presidency university department of economics...

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PRESIDENCY UNIVERSITY

Department of Economics

SYLLABUS

M.Sc.

Applied Economics

July, 2011

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PRESIDENCY UNIVERSITY Course Structure

M.Sc. Applied Economics Total Marks 1000

Semester I 250 Marks Paper I: Theoretical Microeconomics 50 Marks Paper II: Theoretical Macroeconomics 50 Marks Paper III: Mathematical Economics 50 Marks Paper IV: Econometric Methods I 50 Marks Paper V: Computer Application I (Practical) 50 Marks Semester II 250 Marks Paper VI: Applied Microeconomics 50 Marks Paper VII: Applied Macroeconomics 50 Marks Paper VIII: Development Economics 50 Marks Paper IX: Econometric Methods II 50 Marks Paper X: Computer Application II (Practical) 50 Marks In semester III and IV students are required to take two special/elective courses of 200 marks each). The four special/elective fields offered are:

1. Advanced Econometrics 2. Financial Economics 3. Applied Health Economics and Demography (subject to availability of resource persons) 4. International Economics (subject to availability of resource persons)

In semester IV there will be a Project paper of 100 marks.

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PRESIDENCY UNIVERSITY DETAILED SYLLABUS M.Sc. Applied Economics

[Figures in extreme right indicate the number of contact hours]

FIRST SEMESTER

PAPER I THEORETICAL MICROECONOMICS Full Marks: 50 Module 1 Theory of Consumer Choice and Demand 22 Unit 1 Theory of Choice and Postulates about Ordering- Preference Relations

Utility Function Various Types of Preferences 04

Unit 2 Budget Constrained Choice - Utility Maximization Problem (UMP), Interior and Corner Solutions, Ordinary Demand Functions, Comparative Statics of UMP, Indirect Utility function

04

Unit 3 Theory of Revealed Preference Expenditure Minimization Model - Expenditure Minimization, Compensated Demand Functions, Expenditure Function properties: Concavity and Shephard’s Lemma

05

Unit 4 Properties of Consumer Demand – Homogeneity, Price, Substitution and Income Effects, Duality and Modern Derivation of Slutsky Equation, Elasticity Relations

04

Unit 5 Special Topics in Consumer Theory and Applications - Consumer’s surplus: Willingness to pay, Compensating and Equivalent Variation, Intertemporal choice, Labour- Leisure Choice, Household Production Model

05

Module 2 Choice under uncertainty 15 Unit 1 Concepts of Lotteries, Axioms of choice under uncertainty, Expected

Utility Function and its properties, Expected Utility Theorem and its proof, Violations of Expected Utility Theorem – paradoxes

05

Unit 2 Preferences towards risk, Reducing risk – diversification, Insurance, value of information

04

Unit 3 Applications: Demand for risky asset; The trade-off between risk and return –CAPM

03

Unit 4 Individual Decision making under uncertainty 02 Unit 5 Concept of subjective probability 01 Module 3 Theory of Firm 12 Unit 1 What is a Firm? - Firm as a transformer of inputs into outputs, production

sets, production functions, Different types of Technology: Cobb-Douglas, Fixed Proportion, Linear, CES, Multi-product production set

02

Unit 2 Decision-Making By Price-Taking Firms: Input prices and marginal cost, laws of firm demand and supply, short v. long run response to a price change, Cost Function, Output effect, Convexity of the Production Set and Increasing Marginal Cost, Effect of price changes on inputs and outputs, Le Chatelier Principle

04

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Unit 3 Firm and Industry Analysis - optimality of marginal cost pricing, equilibrium with free entry, scale of competitive firms

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Unit 4 Optimal Pricing with Joint Costs 02 Unit 5 Regulation of Monopoly 01 Module 4 Introduction to social choice 15 Unit 1 The Two Basic Theorems of Welfare Economics 03 Unit 2 Kaldor-Hicks Criteria for Welfare Improvement 03 Unit 3 Introduction to the Theory of Social Choice 09

Suggested Readings: Jehle, G.A. and P.J. Reny, Advanced Microeconomic Theory, Addison

Wesley, 2000. Mas-Colell, A., M.D. Whinston and J.R. Green, Microeconomic Theory,

Oxford University Press, 1995. John Riley, The Essence of Microeconomics Varian, H. R., Microeconomic Analysis, W. W. Norton & Co, 3rd Revised

edition, 1992 E. Silberberg and W. Suen, The Structure of Economics: A Mathematical

Analysis, 3rd Ed., Irwin/McGraw Hill W. Nicholson and C. Snyder, Microeconomic Theory: Basic Principles and

Extension, South-Western College Pub; 11th edition, 2011 B. R. Binger and E. Hoffman, Microeconomic Theory with Calculus, Scott,

Foresman, 1988 Carl P. Simon and Lawrence E. Blume Mathematics for Economists, W.W.

Norton & Company, 1994 Efe A. Ok Real Analysis with Economic Applications, Princeton University

Press, 2007 Layard, P.R.G. and A.A. Walters, Microeconomic Theory, McGraw-Hill

College, 1978 Arrow, K. J., Social Choice and Individual Values, John Wiley & Sons, Inc.,

1963. Koopmans, T. C. Three Essays on the State of Economic Science, McGraw-

Hill Inc., 1957

PAPER II THEORETICAL MACROECONOMICS Full Marks: 50 Module 1 Open Economy Macroeconomics 14

Unit 1

Unit 2

Capital flow and effective demand: Mundell – Fleming model and policy effectiveness under alternative exchange rate regimes. Exchange rate dynamics

08 06

Suggested readings : Dornbusch, Open Economy Macroeconomics Mankiw, Macroeconomics

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Module 2 New Classical Economics 16

Unit 1

Unit 2

Rational expectations hypothesis : Barro – Lucas model, anticipated and unanticipated monetary shocks and equilibrium business cycles, issue of time inconsistency Real Business Cycle – Inter temporal substitution of labor, Propagation mechanism, policy issues

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Suggested readings : Snowdon, B. and H. R. Vane, Modern Macroeconomics: Its Origins, Development and

Current State Attfield, C. L. F., Demery, D. and Duck, N. W, Rational Expectations in

Macroeconomics: An Introduction to Theory and Evidence Dornbusch, Fischer and Startz, Macroeconomics Froyen, Macroeconomics : Theory and Policy

Module 3 New Keynesian Economics 14

Unit 1

Unit 2

Unit 3

Unit 4

Sticky price and Efficiency wage models

Models of staggered wages and prices

Strategic complementarity and coordination failure

Adverse selection in credit market and equilibrium credit rationing

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03

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Suggested readings : Mankiw and Romer (ed.), New Keynesian Economics Gali, J, Monetary Policy, Inflation, and the Business Cycle

Module 4 Theories of Endogenous Growth 20 Suggested readings :

David Romer, Advanced Macroeconomics Barrow and Sala-i-Martin, Theory of Growth Aghion and Howitt, Theory of Growth Das Gupta, D, Theory of Growth

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PAPER III MATHEMATICAL ECONOMICS Full Marks: 50 Module 1 Linear Algebra and its Applications 12

Unit 1 Determinants and Matrices – Operations with Matrices – Types of Matrices – Orthogonal and Idempotent matrices and their properties – Rank of a matrix and trace of a matrix – Characteristic roots and Characteristic vectors – Diagonalization of a matrix

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Unit 2 Input-Output Analysis – LSOM and LSCM – Quantity System and Price System – The Hawkins Simon Condition – The derivation of CPL – Numerical problems on the LSOM- Leontief Dynamic Models – Application of LSOM to Planning Exercises

06

Module 2 Techniques of Linear and Non-linear Programming 20 Unit 1 LPP: Primal and Dual – Typical problem of LPP – The Diet problem and

the Assignment problem – Economic interpretation of dual variables – Methods of solving LPP – The Complementary Slackness Theorem and the Duality Theorem

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Unit 2 Non- linear programming problems – Graphical methods of solution – The Kuhn- Tucker Conditions – Application of K-T conditions in selected problems of non-linear programming.

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Module 3 Techniques of Dynamic Optimization 16 Calculus of Variation 06 Dynamic Programming and Optimal Control – Current Value

Hamiltonian and its application to Control problems. Dynamic Programming and Optimal Control – Current Value Hamiltonian and its application to Control problems.

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Module 4 Real Analysis 16 Metric space – Sets and Mappings and selected theorems – Their

applications

Suggested Readings: Hadley, G.: Linear Algebra Takayama, A.: Mathematical Economics Binmore, K. G.: Mathematical Analysis Ross and Starr: General Equilibrium Theory Mukherji and Pandit: Mathematical Methods For Economic

Analysis Rudin: Elementary Real Analysis Hoy, Livernois, McKenna, Rees, Stengos: Mathematics for

Economics Chiang, A.: Elements of Dynamic Optimization

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PAPER IV ECONOMETRIC METHODS I Full Marks: 50 Module 1 Statistical Background 14 Introduction to basic concepts like probability theory, random variables, density and

distribution functions (including some common theoretical distributions). Sampling techniques. Classical statistical inference (including small sample and large sample properties) Suggested Readings:

Miller, I. & Miller, M.: John E. Freund’s Mathematical Statistics with Applications, Prentice Hall.

Hoel, Port and Stone: Introduction to Probability Theory, Houghton Mifflin. Hoel, Port and Stone: Introduction to Statistical Theory, Houghton Mifflin.

Module 2 Multiple Regression Analysis 24 Unit 1 Review of Two Variable Classical Linear Regression Model 04 Unit 2 Matrix Formulation of the K-Variable Model - Estimation –Gauss-Markov Theorem

- alternative measures of goodness of fit – Inference – Prediction 14

Unit 3 Problems with the tests of Stability - use of Dummy Variables as Regressors.

06

Module 3 Problems due to the Nature of the Error Term 20 Unit 1 Nonspherical disturbances and their implications for the properties of the OLS

estimators of CLRM parameters, Aitken theorem and Generalised Least Squares (GLS) methods of estimation.

05

Unit 2 Heteroscedasticity - nature of the problem, tests and estimation techniques; Autocorrelations - nature of the problems, tests and estimation techniques.

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Module 4 Problems due to the Nature of the Regressors 06 Multicollinearity - nature of the problem, and its consequences, detection of

multicollinearity, and possible solutions.

Suggested Readings: Johnston, J. and J. Dinardo: Econometric Methods, McGraw Hill. Wooldridge, J. M.: Econometrics, CENGAGE Learning. Maddala, G.S.: Introduction to Econometrics, John Wiley & Sons Ltd. Greene, W.H.: Econometric Analysis, Prentice Hall. Judge, G.G., W.E. Griffith, R.C. Hill, H. Lutkepoul and T.C. Lee, The

Theory and Practice of Econometrics, John Wiley and Sons Davidson, J.: Econometric Theory, Blackwell Publishers

PAPER V COMPUTER APPLICATIONS I Full Marks: 50 Module 1 Introduction to EXCEL 20 Introduction to Excel – Excel Basics needed for Statistical Analysis of the Data –

Data Presentation and Data Management – Filtering and Sorting Data – Formulae and Functions. Methods for Describing Univariate and Bivariate Data Set: Graphical Techniques, Numerical Techniques (Measure of Center, Spread, Relative Standing, Skewness, Kurtosis, Correlation, etc.). Regression Analysis.

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Solver. Assignments on Economic Problems. Suggested Readings: Whigham, D.: Managerial Economics Using Excel, Thomson Learning

Module 2 Introduction to at least one statistical software (STATA / EVIEWS/ SPSS / R) 44 Data management – Descriptive statistics – Graphical analysis – Bivariate analysis –

Hypothesis testing – Correlation – Regression and some extensions (heteroscedasticity, dummy variables). Assignments on economic problems.

Other references will be provided as and when necessary

SECOND SEMESTER PAPER VI APPLIED MICROECONOMICS Full Marks: 50 Module 1 Market Structures

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Unit 1 Introduction. The SCP paradigm. Additional cost concepts. Basics of game theory 1 Unit 2 Market structures, Cournot competition with many firms. Bertrand competition

with Product differentiation, Hotelling model, Measures of market concentration and market power.

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Unit 3 Cartels and collusion, Explicit collusion, Size of cartel, Cheating in a cartel, Successful operation of a cartel, Tacit Co-operation

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Unit 4 Entry Barriers: Bain: The three types of entry barriers, Conditions of entry: the Dixit Model, The Sylos Postulate and the Limit Pricing Model, Predatory pricing.

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Unit 5 Net work externalities: Compatibility and standards. 1 Unit 6 Auctions: Different Types of Auctions, Winner’s curse, Truthful Revelations of

Valuations, The Revenue Equivalence Theorem, Sniping in internet auctions. 2

Unit 7 Advertising:, Informative advertising, Persuasive advertising, The Dorfman- 1 Steiner model. Unit 8 Strategic Commitment:, Direct and Strategic effects, Commitments, Taxonomy of

strategies, Flexibility and option value.

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Module 2 Firm Behavior 12 Unit 1 Non-profit maximizing behavior: The labor-managed firm, Nash bargaining

solution 3

Unit 2 Multi-market operation:, Vertical integration, Conglomerate diversification, 3 Related diversification, Unrelated diversification. Unit 3 Firm as the source of profit:, Assets of the Firm, A Resource-based View of the

Firm. 2

Unit 4 Architecture I – Contracts and Incentives, Internal labor markets, Efficiency wage theory, The incentive problem, Unobservable efforts, Incentive from ownership, Incentives and insurance., Architecture II – Organizational forms

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Module 3 Government Policies 12 Unit 1 Innovation: R & D, Creative destruction, The incentive to innovate, Innovation

competition, Patent races, A static model of process innovation 3

Unit 2 Privatization: Definition, Techniques, Why were PSEs created in the first place? Why Privatize? Obstacles to privatization - Some Important Issues

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Unit 3 Regulation: Two views of regulation, Price regulation, Monopoly with increasing marginal cost, Natural monopoly.

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Unit 4 Competition Policy: Two main aspects of a competition policy, Why competition policy? Two main domains of antitrust law, Per se violations and the Rule of reason, Different Approaches to regulation, Some Issues in Competition Law, International harmonization of Competition Laws, Competition Policy in Dynamic Markets.

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Module 4 Applications 10 Application of GE theory in International Trade, in Macroeconomics and in

Public Finance. 10

Module 5 Information Economics 10 Information Economics: Models of Adverse Selection and Moral Hazard 10 Suggested Readings:

D.N. Sengupta and A. Sen – Economics of Business Policy,OUP. David Besanko, David Dranove and Mark Shanley – The Economics of Strategy. John

Wiley. D.W.Carlton and J.F. Perloff-Modern Industrial Organization, Harper Collins Publishers.

Jean Tirole – The Theory of Industrial Organization, The MIT Press. Oz Shy- Industrial Organization, The MIT Press F.M. Scherer and D. Ross – Industrial Market Structure and Econoamic Performance,

Houghton Mifflin Company. John Kay – Why Firms Succeed, Oxford University Press. D. A. Hay and D.J. Morris – Industrial Economics and Organization: Theory and

Evidence, OUP. Kreps, D.M., A course in Microeconomics Theory Kemp, M.C., The Pure Theory of International Trade Hicks, J.R., Value and Capital. Houghton (ed) Public Finance

PAPER VII APPLIED MACROECONOMICS Full Marks: 50 Module 1 Macroeconomics for Developing countries 12 Unit 1 Nature and scope of development macroeconomics – a general

accounting framework - economic structure of developing countries with emphasis on production structure, labour market and financial sector

07

Unit 2 The World Bank – IMF view of developing country macroeconomics – issue of stabilization – a prototype WB- IMF model of developing country with a critical appraisal

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Suggested Readings:

Agenor,P-R & Peter.J., Montiel , Development Macroeconomics

Haque, N. U., Kajal Lahiri & Peter.J., Montiel, A Macroeconometric Model for Developing Countries, IMF Staff Papers, Vol.37, No.3 (Sept. 1990)

Montiel Peter.J., Macroeconomics in Emerging Markets Taylor.L. Varieties of Stabilzation Experience, (1988)

Module 2 Sectoral Interlinkages in Developing Countries 13 Unit 1 Structure of a dual economy – some useful structuralist closed economy

and open economy models

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Unit 2 Inflation in a developing country – the structuralist-monetarist debate – structural disequilibrium and inflation Suggested Readings:

Bagchi, Amiya, Closed Economy Structuralist Model for a Less Developed Country in ‘Macroeconomics’ edited by Prabhat Patnaik

Basu, K.; Analytical Development Economics Dutt, Amitava K.; Openeconomy Macroeconomic Themes for

India in Macroeconomics’ edited by Prabhat Patnaik Rakshit, M.;(ed) Studies in the Macroeconomics of Developing

Countries

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Module 3 Public Finance and Financial Repression in Developing Countries 11

Unit 1 Alternative financing options and the sustainability of fiscal deficits - intertemporal budget constraint of the consolidated public sector – dynamics of public debt

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Unit 2 Financial repression: Meaning and implications; financial liberalization and critical appraisal. Suggested Readings:


Brock, Philip L. (1989) Reserve Requirements and the Inflation Tax, Journal of Money, Credit and Banking 21(February), 106-21

Montiel Peter.J., Macroeconomics in Emerging Markets Spaventa, Luigi., The Growth of Public Debt, IMF Staff Papers

Vol.34 (June 1987)

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Module 4 Exchange Rate and Capital Flow to Developing Countries 14 Unit 1 Alternative exchange rate regimes-an overview; capital flow to 07

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developing countries and its macroeconomic implications Unit 2 Some useful models of exchange rate dynamics

Suggested Readings:


Montiel Peter.J., Macroeconomics in Emerging Markets Rakshit, M.;(ed) Macroeconomics of Post Reform India Rakshit, M.;(ed) Money and Finance in the Indian Economy

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Module 5 International Financial Markets and Financial Crises 14 Unit 1 Integration and efficiency of international financial markets, Modigliani-

Miller theorem – leverage and cost of bankruptcy 07

Unit 2 Indicators of financial crises: different approaches to financial crises – Reforming the international financial architecture Suggested Readings:

Agenor,P-R & Peter.J., Montiel , Development Macroeconomics Chui and Gai, Private Sector Investment and international

Financial Crises: An Analytical Perspective Stein, J.L., International Financial Markets: Integration,

Efficiency and Expectation Tirole, J., The Theory of Corporate Finance Some selected papers of Paul Krugman, Mihir Rakshit and Amit

Bhaduri

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PAPER VIII DEVELOPMENT ECONOMICS Full Marks: 50 Module 1 Approaches to Development 16

Unit 1 Unit 2 Unit 3 Unit 4

Development as growth with fairness (redistributive justice), Development as capabilities enhancement, Development as environmental sustainability. Development as structural change, Development as a coordination (failure) problem. Development Strategies and the Role of the State Millennium Development Goals

Suggested Readings:

Sen, A.K: The Standard of Living, CUP Ray, Debraj: Development Economics OUP. (Selected

Chapters) Fukuda-Parr and Shiva Kumar: Readings in Human

Development OUP. (Selected Papers) Human Development Reports- 1991, 1996, 1997, OUP

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World Development Reports- 1992, 1993, 1994, 2001, OUP Websites of the WB, ILO, UNDP,WHO,FAO, etc. Dreze, J., Sen, A.K.: INDIA: Economic Development and

Social Opportunity, OUP Dreze, J., Sen, A.K.: Hunger and Public Action, OUP Christopher Colclough and James Manor(ed):States or

Markets? (Structuralism versus Neo-liberalism: An Introduction by Christopher Colclough)

Sachs, J.: The End of Poverty, Penguin

Module 2 Economic Development: Measurement and Issues

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Unit 1 Issues in Economic Development: Poverty, Inequality, intra household resource allocation, child labour

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Unit 2 Measuring Development: the measures their meanings 06 Unit 3 Gender in Development 02 Unit 4

Special role of education and health in economic development Suggested Readings:

Subramanian, S: Measures of Inequality and Poverty, OUP Sen, A.K.: On Economic Inequality, OUP Siddiqi, Faraaz, Patrinos, Harry Anthony: Child Labor:

Issues, Causes And Interventions, HCOWP 56 Edmonds, Eric V.:Child Labor in T. P. Schultz and J.

Strauss, eds., Handbook of Development Economics Volume 4 (Elsevier Science, Amsterdam,North Holland)

Human Development Reports- 1991, 1996, 1997, OUP Websites of the WB, ILO, UNDP,WHO,FAO, etc.

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Module 3 Globalization and Development: Issues and Trends

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Unit 1 Globalization as a process in history 02 Unit 2 Unit 3 Unit 4 Unit 5 Unit 6 Unit 7 Unit 8

The Drivers of Globalization: Innovations in Technology The Drivers of Globalization: Integration of Markets The Decelerating Forces: Instability of Growth and Crises The Decelerating Forces: Inequality of Income and Wealth The Multilateral Organizations: IMF and World Bank WTO and its functions Global Governance: Possibilities and Problems

02 02 04 04 02 02 02

Suggested Readings:

Marjit, Sugata: International trade and economic development. OUP, (chapter 6, 7 and 8).

Marjit, Sugata and Acharyya, Rajat: International trade, wage inequality and the developing economy. Physica-Verlag (chapters 2 & 3).

Sikdar, Soumyen: Contemporary issues in Globalization,

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OUP (chapters 3, 4 & 7). Narayana, NSS (ed): The Political Economy of Trade,

Finance and Development, OUP, (chapters 1, 4, 5, 16). Goldin and Reinert: Globalization for development, Rawat

publications (Chapter 1 and 7). Stiglitz, J.E. (2002): Globalization and its Discontents,

Penguin Stiglitz, Joseph E.: Making Globalization Work, Allen Lane Shuurman, Frans J. (ed):Globalization and Development

Studies(Paper by Davids and van Driel and Paper by M.A. Mohamed Salih), Vistaar Publications.

Christopher Colclough and James Manor(ed):States or Markets? (Structuralism versus Neo-liberalism: An Introduction by Christopher Colclough)

Bhagwati, J.: In Defence of Globalization, OUP Sachs, J.: The End of Poverty, Penguin Hoekman, B.M., Kostecki, M.M, The Political Economy of

the World Trading System, OUP Bhaduri, Amit: Development with Dignity, OUP ILO: Fair Globalization Korten, David C.: When Corporations Rule the World,

Kumarian Press Ghosh, Ajit K.: Jobs and Incomes in a globalizing world,

Bookwell/ILO

Module 4 Group essay writing followed by personal interviews on any topic of Development Economics involving any of the following:

Survey or experiment Experience of developmental work actually undertaken Analysis of a problem to provide workable solution

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PAPER IX ECONOMETRIC METHODS II Full Marks: 50 Module 1 Problems in Model Specification 10 Unit 1 Concept of Specification Error 02 Unit 2 Model evaluation and diagnostic tests:

Chow test, Ramsay’s RESET, Bera-Jarque test of normality of errors. Nested and non-nested models. Suggested Readings:

Johnston, J. and J. Dinardo Econometric Methods, McGraw Hill. Wooldridge, J. M.: Econometrics, CENGAGE Learning. Maddala, G.S.: Introduction to Econometrics, John Wiley & Sons

Ltd.

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Module 2 Introduction to Limited Dependent Variable Models 10 Binary Choice Models - Linear Probability Model, Probit and Logit Models

Suggested Readings:

Maddala, G.S. Limited Dependent and Qualitative Variables in Econometrics, Cambridge University Press

Maddala, G.S. Introduction to Econometrics, John Wiley & Sons Ltd..

Module 3 Basics of Time Series Econometrics 20 Introduction – ACF and PACF - Some Useful Processes (White Noise,

Random Walks, MA Processes, AR Processes, ARMA Processes and ARIMA Processes) – Analysis of Time Series and Box-Jenkins Method. Introduction to Forecasting. Volatility, Meandering and co-movements with other series. Suggested Readings:

Chatfield, C.: The Analysis of Time Series: An Introduction Enders, W.: Applied Econometrics Time Series, John Wiley

and Sons Nachane, D. M.: Econometrics – Theoretical Foundations and

Empirical Perspectives, OUP Granger, C.W.G. and Newbold, P.: Forecasting Economic

Time Series

Module 4 Basics of Static Panel Data 12 Sources and Types of Panel Data – Pooled Estimator – Random Effect Model

– Fixed Effect Model – Fixed versus Random Effects Model and the Hausmann Test. Suggested Readings:

Johnston, J. & J. Dinardo Econometric Methods, McGraw Hill. Greene, W.H. Econometric Analysis, Prentice Hall. Hsiao, C. Analysis of Panel Data, Cambridge University Press.

Module 5 Introduction to Simultaneous Equation Models 12 Structural equations – reduced form equations - identification problem.

Instrumental variable models Generalized Method of Moments (with application to 2SLS, 3SLS, etc.) Suggested Readings:

Maddala, G.S. Introduction to Econometrics, John Wiley & Sons Ltd.

Johnston, J. and J. Dinardo Econometric Methods, McGraw Hill. Wooldridge, J. M.: Econometrics, CENGAGE Learning.

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PAPER X COMPUTER APPLICATIONS II Full Marks: 50 Module 1 Limited Dependent Variable Models

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Module 2 Time Series Models 30 Module 3 Panel Data

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Module 4 Simultaneous Equation Models 10 Computational Tools:

Use of software like STATA, EVIEWS, TSP, etc. Instructor may also devote some lectures to reviewing estimation procedures as required.

Other references will be provided as and when necessary

THIRD SEMESTER PAPER XIA ADVANCED ECONOMETRICS I Full Marks: 50 Module 1 Advanced Discrete and Limited Dependent Variable Models 30 Multinomial Response Models – Analysis of Ordered Data.

Handling Grouped Data. * Count Data Models. Problem of Limited Information - Truncation and Censoring - TOBIT Models. Sample Selection Models. * Models for Duration Data. Suggested Readings:

Maddala, G.S. Limited Dependent and Qualitative Variables in Econometrics, Cambridge University Press

Greene, W.H. Econometric Analysis, Prentice Hall. Judge, G.G., W.E. Griffith, R.C. Hill, H. Lutkepoul and T.C. Lee, The

Theory and Practice of Econometrics, John Wiley and Sons. Lancaster, T.: Econometrics of Transition Data. Cameron, C. and Trivedi: Regression Analysis of Count Data.

Module 2 Advanced Panel Data Models 20 * Unbalanced Panels – Fixed and Random Effects.

* Heteroscedasticity and Robust Covariance Estimation. Dynamic Panel Data Models. Suggested Readings:

Arrelano, M. Panel data econometrics Greene, W.H., Econometric Analysis, Prentice Hall. Judge, G.G., W.E. Griffith, R.C. Hill, H. Lutkepoul and T.C. Lee, The

Theory and Practice of Econometrics, John Wiley and Sons.

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Module 3 Exploratory Data Analysis 14 Factor Analysis using Principal Component method of estimation.

Cluster Analysis. Suggested Readings:

Johnson, R. A, and Wichern, D. W.: Applied Multivariate Statistical Analysis

Hair, Black, Babin, Anderson, Tatham: Multivariate Data Analysis, Pearson Education

Components marked with * may be covered at the instructor’s discretion

PAPER XIIA ADVANCED ECONOMETRICS II Full Marks: 50 Module 1 Models with Lagged Variables 20 Lagged effects in a dynamic model, Impact multiplier/ Short Run multiplier,

Equilibrium Multiplier/ Long Run Multiplier, Lag Operators Finite and Infinite Distributed Lag Models (Almon Lag, Koyck Lag, Adaptive Expectations Model, Partial Adjustment Model, Partial Adjustment with Adaptive Expectations Model) Autoregressive Distributed Lag model [Error Correction Model- ARDL (1, 1)] Suggested Readings:

Maddala, G. S.: Introduction to Econometrics, John Wiley & Sons Ltd..

Greene, W. H.: Econometric Analysis, Prentice Hall.

Module 2 Advanced Time Series Econometrics 44 Unit 1 Models with Trends – Deterministic and Stochastic Trends, Unit Roots,

Dickey-Fuller Tests 10

Unit 2 Modelling Volatility – ARCH and GARCH Model 06 Unit 3 Introduction to VAR Analysis – Estimation and Identification - Granger

Causality Cointegration and Error Correction Models

10

Unit 4 * Advanced tests for Non-stationarity and structural breaks. 06 Unit 5 * Cointegration with structural breaks 06 Unit 6 * Non-stationary panel data models.

Selected topics marked with * will be covered at the instructor’s discretion. Suggested Readings:

Enders, W.: Applied Econometrics Time Series, John Wiley and Sons. Hamilton, J. Time series analysis. Hendry, D. Dynamic econometrics. Maddala, G.S. and Kim, I.M.: Unit Roots Cointegration and Structural

Change.

06

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PAPER XIIIA ECONOMETRIC APPLICATIONS Full Marks: 50

Practical Paper

Module 1 Quantal and Limited Choice Models 18

Module 2 Analysis of Panel Data 10

Module 3 Distributed Lag Models 08

Module 4 Time Series Analysis 20

Module 5 Factor and Cluster Analysis 08

Computational Tools: use of software like STATA, EVIEWS, TSP, GAUSS,

MICROFIT, SPSS, SAS, R.

PAPER XVB CORPORATE FINANCE Full Marks: 50 Module 1 Introduction to Corporate Finance 02 Introduction to limited liability companies, Corporate Governance Module 2 Corporate Financial Reporting 06 Accounting Identity; Financial Statement Items- Balance Sheet,

Income Statement, Cash Flow; Financial Statement Analysis

Module 3 Value and capital Budgeting 10 Unit 1 Opportunity Cost of Capital, Net Present Value 01 Unit 2 Valuation of bonds using Present Value: Pure Discount Bonds, Level

Coupon Bonds, Consols 02

Unit 3 Valuation of common stocks using Present Value: Dividend Discount Models and Price-Earning-ratio models (under different growth opportunities)

03

Unit 4 NPV versus some alternative investment rules: Pay Back Period, Discounted Pay Back period, Average Accounting Return, Profitability Index and Internal Rate of Return.

02

Unit 5 Strategy and Analysis using Net Present Value: Decision tree, Sensitivity Analysis, Scenario Analysis and Break Even Analysis.

02

Module 4 Risk and Capital Budgeting: 15 Unit 1 Introduction to risk, return and opportunity cost of capital: measuring

portfolio risk, diversification and risk, limits to diversification 04

Unit 2 Return and risk: Capital Asset Pricing Model, validity and role of Capital Asset Pricing Model, Some alternative view of risk and return: Consumption betas, the Arbitrage Pricing Theory, Three-Factor model

08

Unit 3 Risk, return and capital budgeting: Cost of equity capital, estimation of beta, determinants of beta, cost of capital with debt.

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Module 5 Capital Structure and Pay-out policy: 15 Unit 1 Corporate Financing and Efficient Market Hypothesis: Puzzles,

anomalies and lessons of Market Efficiency 01

Unit 2 The capital structure and the pie theory, Maximizing firm value versus maximizing stockholders’ interest, Financial Leverage and Firm Value –Modigliani and Miller Propositions, Implications of Corporate Taxes, Personal taxes and costs of financial distress; Financial leverage and growth.

09

Unit 3 Valuation and capital budgeting for levered firm – APV, Flow-to-Equity and WACC approach

02

Unit 4 Pay-out policy: different types of dividends, standard method of cash dividend payment, The Pay-out Controversy - Irrelevance of dividend policy, Taxes, issuance costs and dividends, Dividend payments and share Buy-back, Dividend and taxes.

03

Module 6 Sources of Long Term Finance 03 Issuing equity securities to public, Long-term Debt, Warrants,

Convertibles, Leasing (concepts only)

Module 7 Working Capital Management 03 Short term finance and planning, Cash management, credit

management

Module 8 Corporate Restructuring 08 Mergers and Acquisitions Module 9 Special Topics 02 DSGE models for monetary policy and analysis Suggested Readings: Ross, S.A., Westerfield, R.W. and J. Jaffe (1999), Corporate

Finance, McGraw Hill International Edition, Finance Series, 5th Edition

Brealey, R.A., Myers, S.C., Allen, F. and P. Mohanty. (2007), Principles of Corporate Finance, Tata McGraw-Hill Publishing Company Limited, New Delhi, 8th Edition

Sharpe, W.F., Alexander, G.J., and J.V. Bailey (2000), Investments, Prentice Hall of India, 5th Edition

Wild, J.J., Subramanyam, K.R. and R.F.Halsey (2007), Financial Statement Analysis, Tata McGraw-Hill Publishing Company Limited, New Delhi, 9th Edition

Copeland, T. E., Weston, J.F., and Shastri, K. (2005), Financial Theory and Corporate Policy, Pearson Higher Education, International Edition, 4th edition

19

PAPER XVIB FINANCIAL MARKETS AND INSTITUTION Full Marks: 50 Module 1 Stock Market 14 Unit 1 Unit 2 Unit 3 Unit 4 Unit 5 Unit 6 Unit 7 Unit 8 Unit 9 Unit 10

Joint Stock Company and Other Forms of Business Organization Classification of Shares Primary Market – Methods of Issuing Shares in India Global Depository Receipt(GDR) and American Depository Receipt(ADR) Secondary Market – Mode of Trade and Settlement in India Share Price Forecasting – Fundamental Analysis and Technical Analysis Share Price Indices – SENSEX, NIFTY and Others Stock Market and Macroeconomic Variables – GDP, Interest Rate, Inflation etc. Stock Market and Foreign Capital Inflows – FII and FDI SEBI as a Regulatory Body in the Indian Capital Market

01 01 02 01

02 02

01 01

01 02

Suggested Readings:

Khan M. Y., Indian Financial System Bhole, L.M., Indian Financial System Chandra, P., Investment Analysis and Portfolio Management Pathak, B. V., The Indian Financial System

Module 2 Bond Market 10

Unit 1 Unit 2 Unit 3 Unit 4 Unit 5 Unit 6

Interest Rate and Term Structure of Interest Rates in India Valuation of Bond – Present Value, Price and Yield Returns from Bond – Yield-To-Maturity, Yield-To-Call, Current Yield, Holding Period Return Risks in Bonds G-secs Market in India Corporate Bond Market in India

02 02 02

02 01 01

Suggested Readings :


20

Module 3 Money Market 12 Unit 1 Unit 2 Unit 3 Unit 4 Unit 5 Unit 6 Unit 7

Call Money Market Treasury Bill Market Commercial Bill Market Certificate of Deposit Commercial Paper Money Market Mutual Fund(MMMF) Repo and Reverse Repo

02 02 02 02 02 01 01

Suggested readings :


Module 4 Derivative Market 20

Unit 1 Unit 2 Unit 3 Unit 4 Unit 5

Options – Call Option, Put Option, Payoff Curves, Speculation with Options, Hedging with Options, Index Options and Their Uses Forward – Long, Short, Payoff Curves Futures – Mode of Trade, Role of the Exchange, Mark-to-Market, Speculation with Futures, Hedging with Futures, Index Futures and Their Uses Swaps – Interest Rate Swap, Currency Swap, Uses of Swaps Derivative Market in India – Commodity Derivatives and Financial Derivatives

07

01 06

04 02


Chandra, P., Investment Analysis and Portfolio Management Hull, J.C., Options, Futures and Other Derivatives Sounders A. and Cornett, M. M., Financial Markets and Institution

Module 5 International Financial Market 08

Unit 1 Unit 2

International Financing and National Capital Markets - Corporate Sources and Use of Fund, National Capital Markets as International Financial Centers, Development Banks, Project Finance The Euro Markets - Eurocurrency Markets, Eurobonds, Note Issuance Facilities, Euro Notes, Euro Commercial Papers, Asia Currency Markets

04

04


Shapiro, A. C., Multinational Financial Management (7th edition) Other references will be provided as and when necessary

21

FOURTH SEMESTER PAPER XIVA ADVANCED ECONOMETRICS III Full Marks: 50 Module 1 Frontier Analysis 26 Unit 1 Theoretical Implication of Frontier Analysis

Basic Concept of Efficiency and Classification 08

Unit 2 Stochastic Frontier Production Function Approach: Maximum Likelihood Method, Moments of OLS Residuals, Gamma Distribution Model, Exponential Model

08

Unit 3 Deterministic Frontier Production Function Approach 04 Unit 4 Time Series Analysis of DEA: Window Analysis, Malmquist Productivity

Index, Total Factor Productivity Growth and Malmquist Productivity Index Suggested Readings:

Fried, Knox Lovell & Schmidt (ed): The Measurement of Productive Efficiency: Techniques and Applications, Oxford University Press.

Kalirajan & Shand: Economics in disequilibrium: An approach from the frontier, Macmillan.

Ramanathan, R.: An introduction to Data Envelopment Analysis: A tool for performance measurement, Sage Publications.

06

Module 2 Demand Analysis 12 Demand functions and elasticities, Engel curve analysis, aggregation issue,

methodologies for estimation of unconstrained demand functions using aggregative data and using micro data. Demand systems. Suggested Readings:

Deaton & Muellbauer: Economics and Consumer Behaviour, Cambridge University Press.

Module 3 Introduction to Non-parametric and semi-parametric analysis 26 Introduction to differencing, smoothing (simple, kernel and spline smoother),

Non-parametric functions of several functions. Applications: Poverty, Income Inequality and Growth - An Analysis with Illustrations from Indian Data. Suggested Readings:

Yatchew, A: Semi-parametric regression for applied econometrician, Cambridge University Press.

Fox, J.: Non parametric simple regression: Smoothing scatter plots, Sage.

Pagan, A.R. and Amanullah: Non-parametric econometrics, Cambridge University Press.

Iyenger, N.S.: Poverty and sustainable development: Concept and Measures, Deep and Deep Publications.

22

PAPER XVIIB INTERNATIONAL FINANCE Full Marks: 50 Module 1: The Balance of Payments and International Economic Linkages 04 Balance of payments categories, The international flow of goods,

services and capital, Coping with the current account deficit; Evolution of international financial systems

Module 2: Introduction to Foreign Exchange Market 10 Unit 1: Organization of the foreign exchange market 02 Unit 2: The Spot market- organization of the interbank spot market, direct,

indirect and cross rates, Bid-ask spread, triangular arbitrage 04

Unit 2: Forward market – premium and discount, forward rate and expected future spot rate, pay-off profile, outright forward exchange and swaps, forward quotation

04

Module 3: Parity Conditions in International Finance 15 The Law of one price- Purchasing Power Parity, The Fisher Effect,

The International Fisher Effect, The Interest Rate Parity, The Unbiased Forward Rate Hypothesis

Module 4: Foreign Exchange Risk Management 20 Unit 1: Foreign Exchange Exposure and Risk Management, alternative

measures of foreign exchange exposure, concept of hedging, cost and benefit of standard hedging technique

02

Unit 2: Measuring Translation Exposure: Alternative currency translation methods, Managing Translation Exposure

05

Unit 3: Measuring and managing Transaction Exposure 05 Unit 4: Hedging through Derivatives: Foreign currency futures and options;

Swaps and interest rate derivatives 05

Unit 5: Measuring and managing Economic Exposure 03 Module 5: Foreign Investment Analysis 05 Unit 1: Cost of capital for foreign investment: cost of equity, cost of debt,

WACC for foreign projects, discount rates for foreign investment,

03 Unit 2: International Portfolio Investment, Corporate strategy and FDI,

Capital Budgeting for MNC

02 Module 6: Multinational Working Capital Management 05 International Cash Management, Accounts Receivable Management,

Inventory Management, Short-term Financing.

Module 7: International Transfer Pricing 05 Suggested Readings: Shapiro, A.C. (2003), Multinational Financial Management,

John Wiley and Sons, Inc. 7th Edition. Levi, M.D. (2005), International Finance, Routledge

23

Hull, J.C. (2008), Options, Futures and other derivatives, Prentice Hall, 7th Edition

PAPER XVIIIB QUANTITATIVE FINANCE Full Marks: 50

Practical Paper Module 1: Applications Using Stock Market Data 14 Unit 1: Micro-aspects: Forecasting share prices - Fundamental analysis,

Technical analysis 03

Unit 2: Macro-aspects: Domestic macro-variables and the stock market, Foreign investment and the stock market, Foreign exchange market and the stock market

06

Unit 3: Efficient Market Hypothesis: Testing and denial 02 Unit 4: Volatility of stock market 03 Module 2: Applications related to Derivative Market 10 Unit 1: Financial Derivatives: Options, forward, futures, swap, Cash market and

the derivative market 06

Unit 2: Commodity Derivatives: Cash market and the derivative market 04 Module 3: Applications related to Money Market and Banking 08 Unit 1: Interest Rate Structure 03 Unit 2: Interest Rate and Inflation Rate 03 Unit 3: Banking: Non-performing assets (NPA), Capital adequacy ratio,

Efficiency measures, Profitability – determinants 02

Module 4: Financial Statement Analysis 06 Module 5: Econometrics for finance 21 Unit 1: Univariate financial time series: linear and non-linear stochastic models

and forecasting 03

Unit 2: Modeling financial returns distribution 03 Unit 3: Multivariate financial time series 03 Unit 4: Modeling long-run relationships in finance 03 Unit 5: Modeling volatility and correlation 03 Unit 6: Panel data applications 03 Unit 7: Exploratory Factor Analysis applications 03 Module 6: Non-linearity in financial market data 05 Data base: RBI website, Economic Survey, International Financial

Statistics, PROWESS

Econometric Softwares to be used: E-Views, LIMDEP, Microfit, SPSS,

SAS

24

Suggested Readings:

Brooks, C. (2008), Introductory Econometrics for Finance, Cambridge University Press, 2nd edition.

Mills, T.C. (2005), The Econometric Modelling of Financial Time Series, Cambridge University Press, 2nd Edition.

Other references will be provided as and when necessary PAPER XIX PROJECT Full Marks: 100 Students will prepare a project of 100 marks under the supervision of an External Supervisor of renowned institution and an Internal Supervisor of Presidency University. The project should be application oriented.

25

Proposed Course on Applied Health Economics and Demography

PRINCIPLES OF HEALTH ECONOMICS Full Marks: 50

Module 1 Introduction to Health Economics 08 Uniqueness of health as a commodity – Market failures – Characteristics

of health market – Evolution of health economics as a separate discipline. Suggested Readings:

Arrow K (1963). Uncertainty and the welfare economics of medical care. American Economic Review, 53(5):941-973.

Hammer PJ, Haas-Wilson D, Sage WM (2001). Kenneth Arrow and the changing economics of health care: “Why Arrow? Why now?” Journal of Health Politics, Policy and Law, 26(5):835-849.

Glied, S. and Smith P. C. Edtd. (2011) The Oxford Handbook of Health Economics, Oxford

Module 2 Individuals as Producers of their Health 10 Health as a part of human capital – Grossman model - Production of health

as modification of a stochastic process Suggested Readings:

Grossman, M. (2000) “The Human Capital Model” in Culyer, A. J. and Newhouse, J. P. (edtd.) Handbook of Health Economics, Vol. IA, Chap. 7, Nort-Holland

Grossman, M. (1972) "On the Concept of Health Capital and the Demand for Health," Journal of Political Economy, 80(2): 223-255.


Zweifel, P. (1997) Health economics, Springer. Morris, Economic Analysis of Health care, John Wiley. Folland et al., Economics of Health and Health Care, 5th Edition,

Pearson.

Module 3 Demand for Health Capital 22 Demand for health care as an investment – Marginal Efficiency of

Investment (MEI) and rate of return Changes in equilibrium – Age, Wage, Education and Uncertainty Is medical care a public health issue? When is medical care a public health responsibility? Hospitals and long-term care Suggested Readings:

Morris, Economic Analysis of Health care, John Wiley. Folland et al., Economics of Health and Health Care, 5th Edition,

Pearson.

26

Henderson, Health Economics and policy, South-western Press. Dranove, D. and Satterthwaite, M. A.(2000) “The Industrial Halfon, Larson & Russ (2010) Why Social determinants?

Healthcare Quarterly, October. Helen Keleher & B. Murphy (2004) Understanding Health – A

determinants approach, Oxford. Glied, S. and Smith P. C. Edtd. (2011) The Oxford Handbook of

Health Economics, Oxford Mary Jone Schneider, Introduction to Public Health, Jones &

Bartlett.

Module 4 The Medical Care Market 10 The Industrial Organization of Health Care Markets – Agency and demand

for health care A Special Note on Pharmaceutical Industry Suggested Readings:

Organization of Health Care Markets” in Culyer, A. J. and Newhouse, J. P. (edtd.) Handbook of Health Economics, Vol. IB, Chap. 20, North-Holland

Glied, S. (2000) “Managed Care” in Culyer, A. J. and Newhouse, J. P. (edtd.) Handbook of Health Economics, Vol. IA, Chap. 13, North-Holland

Scherer, F. M. (2000) “The Pharmaceutical Industry”in Culyer, A. J. and Newhouse, J. P. (edtd.) Handbook of Health Economics, Vol. IA, Chap. 25, North-Holland

Module 5 Market Failure and Some Possible Response 14 Health Goods and Market Failure

Asymmetric Information – Moral Hazard - Health Insurance - Market failure in Health Insurance Market Development and Growth of Managed Care Suggested Readings:

Morris, Economic Analysis of Health care, John Wiley. Folland et al., Economics of Health and Health Care, 5th Edition,

Pearson. Culter, D. M. and Zeckhauser, R. J. (2000) “The Anatomy of

Health Insurance” in Culyer, A. J. and Newhouse, J. P. (edtd.) Handbook of Health Economics, Vol. IA, Chap. 11, North-Holland


27

MACROECONOMIC ASPECTS OF HEALTH ECONOMICS Full Marks: 50 Module 1 Health Issues in Developing Countries 16 Investing in health in developing countries – Linkage between health, growth,

inequality and poverty – Burden of disease – Concepts of QALY, HYE and DALY – Empirical evidence on disease burden in developing countries. Suggested Readings:

World Bank, World Development Report, 1993: Investing in Health, World Bank.

Alleyne & Cohen (2002) Health, Economic Growth and Poverty Reduction: Report of the Working group on Macroeconomics of Health, WHO, Geneva.

Duraiswamy and Mahal (2005) Health, poverty and economic growth in India, Background papers to National Commission on Macroeconomics of Health, MoHFW.

Wagstaff A. (2001) Poverty and health. Commission on Macroeconomics and Health Working Paper Series WGI: 5, Geneva: WHO.

Module 2 Maternal and Child Health 16 Importance of Maternal and Child Health

Infant, Child and Maternal Mortality Nutritional Issues in Child and Women Health Reproductive health Policy measures in India Suggested Reading:

Mary Jone Schneider, Introduction to Public Health, Jones & Bartlett. Sen & Ostlin, “Gender as a social determinant of health: Evidence,

policies and innovations”, in Sen & Ostlin (ed) (2010) Gender equity in Health, Routledge.

Rajiv Dasgupta (2010) Child health inequity in India. In S. Bhattacharya, S. Messenger & C. Overy (ed) Social determinants of health, Orient Blackswan

Module 3 Equity, Needs and Ethics in Healthcare 16 Healthcare consequences of socio-economic change

Understanding reasons for health inequality: Conceptual issues Measuring health inequality * Social exclusion and care of elderly * Epidemiology and Economics - evidence for policy and intervention * Ethical issues in medical care & medical resource allocation * Physician’s Practice: Conflict between public health and medical profession, Licensing and Regulation * Concept of Community Financing

28

[Topics marked * may be covered at discretion of faculty] Suggested Reading:

Leon & Walt (ed) (2001) Poverty, Inequality and Health: An International Perspective, Oxford.

Hurley, J. (2000) “An Overview of the Normative Economics of Health Sector” in Culyer, A. J. and Newhouse, J. P. (edtd.) Handbook of Health Economics, Vol. IA, Chap. 2, North-Holland

Module 4 Environmental Health 16 Importance of Environmental Health

Role of Government Identification of Hazard Setting of standard Occupational Health Suggested Reading:

Mary Jone Schneider, Introduction to Public Health, Jones & Bertlett.

PRINCIPLES OF DEMOGRAPHY, HEALTH ECONOMETRICS & BIOSTATISTICS Full Marks: 50 Module 1 Basics of Demography 22 Definition and scope of demography – Sources of demographic data and their

presentation – Basic measures of fertility and mortality – Life Table construction – Quality of data Suggested Readings:

K. Srinivasan (1998) Basic demographic techniques and applications, Sage, Delhi.

Colin Newell (1988) Methods and models in Demography, Belhaven Press, London.

Module 2 Qualitative Dependent Models 16 Binary Responses

Multinomial and Ordered Resposes Decomposition Limited Dependent Variables with special reference to Two part, Selectivity and Hurdel Models Suggested Readings:

Jones, A. M. ‘Health Econometrics’ in Culyer, A. J. and Newhouse, J. P. (edtd.) Hand Book of Health Economics, Vol. 1A, Chapter 6, North-Holland.

Peter M. Lance (1991) Odds Ratio. Mathematical Subjects Classification

29

Oaxaca, R. L. (1973). Male-Female Wage Differentials in Urban Labour Markets. International Economic Review, 14, 693-709.

Fairlie, R. W (2005). An extension of the Blinder-Oaxaca Decomposition Technique to Logit and Probit Models. Journal of Economic and Social Measurement, 30, 305-16.

Module 3 Longitudinal and Hierarchical Data 10 Multilevel Models

Fixed versus Random Effects Model Individual Effects in Panel Data Suggested Readings:


Wooldridge, J.M. (2001) Econometrics of cross section and panel data, MIT Press.

Module 4 Survival and Duration Data 16 Data Collection in follow up studies - Introduction to Life Tables – Life

tables in Survival Analysis - Product Limit Method - Comparing survival distributions Suggested Readings:


R. N. Forthofer, E. S. Lee and M. Hernandez (2007) Biostatistics: A guide to design, analysis and discovery, 2/e, Elsevier Academic Press, Amsterdam.

APPLIED BIOSTATISTICS & HEALTH ECONOMETRICS Full Marks: 50 Module 1 Study Design (To be covered at discretion of faculty) 12 Sample surveys and experiments - Sampling and sampling designs: Sampling

frame – Importance of probability sampling: Types of sampling, Problems due to unintended sampling - Designed experiments: Comparison groups and randomization, Randomized evaluation and its limitations - Variations in study designs: Cross-over design, Case control design, Cohort study design. Epidemiological studies. Suggested Reading:

R. N. Forthofer, E. S. Lee and M. Hernandez (2007) Biostatistics: A guide to design, analysis and discovery, 2/e, Elsevier Academic Press,

30

Amsterdam. Duflo E, and Kremer M. (2003) Use of Randomization in the

Evaluation of Development Effectiveness. Paper prepared for the World Bank Operations Evaluation Department (OED) Conference on Evaluation and Development Effectiveness, Washington, D.C., 15-16 July, 2003.

Duflo E, R. Glennerster and M. Kremer (2006) Using randomization in Development Economics research: A Toolkit. Centre for Economic and Policy Research, Discussion Paper 6059.

Christopher B. Barrett and Michael R. Carter (2010) The Power and Pitfalls of Experiments in Development Economics: Some Non-random Reflections, Applied Economics Perspectives, 32(4): 515-548.

Module 2 Hypothesis Testing 06 Preliminaries in tests of hypothesis - Recapitulation about parametric

hypothesis tests - Non-parametric tests: Sign Test, Wilcoxon Signed Rank test, Wilcoxon Rank Sum test, Kruskall Wallis Test, Friedman test. Application in STATA and SPSS Suggested Reading:


Module 3 Analyzing Categorical Data 08 Goodness of fit test - 2 X 2 Contingency Table: Odds Ratio, Fisher’s Exact

Test, Matched Pair studies - r X c Contingency Tables: Testing absence of association, testing absence of trend - Multiple 2 X 2 Contingency Tables: Analyzing Tables separately, Cochran-Mantzel-Haenszel test, Mantzel-Haenszel Common Odd ratio. Suggested Reading:



Module 4 Multivariate Analysis of Limited Dependent Models 12 Estimating Logit/Probit, Odds Ratio, Marginal effects.

Multinomial Logit and Relative Risk Ratio Ordered Logit, Marginal effects, Brant test, Tests of Nestedness, Alternative specifications of Ordered Logit Decomposition Analysis Tobit and truncated regression Model

31

Suggested Reading:

Andrew Jones (2007) Applied Econometrics for Health Economists, 2nd Edition, Radcliffe Publishing

Module 5 Longitudinal and Hierarchical Data 10 Preparing data for panel data analysis

LM and Hausman test under alternative specifications Estimating REM and FEM model Incorportaing categorical dependent variable Suggested Reading:

Andrew Jones (2007) Applied Econometrics for Health Economists, 2nd Edition, Radcliffe Publishing


Module 6 Some Important Household Survey Data Sets 06 Demographic Health Survey dataset

National Sample Survey Organization 52 and 60 Rounds India Human Development Survey data set

Module 7 Analyzing health equity usig household survey datasets 10 Analyzing health equality using household survey data

Suggested Reading:

O’Donnel, E. Doerslaer, A. Wagstaff and M. Lindelow (2008) Analyzing health equality using household survey data, World Bank.

Note: Applications (Modules 2-5, 7) should be demonstrated using Stata / R / SPSS.

32

Proposed Course on International Economics

TRADE THEORY Full Marks: 50 Module 1 Generalization of the traditional theory: 06 Unit 1 Extensions of the Ricardian model: multi-country case, multi-commodity

case, World PPF 02

Unit 2 Extensions of the Heckscher-Ohlin Model 02 Unit 3 Merger of Ricardian and Heckscher-Ohlin model

02

Module 2 Specific Factor Model 04 Specific Factor Model: Factor Allocation, Rybsczynski effect and

Stolper-Samuelson effect

Module 3 Refinements of the traditional theory 25 Unit 1 Transportation costs and international trade 05 Unit 2 International Trade and Intermediate goods- pure intermediate inputs,

final goods as inputs 05

Unit 3 International Trade and Non-traded goods 05 Unit 4 Natural Resources, Dutch Disease, deindustrialization 05 Unit 5 International Trade and International factor mobility

05

Module 4 New Theories of International Trade 25 Unit 1 Increasing Returns, Monopolistic Competition and International Trade 04 Unit 2 Scale Economies, Product Differentiation and International Trade 04 Unit 3 Intra-industry Specialization and Gains from Trade 04 Unit 4 Reciprocal dumping model of international trade 04 Unit 5 Technology Gap model of international trade 04 Unit 6 Endogenous innovation, Trade and Growth

05

Module 5 Neo Ricardian Theories of International Trade 04 Unit 1 Intermediate and capital goods in the Ricardian Theory 02 Unit 2 The debate between orthodox and neo-Ricardian theory 02

Suggested Readings: Jones, R. International Trade: Essays in theory, North Holland,

1979 Bhagwati, et al. Lectures on international trade, MIT press, 1998 Krugman, P.R., Rethinking International Trade, MIT Press, 1994

TRADE PLOLICY Full Marks: 50 Module 1 Tariff, Protection and Economic Integration 24 Unit 1 Partial and General Equilibrium Effects of tariff, Tariff as a device for

raising revenue, Tariff and the distribution of income, Tariff and 08

33

alternative policy measures for special objectives Unit 2 Intermediate goods - Effective rate of protection and content protection

scheme 04

Unit 3 Quotas and other non-tariff barriers 04 Unit 4 Free trade versus protection: Domestic Distortion and policy

intervention 04

Unit 5 Non-economic motives for protection, Theory of second best

04

Module 2 Market Power and Protection 16 Unit 1 Domestic Market Power and Protection: Case of an import competing

monopolist, Protection in an oligopolistic domestic market 08

Unit 2 Foreign Market Power and Protection: Trade Policies against foreign monopolist, Trade taxes and quotas, Trade Policies against foreign oligopolist: Kinked Demand model, Cournot model, Bertrand model

08

Module 3 Strategic Trade Policy 16 Unit 1 Strategic Export Policy: Competitive Foreign Conduct, Profit shifting,

Price competition, Entry with increasing return, Resource constraints, Consumption effects

08

Unit 2 Strategic Import Policy: Tariff in the Cournot case, Tariff in the Bertrand case, Import quotas

08

Module 4 Multilateral Trade Policy, Trading Bloc and Economic Integration 08 Suggested Readings:

Helpman and Krugman, Trade Policy and Market Structure, MIT Press, 1989 Corden,M. Theory of Protection

INTERNATIONAL FINANCE Full Marks: 50 Module 1 The Balance of Payments and International Economic Linkages 04 Balance of payments categories, The international flow of goods,

services and capital, Coping with the current account deficit.

Module 2 Introduction to Foreign Exchange Markets 08 Organization of the foreign exchange market; Spot Market and

Forward Market

Module 3 Parity Conditions in International Finance 10 The Purchasing Power Parity, The Fisher Effect, The International

Fisher Effect, The Interest Rate Parity, The Unbiased Forward Rate Hypothesis

Module 4 Foreign Exchange Risk Management 20 Unit 1 Foreign Exchange Exposure and Risk Management, alternative

measures of foreign exchange exposure, concept of hedging, cost and benefit of standard hedging technique

34

Unit 2 Measuring and Managing Translation Exposure Unit 3 Measuring and managing Transaction Exposure Unit 4 Hedging through Derivatives: Foreign currency futures and options;

Swaps and interest rate derivatives

Unit 5 Measuring and managing Economic Exposure

Module 5 Financing the Multinational Corporation 05 International Financing and national capital markets: Corporate

sources and use of fund, National Capital Markets as International Financial Centers, Development Banks, Project Finance; Euro markets

Module 6 Foreign Investment Analysis 06 International Portfolio Investment, Corporate strategy and FDI,

Capital Budgeting for MNC; Cost of capital for foreign investment: cost of equity, cost of debt, WACC for foreign projects, discount rates for foreign investment

Module 7 Multinational Working Capital Management 06 International Cash Management, Accounts Receivable Management,

Inventory Management, Short-term Financing.

Module 8 International Transfer Pricing 05 Suggested Readings:

Shapiro, A.C. (2003), Multinational Financial Management, John Wiley and Sons, Inc. 7th Edition.

Levi, M.D. (2005), International Finance, Routledge Hull, J.C. (2008), Options, Futures and other derivatives, Prentice

Hall, 7th Edition

ECONOMETRIC APPLICATIONS IN TRADE Full Marks: 50

Practical Paper

Module 1 Using Empirical Methods in International Economics: Time Series and

Panel Data Models 09

Module 2 Modeling exchange rate volatility 09 Use of GARCH family models, introduction to non-linearity-BDS test. Module 3 Use of forecasting methods in International Economics 09 Basic principles of forecasting, types of forecasting, Testing accuracy of

forecasts.

Module 4 Testing International Parity Conditions 09 Module 5 Testing the Balassa-Samuelson effect. 09 Definition, assumptions, consequences and empirical evidence. Module 6 Empirical assessment of comparative advantage gains, approaches to test

the HOV model 09

35

Module 7 Testing the Gravity Equation 10 Concept, types of gravity equation, empirical applications and approaches to

testing gravity equation.

Suggested Readings: Enders, W. (2004). Applied Econometric Time Series, 2nd ed., John

Wiley & Sons, Inc. Feenstra, R. (2004). Advanced International Trade: Theory and

Evidence. Princeton University Press. Hamilton, J. (1994). Time Series Analysis, Princeton University Press. Kocenda, E., Cerny, A. (2007). Elements of Time Series

Econometrics: An Applied Approach. Karolinum Press. Ramanathan, R. (1998). Introductory Econometrics with Applications,

4th ed., Harcourt Brace College Publishers. Wang, P. (2005). The Economics of Foreign Exchange and Global

Finance. Springer.

36

Workshop for preparing syllabus for

PG Applied Economics Course at Presidency University

List of Experts

1. Asis Banerjee, (Ex) Vice-Chancellor, Calcutta University

2. Pradip Maiti, Professor, Economic research Unit, Indian Statistical Institute, Kolkata

3. Sugata Marjit, Professor and Director, Centre for Studies in Social Sciences, Kolkata

4. Anup Kumar Sinha, Professor of Economics, Indian Institute of Management, Calcutta

5. Soumyen Sikdar, Professor of Economics, Indian Institute of Management, Calcutta

6. Anindya Sen, Professor of Economics, Indian Institute of Management, Calcutta

7. Sarmila Banerjee, Rajiv Gandhi Chair Professor, Economics Department, University of Calcutta

8. Jyostna Jalan, Professor of Economics, Centre for Studies in Social Sciences, Kolkata

9. Amitava Sarkar, Professor and Director, School of Management and Sciences, West Bengal University of Technology

10. Ashish Bhattacharya, Director, International Management Institute, Kolkata Campus

11. Rajat Acharya, Professor, Economics Department, Jadavpur University

12. Indrani Gupta, Professor and Head, Health Policy Research Unit, Institute of Economic Growth, Delhi and President, Indian Health Economics and Policy Association

13. Diganta Mukherjee, Professor, Bayesisn and Interdisciplinary Research Unit, Indian Statistical Institute, Kolkata

14. Ranajay Bhattacharya, Professor, Indian Institute of Foreign Trade, Kolkata Campus

15. Ranjanendra Narayan Nag, Associate Professor, St. Xaviers College, Kolkata

presidency university department of economics...

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