The course focuses on relevant topics of modern industrial organizations, with a particular attention to the analysis of empirical applications.
Lectures are organized in three modules:
- Incentives: horizontal agreement and vertical relations (E. Giovannetti)
- Incentives and internal organization (A. Zago)
- Incentives, auctions and procurement (C. Zoli)
The aim of the course is to provide students with rigorous economic tools for the analysis of market structure and market relations and of the role played by incentives in shaping the internal organization of the firms and in designing the allocation mechanisms of goods and resources.
At completion of the course students should be able to:
- Understand the market characteristics most likely to facilitate tacit collusion and the incentives and modalities of vertical foreclosure.
- understand the firms’ problems, in particular their interactions with the owners, the management, the workforce, and the input providers.
- Analyse and assess auction/procurement mechanisms both from the point of view of the seller and the buyers.
The three modules will cover the following subjects:
Markets: horizontal and vertical relations (E. Giovannetti): Collusion, mergers, vertical restraints, advanced monopoly theory.
Incentives and internal organization (A. Zago): Principal and agent model, multitasks model, hierarchies.
Incentives, auctions and procurement (C. Zoli): introduction to auction theory, applications to auctions and procurement design.
Selected readings will be taken from the following texts
Campbell, D. E. (2006): Incentives: motivations and the economics of information. Cambridge University Press
Jehle, G. A. and Reny, P. J. (2001) Advanced Microeconomic Theory.. Addison Wesley
Klemperer, P. (2004): Auctions: theory and practice. Princeton University Press
Martin, S. (1993): Advanced Industrial Economics. Blackwell.
Milgrom P. (2004) Putting Auction Theory to Work. Cambridge University Press.
Molho, I, (1997): The Economics of Information. Blackwell
Motta, M. (2004): Competition Policy. Cambridge University Press
Ricketts, M. (2002): The Economics of Business Enterprise. Edward Elgar Publishing
Wolfstetter, E. (2003): Topics in Microeconomics: Industrial organization, auctions and incentives. Cambridge University Press
A detailed program of the course, and teaching material, will be available during the semester on the e-learning web page of the course.
Written exam and project work.