Theory of Industrial Οrganization

Course Description

Τhe course focuses on models of imperfectly competitive markets. Prerequisites are "Micro II" and "Industrial Organization"; relative to the latter, it offers both a more in depth analysis of the core ideas as well as an expansion to new topics.

Topics covered: Monopoly, with emphasis on non-linear pricing, markets for durable goods, behaviour under uncertainty, and the use of empirically derived demand functions for pricing and entry decisions. Oligopoly, with emphasis on the relation between models of price competition and quantity competition, investments and capacity constraints, managerial incentives and strategic delegation. Entry into new markets and pricing strategies (including predatory and discriminatory): case studies in the pharmaceuticals industry. Advertizing, search costs, switching costs, network effects. Innovation and R&D. Industry dynamics. Two-sided markets. The theory of auctions and its applications: open and closed type auctions, common and independent values, winner`s curse.

Indicative Course Prerequisites: Microeconomic theory ΙΙ