1. First class, and Chapter 1
Link to syllabus
Chapter 1

2. Textbook, study guide, tutors
Course Arrangements
Roll – class list
Office Hours
Grade: Exams, curve, extra credit
Syllabus
list server
M.T.’s homepage for syllabus, old exams, and lecture notes in
.pptx or .docx format. Also on C-Tools and CANVAS.
Textbook, study guide, tutors
Math pre-requisite. Good to read newspaper
Different interests of students, by majors.
People who’ve had 202. Freshmen.
Bring pencil and calculator to exams – no scantrons.
Note: Econ 201 is Macro at UMD. Different at UM-AA
Roll, Adds/Drops
list server
Office Hours
Syllabus. My homepage
Textbook, study guide, tutors
Grade: Exams and quizzes, curve, extra credit
Math pre-requisite
Different interests of students, by majors. Freshmen .

3. Characteristics of this course:
1. Moves quickly, hitting main points of text,
frequent efforts at relating to current events
2. Will use PowerPoint presentations. Advisable to bring textbook
to class; try to skim it beforehand. Bring a tape recorder if
you like. TURN OFF CELLULARS!!
3. Anything in the text is fair game on exams. Virtually
nothing from outside the text on exams. Not much math,
but lots of graphs.
4. After each exam, students will be asked if the exam
was fair, and if it repaid studying. Graded exams returned
the next class day (hopefully).
Characteristics of course:
1) Moves quickly, frequent efforts at relating material to current events
2) Advisable to bring textbook to class. Try to skim it beforehand. Will use Powerpoint
3) Anything in text is fair game. Not much math, lots of graphs
4) After each exam, students will be asked if the exam was fair, and if repaid studying
5) Some effort to use web
6) Note that some parts of the text not covered.
Major issues:
Government intervention
liberal/conservative, Democrat/Republican, left/right, interventionist&`progressive, free market (laissez faire)
Deficits (debt)
Depression
Globalization
Supply side economics
Monetary issues
Not stock market
Definition of economics: Study of efficient use of limited resources to achieve maximum satisfaction of human wants.
5. Some effort to use the web; syllabus, extra credit, and
previous exams on my webpage, and listserver for the class.
6. Some parts of text omitted from this course.

4. Definitions of Economics
Study of production, distribution, and consumption of goods and services
Efficient use of limited resources to achieve maximum satisfaction of human wants.
Differences between macro and micro
Positive (value free) vs. Normative (reflects values of the speaker) [p 37-8]

5. Overview of Macro:
Overview of Macro: study of factors determining unemployment and inflation
Producers—respond to wages, price of oil, technology, capital
stock, regulations, taxes.
Purchasers (consumers)—respond to business investment, government
spending and taxes, foreign trade, and monetary policy.
[or, buyers and sellers]

6. Unemployment Rate, US
Source: US Dept. of Labor

7. Inflation in the U.S. Source: Bureau of Labor Statistics:

8. Main Macroeconomic issues for this course:
Government intervention:
Left/right; liberal/conservative; interventionist/free market
(laissez faire)
Democrat/Republican
Government Deficit (and the National Debt)
Depression of the 1930s. Current Crisis (2009)
Globalization: tariffs or free trade, migration, exchange rates
Main Macroeconomic issues for this course:
Supply Side Economics—lower taxes, reduce government regulation
Monetary issues, relating to the Federal Reserve Banks, and finance
Very little on the stock markets.

9. In a free market society, individuals, acting out of their own
Adam Smith: ( ) Prominent Scottish Philosopher. The Wealth of Nations 1776
In a free market society,
individuals, acting out of their own
self interest, will be guided, as if by
an invisible hand, to make socially
beneficial economic decisions.
Discussed on page 2.
Adam Smith: Individuals acting out of their own self interest, will be guided, as if by an invisible hand, to make socially beneficial economic decisions.
Also, benefits of free trade, and criticism of mercantilism.
Also: benefits of free trade, criticism of
mercantilism. Discussed in chapter 2

10. David Malthus, 1766-1834 1798 Essay on the Principle of Population
Overpopulation; economics
as “the dismal science”
Incidentally, Malthus’s ideas had
a big impact on Charles Darwin.
Malthus. Overpopulation. Economics as dismal science

11. John Stuart Mill, 1806-1873 Perhaps better known as a philosopher,
he made important contributions to
economics, as well, among which are
the theory of Infant Industry Tariffs,
which we do in chapter 5.
His father was the head of the East
India Co., and he was given an elite,
rather isolated childhood education.
He was an early promoter of rights for
women, which many attribute to
the influence of his wife.
John Stuart Mill,
Perhaps better known as a philosopher, he made important contributions to economics, as well, among which are
the theory of Infant Industry Tariffs.
His father was a leader of the East India Co., and he was given an elite, rather isolated childhood education.
He was an early promoter of rights for women, which many attribute to the influence of his wife.

12. Karl Marx, 1818-1883 Communist Manifesto, Worked with Engels on
Das Kapital
Criticized capitalism.
Class exploitation
Revolution, led by the
workers
Marx: class exploitation under capitalism, socialist revolution led by workers

13. Argued that unemployment during 1930s Depression
John Maynard Keynes
( ).
General Theory (1936)
Argued that unemployment
during 1930s Depression
could be cured by gov’t.
spending and deficits
Keynes
Keynes: unemployment can be cured by government spending and deficits.

14. Milton Friedman, 1912-2006 Most prominent advocate of
a return to free market/non-
governmental policies.
Influence concretized under
President Reagan.
Also: leading ‘monetarist’ and
a Nobel Prize winner.
Friedman: resurgence of free market economics. Monetarism
Link to Friedman’s bio

15. The Worldly Philosophers, by Robert Heilbroner.
Extra Reading:
Many economists first got interested in this field
by reading
The Worldly Philosophers,
by Robert Heilbroner.

21. US Inflation