Theory of Industrial Organisation
Postgraduate: Level 7
Monday 13 January 2020
Friday 20 March 2020
04 October 2018
Requisites for this module
MSC L10312 Financial and Business Economics,
MSC L10412 Management Economics
This course examines strategic interactions between firms and the determinants of industrial structure.. Recent developments in industrial organisation and regulation are incorporated into the material.
The aim of the course is to provide students with a working knowledge of current thinking in industrial organisation, and its application to competition policy, regulation and business strategy. By the end of the course, students should be able to apply analytical models of firm behaviour and strategic interactions to evaluate various practical situations. The course prepares students who wish to embark on research in this field, or to pursue careers in business, consultancy and government.
Skills -Abstraction: Real-life Competition Law cases involve hundreds of pages of document describing the behaviour of firms in the industry. Through studying theory in the context of cases, students learn how to identify the key aspects of such behaviour and how to build and use models that focus on these aspects.
Deduction and Induction: Economic models involve a systematic use of deduction as they proceed from assumptions to logically proceed to conclusions. Induction is also essential when testing economic models empirically. Deduction is emphasised via the presentation style.
Numeracy: Students learn how to obtain information about industry behaviour and how to use it, either informally or through linkages to systematic econometric techniques developed elsewhere in the curriculum. Our emphasis is on choosing the right technique.
External Awareness: Students become aware of the various constituencies that need to be addressed when presenting an economic analysis of competitive behaviour via our use of cases and emphasis on different types of arguments made and their sources.
Decision-making skills: The stakes involved in industry analysis are often high. Competition cases can involve mergers worth billions of pounds or charges of abuse that can lead to fines of more than a billion pounds. In such a context the role of the economic analyst goes well beyond listing the pros and cons of various arguments: the analysis must lead to a concrete unambiguous recommendation. This involves difficult choices as to which arguments should be given most weight. Moreover, the conduct of a competition case involves crucial choices of strategy as to which argument to advance at which stage of the project and how to react to the moves of the other party.
Knowledge of Work and Organisational Cultures: Students learn about the objectives and constraints faced by government agencies as well as the challenge of communicating with legal experts and business people.
While the exam allows students the opportunity to develop and exhibit all these skills, students are encouraged to write a term paper to pursue creative and research-based applications. The term paper also serves as an output that can be presented as part of either a research proposal for further study or their portfolio for job search. The term paper is an opportunity to tailor the skills delivered by the module to their interests and future plans, be that a business plan, or a preliminary proposal for a more developed research paper.
No additional information available.
One 2 hour lecture per week.
Feedback for this module will occur through class meetings where we will go over the answers to problem sets and where you will be able to ask questions about your own method of solution; answers that will be posted on the website for the module that will give you written guidance on the appropriate method to approach the problems, assignments, and tests; and office hours where any additional questions can be addressed. You should be sure that you use these methods to understand how to improve your own performance.
- Tirole, Jean. (c1988) The theory of industrial organization, Cambridge, Mass: MIT Press.
- Richard Schmalensee. (1978) 'Entry Deterrence in the Ready-to-eat Breakfast Cereal Industry', in Bell Journal of Economics. vol. 9 (2) , pp.305-327
- Competition Commission. (1992) New Motor Cars, London: Competition Commission, Victoria House, Southampton Row, London WC1B 4AD. Telephone: 020 7271 0241.
- Schmalensee, Richard; Willig, Robert D.; Armstrong, Mark; Porter, Robert H. (1989-2007) Handbook of industrial organization, Amsterdam: North-Holland. vol. Handbooks in economics
- Patrick; Joseph Stiglitz. (1995) 'The Role of Exclusive Territories in Producers' Competition', in The RAND Journal of Economics. vol. 26 (3) , pp.431-451
- Symeonidis, George. (2003) 'In Which Industries Is Collusion More Likely? Evidence from the UK', in The Journal of Industrial Economics. vol. 51 (1) , pp.45-74
- Ellison, Glenn. (1994) 'Theories of Cartel Stability and the Joint Executive Committee', in The RAND Journal of Economics. vol. 25 (1) , pp.37-57
- G. F. Mathewson; R. A. Winter. (1984) 'An Economic Theory of Vertical Restraints', in RAND Journal of Economics. vol. 15 (1) , pp.27-38
- Jeffrey R. Church; Roger Ware. (2000) Industrial organization: a strategic approach, Boston: Irwin McGraw Hill.
- Margaret E. Slade. (1990) 'Strategic Pricing Models and Interpretation of Price-War Data', in European Economic Review. vol. 34 (2-3) , pp.524-537
- Margaret C. Levenstein. (1997) 'Price Wars and the Stability of Collusion: A Study of the Pre-World War I Bromine Industry', in Journal of Industrial Economics. vol. 45 (2) , pp.117-137
- Richard Schmalensee. (1979) 'On the Use of Economic Models in Antitrust: The Realemon Case', in University of Pennsylvania Law Review.
- Joel Waldfogel. (2003) 'Preference Externalities: An Empirical Study of Who Benefits Whom in Differentiated Product Markets', in RAND Journal of Economics. vol. 34 (3) , pp.557-568
- George Symeonidis. (2002) The effects of competition: cartel policy and the evolution of strategy and structure in British industry, Cambridge, MA: MIT Press.
- Robert H. Porter. (1983) 'A Study of Cartel Stability: The Joint Executive Committee, 1880-1886', in The Bell Journal of Economics. vol. 14 (2) , pp.301-314
- John Sutton. (1991) Sunk costs and market structure: price competition, advertising, and the evolution of concentration, Cambridge, MA: MIT Press.
- Margaret C. Levenstein; Valerie Y. Suslow. (2006) 'What Determines Cartel Success?', in Journal of Economic Literature. vol. 44 (1) , pp.43-95
- George Symeonidis. (2000) 'Price Competition and Market Structure: The Impact of Cartel Policy on Concentration in the UK', in Journal of Industrial Economics. vol. 48 (1) , pp.1-26
- George Symeonidis. (2008) 'The Effect of Competition on Wages and Productivity: Evidence from the UK', in Review of Economics and Statistics. vol. 90 (1) , pp.134-146
- Sutton, J. (2007) 'Market Structure: Theory and Evidence', in Handbook of Industrial Organization.
- Competition Commission. (2000) New Cars: A Report on the Supply of New Motor Cars within the UK, London: Competition Commission, Victoria House, Southampton Row, London WC1B 4AD. Telephone: 020 7271 0241.
The above list is indicative of the essential reading for the course. The library makes provision for all reading list items, with digital provision where possible, and these resources are shared between students. Further reading can be obtained from this module's reading list.
Assessment items, weightings and deadlines
|Coursework / exam
||120 minutes during Summer (Main Period) (Main)
Module supervisor and teaching staff
Dr George Symeonidis
For further information, send a message to email@example.com
Dr Francis Kiraly
Available via Moodle
Of 30 hours, 30 (100%) hours available to students:
0 hours not recorded due to service coverage or fault;
0 hours not recorded due to opt-out by lecturer(s).
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