• Students are able to use microeconomic theory to study what motivates and drives the individuals’ decisions and can communicate the main insights, both with accuracy and intuition.
• Students are able to understand theoretical work published in scientific journals, reflect upon the underlying model and discuss the findings.
• Students are able to formulate and analyze research questions with the help of the appropriate model and are capable to go further with economic model building.

• Learning outcome 2 (LO2): Explain the main insights within consumer theory and its conceptual foundations.
• Learning outcome 3 (LO3): Analyze the decision-making behavior of individuals within the various models. Explore the arguments put forward verbally, graphically and mathematically.
• Learning outcome 4 (LO4): Identify the crucial assumptions of the standard consumer theory and discuss the implications for the decision-making behavior.
• Learning outcome 5 (LO5): Formulate well-defined decision problems (with the required degree of formalism) and apply the Lagrange’s multiplier method to derive the optimality conditions for these problems.

Course Topics

Part I: A closer look on consumer theory and its fundamental concepts

1. Preferences and utility functions
2. Consumer choice, demand for goods and the utility maximization problem
3. Expenditure minimization problem, compensated demand and the Slutsky equation

Part II: Some important topics in consumer theory

1. Endowments in the budget constraint: consumer’s sale of goods and labor supply
2. Intertemporal choice
3. Choice under uncertainty