Elective Courses

Elective courses are used to develop a student’s subject-matter specialization, and equip students with tools and frameworks for analyzing problems in their candidate field. Course descriptions and numbers may change. Students will need to work with their advisor and the PhD Coordinator to ensure that they are completing an approved course of study.

Course descriptions represent courses expected to be offered during the 2013-2014 academic year. While the School endeavors to offer as many of the courses as possible, not all courses are offered every semester. It is important to check with individual departments prior to scheduling classes to determine the availability of courses for any given semester.

The Wharton School and the University of Pennsylvania reserve the right to make changes affecting policies, fees, curricula, or any other matters announced here.

This list includes the graduate courses offered by Wharton departments that are possible electives for the field areas within the Applied Economics program. Other electives may be taken with approval from the student’s advisor and the doctoral coordinator.

Business Economics & Public Policy

BEPP 900: Research Seminar

Of the many ways that doctoral students typically learn how to do research, two that are important are watching others give seminar presentations (as in Applied Economics Seminars) and presenting one’s own research. The BEPP 900 course provides a venue for the latter. Wharton doctoral students enrolled in this course present applied economics research. Presentations both of papers assigned for other classes and of research leading toward a dissertation are appropriate in BEPP 900. This course aims to help students further develop a hands-on understanding of the research process. All doctoral students with applied microeconomic interests are encouraged to attend and present. Second and third year Applied Economic Ph.D. students are required to enroll in BEPP 900 and receive one-semester credit per year of participation. Prerequisites: None.

BEPP 911: Empirical Public Policy

This course examines econometric research on a variety of topics related to public policy, with the goal of preparing students to undertake academic-caliber research. The course is not an econometrics or statistics course per se; rather, it focuses on research designs with observational data and how econometric techniques are applied in practice. The course aims to train students to do applied economic research that involves measuring effects of theoretical or practical interest. It proceeds in two major parts. The first part examines endogeneity and inference about causal relationships, instrumental variables methods and critiques, and panel data methods. The second part of the course addresses ‘structural’ econometric modeling. Topics covered in this part include sorting and selection, entry models, and counterfactual analyses of policy changes. The course proceeds by analyzing, in detail, approximately 24 well-known empirical research papers in applied economics or related fields. These include public economics and tax policy, labor economics, law and economics, health care policy, industrial organization and competition, transportation demand and policy, and others. Prerequisites: A graduate-level statistics or econometrics course.

BEPP 951: Political Economy

This course will introduce the students to the basic models of formal political economy and methods for empirically estimating those models from policy data, both for the developed and developing economies. Topics to be covered will include Downsian electoral competition and median voter politics, theories of legislative politics including minimum winning coalition and universalistic (pork-barrel) politics, models of lobbying and political corruption, models of executive influence in legislative settings. Particular attention is paid to the role of formal (constitutional) and informal (non-constitutional) institutions as they determine policy outcomes in democratic societies, including majoritarian (first-past-the-post) and proportional representation systems of elections, partisan (party) and non-partisan (special interest) legislatures, executive agenda-setting and veto powers, federal and unitary forms of governance, and finally, the role of judicial review. Policy applications will focus on fiscal policy (taxes, spending, and debt), though students should feel free to apply the analysis to other public policies of interest. Students should have a firm understanding of micro-economic theory and applied econometrics. Prerequisites: PHD course with advanced microeconomics.

BEPP 961: Risk Analysis and Environmental Management

This course is designed to introduce students to the role of risk assessment, risk perception and risk management in dealing with uncertain health, safety and environmental risks including the threat of terrorism. It explores the role of decision analysis as well as the use of scenarios for dealing with these problems. The course will evaluate the role of policy tools such as risk communication, economic incentives, insurance, regulation and private-public partnerships in developing strategies for managing these risks. A project will enable students to apply the concepts discussed in the course to a concrete problem. Prerequisites: None, but microeconomics helpful.

BEPP 962: Applied Economics Seminar

The goal of this course is to help doctoral students develop critical thinking skills through both seminar participation and writing of referee reports. To this end students will attend the Wharton Applied Economics each Wednesday at noon seminar when it meets; prepare two written referee reports on WAE papers per semester, due before the seminar is presented; after attending the seminar – and the ensuing discussion of the paper – students will prepare follow-up evaluations of their referee report reports, due one week after the seminar. Prerequisites: None.

BEPP 987: Industrial Organization and Competition Policy

This course focuses on empirical methods and applications of research topics in Industrial Organization. Although not exclusively, the course will focus mostly on the application of econometric techniques used to study specific markets and antitrust policies. The topics that will be covered include the evaluation of market power and mergers, product differentiation, investment and innovation, collusion, price discrimination, vertical relations, entry and product positioning, and the dynamics of industries. The course will also discuss research methodologies related to microeconomic theory, computational methods, and econometric analysis. The applicability of the techniques goes beyond the field of Industrial Organization, and include the Labor, Health, Trade and Public economics.

BEPP 932: Contract Theory and Applications

The course provides an advanced introduction to the theory of contracts and its mixture of foundational theories and applications to fields such as labor, industrial organization. Prerequisites: None.

BEPP 933: Public Economics: Social Insurance and Government Expenditures

The first part of this course will examine the rationale for an economic impact (e.g. on saving, labor supply, etc.) of social insurance programs such as social security, unemployment insurance, and disability insurance. The next major part of the course will explore these same issues for government interventions in health insurance markets. The course will then cover research on public goods, externalities, fiscal federalism, and economic stimulus (including the government’s recent response to the “Great Recession”) before proceeding to an exploration of the government’s role in K-12 and higher education. Both theoretical and empirical evidence will be covered along with a mix of classic studies and more cutting-edge research. Throughout the course we will discuss the tradeoffs – for example between the protection and distortion of social insurance programs – that influence the government’s optimal role. While the focus will be on evidence from the U.S., some research from other industrialized and developing countries will also be covered.

BEPP 934: Economics of Risk & Time

This course deals with the economic theory of supply, demand, and equilibrium in insurance markets. The course will review decision models under conditions of risk, use these to address problems of optimal insurance, moral hazard and adverse selection, classification, contract enforcement and fraud. The course also looks at instability in insurance markets. No prerequisites.


ECON 721: Econometrics III: Advanced Techniques of Cross-Section Econometrics

Qualitative response models, panel data, censoring, truncation, selection bias, errors in variables, latent variable models, survey design, advanced techniques of semiparametric estimation and inference in cross-sectional environments. Disequilibrium models. Methods of simulated moments. Prerequisite(s): ECON 705 and 706.

ECON 750: Public Economics I

Public goods, externalities, uncertainty, and income redistribution as sources of market failures; private market and collective choice models as possible correcting mechanisms. Microeconomic theories of taxation and political models affecting economic variables. Prerequisite(s): ECON 701 and 703.

ECON 751: Public Economics II

Expenditures: Alternative theories of public choice; transfers to the poor; transfers to special interests and rent seeking; social insurance; publicly provided private goods; public production and bureaucracy. Taxation: Tax incidence in partial and general equilibrium; excess burden analysis. Topics on tax incidence and efficiency: lifetime incidence and excess burden, dynamic incidence, the open economy. Prerequisite(s): ECON 701 and 703.

ECON 792: Economics of Labor I

Topics include: Theories of the supply and demand for labor, wage determination, wage differentials, labor market discrimination, unemployment, occupational choice and dynamics of specific labor markets, theory of matching, trade unions. The theory and empirics of human capital accumulation, intertemporal labor supply, search, intergenerational mobility of income and wealth, contracts and bargaining, efficiency wage models, principal/agent models, and signaling models. Prerequisite(s): ECON 701, 703, 705, and 706.


FNCE 922: Continuous-Time Financial Economics

(Graduate level knowledge of analysis and statistics is highly recommended but not required). This course covers some advanced material on the theory of financial markets developed over the last two decades. The emphasis is on dynamic asset pricing and consumption choices in a continuous time setting. The articles discussed include many classical papers in the field as well as some of the most recent developments. The lectures will emphasize the concepts and technical tools needed to understand the articles. Prerequisite(s): FNCE 911, ECON 701, ECON 703.

FNCE 924: Intertemporal Macroeconomics and Finance

This is a doctoral level course on macroeconomics, with special emphasis on intertemporal choice under uncertainty and topics related to finance. Topics include: optimal consumption and saving, the stochastic growth model, q-theory of investment, (incomplete) risk sharing and asset pricing. The course will cover and apply techniques, including dynamic programming, to solve dynamic optimization problems under uncertainty. Numerical solution methods are also discussed. Prerequisite(s): FNCE 911.

FNCE 932: Corporate Finance

Advanced theory and empirical investigations: financial decisions of the firm, dividends, capital structure, mergers and takeovers. Prerequisite(s): FNCE 911, FNCE 921, or permission of instructor.

FNCE 934: Empirical Methods in Asset Pricing

Rigorous treatment of current empirical research in finance. Applications of multivariate and nonlinear methods. Intertemporal and multifactor pricing models. Conditional distributions. Temporal dependence in asset returns. Prerequisite(s): FNCE 911 and FNCE 921.

FNCE 937: Applied Quantitative Methods in Finance

Finance 937 uses numerical tools to address a variety of issues in finance. The course has two main objectives. First, it seeks to provide the students with useful quantitative tools to understand and produce frontier research in finance. Second, it applies these tools to advanced topics in both corporate finance and asset pricing. A special emphasis is placed on new and recent research. Prerequisite(s): FNCE 911.

Real Estate

REAL 945: Urban Real Estate Economics

This course covers fundamental and cutting-edge topics in urban economics and real estate as well as the most important econometric issues that arise in the estimation of urban economics and real estate models. The first part of the course focuses on the application of modern econometric methods to analyze empirical questions in the broad urban economics field, which includes topics from public economics and local finances, such as household sorting and valuation of public goods. This part of the course is especially concerned about dealing with non-experimental data, and also provides a guide for tools that are useful for applied research. The second and third parts of the course examine the economic modeling and intuition of a range of topics in urban economics and real estate, such as spatial equilibrium, supply and demand of space, house prices and cycles. In addition, special emphasis is given to how the understanding of economic theory and institutions can help any empirical analysis. At the end of the course students should have a firm grasp of theory and econometric tools that lead to convincing empirical applications.

All PhD students will be expected to complete a research paper in addition to the successful completion of the course examination requirements.

Prerequisites: MGEC 601

REAL 946: Advanced Topics in Urban Economics

This course addresses advanced topics in urban and real estate economics. The course will mix theory and empirics and will cover a broad range of topics including the modeling and estimation of agglomeration economies, land use and urban costs, transportation in cities, urban growth, migration between cities etc. The classes will mix formal presentations made by the instructor and student-led discussions of recent academic papers. In addition to presentations, students will be expected to complete a series of assignments including a short original research paper.

Prerequisites: The course assumes that students have familiarity with standard first year econometrics and microeconomics. It is recommended that students take and pass REAL 945 Urban RE Economics prior to this course. Exceptions can be granted in certain circumstances.

Other Information: All PhD students will be expected to complete a research paper in addition to the successful completion of the course examination requirements.


STAT 530 (MATH 546): Probability

Measure theory and foundations of Probability theory. Zero-one Laws. Probability inequalities. Weak and strong laws of large numbers. Central limit theorems and the use of characteristic functions. Rates of convergence. Introduction to Martingales and random walk. Prerequisite(s): STAT 430 or 510 or equivalent.

STAT 921: Observational Studies

This course will cover statistical methods for the design and analysis of observational studies. Topics will include the potential outcomes framework for causal inference; randomized experiments; matching and propensity score methods for controlling confounding in observational studies; tests of hidden bias; sensitivity analysis; and instrumental variables. Prerequisites: STAT 520, 541 or 550 or permission of instructor.