Robert Whaples and the Modern Principles

A blog on my teaching with Modern Principles of Economics by Tyler Cowen and Alex Tabarrok

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New Fashioned Supply and Demand

Posted by Robert Whaples on September 3, 2009

I’ve just finished covering the supply and demand chapters of Cowen and Tabarrok.  My students are always quick to grasp demand and have a good intuitive sense of what will shift a demand curve inward or outward, but a subset of them have a harder time with shifts in supply.  I always emphasize that they should think of the supply curve as a cost curve — if one of the costs of making the product rises, then the supply curve will vertically rise in the graph.  What I really like about C&T is that they have this same emphasis — driving home the point that supply reflects costs.  Their “horizontal reading” versus “vertical reading” of the demand and supply curves is especially clear.  I wish that all textbooks used this language, since it is so straight-forward and easy for students to grasp.

My favorite innovation in the equilbrium chapter is the coverage of Vernon Smith, his fit of insomnia and subsequent birth of experimental economics.  I asked an extra credit question on yesterday’s quiz, asking students to identify Smith and many of them rattled off the exact dates of the first experiments and his Nobel Prize — a pretty good sign that they were equally intrigued by this section.  A discussion showed that students are convinced that experimental results are an important addition to economics.

Posted in Ch 02 Supply and Demand, Ch 03 Equilibrium: How Supply and Demand Determine Prices | 2 Comments »