SYLLABI OF M. Phil. in Economics OF PUNJAB UNIVESITY, CHANDIGARH

SEMESTER – I
Paper I : Research Methodology and Quantitative Methods
3 Credits
75 marks
(60+15 internal assessment)
Teaching Hour : 40
Time : 3 Hours
OBJECTIVES: The paper aims at equipping the students with various methods and techniques
which can help them to carry out research in economics.
Pedagogy of the Course Work: The course relies on a combination of lectures, solving
problems, and discussing of academic articles or real-life situations. Teacher will assign topic
for assignments on contemporary themes and issues from the syllabi. Special tutorials/contact
hour for one-to-one student-teacher interactions.
INSTRUCTIONS FOR THE PAPER-SETTERS:
Nine questions will be set in all with two from each unit and one question spread over the
entire syllabus.
The First question consisting 4 short notes, each carrying 5 marks, set out of the entire
syllabi would be compulsory with no internal choice. Additionally, the students are
required to attempt one questions from each Unit. Each such question would carry 10
marks.

UNIT – I
Research method and methodology – Relevance and Limitations. Typology of Economic
Relations, Models and Data, Procedure for Estimating Macro Level Relations (Consumption
Function/Investment Function. Wage or Price Relationship).
Concepts of Fact and Theory, Essentials and Tests of a Good Theory. Nature of Causality,
Logical Consistency, Verification and Falsification, Hypothesis Testing – an overview.
UNIT – II
Optimisation Techniques: Lagrangian method, Kuhn-Tucker method of inequality constraint,
Linear Programming, Duality. Calculus of variation.
Matrix Algebra: Linear models, characteristic roots and vectors, linear and quadratic forms,
vector differentiations.
3
UNIT – III
Difference Equations: Linear first order difference equations, non-linear first order equations,
use of phase diagrams, second order difference equations, conditions of stability.
Game Theory: Importance of strategic behaviour in economic decision making, cooperative
and non-cooperative games; different equilibrium concepts: dominant strategy equilibrium, Nash
equilibrium in pure and mixed strategy; repeated games, sequential games, sub-game perfect
Nash equilibrium and non-credible threats; applications: Cournot and Bertrand models, entry
deterrence and commitment models.
UNIT – IV
Input-Output Model: Static and closed models; viability conditions, aggregation problem,
substitution theorem, cost and price determination. Dynamic Leontief system. Balanced growth
of Leontief system.
References:
Chiang, A C (1984) : Fundamental Methods of Mathematical
Economics, (3rd Edition), McGraw Hill,
Singapore.
Chiang, A C (1992) : Elements of Dynamic Optimization,
McGraw Hill, Singapore.
Goode, W J & Hatt, P K (1952) : Methods of Social Research, McGraw Hill
Singapore.
Koutsoyiannis, A (1978) : Theory of Econometrics, Macmillan Press
Ltd., London.
Pindyck, Robert S. & Daniel L Rubinfeld
(2009)
: Microeconomics, Pearson Education (7th
edition), India.
Varian, H R (1992) : Microeconomic Analysis, W W Norton and
Co., (3rd edition), New York.
4
Paper II : Theory of Agricultural Economics
3 Credits
75 marks
(60+15 internal assessment)
Teaching Hour : 40
Time : 3 Hours
OBJECTIVES: The paper is designed to expose the students to the contemporary issues in
agricultural development both in the theory and in the Indian context.
Pedagogy of the Course Work: The course relies on a combination of lectures, solving
problems, and discussing of academic articles or real-life situations. Teacher will assign topic
for assignments on contemporary themes and issues from the syllabi. Special tutorials/contact
hour for one-to-one student-teacher interactions.
INSTRUCTIONS FOR THE PAPER-SETTERS:
Nine questions will be set in all with two from each unit and one question spread over the
entire syllabus.
The First question consisting 4 short notes, each carrying 5 marks, set out of the entire
syllabi would be compulsory with no internal choice. Additionally, the students are
required to attempt one question from each Unit. Each such question would carry 10
marks.
UNIT – I
Agriculture Transformation – Role of Agricultural Innovations: Generations of Innovations
(induced innovations, Political Economy of Public Funded Innovations, and Policies and
Institutions Managing Innovations]; Technology Adoptions [Adoption and Diffusion, Risk
Management, Institutional Constrains to Innovations and Farm Policy]; Ruttan-Hayami Induced
Innovation Hypothesis.
Agricultural Commodity Futures and Options: Nature and Principles of Future Markets;
Participants in Future Markets; Trading in the Presence of Risk Aversions and Transaction Costs,
Future Prices as Forecasts.
UNIT - II
Agro-processing: Specificities of Agro-processing, Developmental Role of Agro-processing
Industries, Selection and Evolution Options; Food Processing Policy of India, 2005.
Agricultural Finance: Agency Relationship, Adverse Selection, Moral Hazards and Enforcement
Problem; Segmented Rural Credit Markets; Resolving Information and Incentive Problems;
Managing Borrowers’ Credit Risks, Agribusiness and Trade Financing and Role of Social
Capital.
5
UNIT - III
Political Economy of Agricultural Policies: Protection across countries and sectors, influence of
political institutions; collective actions of lobbing groups and strategic interactions between
lobbing groups and politicians; use of inefficient instruments and rent seeking; and explaining
public investment in agricultural research.
Food Security and Food Assistance: Concept, Threat, Indicators and Mechanism to Food
Security; Food Assistance Programmes [both Domestic and International], and Their
Effectiveness.
UNIT – IV
Indian Agriculture- Opportunities and Challenges: Expectations, Performance, Problems and
Prospects of Indian Agriculture in the Post-reform Period.
Investment in Farm People: Role of Human Capital Formation [Education and Health] in
Modernisation and Transition of Agrarian Economies.
References:
Bruce L. Gardner and Gordon C. Rausser
(2002)
: Handbook of Agricultural Economics, Vol-
1A,1B, 2A, 2B and 3; North-Holland,
Amsterdam
James G. Brown and Deloitte and Touche
(1994)
: Agro-industrial Investment and Operations,
Washington, The World Bank.
Government of India (2005) : Food Processing Policy, Ministry of Food
Processing, New Delhi.
T.W.Schultz (1981) : Investing in Peoples: The Economics of
Population Quality, University of
California, Berkley.
Radhakrishna R, S. K. Rao, S. Mahendra
Dev and K Subbarao (2006)
: India in a Globalising World: Some Aspects
of Macroeconomy, Agriculture and
Poverty, Academic foundation, New Delhi.
Government of India (2004) : State of the Indian Farmer : A Millennium
Study, Academic Foundation and Ministry
of Agriculture, New Delhi, (Vol. 1-27)
6
OR
Paper –II : Theory of Industrial Economics
3 Credits
75 marks
(60+15 internal assessment)
Teaching Hours : 40
Time : 3 Hours
Objectives: In the 21st century, efficiency and competitiveness in all spheres of economic life
and more 500 industrial sectors are at the core of success. The present syllabus is designed for
the students to capture the contemporary issues in industrial development both in theory and in
the Indian context.
Pedagogy of the Course Work: The course relies on a combination of lectures, solving
problems, and discussing of academic articles or real-life situations. Teacher will assign topic
for assignments on contemporary themes and issues from the syllabi. Special tutorials/contact
hour for one-to-one student-teacher interactions.
INSTRUCTIONS FOR THE PAPER-SETTERS:
Nine questions will be set in all with two from each unit and one question spread over the
entire syllabus.
The First question consisting 4 short notes, each carrying 5 marks, set out of the entire
syllabi would be compulsory with no internal choice. Additionally, the students are
required to attempt one question from each Unit. Each such question would carry 10
marks.
UNIT – I
I. Economics of Takeovers and Mergers: Types, Objectives and Effects. Public Policy
for business combinations with special reference to India: Takeover code of SEBI and
Competition Policy
UNIT – II
II. Technological Progress: Concepts, Optimal Technological Change; Patents and
Innovations.
UNIT - III
III. Porter’s Five Competitive Forces: bargaining power of customers, the bargaining power
of suppliers, the threat of new entrants, and the threat of substitute products -- combined
with other variables to influence a fifth force, the level of competition in an industry.
Determinants and Strategy formation.
7
UNIT - IV
IV. Globalization, trade liberalization and industrial market structure and economic
performance: Theory and evidence since 1991.
References:
Martin, Stephen (2001) : Advanced Industrial Economics, Blackwell,
(2nd edition).
Scherer, F M & Ross David (1990) : Industrial Market Structure and Economic
Performance, Boston Houghton Mifflin
Company, (3rd edition).
Hay, D A & Morris, D J (1979) : Industrial Economics and Organization
Oxford Univ. Press, New York.
Shepherd, William, G, J.M. Shepherd
(2003)
: The Economics of Industrial Organization
Analysis, Market Policies. Prentice Hall
International, (5th edition).
Petersen H.C., W.C. Lewis (2002) : Managerial Economics, Prentice Hall of
India, New Delhi.
Schmalensee, R and Robert Willig (1989)
: Handbook of Industrial Organization (Vol. I
& II), Elsevier, North Holland.
Paper III - Econometrics-I
3 Credits
75 marks
(60+15 internal assessment)
Teaching Hours: 40
Time : 3 Hours
OBJECTIVES: Application of economic theory need a reasonable understanding of economic
relationships and relevant statistical methods. The econometric theory thus becomes a very
powerful tool for understanding of applied economic relationships and for meaningful research
in economics. This paper accordingly is devoted to equip the students with basic theory of
econometrics and relevant applications of the methods. The topics covered in the course include
various problems faced in estimation of both single equations and simultaneous equation models.
8
Pedagogy of the Course Work: The course relies on a combination of lectures, solving
problems, and discussing of academic articles or real-life situations. Teacher will assign topic
for assignments on contemporary themes and issues from the syllabi. Special tutorials/contact
hour for one-to-one student-teacher interactions.
INSTRUCTIONS FOR THE PAPER-SETTERS:
Nine questions will be set in all with two from each unit and one question spread over the
entire syllabus.
The First question consisting 4 short notes, each carrying 5 marks, set out of the entire
syllabi would be compulsory with no internal choice. Additionally, the students are
required to attempt one question from each Unit. Each such question would carry 10
marks.
Unit-I
Introduction: Meaning and rationale of Econometric as a separate discipline, Methodology,
Types of Econometrics, Nature and Sources of Data used in Econometric Analysis. Functional
Forms of Regression Models.
Linear Regression Model: Assumptions, Estimation [OLS], Properties, Interpretation of
Estimates and Hypothesis Testing.
UNIT – II
Dummy Variables: Introduction and Uses [as independent variables].
Estimation Problems: Nature, Consequences, Detection and Remedial Measures of the problems
of Autocorrelation, Hetroscedasticity, Multicollinearity, and Specification Errors.
UNIT – III
Dynamic Econometric Models: Distributed Lag and Autoregressive Models-Rationale, Problems,
Kyock and Polynomial Approaches of Estimation, and Adaptive Expectation and Partial
Adjustment Models, Causation and Granger Test.
Simultaneous Equation Models: Nature of Simultaneous Equation Models, Problem and
Consequences of Simultaneity in Regression Models. Identification Problem. Derivation of Rank
and Order Conditions for Identification of Simultaneous Equations.
UNIT – IV
Estimation of Simultaneous Equation Models: Indirect Least Squares, Two Stage Least Squares,
Least Variance Ration, and Three Stage Least Squares Methods of Estimation of Simultaneous
Equation Models.
9
References:
Damodar Gujarati (2003) : Basic Econometric [4th Edition], McGraw
Hill, New York.
Jack Johnston and John Dinardo (1997) : Econometric Methods [4th Edition],
McGraw Hill, New York.
OR
Paper – III : Econometrics-II
3 Credits
75 marks
(60+15 internal assessment)
Teaching Hours : 40
Time : 3 Hours
OBJECTIVES: The aim of this paper is to make the students familiar with the use of Limited
Dependent Variable models in econometric analysis and also with the application of
econometrics to household demand and production analysis in agriculture and industry.
problems faced in estimation of both single equations and simultaneous equation models.
Pedagogy of the Course Work: The course relies on a combination of lectures, solving
problems, and discussing of academic articles or real-life situations. Teacher will assign topic
for assignments on contemporary themes and issues from the syllabi. Special tutorials/contact
hour for one-to-one student-teacher interactions.
INSTRUCTIONS FOR THE PAPER-SETTERS:
Nine questions will be set in all with four from each unit and one question spread over the
entire syllabus.
The 1st question consisting of 4 short notes, each carrying 5 marks, set out of the entire
syllabi would be compulsory with no internal choice. Additionally, the students are
required to attempt two questions from each Unit. Each such question would carry 10
marks.
Unit-I
Discrete Dependent Variable Models: Linear Probability Model and its Problems; Logit [both
Binomial and Multinomial] and Probit Models: Assumptions; Maximum Likelihood Estimation
Methods; Interpretation of Coefficients; Constructing Probabilities; Restrictions and Limitations;
Marginal Effects; Measuring Goodness-of-fit; Testing Parameter Restrictions.
10
UNIT – II
Limited Dependent Variable Models
Truncated and Censored Samples; Sample Selection Bias; The Truncated Regression Model;
Marginal Effects; The Tobit Model; Interpretation of Tobit Model Coefficients; Testing for
Normality; Limitations of the Tobit Model.
Bivariate Generalisations of the Tobit Model; the Selectivity(Heckit) Model; Two-step and Fullinformation
Estimation Methods; Interpretation of Model Coefficients; Diagnostic Testing; the
Double Hurdle (DH) Model; Switching Regressions; Diagnostic Testing.
Unit-III
Econometrics Application to Demand Analysis: Introduction, Single Demand Equations,
Systems Demand Equations, Dynamic Demand Analysis.
UNIT – IV
Econometric Applications to Production Analysis in Agriculture and Industry: Basic
Introduction to Theory of Firm, Relationship between Production, Cost and Profit Functions,
Cobb-Douglas, CES, and Translog Production Functions.
Frontier Production Function and Technical Efficiency. Random Coefficient Frontier Production
Function, Cost Function, and Employment Function. Total Factor Productivity- Measurement,
Growth, and Decomposition.
References:
Jack Johnston and John Dinardo (1997) : Econometric Methods [4th Edition],
McGraw Hill, New York.
Michael D. Intriligator (1996) : Econometric Models, Techniques, and
Applications, (2nd Edition) Prentice-Hall,
New Jersey.
K. L. Krishna (1999) : Econometric Application in India, Oxford
University Press, New Delhi.
William H. Green (2000) : Econometric Analysis, (4th Edition)
Prentice-Hall, New Jersey
11
SEMESTER – II
PAPER IV - ECONOMIC THEORY – I
3 Credits
75 marks
(60+15 internal assessment)
Teaching Hours 40
Time : 3 Hours
Objectives: The aim of this paper is to make the students familiar with some of the recent
developments in micro and macro economics which have wide range of applicability to solve
and explain phenomena; some of which can provide new insights into the empirical estimation of
economic relationship.
Pedagogy of the Course Work: The course relies on a combination of lectures, solving
problems, and discussing of academic articles or real-life situations. Teacher will assign topic
for assignments on contemporary themes and issues from the syllabi. Special tutorials/contact
hour for one-to-one student-teacher interactions.
INSTRUCTIONS FOR THE PAPER-SETTERS:
Nine questions will be set in all with two from each unit and one question spread over the
entire syllabus.
The First question consisting 4 short notes, each carrying 5 marks, set out of the entire
syllabi would be compulsory with no internal choice. Additionally, the students are
required to attempt one question from each Unit. Each such question would carry 10
marks.
UNIT – I
I MARKET FAILURE: SOME MICRO ECONOMIC ASPECTS
A. Externalities: (i) Inefficiency of resource allocation in the presence of externalities;
Impact of Market Structure on social welfare loss due to negative externalities.
(ii) Reducing negative externalities. Emission Standards, Emission Fees, Cost &
Benefit analysis of reducing negative externalities. Taxing negative externalities
in Non Competitive market structures.
(iii) Allocating Property Rights to reduce negative externalities: Coase Theorem;
Markets for Pollution.
B. COMMON PROPERTY. Issue of over use and solution.
Public goods. Paretian conditions for Public goods. Revealing preferences and valuing
Public goods.
12
UNIT – II
II. Markets with Asymmetric Information: Issues of hidden characteristics/actions and
Adverse Selection/Moral Hazard in Insurance and Labor Markets. Response of Market
and Government to asymmetric information: efficiency effects.
III. Questioning the Orthodoxy: The emergence of Behavioral Economic Reference Points,
Adaptation and Losses. Social Preference and Fair allocations; Law of small numbers;
Belief Perseverance and confirmatory Bias.
UNIT – III
Monetarist Keynesian debate on Macro theory and Policy.
The Micro-foundations of the Phillips curve
Rational Expectations and the New classical Macro Economics:
Lucas critique
Policy ineffectiveness
Time inconsistency
Dornbusch’s overshooting model
The random walk model – modern approach to consumption
Real Business Cycle Theory
UNIT – IV
New Keynesian models of macroeconomic equilibrium:
(a) Real and nominal price rigidity:
Menu costs; coordination failures; imperfect competition.
(b) Real and nominal wage rigidity:
Insider-outsider models, efficiency wages; implicit contracts.
References:
Pindyck, R.S. Rubinfeld, D L & P.L. Mehta
(2005)
: Microeconomics (5th Edition), Pearson
Education, Delhi, Chapters 16, 17, 18.5.
Katz, M L and Harvey S Rosen (1999) : Microeconomics (3rd Edition) Irwin
Chapter 16.
Szenberg, M and Ramrattan L (2004) : New Frontiers in Economics, Cambridge
University Press. (following readings)
13
(i) Reading of Behavioral Economics by
Mathew Robin
(ii) Information and the change in the
Paradigm in Economics by Joseph E
Stigliz
Dornbusch, R, S. Fischer, R. Startz (2004)
: Macroeconomics, (9th Edition) Tata
McGraw Hills Publishing Co. Ltd., New
Delhi.
Gupta, G S (2004) : Macroeconomics: Theory and Applications
(2nd Edition), Tata McGraw Hills Publishing
Co. Ltd., New Delhi.
Eric J. Pentecost (2000) : Macroeconomics: An open economy
approach, Macmillan Press Ltd., London.
Bhaduri, A (1993) : Unconventional Economics Essays, Oxford
University Press, New Delhi.
Rakshit, M (1989) : Studies in the Macroeconomics of
Developing Countries. Oxford University
Press, New Delhi.
Patnaik, P (1997) : Macroeconomics, Oxford University Press,
New Delhi.
Jha Raghbendra (2008) : Contemporary Macroeconomic Theory and
Policy, New Age International Publications.
14
Paper - V : Economic Theory – II
3 Credits
75 marks
(60+15 internal assessment)
Teaching Hours : 40
Time : 3 Hours
Objectives: The aim of this paper is to make the students familiar with some of the recent
developments in micro and macro economics which have wide range of applicability to solve
and explain phenomena; some of which can provide new insights into the empirical estimation of
economic relationship.
Pedagogy of the Course Work: The course relies on a combination of lectures, solving
problems, and discussing of academic articles or real-life situations. Teacher will assign topic
for assignments on contemporary themes and issues from the syllabi. Special tutorials/contact
hour for one-to-one student-teacher interactions.
INSTRUCTIONS FOR THE PAPER-SETTERS:
Nine questions will be set in all with two from each unit and one question spread over the
entire syllabus.
The First question consisting 4 short notes, each carrying 5 marks, set out of the entire
syllabi would be compulsory with no internal choice. Additionally, the students are
required to attempt one question from each Unit. Each such question would carry 10
marks.
Unit - I
I New growth theory – A Survey
Neo-classical theory of growth and convergence – what it meant; The empirics of growth
– what the studies reveal; Explaining the observed patterns of growth through
(a) Increasing returns
(b) Externalities
(c) A K Type models
UNIT - II
II Models of Optimal growth – From Ramsey to McKenzie
(a) The Ramsey Exercise
(b) Philip’s golden rule
(c) Discounting the future and Koopman’s axiomatization.
(d) Turnpike theorems – an exposition.
15
Unit – III
Recent Developments in the Theory and Role of Central Banks.
Recent Developments in the Theory of Financial Markets and Asset Pricing.
UNIT – IV
Fiscal Responsibility and Budget Management Act – Issues and Challenges.
Tax and Expenditure Reforms in India.
References:
Romer, David (2005) : Advanced Macroeconomics, (3rd Edition)
McGraw-Hill, Singapore.
Barro, Robert J & Xavier Sala-I-Martin
(2003)
: Economics Growth (2nd edition), McGraw-
Hill, Singapore.
Reddy, Y V (2004) : Lectures on Economic and Financial Sector
Reforms in India Oxford University Press,
New Delhi.
Romer, Paul, M The Origins of Endogenous Growth, The
Journal of Economic Perspectives Volume
8, Number 1, Winter 1994.
Grossman Gene, M & Elhanan Helpman Endogenous Innovation in the Theory of
Growth, The Journal of Economic
Perspectives Volume 8, Number 1, Winter
1994.
Solow Robert M : Perspective on Growth Theory, The Journal
Economic Perspectives Volume 8, Number
1, Winter 1994.
Pack Howard : Endogenous Growth Theory: Intellectual
Appeal and Empirical Shortcomings, The
Journal of Economic Perspectives Volume
8, Number 1, Winter 1994.
Szenberg, M and Ramrattan L (2004) : New Frontiers in Economics, Cambridge
University Press.