An advanced course in Microeconomics.
An introductory course in Industrial Organization
Market power
Sources of market power
Pricing strategies and market segmentation
Product quality and information
Theory of competition policy
R&D and intellectual property
Network, standards and systems
Market intermediation
In terms of knowledge, students should be able at the end of the course to
(i) understand how and why oligopolistic firms manage to set equilibrium prices above marginal costs,
(ii) analyze asymmetric information problems, in which firms choose their marketing strategy to inform consumers about product quality,
(iii) address competition policy issues (cartels, collusion, mergers, exclusionary conduct),
(iv) understand strategies and policies related to innovation and intellectual property,
(v) analyze topical issues pertaining to network and platform markets.
In terms of skills, students should be able at the end of the course to
(vi) read and discuss recent contributions to the theoretical and empirical literature in industrial organization.
The contribution of this Teaching Unit to the development and command of the skills and learning outcomes of the programme(s) can be accessed at the end of this sheet, in the section entitled “Programmes/courses offering this Teaching Unit”.
Grading for the course will be based on
' In-class participation (10%),
' A presentation on a recent paper (40%), and
' A take-home final exam (50%), which must be completed within 1 day.
In the last class, each student should give a presentation on one of the recommended papers, with 15 minutes for a short summary, 10 minutes for their own comments, and 5 minutes for questions from other students and me.
Outline of Topics:
Lectures 1&2 (March 24): Product Differentiation
Lectures 3&4 (March 31): Price Discrimination
Lectures 5&6 (April 7): Switching Costs
Lectures 7&8 (April 14): Network Effects
Lectures 9&10 (April 21): Standardization
Lectures 11&12 (April 28): Two-sided Markets, Competition Policy
Lectures 13&14 (May 12): The Economics of IT, Student Presentations
This course provides a graduate level introduction to Industrial Organization. It covers several basic topics in the theory of IO and some recent policy applications. It presumes that students have a familiarity with basic micro theory and game theory.
There is no required textbook. This course will be based mainly on journal
articles. Detailed lecture notes and related readings will be provided throughout the course. As a general reference, the following books are recommended:
' Tirole, Jean, 1988. The Theory of Industrial Organization, MIT Press.
' Belleflamme, Paul and Martin Peitz, 2015. Industrial Organization: Markets and Strategies, Cambridge University Press.
Please also note: We will begin at 14:00 sharp.
