­Economics 341: Industrial Organization

Fall 2008

 

Section 1: MW 1:10-2:30 pm, Freylinghusen Hall A6

Professor Hilary Sigman

Office hours: New Jersey Hall 419, Monday 10:30amnoon 

Telephone: (732) 932–7594

E-mail: sigman (at) econ.rutgers.edu

 

Course overview: This course examines the determinants and effects of market structure.  It relies theoretical concepts and empirical research, focusing particularly on U.S. industries.  The course discusses monopolies and oligopolies and public policies to address these market structures. Later topics include price discrimination, vertical relationships, innovation and R&D.  

Objectives: Throughout the course, students will use microeconomics to understand firms' strategic decisions and to evaluate public policies for competition.   They will solve problems designed to capture some of the major concepts in the course; some of these problems require basic calculus as well as other mathemetical skills. Students will also apply econometrics to empirical research on the causes and consequences of market concentration.  

Text: Jeffrey Church and Roger Ware, Industrial Organization: A Strategic Approach.  You may download the pdf version of the book (for free!) from the Resources section of our Sakai site.

 

Problem sets: Seven problem sets will be distributed during the term. Timely submission of these problem sets will count for 10% of your course grade. You may drop one problem set and still get full credit for problem set submission. This dropped problem set gives you an automatic excuse for a date when you have a conflict, illness, or transportation problem. Otherwise, no problem sets will be excused for any reason, even very good ones. Problem sets are due at the beginning of class on the due date. Late, faxed, or emailed problem sets will not be accepted.

 

Class web site: The class has a website on Sakai (log in to sakai.rutgers.edu) This web site will include copies of class handouts, such as this syllabus and problem sets. I will try to make lecture outlines available on the web site before each class. Some sample old exam questions will also be posted.

 

Email addresses: Any course-related email messages (e.g., snow cancellations) will be sent to via Sakai.  Please make sure that your preferences there are set to send mail to an email address you actually check.  You may also decide (under preferences on Sakai) whether you'd like to receive  

 

Exams:  There will be two midterm exams in class (see attached schedule) and a cumulative final exam (at the time scheduled by the Registrar, Wednesday, 12/17, 8–11 am).  The exams will be based on the lectures, readings, and the problem sets. The lecture and readings will not always cover the same material. You are responsible for the material in both the lectures and readings.

 

Check to be sure you can attend all the exams before deciding to take this class.  There will be no alternative exam dates. 

 

Grading policy: Course grades will be based on problem set completion (10%), midterms (25% each) and final 40%.  All course grades will be curved.  No additional coursework will be available for students dissatisfied with their grades.


Economics 341: Industrial Organization

Fall 2008

Prof. H. Sigman

 

Calendar

(Dates are approximate, except for exams, which are definite)

 

Day

Topic

Reading
(all in C&W text)

Problem set due dates

W, 9/3

Introduction; Costs

pp. 50-62 (sec. 3.1)

 

M, 9/8

Scale Economies, Profit maximization

pp. 94-101 (skip sec 3.4.1)

 

W, 9/10

Markets and welfare

pp. 19-29 (sec. 2.1-2.3)

 

M, 9/15

Entry barriers

pp113-124 (sec 4.1)

 PS 1 due

W, 9/17

Monopoly

pp. 29-42 (sec 2.4-2.5)

 

M, 9/22

Monopoly

pp. 130-133, 135-141 (skip math), 145-150

 

W, 9/24

Dominant firms

pp. 124-127

 

M, 9/29

Regulation of monopolies

pp. 747-764

 PS 2 due

W, 10/1

Exam Review

 

 

M, 10/6

First Midterm Exam

 

 

W, 10/8

Noncooperative Oligopoly: Cournot

pp. 231-246

 

M, 10/13

Noncooperative Oligopoly: Bertrand; Stackelberg

pp. 256-258, 467-472

 

W, 10/15

Repeated games; Cartels

pp. 307-308, 328, 340-357

 

M, 10/20

Cartels

 

PS  3 due

W, 10/22

Monopolistic Competition

pp. 247-254

 

M, 10/27

Product Differentiation

pp. 258-262,  367-374, 379-384

 

W, 10/29

Empirical analysis of market structure

Chapter 12

PS 4 due

M, 11/3

Empirical analysis of market structure

 

 

W, 11/5

Antitrust policy

pp. 715-719, 726-732

 

M, 11/10

Exam Review

 

PS 5 due

W, 11/12

Second Midterm Exam


 

M, 11/17

Price Discrimination

pp. 155-170

 

W, 11/19

Price Discrimination

 

 

M, 11/24

Theory of the Firm

pp. 62-75

PS 6 due 

M, 12/1

Vertical Integration

pp. 76-79, 683-687

 

W, 12/3

Vertical Restraints

pp. 688-696

 

M, 12/8

Patents and Research and Development

pp. 575-585

PS 7 due

W, 12/10

Exam Review

 

 

Wed 12/17,

8–11am 

Final Exam (cumulative)