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PORTALE DELLA DIDATTICA

Industrial Economics

02OJAPH

A.A. 2019/20

Course Language

English

Course degree

Master of science-level of the Bologna process in Engineering And Management - Torino

Course structure
Teaching Hours
Lezioni 80
Teachers
Teacher Status SSD h.Les h.Ex h.Lab h.Tut Years teaching
Benfratello Luigi Professore Associato SECS-P/02 68 0 0 0 5
Teaching assistant
Espandi

Context
SSD CFU Activities Area context
ING-IND/35
SECS-P/06
4
4
B - Caratterizzanti
C - Affini o integrative
Ingegneria gestionale
Attività formative affini o integrative
2018/19
The purpose of this course is to provide students a framework to understand the strategic behaviour of firms and consumers acting in oligopolisitc markets where competition is imperfect. Policy reforms aiming at enforcing competition in markets (antitrust policy) and at regulating markets were competition is not present will also be illustrated. The course is structured in a theoretical part where market equilibrium, game theory and oligopoly theory will be developed. A second part dealing with econometric tools will allow students to understand and replicate applied works in Industrial Economics. Then, the theoretical and applied tools will be applied to specific markets and institutions.
The purpose of this course is to provide students a framework to understand the strategic behaviour of firms and consumers acting in oligopolisitc markets where competition is imperfect. Policy reforms aiming at enforcing competition in markets (antitrust policy) and at regulating markets were competition is not present will also be illustrated. The course is structured in a theoretical part where market equilibrium, game theory and oligopoly theory will be developed. A second part dealing with econometric tools will allow students to understand and replicate applied works in Industrial Economics. Then, the theoretical and applied tools will be applied to specific markets and institutions.
Students will learn the functioning of different market structures (competitive, oligopolisitc or monopolistic markets), firms' strategies and competitive issues. They will also understand the rationale for antitrust and regulation policies. They will also learn to understand and replicate on their own econometric analyses in Industrial Economics.
Students will learn the functioning of different market structures (competitive, oligopolisitc or monopolistic markets), firms' strategies and competitive issues. They will also understand the rationale for antitrust and regulation policies. They will also learn to understand and replicate on their own econometric analyses in Industrial Economics.
This class requires a solid foundation in calculus and some knowledge of statistical inference. Moreover, the frequency to the “Economics” course is a pre-requisite.
This class requires a solid foundation in calculus and some knowledge of statistical inference. Moreover, the frequency to the “Economics” course is a pre-requisite.
The course is divided into three parts. The first section is devoted to a review of perfect competition and monopoly and to market failures. The second section is devoted to methodological tools necessary to understand theoretical models and applied analyses in industrial economics, namely game theory and econometrics. The last part deals with the theory and empirics of imperfect competition, with a special focus on con competition policy and regulation. In particular, the detailed syllabus is the following: 1. Introduction to welfare economics. Market failures: market power, externalities, public goods and asymmetric information. A focus on externalities: network economics. 2. Game theory. Static games with perfect information: Equilibrium concepts; Nash equilibrium; pure and mixed strategies; Nash theorem. Dynamic games with perfect information: the refinement of perfection; subgame perfection; backward induction; repeated games (finite and infinite time horizon); Folk’s theorem. 3. Econometrics. Linear regression with single regressors and with multiple regressors. Non linear (in variables) regression. 4. Oligopoly theory. Cournot and Bertrand models; SCP paradigm; concentration. Multiplant monopolist and collusion. Stackelberg model; entry. 5. Price discrimination: Pigou classification; third degree discrimination; two-part tariffs; quality, quantity and autoselection. Tying and bundling. 6. Differentiated products: Spence model; address models: horizontal and vertical differentiation with exogenous location. 7. Empirical analyses in Industrial Economics. Competition and regulation policies.
The course is divided into three parts. The first section is devoted to a review of perfect competition and monopoly and to market failures. The second section is devoted to methodological tools necessary to understand theoretical models and applied analyses in industrial economics, namely game theory and econometrics. The last part deals with the theory and empirics of imperfect competition, with a special focus on con competition policy and regulation. In particular, the detailed syllabus is the following: 1. Introduction to welfare economics. Market failures: market power, externalities, public goods and asymmetric information. A focus on externalities: network economics. 2. Game theory. Static games with perfect information: Equilibrium concepts; Nash equilibrium; pure and mixed strategies; Nash theorem. Dynamic games with perfect information: the refinement of perfection; subgame perfection; backward induction; repeated games (finite and infinite time horizon); Folk’s theorem. 3. Econometrics. Linear regression with single regressors and with multiple regressors. Non linear (in variables) regression. 4. Oligopoly theory. Cournot and Bertrand models; SCP paradigm; concentration. Multiplant monopolist and collusion. Stackelberg model; entry. 5. Price discrimination: Pigou classification; third degree discrimination; two-part tariffs; quality, quantity and autoselection. Tying and bundling. 6. Differentiated products: Spence model; address models: horizontal and vertical differentiation with exogenous location. 7. Empirical analyses in Industrial Economics. Competition and regulation policies.
The course is organized into lectures and practical classes. Workshops will be organized for discussing applications and real cases.
The course is organized into lectures and practical classes. Workshops will be organized for discussing applications and real cases.
• Jeffrey R. Church and Roger Ware. Industrial Organization: A Strategic Approach. New York: McGraw-Hill, 2000. • James Stock and Mark W. Watson. Introduction to Econometrics, 3rd Edition, Addison-Wesley, 2010. • Lecture notes, exercises with solutions and past exams will be posted on the website
• Jeffrey R. Church and Roger Ware. Industrial Organization: A Strategic Approach. New York: McGraw-Hill, 2000. • James Stock and Mark W. Watson. Introduction to Econometrics, 3rd Edition, Addison-Wesley, 2010. • Lecture notes, exercises with solutions and past exams will be posted on the website
Modalità di esame: prova orale obbligatoria;
Grading in the course will be on the basis of performance on a written examination of 1h45' in total. The exam is made by four questions: three are quantitative exercises and the fourth is the interpretation of an econometric regression. The weight of each question on the final grade is the same.
Exam: compulsory oral exam;
Grading in the course will be on the basis of performance on a written examination of 1h45' in total. The exam is made by four questions: three are quantitative exercises and the fourth is the interpretation of an econometric regression. The weight of each question on the final grade is the same.


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