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ECO 329 Industrial Organization

ECO 329 Industrial Organization. Dr. Selcen Öztürk. Personal info. Name of Tutor: Dr. Selcen Öztürk BSc: Gazi, University, Department of Economics MSc: Hacettepe University, Department of Economics PhD: University of Sheffield, UK, Department of Economics Section information:

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ECO 329 Industrial Organization

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  1. ECO 329 IndustrialOrganization Dr. SelcenÖztürk

  2. Personalinfo • Name of Tutor: Dr. SelcenÖztürk • BSc: Gazi, University, Department of Economics • MSc: Hacettepe University, Department of Economics • PhD: University of Sheffield, UK, Department of Economics • Section information: • Office Hours:

  3. CourseOutline • Introduction:What is industrial organization and what does this lecture offer? • Firms, consumers and the market • Game theory • Static imperfect competition: Bertrand and Cournot competition • Dynamic imperfect competition: Stackelberg • Product differentiation and advertisement • Pricing strategies and market segmentation • Cartels and tacit collusion • Horizontal mergers • Strategic incumbents and entry • Vertically related markets • R&D

  4. Text • Belleflamme P.; M. Peitz. Industrial Organization: Markets and Strategies. Cambridge, Cambrigde University Press, 2010. • Pepall, L.; D. J. Richards and G. Norman. Industrial Organization: Contemporary Theory & Practice, 3rd edition. Mason, OH: South-Western, 2005. • Church, J. and R. Ware. Industrial Organization: A Strategic Approach. New York, NY: McGraw-Hill, 2000.

  5. Aboutthiscourse • Theaim of thiscourse is tointroduceyoutothefield of industrialorganization. • Thiscoursewillusemicroeconomicandmathematicaltools. • Attendance is not necessary. • Therewillbe assignments. • 2 midtermsand a final exam (nevermultiplechoiceexams).

  6. What is a market? • Markets allow buyers and sellersto exchange goods and services in return for a monetary payment. • Think about the assumptions of the perfect competition. • Do we often face perfectly competitive markets?

  7. Market Power • Market power is essentiallyrelatedtopricing. • Inperfectlycompetitivemarketseven a slightchange in pricesyieldsto a loss of allormost of the market share. • How is it possible?

  8. Market Power • Market power is not a staticconcept. Firmsenjoy market powerbecauseotherfirms do not find it worthwhiletoofferidenticalorsimilarproductsorservices. • This can also be situatedbyentrydeterrence.

  9. Market PowerandMonopoly • Naturalmonopolyandoligopoly • Governmentsponsoredmonopolyandoligopoly

  10. Strategies • Inindustrialorganizationweseefirms as strategicplayers. • Thegametheyareplaying can be staticordynamic. • Depending on theassumptionsandthedefinition of thegamefirmsresponsetoeachothers strategies. • Firms’ strategiesandresponsesyieldtotheequilibrium.

  11. NextWeek • Firmsconsumersandthe market: Chapter 2

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