University of Liverpool - ECON222: Microeconomics 2

This module, ECON222: Microeconomics 2 builds on Microeconomics 1, providing an intermediate-level foundation in microeconomic theory. It deepens students' understanding by applying previously learned skills to advanced topics such as welfare economics, asymmetric information, and game theory. The module also prepares students for more specialised third-year courses by introducing key concepts like Nash equilibrium, adverse selection, and externalities. To enrol, students must have completed ECON121 along with either ECON111 or ECON113, and either ECON221 or ECON227.

The syllabus covers three main areas: Game Theory, exploring domination, iterated elimination, rationalizability, and oligopoly games; Asymmetric Information, focusing on insurance contracts, moral hazard, and adverse selection; and Welfare Economics, examining preference aggregation, Arrow’s theorem, public goods, and envy-free allocations. By the end of the module, students will be able to assess core microeconomic models, apply analytical and mathematical methods to solve problems, and critically evaluate underlying economic assumptions. This module is a prerequisite for ECON306, ECON325, ECON327, ECON330, ECON335, ECON342, ECON360, and ECON364.