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Program

Updated A.Y. 2022-2023

This course provides a theoretical and practical understanding of the principal issues in industrial organization and competition policy. The course studies the strategic interaction among firms in imperfectly competitive markets, the sources of market power, and the rationale and impact of competition policy. Lectures will use analytical tools and discuss case studies.

LEARNING OUTCOMES

At the end of the course, students should be able to understand and apply the analytic approach of game theory to :

  • Study collusive practices among firms in static and dynamic contexts
  • Understand the firms' strategies to deter entry
  • Discuss anticompetitive practices in oligopolies and the role of competition policy
  • Discuss the rationale of different arguments on the effects on competition of firms' practices
  • Prepare presentations to discuss the impact of mergers and collusive deals

ASSESSMENT

Game Theory and Industrial Organization is an exam divided into two parts. To pass the exam, students must obtain a grade of 18 or higher in both parts. The final mark will be the average of the two. The exam is in written format, with a possibility of an oral exam at the teacher's discretion. 

LECTURES
This is a tentative program that will be subject to changes in due course.

1. Course introduction 
2. Firms, consumers and the market 
3. Oligopoly models: price and quantity setting. 
5. Product differentiation
6. Theory of Competition Policy
7. Cartels and tacit collusion
8. Horizontal mergers 
9. Strategic incumbents and entry     Week 4/5
10. Strategies Affecting Demand variables: Brand Proliferation and Bundling
11. Limit Pricing 
12. Vertically related markets: The double marginalization problem, Resale price maintenance, Exclusive dealing, Vertical mergers

ESSENTIAL READING
• Belleflamme, Paul and Martin Peits, (2015) Universität Mannheim, Germany Industrial Organization Markets and Strategies, 2nd Edition Cambridge University Press

ADDITIONAL READING FOR INTERESTED STUDENTS

• Motta Massimo (2014), Competition Policy: Theory and Practice, Cambridge University Press.

Book website: all slides and exercises here.
https://www.cambridge.org/it/academic/subjects/economics/industrial-economics/industrial-organization-markets-and-strategies-2nd-edition?format=PB#resources