Economics for the Citizen


Fall 2001



Professor Peter J. Boettke

ECON100/Fall 2001

Tues. and Thurs. 9:00-10:15am



Office Hours

Tues. 10:30-12:00

Thurs. 1:00-3:00

Rm. 324 Enterprise Hall

Or by appointment




Course Introduction


This class is a survey of basic economics and political economy. The focus on the class will be in presenting the "economic way of thinking" and applying that way of thinking to make sense of the world in which you live. We will be doing some black-board economics - formulas and graphs - but our primary objective would be to use what we learn from the black-board to interpret what we see "out of the window" in the stock-market in New York city, the policy process in Washington, DC, or global economic events in London, Paris and Hong Kong.

Our goal is that you will read the newspaper or watch TV differently than you did before you came into this class. If that happens, then the course will have been successful. This does not mean that you will see things "my way". That is actually the last thing we want. Instead, what we are after is that you learn to read, listen and watch critically and to apply the tools of economic reasoning in so doing.

Reading and Course Assignments

There are two required texts for the class - Paul Heyne, The Economic Way of Thinking, 9th Edition (Prentice-Hall, 2000) and Mark Skousen, The Making of Modern Economics: The Lives and Ideas of the Great Thinkers (ME Sharpe, 2001). Heyne's book is the best selling one semester survey of economics.  Skousen’s book is an entertaining guide through the debates that have shaped modern economics and the individuals who were the major players in those debates.  Our lectures will fill out the course by providing information from how to read economic statistics to the development of basic economic models to the application of those models to understanding economic conditions and public policy. We will create a class email bulletin board for continued discussion of the reading material and course lectures.  The TA for the class is Mr. Peter Leeson and his email is and he will set up alternative office hours to mine for you and also a “virtual” office hour for your convenience.  Mr. Leeson’s meeting place will be right outside of 324 Enterprise Hall.

We have also required the workbooks that go to the video series Stossel in the Classroom. We will be watching five videos from John Stossel throughout the semester. Each of these videos was originally an ABC News Special program. Four of the videos have workbooks published for the purpose of economic education which you must purchase from the bookstore. We will assign projects from the workbooks and in the instance of the last video we will provide a set of essay questions for you to write.

In addition to keeping up with the assigned reading, doing the video assignments, and passing the exams, each student will be responsible for keeping an economic notebook.  The Economics Notebook will consist of 10 economics articles you will clip out of newspapers or magazines during the semester and a 3 paragraph summary of each article chosen by yourself. The 3 paragraphs must address the following questions: (1) what is the basic thesis of the article?; (2) what economic concepts are employed in the article?; and (3) are you persuaded by the article, and if so, why, and if not, why not? Articles are to be selected only from the following (or others by instructor approval):

Paul Krugman, "The Dismal Science," column in Slate or his articles in the New York Times.

Stephen Landsburg, "Everyday Economics," column in Slate.

Gary Becker, Business Week column.

David Warsh, "Economic Principals," weekly column in the Boston Globe.

Virginia Postrel, “Economic Scene” column in the New York Times.

The Foundation for Economic Education – various articles in their monthly periodical Ideas on Liberty.

The Economist - "Economic Focus" weekly column.

Walter Williams - syndicated columnist, and Chair, Department of Economics, GMU.

The easiest way for you to do this assignment is to go to GMU Library and Use the Electronic DATABASES to do a search for each of the authors listed above and get a list of the articles they have written for newspapers and magazines over the past year and then look for articles that touch upon subjects which interest you.



Course grade will be determined on the basis of a mid-term and final, the five video assignments, and the notebook. Each exam will be worth 100 points each, each video assignment will be worth 20 points each (totaling 100 points), and the notebook will be worth 100 points. Thus, we will have a total of 400 points and a rough estimate would be that you will need to get 360 points or higher to get in the A range, 320 or higher for the B range, 280 or higher for the C range, 240 or higher for the D range, and below 240 for an F. Class attendance and participation both in class and in the electronic discussion can count toward your final grade, though it will not in itself lift your grade more than half a grade.


Course Schedule




August 28

Course Introduction


August 30

Reading The Economic News


September 4

Basics of Economic Understanding

Heyne, Chapter 1.

Skousen, Chapters 1-2.

September 6


Answer questions 1, 2, 5, 10, and 20 in Video Study Guide. 

September 11

Demand and Supply

Heyne, Chapter 2.


Skousen, Chapters 7-8.

September 13

Demand and Supply

Heyne, Chapter 3.

September 18

Market Coordination

Heyne, Chapters 4-5.

September 20

Mutual Advantage and Social Cooperation

Heyne, Chapters 6-7.


Skousen, Chapter 5.

September 25

Competition and Monopoly

Heyne, Chapters 8-10.

September 27


Answer questions 1, 4, 12, 22, and 27 in Video Study Guide.

October 2

Competition and Monopoly

Heyne, Chapters 8-10.

October 4

Government Policy and the Market Economy

Heyne, Chapters 13-14. 

Skousen, Chapters 2-3.

October 11

Government Policy and the Market Economy

Heyne, Chapters 13-14. 


October 16

Profit and the Distribution of Income

Heyne, Chapters 11-12. 

Skousen, Chapters 4, 6, and 9.

October 18



October 23

Mid-Term Exam


October 25


Answer questions 2, 6, 11, 13, and 15 in Video Study Guide.

October 30

Measuring Economic Performance

Heyne, Chapter 15. 


November 1

Monetary Theory and the Trade Cycle

Heyne, Chapter 16. 

Skousen, Chapters 11-12.

November 6

Monetary Theory and the Trade Cycle

Heyne, Chapters 17-18.


Skousen, Chapters 13-15.

November 8

Boom, Bust and Politics

Heyne, Chapters 19-21. 


November 13

Why are Some Countries Rich and Others Poor?

Heyne, Chapter 20. 

Skousen, Chapters 16-17.

November 15


Answer questions 3 (p. 7), 1 (p. 13), 2 (p. 13), 4 (p. 13), and 5 (p. 17) in Video Study Guide.

November 27

Why are Some Countries Rich and Others Poor?

Heyne, Chapter 20.

November 29

The Political Economy of a Free and Prosperous Commonwealth

Heyne, Chapter 21-22.

December 4


Answer the questions from the hand-out.

December 6 


Course Review for Exam




December 18