Topics include an introduction to welfare economics theory, a review of the fundamental economic criteria for making public judgments with respect to political issues, and methods of applied applications of economic theory to public policy decision-making. Several other readings related to specific topics addressed during the semester will be assigned. The fundamental theorems of welfare economics i. Pareto optimality and competitive equilibrium ii.
Compensation principles iii.
The social welfare function iv. Welfare analysis and general equilibrium iii. Welfare analysis of imperfect competition iv. Welfare analysis in uncertain markets C. Applications of welfare economics in non-market situations i. Determination of optimal levels of pollution ii. Techniques for measuring economic value of non-market goods iii.