The Economics of Industrial Organization
Industrial organization is about the functioning of markets, in particular markets with imperfect competition where firms act strategically.
It is a sub-field of microeconomics that deals with questions such as: What determines how many and how large firms that are active in an industry? What are firms’ optimal pricing and product design strategies given the structure of the market? How can firms improve profits by bundling goods together or offering quantity discounts?
The answers to these questions are essential not only to profit-maximizing firms, but also to competition authorities and other regulators trying to improve consumer welfare.
The course covers standard models for oligopoly and monopoly markets, product differentiation, cartels, dominant firms, price discrimination, entry and exit, network economies, horizontal and vertical integration, and innovation.
The analysis is to a great extent based on game theory, why EC7101 Game Theory is recommended for students who intend to take this course.
Industrial organization is the first of a sequence of two courses on the functioning of markets. The second course, EC 7114 Antitrust and Regulation, deals with ways to improve welfare by creating policy and regulation that improve the performance of markets with imperfect competition.
This is a 7.5 credit course. Course material will be available on the learning platform.
Teaching Format
Instruction is given in the form of lectures. The language of instruction is English.
Assessment
The course is examined on the basis of a written examination.
Examiner
Belleflamme, Paul, and Martin Peitz. Industrial organization: markets and strategies. Cambridge University Press. Latest edition.
