Learning Outcomes
The aim of the course is for the students to acquire basic knowledge of microeconomic principles and methodology relevant for tourism, as well as the skills needed to make simple microeconomic analyses of tourism.
After the course is completed the students should be able to:
After the course is completed the students should be able to:
- explain and calculate the concept of opportunity cost (1)
- explain what influences demand and supply curves in markets for goods and services in general and with applications in tourism (2)
- explain and apply the elasticity concept (3)
- explain the basis for consumer demand on tourism: utility theory and indifference curves (4)
- derive and graphically construct cost curves for a firm active in the tourism market (5)
- derive and graphically construct demand and marginal revenue curves for firms active in the tourism market in perfect competition and monopoly (6)
- explain how game theory can be used in the microeconomic analysis of tourism (7)
- make simple analyses of imperfect markets, incomplete competition, external factors, and imperfect information within tourism (8)
- apply the concepts of consumer and producer surplus and so-called dead weight loss to analyse the effect of imperfect markets and taxation on economic efficiency (9)
- derive and graphically construct the demand curve for tourism labour (10)
Course Content
The course starts with a discussion about the concept of scarcity (that there are limited resources) and the trade-offs that this implies, since this is the basis for economic analyses of tourism. Thereafter the concept of opportunity cost and the implications of trade and specialization for production are explained. Following this introduction the focus will shift to the principles and methodology used in microeconomic analyses of tourism. First demand and supply curves are described along with an explanation of how they can be used in economic analyses of tourism and other markets, for example explaining the role of prices in the distribution of resources as well as analysing trade effects. Moreover it provides knowledge of the basics regarding the theories on consumer and producer behaviour and how these theories can be used for efficiency and welfare analyses of tourism and other activities. After this first part of the course is completed, the focus will shift towards imperfect markets and how microeconomic theory can be used to explain and analyse the effects of market failures related to tourism and other markets. The role of the state and the effects of regulations (taxes, laws, etc.) are also discussed in this part of the course. Furthermore, game theory and how it can be used in microeconomic analysis is introduced as well as the basics of labour market theory related to tourism.
Assessment
The learning outcomes 1-10 are assessed by a mid-course exam “Dugga” (multiple-choice questions) 1,5 credits (U-G) and a written exam 6 credits (U-VG).
Forms of Study
The course contains lectures, math exercises and economic experiments. The lectures cover the central parts of the literature, while the math exercises deepens students’ knowledge about the mathematics that is the basics for economic analysis. In the economic experiments the students carry out trade. The information from the trade is then used to evaluate how theoretical predictions compare with the true market outcome.
Grades
The Swedish grades A–F.
Prerequisites
- General entrance requirements and Civics A, English B and Mathematics B at Swedish upper secondary school, or equivalent knowledge. No knowledge of Swedish is required
Other Information
Maximum five examinations.