilibrium- relative commodity price with trade, offer curves, general equilibrium, terms of

trade

Unit 3: Modern theory of trade

The Heckscher- Ohlin theory, Assumptions, factor intensity, factor abundance, the production

frontier, factor endowments, factor- price equalization theorem, New trade theories, imperfect

competition, dynamic technological changes

57

Unit 4: International Finance

Balance of payments, foreign exchange market, foreign exchange rate, spot and forward rates,

purchasing power parity theory, fixed exchange rate system vs. flexible exchange rate system,

managed floating, adjustments, stability, Marshal-Lerner condition

Unit 5: International Monetary System

The gold standard, the interwar experience, the Bretton woods System, its collapse, the present

International Monetary System

Unit 6: Exchange Rate Determination, Behaviour, Risk and Management thereof

Demand for and Supply of Currency - Exchange Rate Equilibrium - Determinants of Exchange

Rate - Forwards, Futures and Options in Currencies - Arbitrage - Interest Rate Parity

Readings:

1. International Economics: Dominick Salvatore (8th Ed.), Wiley India

2. International Financial Management, Jeff Madura, 12th Edition, Cengage Learning, Connecticut

3. Open Economy Macroeconomics: R Dornbusch, (International Students

4. Edition), Basic Books, New York.

5. World Trades and Payments: Caves, Frankel, Jones (9th Ed.), Pearson Education.

6. Sodersten, B. and Reed G.(1994) : International Economics, Macmillan, London, 3rd edition

7. Marjit, S. (2008): International Trade and Economic Development: Essays in Theory andPolicy,Oxford University Press, New Delhi.

8. World Trades and Payments: Caves, Frankel, Jones (9th Ed.), Pearson Education

9. International Trade Theory and Policy: M.Chacholiades, McGraw Hill Book Company (1978)

58

LABOUR ECONOMICS


This course is designed to provide the theoretical background of labour Economics with special

emphasis on trade union. The course is aimed as complementary to the undergraduate students

studying industrial economics. The course will highlights major theoretical models existing in

labour economics and will highlights theoretical explanations of unemployment.

Unit 1: Aggregate Labour Market

Basic theories of Labour Demand; Labour Supply: A household choice; Empirical Estimation of

the labour demand schedule; Nominal Wage rigidity;

Unit-2: Labour Market: A closer looks

Some stylized facts; Some standard Macroeconomic models for the labour markets; Real wage-

rigidities; Summary

Unit-3: Trade Union Models

Basic Trade Unions Model; Monopoly Trade Union Model, Right to Manage Model; Efficiency

Bargaining Model; Hysteria and persistence of Unemployment.

Unit-4: Unemployment

Insider -Outsider model; Efficiency wage model; Search Model; Labour market institutional

models of Unemployment.

References:

1. Ben J Heijdra and F Van der Ploeg ,The Foundations of Modern Macroeconomics by,

Oxford University Press.

2. Daniel S.Hamermesh, Labour Demand, Princeton University Press,1996.

3. Cahuc, Pierre, and Andre Zylberberg. Labor Economics. Cambridge, Mass. and London: MIT Press, 2004.

4. Bhattacharjea,Aditya (2006), “labor Market Regulation and Industrial Performance in

India:A Critical Review of the Empirical Evidence”, The Indian Journal of labor

Economics, 49(2):211-32.

5. Deakin Simon (2014), “Labour Law and Inclusive Development”,Centre for Business

Research, University of Cambridge ,Working Paper No. 458.

59

ENVIRONMENTAL ECONOMICS


This course is designed to introduce under-graduate students to the economic issues around

natural resources as well as environmental problems from the perspective of economics. Natural

resources being scarce lead to core economic questions regarding the optimal rate of extraction.

On the other hand, how discovery of new resource bases change the pricing and usage of one

resource comes under the domain of resource economics. Designing economic instruments for

regulation of environmental problems as well valuation of environmental services are major two

focus of this course. In addition to that, some global environmental issues along with their

macroeconomic policy impact will be addressed in this course.

Unit 1: Economics and Environment

Introduction; Economics and Environment; Review of Microeconomics and Economic Welfare;

Definition and role of Environmental Economics; Scope and Significance of Environmental

Economics; Relationship between the Environment and the Economic System; Environment as a

Resource: Environmental Quality;

Unit 2: Economics of Exhaustible Resources

Intergenerational liquidity – Intertemporal - Dynamic Framework of Optimal Control – Market

structure of Non-renewable resources – problem of Uncertainty – Depletion vs. Discovery –

Examples;

Unit 3: Economics of Renewable resources

Renewable resources – Problem of uncertainty – Case study of Forestry: Single versus Multiple

use Forest – Fishery: The concept of Maximum Sustainable Yield (MSY) - Economic Decision

regarding optimal rate of Extraction;

Unit 4: Market Failure and Problem of Externality and Environmental Regulation

Concept of Externalities and Public Bad; Concepts of Rivalry and Excludability;Environmental

Pollution as a Public Bad; Externality (Pigou), Property Rights (Coase), Optimal Pollution;

Pollution Control: Alternative Market Based Instruments – Pure policies (Emission Fees,

Standard setting, and Tradable Pollution Permits), Hybrid instruments (two-part tariff),

Unit 5: Environmental Valuation

Measuring values, benefits and costs – overview; total value – use and non-use values of goods;

60

Total Economic Valuation; Valuation Methods: Stated Preference Approach, Revealed

Preference Approach (intuitive discussion on different valuation methods)

Unit 6: Macroeconomic Purview of Environment

Environment and Global Climate Change; Kiyoto Protocol and Issues around Carbon trading;

Ecological Footprints; International Environmental Policies; Environmental Performance Index:

choice of indicators; Environmental Performance Index: Comparison across Developing and

Developed World;

References:

1. Charles Kolstad, Intermediate Environmental Economics, Oxford University Press, 2nd

edition, 2010

2. Costanza, et.al. (1998): An Introduction to Ecological Economics.

3. Bhattacharyya, R.N. (2001): Environmental Economics: Indian Perspective, OUP

4. Hanley, Shogren& White (1997): Environmental Economics, McMillan.

5. James, Mishra &Murty (1999) Economics of Water Pollution: The Indian Experience.OUP

6. Kadekodi , G. (2004): Environmental Economics in Practice: Case Studies from India, OUP

7. Environmental Performance Index, http://epi.yale.edu/ , Yale University;

8. United Nations Framework on Climate Change, http://newsroom.unfccc.int/

Kiyoto Protocol http://www.kyotoprotocol.com/

http://epi.yale.edu/

http://newsroom.unfccc.int/

http://www.kyotoprotocol.com/

61

PROJECT

[CEC33412: 6 Credits]

This course plan aims to provide exposure to the fundamentals of project writing techniques and

methods. Students are expected to learn critical reviewing of literatures in the area they are

interested in. Writing a short project will enhance their analytical and critical view towards

contemporary issues.

It is intended to enable students with writing guidelines which include the structuring of an

economic problem in reference to existing literature. The search of literature both theoretical

along with empirical evidences will train them into critical thinking. They need to present their

understanding first, later on they need to write a short project. It is expected that the students will

identify one particular research area which they will carry forward in writing dissertation in the

next semester. Identifying the research question in vast academic literature is the requisite of this

course. Students should be able to present their own viewpoint on the topic in the form of a

critique and future research ideas.

The final project report should include an Abstract, Introduction, Literature review, Research

Issue/Question and References. However depending on the type of topic the sections for Project

writing may vary student wise. In due course the students will learn proper referencing of

literature (APA, MLA styles of referencing), formatting styles etc.

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b.sc.(hons.) in economics

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