Scheme of Studies & Course Outlines for

M. Sc. Economics (Four semesters of 60 Credit Hours)

(For Morning & Afternoon Programs under semester System from
Session 2012-2014 & onwards)

First Semester

ECON-301 Microeconomic Theory-I 3-Credit Hours (100 marks)

ECON-303 Macroeconomic Theory-I 3-Credit Hours (100 marks)
ECON-305 Mathematical Economics 3-Credit Hours (100 marks)
ECON-307 Descriptive and Inferential Statistics 3-Credit Hours (100 marks)
ECON-309 Development Economics 3-Credit Hours (100 marks)
(All Compulsory)

Second Semester

ECON-302 Microeconomic Theory-II 3-Credit Hours (100 marks)

ECON-304 Macroeconomic Theory-II 3-Credit Hours (100 marks)
ECON-306 Optimization and Dynamic Analysis 3-Credit Hours (100 marks)
ECON-308 Basic Econometrics 3-Credit Hours (100 marks)
ECON-310 Economic issues in Pakistan 3-Credit Hours (100 marks)
(All Compulsory)

Third Semester

ECON-401 Economics of Money and Banking 3-Credit Hours (100 marks)

ECON-403 Econometric Analysis 3-Credit Hours (100 marks)
ECON-405 Public Finance 3-Credit Hours (100 marks)
ECON-407 International Trade: Theory & Policy 3-Credit Hours (100 marks)
ECON-409 Agricultural Economics 3-Credit Hours (100 marks)
(All Compulsory)

Fourth Semester

(Compulsory Courses)
ECON-402 International Finance 3-Credit Hours (100 marks)
ECON-404 Islamic Economics 3-Credit Hours (100 marks)
ECON-406 Financial Economics 3-Credit Hours (100 marks)

Two optional courses will be selected from the list of optional

1

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
Optional Courses

ECON-410/
ECON-412 Thesis 6-Credit Hours (200 marks)
ECON-414 Applied Economics 3-Credit Hours (100 marks)
ECON-416 Corporate Governance 3-Credit Hours (100 marks)
ECON-418 Cost-Benefit Analysis and
Project Evaluation 3-Credit Hours (100 marks)
ECON-420 Economics of Poverty and
Income Distribution 3-Credit Hours (100 marks)
ECON-422 Energy Economics 3-Credit Hours (100 marks)
ECON-424 Environmental Economics 3-Credit Hours (100 marks)
ECON-426 History of Economic Thought 3-Credit Hours (100 marks)
ECON-428 Human Resource Development 3-Credit Hours (100 marks)
ECON-430 Industrial Economics 3-Credit Hours (100 marks)
ECON-432 Labor Economics 3-Credit Hours (100 marks)
ECON-434 Managerial Economics 3-Credit Hours (100 marks)
ECON-436 Population Economics 3-Credit Hours (100 marks)
ECON-438 Research Methods in Economics 3-Credit Hours (100 marks)
ECON-440 Transport Economics 3-Credit Hours (100 marks)

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
 Detail of Course Outlines
FIRST SEMESTER
ECON-301 MICROECONOMIC THEORY-I

Microeconomics: Comparison with other branches of economics; The uses and limitations of
Microeconomic theories; The problem of Scarcity; The Concept of opportunity cost; Markets;
Firms and Individuals; Demand and Supply: A Review; Relative and absolute Prices; Real and
Nominal Prices; Cobweb Theorem; Slope and Elasticity of Demand; Different Kinds of elasticity
of demand; Price Controls; Consumer and Producer’s surpluses.

Consumer’s equilibrium under Cardinal Approach and consumer demand curve; Ordinal
Approach axioms and Consumer’s equilibrium under Ordinal Approach; Effects on consumer
equilibrium; Marginal rate of consumer substitution; Properties of indifference curves; Graphical
derivation of Marshallian; Hicksian and Slutsky demand curves; Theory of Revealed Preference;
Implication of Elasticities and Problem Solving Approach; Identification of Inferior goods;
Griffin goods and normal goods.

The Concept of Production Function; Production with one variable and two variable inputs;
Laws of Returns and Returns to scale; The substitution and Resource effects of change in input
prices; Euler’s Theorem; The elasticity of substitution; Some special production functions: Cobb
Douglas Production function; CES Production Function; Translog Production function;
Homogenous Production Function.

Definition and kinds of costs; Cost Functions; Traditional; Modern and Engineering costs
Theories; Economies of Scale and Scope; Revenue Analysis (Total, Marginal and Average
Revenue); Derived Demand; Cost Minimization. Decreasing and Increasing Cost Industry and
Price Determination.

Recommended Books:
1. Bilas, Richard A, Microeconomic Theory*, McGraw-Hill Kogakusha Ltd, (2nd Edition).
2. Koutsoyiannis, A, Modern Microeconomics*, London, Macmillan, (Latest Edition).
3. Pindyck, Robert. S , Daniel L. Rubinfeld and Prem L.Mehta, Microeconomics*. Pearson
Education Inc, (Sixth Edition).
4. Henderson, J.M & Quandt, R.E, Microeconomic Theory*, N.Y Macmillan II A Book Co.
5. Varian Hal R., Microeconomics Analysis*, Norton & Company, New York, 1992.
6. Ferguson, C.E & Gould, J.P, Microeconomic Theory, Macmillan, (Latest Edition).
7. Layard and Walter A.A., Microeconomics, McGraw Hills, (Latest Edition).
8. Walter Nicholson, Microeconomic Theory, Basic Principles and Extensions (6th edition)
*Strongly Recommended

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
ECON-303 MACROECONOMIC THEORY-I

The development of Macroeconomics: Introduction; main objectives; scope and subject matter of
Macroeconomics. Circular flow of national income; national income aggregates; measurement of
GNP: expenditure approach, income approach, product approach; GNP as a measure of welfare;
Outlays and components of demand; some important identities; rules for computing GDP; real
GDP VS nominal GDP; actual GDP VS potential GDP; prices indices; GDP deflator; CPI; PPI;
Measuring joblessness; The unemployment rate; unemployment; GDP and Okun’s Law;
Inflation and Inflation rate; GDP growth rate.

The classical revolution; production function and employment; demand for and supply of labor;
labor market equilibrium; the determinants of output and employment; derivation of classical
aggregate supply curve; What is money? Functions of money and types of money; how quantity
of money is measured? The quantity theory of money; the money demand function and the
quantity equation; relationship between money; prices and inflation; Seigniorage; real vs
nominal interest rates; the fisher effect; The classical aggregate demand curve; The classical
theory of the interest rate; Say’s Law of markets; pricing implications of the classical equilibrium
model.

Simple Keynesian model; conditions for equilibrium output; The components of aggregate
demand; Consumption function; saving function; investment function (relationship between
APC, MPC, APS and MPS); Government expenditures and net exports; aggregate demand
equals aggregate output; Theory of multiplier; derivation of simple multiplier; Government
expenditures and tax multiplier; export and import multipliers; super multiplier; employment
multiplier; balanced budget multiplier; Budget surplus and full employment; Money in the
Keynesian system; Interest rate and aggregate demand; Keynesian theory of interest rate;
Keynesian theory of demand for money; Regressive expectation model; portfolio balance
approach.

Investment VS capital; kinds of investment; determinants of investment; MEC VS MEI; Present

value criterion for investment; Internal Rate of Return Criterion; Neo classical model of fixed
business investment; Taxes and investment; Tobin’s q theory; Residential investment model;
Acceleration Principle; Rigid and Flexible Accelerator; Inventory Investment Model.

IS curve; its derivation; shape of IS curve; factors affecting the slope and position of IS curve
(Mathematical version); LM curve; its derivation; factors affecting the slope and position of LM
curve; Policy effects in the IS-LM model; Monetary and fiscal policy multipliers in the IS-LM
curve model.
Recommended Books:

1. Branson, William H., (Latest Edition), Macroeconomic Theory and Policy*, Harper and
Row Publishers, New York / London.
2. Froyen, R. T., Macroeconomics: Theories and Policies*, (Latest Edition), Prentice Hall .

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
 3. Branson, William H. and Litvack James M., Macroeconomics*, (Latest Edition),
Princeton University.
4. Glahe, Fred R., (Latest Edition), Macroeconomics, Theory and Policy, Harcourt Brace
Jovanovich Inc.
5. Mankiw, Gregory N., (Latest Edition) , Macroeconomics*, Worth Publishers, New York.
6. Peel D. and Minfow P., (Latest Edition), Advance Macroeconomics, Edward Elgar,
Cheltenham, U.K.
7. Delorme. Jr., Macroeconomics, 2nd Edition.
8. Romer, David (Latest Edition), Advanced Macroeconomics*, McGraw Hills, New
York,London.
9. Sargent, Thomas J., Rational Expectations and Inflation*, Harper and Raw Publishers,
New York / London.
* Strongly Recommended

ECON-305 MATHEMATICAL ECONOMICS

The Nature of Mathematical Economics; Economic Models: Ingredients of mathematical

models: Real Number Systems: Concept of Sets: Relations and Functions: Types of Functions;
Equilibrium Analysis in Economics: Partial and General Market Analysis: Some Economic
Examples and Interpretations; Linear Models and Matrix Algebra: Matrices and Vectors with its
Operations: Laws and Forms of Matrices: Finite Markov Chains: Conditions and Tests of
Nonsingularity: Properties of Determinants: Finding the Inverse Matrix: Cramer’s Rule: Leontif
Input-Output Models; Comparative Statics and the Concept of Derivatives; Rules of
Differentiation and their Use in Comparative Statics; Applications to Comparative –Static
Analysis; Concept of Functional Dependence; Comparative-Static Analysis of General-Function
Models: Differentials and Total Derivatives: Derivatives of Implicit Functions: Comparative
Statics of General-Function Models.

Recommended books:

1. Alpha C. Chiang and K. Wainwright, Fundamental Methods of Mathematical

Economics*, Latest Edition, Mc Graw-Hill.
2. Dowling, Edward T. Introduction to Mathematical Economics* (part of Schaum’s easy
outlines series), New York, McGraw-Hill, 2006.
3. Pemberton and Rau, Mathematics for Economists*, Manchester University Press, 3rd
Edition, 2011.
4. Abadir, K.A. and Magnus, J. R., Matrix Algebra*, Cambridge University Press, 2005.
5. Fuente, A. de la, Mathematical Methods and Models for Economists*, Cambridge
University Press, 2000.
6. Sydsaeter, Knut and Peter Hammond. Essential Mathematics for Economic Analysis, 2nd
Ed. Financial Times, Prentice Hall, Harlow, England. ISBN is 0-273-68180-X, 2006.
7. Simon, Carl P, and Lawrence Blume, Mathematics for Economists. New York: W.W.
Norton & Company, Inc., 1994.

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
 8. Anthony, Martin Henry George, Mathematics for economics and finance Cambridge,
Cambridge University Press, 1996.
9. Bradley, Teresa, Essential mathematics for economics and business, 2nd Edition,
Chichester, J. Wiley, 2002.
10. Jacques, Ian,Mathematics for economics and business, 5th Edition, Harlow, FT Prentice
Hall, 2006.
11. Rosser, M. J, Basic mathematics for economists, 2nd Edition, London, Routledge, 2003.
12. Weber E. Jean, Mathematical Analysis, Business and Economic Applications, (Latest
Edition) I-Harper and Row Publishers, New York.
13. Blume, Lawrence,Mathematics for economists New York, Norton, 1994.
14. Hoy, Michael, Mathematics for Economists, Cambridge, MA: MIT Press, 2001.
15. Klein, Michael W., Mathematical Methods for Economics. Boston, MA: Addison-
Wesley, 2002.
16. Hoy, Livernois, McKenna, Rees and Stengos, Mathematics for Economics, MIT Press,
3rd Edition, 2011.
* Strongly Recommended

ECON-307 DESCRIPTIVE AND INFERENTIAL STATISTICS

a) Descriptive and Applied Statistics

Descriptive and inferential statistics; population and sample; parameter and statistic; The
four basic activities in statistics: Designing a plan for data collection; Exploring the data;
Type of measurement scales: Nominal; Ordinal; Interval and Ratio; Types of data:
Univariate; Bivariate and Multivariate data; Primary and secondary data; Quantitative
data and qualitative data; Time series; Cross-sectional and pooled data

Introduction; Classification; Tabulating numerical data: The frequency distribution; the

cumulative frequency distribution; the relative frequency distribution; the percentage
frequency distribution; Graphic and diagrammatic representation: Bar chart; Pi chart;
Histograms; Frequency curves and Histograms;' Measure of central tendency;
Introduction; Types of Averages: Quintiles: Median; Quartiles; Deciles; Percentiles; The
mode; Empirical relation between Mean; Median and Mode

Absolute and relative measures of dispersion; Different measures of dispersion: The

Range; Quartile deviation; Mean deviation; Variance and standard deviation:
Standardized variable; Properties of standard deviation and variance; Skewness.

Index Numbers; Un-weighted index numbers; Simple aggregative index; Weighted

indexes; Laspeyre's price index; Paaseche’s price index; Marshal Edgeworth price index;
Fisher’s ideal index; Consumer Price Index (CPI); Producer Price Index (PPI); CPI
versus GDP Deflator; Issues in constructing and using index numbers; Application of
index numbers to business and economics; An overview of time series analysis;
Component Factors of the classical multiplication time series model and their estimation

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
 A survey of probability concepts: Classical probability; Empirical concept; Subjective
probability; some rules of probability: Rules of addition; Counting rules: The permutation
formula; The combination formula; Mathematical Expectation; Random variables;
Discrete random variable Continuous random variable; The mean; variance and standard
deviation of a probability distribution; Binomial probability distribution; and its
computation; Properties of Binomial probability distribution; The normal probability
distributions: Properties of normal distribution.
b) Inferential Statistics
Sampling and Sample: Advantages of sampling; Representative samples; design and
sample survey; Sampling frame; Probability and non-probability sampling; Sampling
with and without replacement; Sampling .and non-sampling error; sampling bias;
Sampling distribution of the mean; The central limit theorem; Sampling distribution of
differences between means.

Point estimates and confidence intervals; Criteria for good estimators; Point estimators of
mean and variance; Estimation by confidence interval: Confidence interval estimate of a
population mean (Known & Unknown Variances); Types of hypotheses; Type I versus
Type II errors; Z and t test distribution and their properties; Chi square distribution and
its properties; ANOVA test.

Recommended Books:

1. Chaudhry, Sher Mohammad and Kamal Shahid, Introduction to Statistical Theory*,

Lahore: lImi Kitab Khana, 2009.
2. Lind, Marchal, Wathen, Statistical Techniques in Business and Economics*, McGraw-
Hill Companies, 12th Edition, 2005.
3. H.K. Chow, Introductory Statistics*, 2nd edition, Prentice Hall, 2007.
4. Barrow, M., Statistics for Economics, Accounting and Business Studies, 4th edition
(Longman), 2005.
5. Agresti, Alan, Statistical methods for the social sciences, 3rd Edition, Upper Saddle
River, N.J., London: Prentice Hall, 1997.
6. Mc Clave, J.M., Benson, P. G., Sincich, T., Statistics for Business and Economics (9th or
10th ed.) Pearson Publishing, 2005.
7. Berenson M L., D. M. Levine, and T. C. Krehbiel, Basic Business Statistics, 11th edition,
Pearson Prentice Hall, 2009.
8. J. Siegel, .Andrew F., Practical Business Statistics (5th edition), Boston: McGraw Hill,
2003.
9. New bold, Paul, Carlson, William L. and Thorne, Betty M, Statistics for Business and
Economics (5th edition), New Jersey: Prentice Hall, 20m.

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
 10. Keller, Gerald and Warrack, Brian, Statistics for Management and Economics (5th
edition), Boston: Duxbury Thomson Learning, 2000.
11. Stephan and Spegal, Statistics, latest Edition, Schum’s Outline Series.
* Strongly Recommended

ECON-309 DEVELOPMENT ECONOMICS

The nature of development economics; Why study development economics? Some

critical questions; The important role of values in development economics. Traditional
economic measures; The new economic view of development; Three core values of
development; The three objectives of development; Diverse Structures and Common
Characteristics of Developing Nations; Some classifications of developing countries;
common characteristics of developing nations.

Nurkse’s Model of Vicious Circle of Poverty; Nelson’s low level equilibrium trap;
Leibinstein’s critical minimum theory; Rosenstein Rodan’s Big Push theory; The linear
stages theory: Rostow growth model and Harrod Domar growth model; Structural change
models; International dependence revolution: Neocolonial Dependence Model; The
False-Paradigm Model; The Dualistic-Development Thesis; Dualistic theories; The Neo-
classical counter revolution: Challenging the Statist Model: Free Markets; Public Choice;
and Market-Friendly Approaches. The Growth Game; The Economics of Growth:
Capital; Labor; and Technology; Capital Accumulation; Population and Labor Force
Growth; Technological Progress; The Historical Record: Kuznets's Six Characteristics of
Modern Economic Growth.

The Growth Controversy; Some Basic Concepts: Size and Functional Distributions of
Income; Size Distributions; Lorenz Curves; Dualistic Development and Shifting Lorenz
Curves: Some Stylized Typologies; GINI Coefficients and Aggregate Measures of
Inequality; Functional Distributions; A Review of Evidence: Inequality and Absolute
Poverty in Third World Countries. Inequality: Variations among Countries; Absolute
Poverty: Extent and Magnitude; The Human Poverty Index; Economic Characteristics of
Poverty Groups; The Kuznets Hypothesis and Other Tests Redefining Development
Goals: Growth with Improved Income Distribution.

The Basic Issue: Population Growth and the Quality of Life; A Review of Numbers:
Population Growth—Past, Present and Future; World Population Growth through
History; Structure of the World's Population; The Hidden Momentum of Population
Growth; The Demographic Transition; The Causes of High Fertility in Developing
Countries: The Malthusian and Household Models; The Malthusian -Population Trap;
Criticisms of the Malthusian Model. The Microeconomic Household Theory of Fertility;
The Demand for Children in Developing Countries: Some Empirical Evidence;
Implications for Development and Fertility; The Consequences of High Fertility: Some

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
 Conflicting opinions; Goals and Objectives: Toward-a Consensus Some Policy
Approaches.

The Employment Problem: Some Basic Issues Dimensions of LDC Unemployment:

Evidence and Concepts; Employment and Unemployment: Trends and Projections; Four
Dimensions of the Employment Problem; Labor Force: Present and Projected; Labor
Underutilization: Some Definitional Distinctions; Linkages among Unemployment;
Poverty and Income Distribution; The Phenomenon of Jobless Growth and the Output-
Employment Lag; Economic Models of Employment Determination.

The Migration and Urbanization Dilemma; Urbanization: Trends and Projections; The
Urban; Informal Sector; Women in the informal Sector; Urban Unemployment Migration
and Development; Toward an Economic Theory of Rural-Urban Migration: A Verbal
Description of the Todaro Model, A Diagrammatic Presentation, Five Policy
Implications; The Shape of a Comprehensive Migration and Employment Strategy.

Education and Human Resources; Education in Developing Regions; Public Educational

Expenditure; Enrollments; Literacy; Costs and Earnings; The Gender Gap: Women and
Education; The Economics of Education and Employment; Educational Supply and
Demand: The Relationship between Employment Opportunities and Educational
Demands; Social versus Private Benefits and Costs; Education, Society, and
Development; Some Issues in Education and Economic Growth; Inequality and Poverty;
Education and Internal Migration; and the Brain Drain; Education of Women; Fertility
and Child Health; Education and Rural Development: Summary and Conclusions; Major
Educational Policy Options; Policies Largely External to Educational Systems; Policies
Internal to Educational Systems; International issues in development economics: foreign
Aid; BOP; Debt Problem.

Recommended Books:

1. Todaro, M.P, Economic Development*, Latest Edition, Heinemann;London.

2. Balasubramanyam V and Hall. S (Latest Edition) Current Issues in Development
Economics, London.
3. Chenery H.B and Srinivasen, Hand book of Development Economics*, Vol I & II
Amsterdam (Latest Edition), North Holland.
4. Cypher J. M and Dietz James (Latest Edition), The process of Economic
development*.
5. Ghatak Subarat, (Latest Edition), Introduction to Development Economic,
Routledge*, Taylor and Francis Group, London /New York.
6. Herrick B, and Kindlebergerc, (Latest Edition), Economic Development, McMillan
New York.
7. Jones H, G. An Introduction To Modern Theories Of Economic Growth, (Latest Edi),
McGraw Hill.
8. Hirshman, A.O., Strategy of Economic Development, Yale University Press.
9

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
 9. Mahboob ul Haq, Centre for Human Resource Development, Human Development in
South Asia, Annual Report Islamabad.
10. Mahboob ul Haq, Poverty Curtain.
11. A profile of Poverty in Pakistan (In collaboration with UNDP).
12. Meier Gerald M, Leading Issues In Economic Development*, (Latest Issue) Oxford
Uni Press.
13. Thirlwall A. P., (Latest Edition), Growth And Development*, With Special Reference
To Developing Economics, 7th Edition ,Palgrave Publisher.
14. UNDP, Human Development Report, Annual Reports.
15. Van Den Berb H,(2001) Economics Growth Development, McGraw hill.
16. William Easterly, Growth without Development, A case Study Of Pakistan, World
Bank.
17. World bank, world Development Report, Annual Report,(Various Issues).
18. William Easterly, Growth without development, A Case study of Pakistan, World
Bank.
19. Yotopolus, P. A. and Nugent Jeffery B, Economics of Development, Empirical
Investigation (Latest issue), Harper and Row Publishers, London/ New York.
*Strongly Recommended

SECOND SEMESTER
ECON-302 MICROECONOMIC THEORY-II

Pure and Perfect competition: equilibrium of firm in Short run; The supply curve of the firm and
the industry; Short run equilibrium of industry; Equilibrium of firm and Industry in Long Run;
Optimum Resource allocation; Dynamic changes and Industry Equilibrium: Shift in the Market
demand; Predictions of the perfect competition model when costs change; Effects of Imposition
of a Tax; Monopoly and its basis; The negatively sloping demand curve: Short run and Long Run
equilibrium; Predictions in dynamic changes: Shift in the Market demand; An increase in the
costs of monopolist; Imposition of a Tax; Comparison with perfect competition: Bilateral
Monopoly; Multi-plant Monopolist Firm; Price Discrimination; Govt. regulated Monopoly.
Monopolistic competitive conditions: The historical setting of the theory of monopolistic
competition; Characteristics of Monopolistically competitive firms; The concepts of industry &
group: The basic Chamberlin theory of Monopolistic competition: (Model No 1: Equilibrium
with new firms entering the industry; Model No 2: Equilibrium with Price competition; Model
No 3: Equilibrium with Price competition and free entry); Critique of Chamberlin Model.
Comparison with pure competition; Oligopolistic conditions: A simple statement of the problem
of oligopoly: Non-collusive Oligopoly: Models of Cournot; Bertrand; Chamberlain; Sweezy &
Stackelberg Collusive Oligopoly: Model of cartels and Price Leadership; Factor Pricing in
perfectly competitive and imperfectly competitive Markets; Elasticity of Factor substitution;
Technological progress and Income Distribution.

General Equilibrium and Economic Efficiency: Partial and general Equilibrium Analysis; Two
interdependent markets -moving to general equilibrium (an example); Efficiency in exchange.
10

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
Equity and Efficiency; Efficiency in Production; Welfare Economics: Criteria of social welfare:
Growth of GNP as a welfare criterion; Bentham’s criterion; A cardinalist criterion; The Pareto
optimality criterion; The Kaldor-Hicks Compensation criterion; The Bergson criterion ‘social
welfare function; Maximization of social welfare; Determination of the welfare maximizing
output mix; Commodity distribution and Resource Allocation; Welfare Maximization and
Perfect Competition.

Recommended Books:
1. Koutsoyiannis, A. Modern Microeconomics*, London; Macmillan, (Latest Edition).
2. Bilas, Richard , Microeconomic Theory*, McGraw-Hill Kogakusha;Ltd, (2nd Edition).
3. Pindyck, Robert. S, Daniel L. Rubinfeld and Prem L.Mehta, Microeconomics*, Pearson
Education Inc, (Sixth Edition).
4. Henderson, J.M & Quandt, R.E. Microeconomic Theory*, N.Y Macmillan II A Book Co.
5. Varian Hal R, Micro Economics Analysis*, Norton & Company, New York, 1992.
6. Ferguson, C.E & Goul, J.P, Microeconomic Theory, Macmillan, (Latest Edition).
7. Layard and Walter A.A., Micro Economics, McGraw Hills, (Latest Edition).
8. Walter Nicholson, Microeconomic Theory: Basic Principles and Extensions, (6th
edition).

ECON-304 MACROECONOMIC THEORY-II

Theories of Consumption: Duesenbury Hypothesis; Keynesian Consumption Function.

Permanent Income Hypothesis / Life Cycle Hypothesis; Beyond Permanent Income Hypothesis;
Kuznet's findings and Reconciliation of Marginal Propensity to Consume and Average
Propensity to Consume and Evidences; Mathematical derivation of Consumption Models; The
MPS Model; Wealth effect in the Static Model; Implications of Consumption Theories for Policy
Formulation and Stabilization Policy; Random Walk Model.

Keynesian aggregate demand curve; its derivation; factors determining its slope and position;
The aggregate demand schedule combined with the classical theory of aggregate supply; The
Keynesian contractual view of labor market – a flexible price – fixed money wage model;
comparison of classical and Keynesian theories of labor supply; The Keynesian aggregate supply
curve with variable money wage; Policy effects in the variable–wage Keynesian model; The
effects of shifts in the aggregate supply schedule; factors that shift the aggregate supply
schedule; Aggregate supply models; The sticky wage model; the imperfect information model;
the sticky – price model; The Worker Misperception Model.

The concept of inflation; Demand pull and Cost push inflation; hyperinflation; social cost of
inflation; theory of stagflation; The Relation of Wages Changes to Unemployment; The Philips
curve – the theoretical basis for the Philips curve. Unemployment and price expectations; The
long-run Philips curve; Deriving the Philips curve from the aggregate supply curve; Adaptive
expectations and inflation inertia; The Natural Rate Theory; Monetarist View of the Philips
Curve; Keynesian view of the Philips curve. The size of Government Debt; Measurement
Problem: Inflation; Capital Assets; Business Cycle etc; Ricardian view or Debt: Ricardian
11

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
Equivalence; Consumers and Future Taxes; Tax shooting; Delayed Stabilization; Ricardo and
Ricardian Equivalence and Debate; Model or Debt Crises.

The theory of real business cycles; interpretation; labor market; technology shocks; household
behavior; the persistence of output fluctuation; limitations of the models Samualson’s multiplier
– accelerator interaction theory of trade cycles; Kaldor’s model of the business cycle. Hicks’s
theory of business cycle; AD-AS theories of output functions; Basic neoclassical growth
model/Solow growth model – the accumulation of capital; determination of steady state
equilibrium in the long-run; how savings affects growth; the golden rule level of capital; how
population affects the steady state level; technological progress in the Solow model; policies to
promote growth endogenous growth theory.
Recommended Books:

1. Branson, William H., (1979), Macroeconomic Theory and Policy*, Harper and Row
Publishers, New York / London.
2. Froyen, R. T., Macroeconomics: Theories and Policies*, (Latest Edition), Prentice Hall,
7th Edition, 2002.
3. Branson, William H., and Litvack James M., Macroeconomics*, (Latest Edition),
Princeton University.
4. Glahe, Fred R., (Latest Edition), Macroeconomics, Theory and Policy, Harcourt Brace
Jovanovich Inc.
5. Mankiw, Gregory N., (2000) Macroeconomics*, Worth Publishers, New York.
6. Peel D. and Minfow P., (2002). Advance Macroeconomics, Edward Elgar, Cheltenham,
U.K.
7. Delorme. Jr., Macroeconomics, 2nd Edition.
8. Romer, David, (200I). Advanced Macroeconomics*, McGraw Hills, New York, London.
9. Sargent, Thomas J., (Latest Edition) Rational Expectations and Inflation*, Harper and
Raw Publishers, New York / London.
* Strongly Recommended

ECON-306 OPTIMIZATION AND DYNAMIC ANALYSIS

Concept of Optimization; Optimization: Special Variety of Equilibrium Analysis; The nature of

exponential functions; Nature exponential functions and the problem of growth; Logarithms;
Logarithmic functions; Derivatives of Exponential and Logarithmic Functions; Optimal Timing;
Further Application of exponential and Logarithmic Derivatives; The Differential version of
optimization conditions; Extreme values of a function of two variables; Objective functions with
more than two variables; second order conditions in Relation to Concavity and Convexity;
Economic applications; Comparative Static aspects of optimization; Effects of Constraint;
Finding the Stationary values; Second Order Conditions; Quasiconcavity and Quasiconvexity;
Non linear programming and Kuhn Tucker Conditions; The Constraint Qualification; Economic
Applications; Sufficiency Theorems in Non linear Programming; Maximum Value functions and
the Envelope Theorem; Duality and the Envelope Theorem.

12

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
Economic Dynamics and Integral Calculus: Dynamics and Integration: Indefinite Integrals:
Definite Integrals: Improper Integrals: Some Economic Applications of Integrals: Domar Growth
Model; First Order linear differential equations with constant coefficient and constant term;
Dynamics of Market price; Variable coefficient and variable term; Exact Differential equations;
Non linear Differential equations of the first order and first degree; The Qualitative Graphic
Approach; Solow Growth Model; Second Order linear differential equations with constant
coefficients and constant term; Complex numbers and circular Functions; The interaction of
inflation and unemployment; Differential equations with a variable term; Discrete time;
differences and difference equations; Solving a first order difference equations; The dynamic
stability of equilibrium; The Cobweb model; Second order linear difference equations with
constant coefficients and constant term; Samuelson Multiplier Acceleration interaction model;
Inflation and Unemployment in Discrete time; Game Theory.
Recommended Books:

1. Alpha C Chaing and Kevin Wainwright, Fundamental Methods of Mathematical

Economics, Latest Edition, McGraw hill.
2. Brichenhall C. & P. Grout, Mathematics for Modern Economics, Latest Edition.
3. Dowling; E.T, Mathematics for Economists, Latest Edition.
4. Intrilligator; M.D, Mathematical Optimization and Economic Theory
5. Kooros; A., Elements of Mathematical Economics, Latest Edition.
6. Varian; H.R, Microeconomic Analysis, Latest Edition.

ECON-308 BASIC ECONOMETRICS

Definition and scope of Econometrics; Methodology of Econometrics; Types of Econometrics;

The Role of the Computer; Some basic ideas of Regression analysis; OLS estimation;
Interpretation and economic meanings of the Results; Goodness of fit; Properties of the OLS
estimator; Scaling and Units of Measurement; Functional Forms of Regression Models; Interval
estimation; Hypothesis Testing; Prediction; Some extensions of the simple linear regression
model; Some basic ideas; OLS estimation; Interpretation and economic meanings of the Results;
Multiple Coefficient of Determination; Hypotheses testing; R2 and F; Testing for parameter
stability; Prediction. Illustration of the use of a Dummy Variable; Extension to more than two
categories and to multiple sets of dummy variables: ANOVA models; ANCOVA models;
Dummy variable alternative to Chow test ; Interaction Effects; Seasonal Analysis; Piecewise
linear regression.

Recommended Books:

1. Gujarati, N. D., Basic Econometric Harper, Row, Latest Edition.

2. Johnston, J. J., Econometrics Methods McGraw Hill, Latest Edition.
3. Koutsouyiannis, A. R. , Theory of Econometrics Harper, Row,2nd Edition.
4. Pindyck, R.S.Rubinfeld, Econometric Models and Economic Forecasts, McGraw Hill,
Latest edition.
5. Christopher Dougherty, Introduction to Econometrics, Third Edition, Oxford.
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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
 6. Dominick Salvatore and Derrick Reagle, Statistics and Econometrics, Latest edition.
7. Maddals, G.S. Econometrics McGraw Hill, latest Edition.

ECON-310 ECONOMIC ISSUES IN PKISTAN

Pakistan’s Development Experience; Agriculture Development; Agricultural Pricing Issues;

Rural Development Policy; Resource Mobilization; Industrial Development; Policy and Issues;
Internal and External Migration; Urban Informal Sector; Income Distribution and Poverty;
Unemployment Issue; Foreign Aid and Debt Burden; Commercial Policy; Planning Process in
Pakistan; Balance of Payments Issues; Trade Regimes; Issues of Fiscal and Monetary Policies;
Financial & Capital markets; Structural Adjustment Policies.

Recommended Books:

1. S. Akbar Zaidi, Issues in Pakistan Economy, Oxford .Univ. Press, Karachi, Latest
Edition.
2. Khawaja Amjad Saeed, The Economy of Pakistan, Karachi: Oxford University Press,
Latest Edition.
3. Government of Pakistan, Pakistan Economic Survey (Various Issues including Latest
One)
4. Ishrat Hussain, Pakistan: The Economy at the Gross Roads - Past Policies and Present
Imperatives, Oxford Univ. Press, Karachi.
5. Khan, Shahrukh R., 50 Years of Pakistan's Economy - Traditional Topics and
Contemporary Concerns. Oxford Univ. Press, Karachi (2000).
6. Mahbool-ul-Haq, Centre for' Human Development (MHCHD), Poverty Profile of
Pakistan, (1989), Oxford University Press.
7. World Development Reports, World Bank.

THIRD SEMESTER
ECON-401 ECONOMICS OF MONEY AND BANKING

Money and its functions; kinds of money; evolution of monetary system; Monetary Standards;
Monetary Aggregates; Demand for money: meaning of holding money; demand for money; and
recent development theories in demand for money; Quantity theory of money; Supply Of
Money: Definition of supply of money (M1; M2; M3); exogenous and endogenous determinants
of money supply; Money Multiplier; Deposit Multiplier; Credit Multiplier; Central bank as
monetary base; Banking: Commercial bank: structure and functions of commercial banks; money
/ credit creation. Functions of commercial banks; Central Bank: structure and functions of central
bank; control of money supply; tools to control of money supply; Monetary policy and
independence of monetary authority: targets; goals of monetary policy; management
determinant; and role of monetary policy; short and; long run aspects Determination of interest
rates; Lags in Monetary Policy; Efficiency of Monetary Policy; Islamic Banking.

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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
Recommended Books:

1. Fredric, S. Mishikin, Financial Markets Institutions and Money. Harper Collins College
Publishers, Latest Edition.
2. Fredric S. Mishkin, Economics of Money, Banking and Financial Markets.
3. Lawrence Harris, Monetary Theory McGraw Hill, 1985.
4. Luckett G. Dudley, Money and Banking, 3rd Ed, McGraw Hill 1984.
5. Goldfeld & Chandler, The Economics of Money and Banking Harper& Row Publishers.
6. Vaish, M.C., Monetary Theory Vikas Publishing House, Delhi 2000.
7. Bennett. T. McCallum, Monetary Economics (Theory &Policy), McMillan 1989.

ECON-403 ECONOMETRIC ANALYSIS

Concept of Multicollinearity; Consequences of Multicollinearity problem; Methods for detection

of Multicollinearity problem; Remedial measures for Multicollinearity problem; Estimations and
Interpretations; Heteroscedasticity and its Implications; OLS estimation in the presence of
heteroscedasticity; Generalized least squares (GLS); Detection of heteroscedasticity; Remedial
measures; The nature of autocorrelation; OLS estimation in the presence of autocorrelation;
Detection of autocorrelation; Remedial measures; Misspecification vs pure autocorrelation;
Newey-West procedure; Forecasting with auto-correlated disturbances; Introduction to Model
specification; Types of Specification errors; Consequences and Tests of Specification Errors;
Errors of Measurement; Approaches in Choosing an Appropriate Model; Distributed Lag Models
and Estimations: The Koyck Transformation; The Almon Transformation; Other models of Lag
Structures; Autoregressive Models and estimation: The Partial Adjustment Model; The Adaptive
Expectations Model; Tests of Autocorrelation in Autoregressive Models; Simultaneous Equation
Models; Introduction of Qualitative Response Regression Models; The linear probability model;
The Logit model; The Probit model; The Tobit model; Introduction to Time series data handling
techniques.

Recommended Books:

1. Gujrati, D., Basic Econometrics, McGraw Hill, Latest Edition.

2. Intrilligator, Econometric Model, Techniques and Applications N.J.Printice Hall, Latest
Edition.
3. Johnston, Econometric Models McGraw Hill, Latest Edition.
4. Christopher Dougherty, Introduction to Econometrics, Third Edition, Oxford.
5. Dominick Salvatore and Derrick Reagle, Statistics and Econometrics, Latest edition.
6. Koutsoyinnis, Theory of Econometrics McMillan, Latest Edition.
7. Maddala, J.S. Econometrics McGraw Hill, NewYork, Latest Edition.
8. Pindyck R.R., Applied Econometrics, 2nd Ed Mc Graw Hill 1993.

ECON-405 PUBLIC FINANCE

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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
Public Finance defined; importance of the study of public finance; need for the public sector;
main functions of the public sector; The Theory of Public Goods; Public & Private goods; pure
public goods; semi public goods; merit goods; free rider problem; externalities. Revenue; Tax
and non tax revenue; categories of taxes; income and cooperate taxes; wealth tax; sales tax;
excise and custom duties; surcharges; Direct and in direct taxes; Tax Criteria: Efficiency
Criteria; the benefit principle; Ability to pay; limitation of tax effort: Laffer Curve approach: Tax
Structure of Pakistan. Tax Reforms in Pakistan and Problem of tax evasion; Tax Incidence;
Impact and incidence of taxes; partial equilibrium in view of product tax; partial equilibrium
view of factor tax; general equilibrium in view of tax incidence; Public Expenditure;
Components of public expenditure in Pakistan; causes of growth of public expenditure in
Pakistan. Budget; Preparation of budget cycle in Pakistan; Development and non-development
budget; budget procedures; balanced budgets; deficit and surplus budget; zero based budget;
program budget; planning programming budgeting system; Public Debt; Structure of public debt
in Pakistan; who bears tax burden; to tax or to borrow; Fiscal Policy; Fiscal policy defined;
analytical foundations of fiscal policy; static and dynamic theory of fiscal policy; techniques of
measuring influence; the role of fiscal policy in developing countries with emphasis on resource
allocation; income redistribution; capital formation and stabilization; analysis of means of
financing economic development including capital imports; domestic savings; inflation and
taxation; fiscal policy in Pakistan;

Recommended Books:

1. Musgrave & Musgrave, Public Finance in theory and Practice 5th Edition.
2. Otto Eckstien, Public Finance 3rd Edition, 1973.
3. Richard Aronson, Public Finance International Student Ed 1985.
4. Due John F., Government Finance.
5. Chellieah R.J., Fiscal policy in less developed countries.
6. Harvey, S.Rosen, Public finance 5th Ed, McGraw Hill 1999.
7. Eleaner Brown& Robert, L., Reading, Issues and Problems in Public Finance IRWIN.
8. Bernard, P.Herber, Modern Public Finance, A.I.T.B.S 1999.
9. David, N.Hyman, Public Finance, A Contemporary application of to Policy: Harcourt.
Brace College Publishers 1996.

ECON-407 INTERNATIONAL TRADE: THEORY & POLICY

Introduction to International Economics; The scope and significance of international economics;

International Economic Theories and Policies; Current International Economic Problems and
Challenges; Various Classical Theories of International Trade and Critical appraisals; Demand
and Supply, Offer Curves, and the Terms of Trade; Factor Endowments and the Heckscher-Ohlin
Theory: Empirical evidences and critical appraisal; Economies of Scale, Imperfect Competition
and International Trade; Economic Growth and International Trade.
International Trade Policies: Trade Restrictions, Theory of Tariffs; Instruments of Commercial
Policy: Non Tariff Trade barriers and the New Protectionism; Economic Integration: Types and

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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
reasons for economic integration; The theory of customs unions; International Trade and
Economic Development; International Resource Movements and Multinational Corporations.

Recommended Books:

1. Dominick Salvatore, International Economics: Trade and Finance, Latest Edition, Wiley.
2. Miltiades Chacholiades, International Economics, New York, McGraw Hill Co.
3. Sodersten, B.O., International Economics New York, Harper and Row, Latest Edition.
4. James C. Ingram, International Economics, 3rd ed. John Wiley & Sons, 1994.
5. Grubel, Herbert G., International Economics, Homewood IL, Richard D. Irwin (Ins),
Latest.

ECON-409 AGRICULTURAL ECONOMICS

Agricultural Revolution; Importance of Agriculture; Food Safety; Agriculture vs. Industrial

development Debate- Current Stale of Agricultural Development; Brief Overview of Sources of
Growth; Introduction to issues in Agriculture; Traditional Agriculture and Productivity; A
framework of Analysis; Product Contribution; Market Contribution; Factor Contribution;
Foreign Exchange Contribution. Agriculture vs. Industry Debate of Development; Economic
Rent; The Theory of Rent; Rent and Quasi-Rent; The Ricardian 'Corn Rent; The Rental Market;
Agricultural Surplus; Characteristics of Landownership in Underdeveloped Agriculture and
Pakistan; The Theory of Share Tenancy; Some Extensions of the Share Tenancy Model; Tenure
Status in Pakistan; Agricultural productivity in Pakistan and use of inputs; The Lewis Model;
The Fei-Ranis (FR) Model; The Jorgenson Model; Kelley, Williamson, Cheetham Model:
Criticism; Dual Economy Models; Agricultural Adequacy; Mellor's Model.

The Cobweb Model: An Illustration; Price-Supply Response in. Backward Agriculture; A simple
Supply Response Model; Supply Response in the Underdeveloped Agricultural labour Market;
Specifically in Pakistan; The Concept of Marketed Surplus: Some Methods of Estimation; Some
Criticisms of Krishna's Method and the Alternative Approach of Behrman Perennial Crops and
Marketed Surplus in Pakistan; Green Revolution in Pakistan and Responses; Present Status of
Green Revolution in Pakistan: Empirical Analysis; Inequitable Landownership and Land
Reform; Capital and Finance in Underdeveloped Agriculture; Marketing Imperfections and
Marketing Policies in Pakistan; Measures to Improve Marketing System in Pakistan; Support
Price Policy in Pakistan; Determinants of support prices; Impacts of support prices; Main
Features of Trade in Agricultural Goods; Trade Policies in Developed Countries and their
Impacts.

Recommended Books:

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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
 1. Colman D., Young T. Principles of agricultural economics: Markets and prices in less
Developed Countries, Cambridge University Press, Cambridge, 1989.
2. Kenneth L. Casavant, Craig L. I. and Deborah E. Bridges, Agricultural Economics and
Management, 1999, Prentice Hall.
3. Ellis F. Peasants economics: Farm households and agrarian development, Cambridge
University Press, 1988.
4. Capstick Margret. The Economics of Agriculture, London George Allen Unwin Ltd.
latest edition.
5. Chaudhary M. Aslam, Agricultural Development and Public Policies, lzhar Sons, Lahore,
1989.
6. Ghatak S., and Ingersent K., Agriculture and Economic Development, (Latest Edition),
Harvester Press.
7. Johnston, Bruce, F & Fellir Kily. Agricultural and Structural Transformation, Economic
Strategies in late Developing Countries.
8. Khan Mahmood-ul-Hassan. The Economics of Green Revolution in Pakistan, New
York, Published 1975

FOURTH SEMESTER
ECON-402 INTERNATIONAL FINANCE
Introduction of International Finance; International Financial Markets: The basis of the foreign
exchange market; Organization of the market; Exchange rate systems; The international
character of the foreign exchange market; Exchange risk; Forward exchange; Covered interest
arbitrage; Balance of Payments Problem: Balance of payments accounts. Autonomous and
accommodating items; Disequilibria in balance of payments of corrective measures; Price
Adjustment Mechanism; The partial equilibrium model; Price elasticities of demand for imports
and exports; The J-Curve Effect; Theory of Exchange Rate Determination: Determination of
fixed and flexible exchange rates; Debate on fixed and flexible exchange rates; Devaluation and
its effects; appreciation and depreciation; Expenditure switching policies; Elasticity and
absorption approaches to devaluation and their synthesis; Monetary approach to balance of
payment; Income Adjustment Mechanism: Income determination in an open economy. The
foreign trade multiplier; Foreign repercussions; National income and the balance of payments;
The world Debt Crisis; Fiscal and Monetary Policies for internal and external balance; Flexible
versus Fixed Exchange Rates: Models; The Monetary Approach: Basic Model, Policy
Implications, PPP Theory; The International Monetary System.

Recommended Books:

1. Miltiades Chacholiades, Principles of International Economics New York, McGraw Hill

Co. 1981.
2. Maurice D. Levi, International Finance, 5th edition, Routledge, 2009.
3. Sodersten, B.O. , International Economics, New York, Harper and Row, Latest Edition.
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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
 4. Caves, R.E. & Jones, R.W World Trade and Payments. An Introduction Boston, Little,
Brown, and Company, (Inc.) Latest Edition.
5. James C. Ingram, International Economics 3rd ed. John Wiley & Sons, 1994.
6. Grubel, Herbert G., International Economics Homwood Illinoesa, Richard D. Irwin (Ins),
Latest
7. Jeff Madura, International Financial Management, 10th edition.

ECON-404 ISLAMIC ECONOMICS

Introduction of Islamic Economics; Nature of Islamic Economics; Need and Importance of

Islamic Economics; Islamic economic system and Other Economic Systems; Brief Introduction
of Basic Vales of Islam; Taqva; Halal and Haram; Justice; Benevolence; Equality; Brotherhood
and Cooperation as Determinants of Economic Behaviour and Policies; Sources of Islamic
economics: the Holy Quran; The Sunnah of Allah's Apostle (S.A.W).

Meanings and Importance; Islam and Consumption of Wealth; Moderation; Theory of

Consumer's Behaviour in an Islamic Society. Islamic Approach to Production; Ownership of
land. Tenancy (Muzarat).Partnership (Shirakat). Modarbah; Objectives of an Islamic Firm; Al-
Hisba and Islamic Firm; Islamic Firm under different market conditions; Islam and Price
Mechanism; Meaning; Quranic Emphasis on the Circulation of Wealth; Rent; Profit; Wages;
Dignity of Labour; Measures to Stop Concentration of Wealth: Legal Measures; Optional
Measures. Islamic Law of Inheritance; Definition of Interest; Riba in the period of Ignorance;
Definition of Riba or Interest in Islam; Kinds of Interest; Distinction between Trade and Riba;
Moral, Social and Economic Importance of Prohibition of Interest; Western Justification of
interest; Interest-Free Banking; Functions of the Bank in Interest-Based Economy and Interest-
Free Banking; Need for Interest-Free Banking; Banking in the Economic System of Islam;
Model of Interest-Free Banking; Interest-Free Banking in Pakistan; Current Modes of Interest-
Free Banking; Islam and Insurance Islamic Modes of Financing: Bai Salam; Bai Murabaha; Bai
Muajjal; Ijara; Rent.
Meaning; Objectives; Instruments of Fiscal Policy; Islamic State and its Fiscal Policy; Zakat as
an Instrument of Fiscal Policy;Effects of Zakat on the Allocation; Zakat and Economic Stability.
The Institution of Bait-ul-Mal; Principles of Tax Policy in Islam; Public Expenditure in Islamic
Economy; Zakat and Ushr Ordinance 1980; Central Banking and Monetary Policy in Islam.
Inflation VS Design of Capital market; Monetary Policy in an Islamic Framework; Effects and
Causes of inflation in Islamic Economy; Consumption; saving and Investment Functions in
Islamic Environment; Determents of Islamic Consumption Function; The Islamic State: Its
Meaning; Aims and Functions; Concepts of Economic Planning and Development in Islam

Recommended Books:

1. Dar A. H. & M. Akram, Islamic economics, Ilmi Kitab Khana, Lahore (Latest edition.)
2. M.A Mannan, Islamic Economics: Theory and Practice, A Comparative Study,.
Cambridge, Hodder and Stoughton, Latest edition.
3. M. Fahim Khan, Consumption Function in an Islamic Economic Framework,
International Centre for Research in Islamic Economics, King Abdual Aziz Univ, KSA.
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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
ECON-406 FINANCIAL ECONOMICS

Introduction to Financial Economics; Scope and Subject matter of the financial economics; Real
Assets versus Financial Assets; The Role of Financial Assets in the Economy; Users of the
Financial System; Types of Financial Instruments; Characteristics of Financial Instruments;
Financial Innovation; Theories of Term Structure – The Expectations Hypothesis, Liquidity
Preference, Market Segmentation Theory, Preferred Habitat Theory, Interpreting the term
structure, Measuring the term structure; Defining options and futures; Understand rights and
obligations of the parties involved in various types of options; Familiarity with the basic
taxonomy used in options analysis; Types of Markets; Types of Traders; The Trading Process;
Defining Financial Intermediation; Different Types of Financial Intermediaries; The Role of
Banks in Financial Intermediation; Moral Hazard; Adverse Selection ;Solutions ; Defining
Capital Structure; Modigliani and Miller Propositions I and II; How taxes affect financing
choices; Dividend policy issues; The Regulatory Role of the Government; How the Legal
Environment Affects Access to External Finance; How the Legal Environment Affects Financial
Decisions.

Recommended Books:

1. Charles P. Jones, Investments latest Edition

2. Bodie, Kane and Marcus, Investments 5th Edition.
3. Grinblatt and Titman, Financial Markets and Corporate Strategy, 2nd Edition.
4. Cecchetti, Money, Banking and Financial markets.
5. Elton and Gruber, Modern Portfolio Theory and Investment Analysis, Latest Edition.
6. Bebczuk, R. N. (2003) Asymmetric Information in Financial Markets: Introduction and
Applications. Cambridge University Press
7. Copeland, Weston and Shastri (2005). Financial Theory and Corporate Policy. 4th
Edition.
8. Livingston, M. (1999). Money and Capital Markets. 3rd Edition (or later).
9. Fredric, S. Mishikin, Financial Markets Institutions and Money. Harper Collins College
Publishers, Latest Edition.
10. William F. Sharpe & Gordon J., Investments5th Ed, Prentice Hall, 1996

OPTIONAL COURSES
ECON 410/ECO 412 THESIS

ECON-414 APPLIED ECONOMICS

Basic Data Handling Techniques and Descriptive data analysis, Estimation of econometric
models, hypothesis testing and diagnostics and solutions of econometric problems, Diagnostics
20

Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
and estimation of univariate time-series models, Diagnostics and estimation of multivariate time-
series models (VAR models, causality, impulse response analysis, variance decomposition and
co-integration), Survey data analysis of household consumption, Survey data analysis of
manufacturing production, Survey data analysis of agricultural production, Analysis of
macroeconomic and financial time-series data with applications in consumption, investment,
budget and international trade, money, inflation, interest rate, exchange rate and stock prices,
Writing an empirical project/research.

Recommended Books:

1. Gary Koop, 2004, Analysis of Economic Data, John Wiley & Sons Ltd.
2. Thomas Sowell, 2009, Applied Economics, Revised and enlarged Edition, Basic Books.

ECON-416 CORPORATE GOVERNANCE

The corporate Governance: An Overview and Introduction; The Theory and practice of
Corporate Governance; Corporate Governance Models; Rights and Privileges of Shareholders;
Conflict between managers and shareholders; Corporate Governance and Other Stakeholders;
Board of Directors; Role, Duties and Responsibilities of Auditors; Business Ethics; Corporate
Social Responsibility; Environmental Concerns; The role of Media; Capital Market Regulator in
Pakistan; Issues in Corporate Governance.

Recommended Books
1. Corporate Governance, Latest Edition, Dr Safdar Butt.
2. Corporate Governance (Principles, Plicies and Practices), A. C. Fernando.
3. Corporate Governance 2nd edition, Christine A. Mallin, Oxford University Press.
4. Corporate Governance and Chairmanship a personal view by Adrian Cadbury by Oxford
University Press.

ECON-418 COST – BENEFIT ANALYSIS AND PROJECT EVALUATION

Cost-Benefit Analysis: Introduction and Overview, Welfare Foundations of Cost-Benefit Analysis,

Rationale for Policy Intervention, Calculating Costs and Benefits, Aggregating Costs and Benefits: The
Net Present Value Rule, An Illustrative Example, Dealing with Uncertainty, The Public Sector Discount
Rate, The Valuation of Non-Market Goods, Project Evaluation, Investment Planning and Programming,
Project appraisal and risk management, Project management and quality, Project appraisal and
environmental impact, Cost estimating and financing, Project organization and management,
Project failure, success and lessons learned

Recommended Books
Nicholas, J.M., 1990, Managing Business & Engineering Projects, Prentice Hall.
Shtub, A., Bard, J. and Globerson, S., 1994, Project Management - Engineering, Technology and
Implementation, Prentice Hall, International Edition.
Wearne, S., 1991, Control of Engineering Projects, McGraw-Hill.
Bennet, J., 1985, Construction Project Management, Butterworths.
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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
Walker, A., 1989, Project Management in Construction, BSP Professional Books.
E. J. Mishan. Cost-Benefit Analysis: A Handbook. Praeger, New York, NY, 1976.
Peter G. Sassone and William A. Schaffer. Cost-Benefit Analysis: A Handbook. Academic Press,
NY,1978.
J. Schofield. Cost-Benefit Analysis in Urban and Regional Planning. Allen and Unwin, London,
UK,1978.
Ronald D. Sylvia. Program Planning and Evaluation for the Public Manager. Brooks-Cole
Publishing Co., Monterey, CA, 1985.

ECON-420 ECONOMICS OF POVERTY AND INCOME DISTRIBUTION

Size and Functional Distribution of Income; Place of Distribution, Poverty and Inequality in the
development models; Measures of Income Inequality and Poverty; Causes of Income Inequality
and Poverty; Remedial Measures; Growth with Redistribution; Basic Need Approach; Policy
options; Poverty and Income Distribution in Pakistan.

Recommended Books:
1. Adelman, I. & S. Robinson, Income Distribution Policy in Developing Countries Oxford
University Press, 1978.
2. Chaudhry, Imran S., “Evolving Views on Poverty and Welfare: An Analysis of Conventional and
Islamic Approaches”, Journal of Research, B. Z. University, Multan, 2005, Vol.7, pp. 39-56.
3. Chaudhry, Imran S. & Shahnawaz malik, “Rural Poverty in Pakistan: Some Related Concepts,
Issues and Empirical Analysis ”, Pakistan Economic and Social Review , University of Punjab,
Lahore, Vol. 44, No. 2, pp. 259-276, 2006.
4. Chaudhry, Imran S. & Shahnawaz malik, “Urban Poverty and Governance: The Case of Multan
City”, The Pakistan Development Review, Islamabad, Vol. 45, No. 4, pp. 819-830, 2006.
5. Chaudhry, Imran S. & Shahnawaz malik, “Urban Poverty and Governance: The Case of Multan
City ”, The Pakistan Development Review , Islamabad , Vol. 45 , No. 4, pp. 819-830, 2006.
6. Chaudhry, Imran S., Shahnawaz malik & M. Zahir Faridi, “Factors Affecting Rural Poverty: A
Qualitative Approach”, The Journal of Humanities and Social Sciences, Peshawar, Vol. 15, No.
01, 2007
7. Desai, M. J., A General Theory of Poverty, Indian Economic Review1983.
8. Ercelawn, A., “Income Inequality and Poverty in Rural Pakistan” Pakistan Journal of
Applied Economics, 1984.
9. Griffin, K. B. Alternative Strategies for Economic Development MacMillan, 1989.
10. International Labor Org., Poverty in Rural Asia (eds)
11. Malik, Shahnawaz, “The Estimates and Trends in Poverty in Pakistan” The Indian
Journal of Social Science (India) (1991) .
12. Malik, Shahnawaz, “Trends in Inequality in Pakistan” Journal of Economic Affairs
(India) (1991).
13. Malik, Shahnawaz, “Determinants of Rural Poverty in Pakistan: A Micro Study” Pakistan
Development Review, 1996.
14. Naseem, S. M., Poverty, Inequality and Underdevelopment in Pakistan, Vanguard, 1981.
15. Sen., A., “Poverty, inequality and Unemployment: Some Conceptual Issues in
Measurement” Economic and Political Weekly, 1973.
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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
 16. World Bank, World Development Report (Various Issues).

ECON-422 ENERGY ECONOMICS

Introduction to Energy Economics and the interrelationship between energy, the economy,
society, and the environment, Natural resource economics: static criteria and dynamic criteria for
efficient allocation, Techniques for overall cost determination, marginal cost determination, life
cycle cost, economic comparison of energy technologies, financial analysis of renewable energy
projects, financial vs. economic analysis, Consumer behavior and demand elasticity, Procedure
to determine the best economic choice of energy technology for specific applications,
Environmental impacts of conventional and renewable technologies, Environmental Impact
determination and economic of pollution control, expressing Impacts in economic and social
terms.
Recommended Books
1. J.M. Griffin, and H.B. Steele (1985): Energy Economics and Policy, Academic Press
2. Tom Tietenberg (1992), Environment and Natural Resource Economics, second edition
Academic Press.

ECON-424 ENVIRONMENT ECONOMICS

Introduction to Environment Economics; The Economy and Environment; Analytical Tools.

Benefits and costs; supply and demand; willingness to pay, benefits; costs; technology the
equimarginal principle; marginal cost and supple; Economic efficiency and markets; Economic
efficiency; equity; social efficiency; external costs and benefits; The Economics of
Environmental Quality; Pollution Control; General model; the equi marginal principal applied to
emission reduction; long run sustainability; Environmental Analysis: Impact analysis, cost
effective analysis, benefit cost analysis, risk analysis; Benefit cost analysis; risk analysis;
measuring damages directly; Environmental Policy Analysis; Criteria for evaluating
environmental policies; federal policies; centralized policies; Command and control strategies;
incentive based strategies; emission taxes and subsidies; transferable discharge permits;
International Environmental Issues; Environmental policies in industrialized countries; economic
development and the environment; the global environment; international environmental
agreements.

Recommended Books:
1. Barry C, Field , Environmental Economics, An Introduction, McGraw Hill
2. Miller Alan, An Introduction to ecology, Ecoethics and Economics, Rowman and Allen
held Lanham Md, 1991
3. Baumal William, Economics, Environmental policy and quality of life, Prentice Hall,
Euglewood Cliffs
4. McKee David, Energy the Environmental public Policy, Issues for the 1990’s. Praeger,
New York 1991

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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
ECON – 426 HISTORY OF ECONOMIC THOUGHT

Introduction; Ancient and Medieval Economic Thought; Mercantilism; Harbingers of Adam

Smith; Adam Smith I: Value Theory; Adam Smith II: Growth and Income Distribution; Adam
Smith III: Political Economy and Ideology; Malthus and Ricardo I: Population and Scarcity;
Malthus and Ricardo II: The Theory of Value and Distribution; Malthus and Ricardo III:
Accumulation and Gluts; Karl Marx I: Value Theory, Karl Marx: Accumulation, Growth and
Crises.

Recommended Books
1. Backhouse, Roger, A History of Modern Economic Analysis. Oxford, Blackwell, 1985.
2. Blaug, Mark, Economic Theory in Retrospect. Fifth edition. Cambridge, C.U.P., 1996.
3. Deane, Phyllis, The Evolution of Economic Ideas. Cambridge: Cambridge U.P., 1978.
4. Dobb, M. H., Theories of Value and Distribution since Adam Smith. Cambridge, C.U.P.,
1973.
5. Ekelund, Robertb and Hebert, Robertf, History of Economic Thought and Method. New
York, McGraw-Hill, 1990 (3rd edition).

ECON-428 HUMAN RESOURCE DEVELOPMENT

Concepts and Measurement of HRD; its relevance for economic development; basic concept and
terminologies; Strategies of Human Resource Development; education and investment in human
capital; Different approaches relating to the contribution of education to economic growth,
returns to Growth, international comparison, Production Function, Social and Private Demand;
Issues in Formal and Informal Education; Efficient allocation of resources, maximization of the
objective, labor market structure, demand and supply of human skills; International Migration of
Human Skills: problems; manpower requirement approach, human resource led development,
industrialization and employment; Health and Nutrition Policies: Issues, Problems, comparison
with the other developing Countries

Recommended Books:

1. Amjad, R: Human resource Planning, ILO-ARTEP New Delhi, 1987.

2. Asian Development Bank: Human Resource Policy and Economic development Selected
Country Studies, Manila 1990.
3. Blaug, M., An Introduction to Economics of Education Penguin Press, and London, 1970.
4. Bowles, S., Planning Educational Systems for Economic Growth Harvard University
Press 1969.
5. Mahboob ul Haq, Reflections and Human Development Oxford University Press, 1995.
6. Human Development Center: Human Development in South Asia. The Crisis of
Governance Oxford University Press, Karachi 1999.
7. ILO, World Employment Report Geneva, 1999.
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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
 8. Rizwan ul Islam, Rural Industrialization and Employment in Asia ILO-ARTEP, New
Delhi 1987.

ECON-430 INDUSTRIAL ECONOMICS

The scope and method of industrial economics; the welfare economics of competition and
monopoly; the determinants of market structure; economic theories of oligopoly pricing and
conditions facilitating as well as limiting oligopolistic co-ordination; the dynamics of monopoly
and oligopoly pricing; price discrimination market structure; administrated prices and
macroeconomic stability; product differentiation, market structure and competition; factors
influencing the industrial location choice; policy approaches to monopoly and oligopoly.

Recommended Books:

1. C.H.Krikpartrick, Industrial Structure and Policy in Less Developed Countries, English

Language Book Society, 1999.
2. Rajat K. Ray, Industrialization in India, Growth and Conflict in the Private Corporate
Sector 1914-47 Oxford University Press, Delhi, India. 1982.
3. Stephen R. Lewis, Economic Policy and Industrial Growth in Pakistan: PIDE 1969.
4. K.L.Gupta, Industrialization and Employment in Developing Countries, A Comparative
Study: Routledge, UK, 1999.

ECON-432 LABOR ECONOMICS

Importance of Labor Economics; Introduction: Industrialization and Emergence of Labor

Analyze Labor Markets and Conditions; Labor Markets Analysis: Demand for Labor; Labor
Market Indicators; Demand for Labor; Decision Making and Labor Hiring; Labor Migration:
Reasons and Impacts. Determinants of Labor Supply; Concepts of Human Capital; Human
Capital productivity and Wages; The Determinants of Labor Force Participation; Supply of Labor
and Household Productions; Labor- Skill, Training and Productivity; The Dual Labor Market
Theory; Labor Unions and Wages; Labor Unions and Underemployment; Underemployment and
Social Protection; Labor Market Discrimination; Discrimination in Labor Market: Gender Race
and Ethnicity; Efficiency Wage Theories and Coordination Failure; Labor Market Information
System; Labor Market Information System and Efficiency; Labor Statistics and Labor Policy;
Human Welfare and Labor Policy; Minimum Wages; Rationale and Impacts; Theories of Labor
Movements; Trade Unions in Pakistan; Labor Legislation in Pakistan; Impacts of Labor Union;
Labor Policies in Pakistan: Critical Evaluation; Child Labor: Definition and extent of child labor;
Child labor and moral aspects; Child labor an international issue: Extent of Child labor in
developing countries; Child labor in Pakistan; Policies to combat child labor; Child labor and
international trade issue.

Recommended Books:

1. Comith Stephen, (2003), Labour Economics*, Routledge Publishers.

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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
2. Bruce, Kaufman; c. Kaufman, Julie L; Hotchkiss, (2002), Economics of Labour Markets,
Thomson Publisher.
3. Current Issues in Labour Economics*, (1989), Palgrave Mcmillan.
4. Reynolds, Labor Economics and Labor Relations.
5. Grley, Ashenfelter (edt), Layard, P. R. G, (cdt), Hand Book of Labour' Economics, Elsevier
Science Pub. Co. (1986).

ECON-434 MANAGERIAL ECONOMICS

Introduction to Managerial Economics, Decision Making Under Risk and Uncertainty: Demand
Theory: Concepts and Estimation; Production and Cost Analysis; Pricing Analysis and
Decisions: A Review of Market Structures and Basic Pricing Models; Limit Pricing Models;
Managerial Theories of the Firm: Baumol’s Theory of Sales Revenue Maximization; Linear
Programming; Capital Budgeting.

Recommended Books:

1. Douglas, E. J., Managerial Economics Prentice Hall, 1996.

2. Keat and Young, Managerial Economics Maxwell 1998.
3. Petersen and Lewis, Managerial Economics, Maxwell 1996.
4. Salvatore, D., Managerial Economics3rd Ed, McGraw Hill.
5. Koutsoyiannis, A., Modern Microeconomics.

ECON-436 POPULATION ECONOMICS

The Nature of Population Study; Analytics; Demographic Research in Action; Variables, The
Sources of Information for Demographers; The Growth of Population; The Distribution of
Population; Mortality; Fertility; Migration; International Migration; Internal Migration; The
Composition of Population; The Socioeconomic Effects of Population Change; Population
Policy.

Recommended Books:
1. Hauser, P. M., and O.D. Duncan, The Study of Population, Chicago: University of
Chicago Press, 1964.
2. Nam, C.B. The Progress of Demography as a Scientific Discipline. Demography 16
(November 1979).
3. Thompson, W.S, and D.T. Lewis, Population Problems, 5th Ed., New York: McGraw-
Hill, 1965.
4. Johannes Overbeek, University of Maine at Orono, Population An Introduction, Harcourt
Brace Jovanovich, Inc. New York, San Diego, Chicago, San Franscisco, Atlanta London,
Sydney, Toronto.
5. Gaugh, M.E., A Geography of Population and Settlement. Dubuque: Bromen, 1970.
6. Miller, Z.L., The Urbanization of Modern America: A Brief History, New York, Harcourt
Brace Jovanovich, 1973.
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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics
ECON-438 RESEARCH METHODS IN ECONOMICS

Introduction; Research, research in business; scientific thinking; Research Designs; the research
process; research design; what is research design; classification of design; exploratory research;
casual inference; Sample Design; the nature of sampling, probability sampling; complex
probability sampling; non- probability sampling; Measurement and Scaling; measurement scales;
the characteristics of sound measurement; the development of measurement tools; scaling; the
nature of scaling; response methods; scale construction; Data Collection Methods; Survey
Instruments and Field Procedures; survey instrument designs; the survey situations; the
instrument development process; questionnaire development; field procedures; personal
interviewing; telephone interviewing, interviewing by mail; observations; Data collection,
experimentation and Simulations; experimentation and simulation; experimental Research
design; simulation; observation; observation designs; Use of Secondary Data; the nature of
secondary data sources; the use of secondary data; types of secondary data sources; statistical
sources; data research procedures; evaluating secondary data; Data presentation and Analysis:
elements of analysis; data preparation; special data problem; tabulation; data presentation; and
data analysis; Report writing; the research proposal; the research report; research report format;
writing the research report.

Recommended Books:

1. Zikmund, Business research methods, Latest Edition.

2. Uma Sckaran, Business research methods, Latest Edition.
3. Newman, Research methods in Social Sciences, Latest Edition.

ECON – 440 TRANSPORT ECONOMICS

Introduction of Transport Economics; The Transport System: Operator Cost Structures, Review
of Optimization, Firm Behavior: Production & Technology, Firm Behavior: Profit Maximization
& Production. Economies, Firm Behavior: Cost Minimization, Firm Behavior: Monopolies &
Price Discrimination, Consumer Behavior: Utility Maximization, Consumer Behavior: Demand
Relationships, Welfare Theory: Consumer Surplus & Other Measures, Market Imperfections:
Negative Externalities, Roadway Congestion & Pricing TBA, Value of Time TBA, Econometrics
& Statistical Applications, Project Presentations

Recommended Books:
1. Kockelman and Chen’s (2012), The Economics of Transportation Systems: A Reference
for Practitioners.
2. Small and Verhoef’s (2007), Economics of Urban Transportation (2007)
3. Sergio Jara-Díaz’s (2005), Transport Economic Theory (2005).

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Professor Dr Imran Sharif Chaudhry

Chairman, Department of Economics