Preface The nature and scope of microeconomics Concepts and methods 1. The economic and social framework 2 - The theory of the consumer The preference ordering The feasible set The consumption decision The comparative statics of consumer behaviour Offer curves and net demand curves Appendix 1 : The lexicographic ordering Appendix 2 : Existence of a utility function 3 - Consumer theory : duality The expenditure function The indirect utility function, Roy's identity and the Slutsky equation Measuring the benefits of price changes Composite commodities, separability and homotheticity Further models of consumer behaviour Revealed preference The consumer as a labour supplier Consumption and the allocation of time Households 5 - Production Introduction The production function Variations in scale Variations in input proportions The multi-product case 6 - Cost Introduction Long-run cost minimization Short-run cost minimization Cost minimization with several plants Multi-product cost functions 7 - Supply and firm objectives Long-run profit maximization Short-run profit maximization The multi-product firm The profit function and comparative statics The entrepreneurial firm Labour managed firms 8 - The theory of a competitive market Short-run equilibrium Stability of equilibrium Long-run equilibrium 9 - Monopoly Introduction Price and output determination under monopoly Price discrimination Monopoly welfare loss 10 - Input markets Demand for inputs Monopsony Unions as monopoly input suppliers Bilateral monopoly 11 - Capital markets Introduction Optimal consumption over time The optimal investment decision Capital market equilibrium under certainty Extensions to many periods 12- General equilibrium Introduction Walrasian equilibrium of a competitive economy Existence of Walrasian equilibrium Stability of Walrasian equilibrium Edgeworth exchange theory Exchange, equilibrium and the core 13 - Welfare economics Introduction Pareto efficient resource allocation Welfare functions and the Pareto criterion Pareto efficiency and competitive markets Distribution and markets Arrow's impossibility theorem 14 - Market failure and government failure The causes of market failure Instances of market failure Theory of the second best Government failure 15 - Game theory Introduction Game representation and solutions Imperfect and incomplete information Mixed strategies Cooperative bargaining Non-cooperative bargaining Delay and disagreement in bargaining 16 - Oligopoly 17- Choice under uncertainty Introduction A formalization of 'uncertainty' Choice under uncertainty Properties of the utility function Risk aversion and indifference curves Measures of risk Comparative statics under uncertainty 18 - Production under uncertainty Introduction Competitive firm under uncertainty Production with futures markets 19 - Insurance, risk spreading and risk pooling Introduction The insurance decision Incomplete insurance markets Risk spreading: the Arrow-Lind Theorem Risk pooling Asymmetric information in insurance markets : adverse selection Asymmetric information in insurance markets : moral hazard 20 - Agency and contract theory 21 - General equilibrium under uncertainty and incomplete markets Introduction Complete markets in state contingent claims State contingent commodities Efficiency with production The stock market Incomplete stock markets Further reading - Mathematical Appendices Structure of optimisation problems Solutions: questions and concepts Existence of solutions Local and global optima Uniqueness of solutions Interior and boundary optima Location of the optimum: method of Lagrange Concave programming and the KuhnTucker conditions Second order conditions and comparative statics The envelope theorem Fixed point theorems Bayes rule Index