Phone: (574) 631-2803
Fax: (574) 631-5255
Office Hours: M - F: 1:00 -3:00 PM
Other times by appointment
Teaching Assistant: Greg
Cochara (email@example.com )
Office Hours: TBD
McGuigan, James, Charles Moyer, and Fredrick Harris, Managerial Economics; Applications, Strategy and Tactics, 10th Edition, Thomson-Southwestern, 2005
Allen, Bruce, Neil Doherty, Keith Weigelt and Edwin Mansfield, Managerial Economics; Theory, Applications, and Cases, 6th Edition, Norton, 2005
Pepall, Lynne, Daniel Richards, and George Norman, Industrial Organization; Contemporary Theory and Practice, 3rd Edition, Thomson-Southwestern, 2005
Varian, Hal, Microeconomic Analysis, 3rd Edition, Norton, 199
Varian, Hal, Intermediate Microeconomics; A Modern Approach, 6th Ed, Norton, 2002
David, A Course in Microeconomic Theory, 2nd Ed.,
Brickley, James, Clifford Smith and Jerold Zimmerman, Managerial economics and Organizational Architecture, 3rd Edition, McGraw – Hill/Irwin, 2004
Grading: There will be two non-cumulative exams given during the course as well as daily problem sets (to be done in groups). The final grade will be computed as follows:
Midterm = 100
Problems Sets = 100
Final = 100
Total = 300
There is also the possibility of random, unannounced quizzes, so attending class and keeping up with the material is very important. Bonus points will be awarded for exceptional class participation.
The median score (out of 300 points) will receive at least a ‘B’ for the course. The ranges for other grades will be at 10 point intervals around the median. For example, if the median score for the class is 250, the grade distribution would be as follows:
280 - 290: A
270 - 280: A-
260 - 270: B+
250 - 260: B
240 - 250: B-
230 - 240: C+
220 - 230: C
210 - 220: C-
200 - 210: D
<200 : F
Consider this distribution to be a minimum distribution. That is, if your final score is 10 points above the median, you are guaranteed a B+, but could receive a higher grade.
Honor Code: This
course, like all other courses at Notre Dame, is subject to the Academic
Code of Honor. Please read the Handbook to refresh your understanding of the
(Note: The books/articles
listed below are NOT required reading. They
are only intended to offer additional sources of information in case you would
like to learn more about a particular subject)
Day 1 (July 12th): Mathematical Preliminaries and Optimization
- Hirschey, Chapters 1,2
- Binmore, K. (1983), Calculus,
Cambridge, Press. Cambridge University
- Binmore, K.(1982), Mathematical Analysis, 2nd Edition,
Cambridge, Press Cambridge University
- Dixit, A., 1990. Optimization in Economic Theory,
Oxford, Press Oxford
- Sundaram, Rangarajan, 1999, A First Course in Optimization Theory ,
Cambridge UniversityPress, Cambridgeand New York
II (July 13th): Consumer Demand Analysis
- Hirschey, Chapters 3,4,5
- Afriat, S., 1967, “The Construction of A Utility Function from Expenditure Data”, International Economic Review, 8: 67-77
- Deaton, A. and J. Muelbauer, 1980, Economics and Consumer Behavior,
Cambridge, Press. Cambridge University
- Varian, H., 1982a, The Non-Parametric Approach to Demand Analysis”, Econometrica, 50, 945-973
- Varian, H., 1982b, The Non-Parametric Approach to Demand Analysis”, Econometrica, 52, 579-597.
Day III & Day IV (July 14th & 15th)
Technology, Costs and Pricing
- Hirschey, Chapters 8 - 12
- Baumal, W., J. Panzar, and R. Willig, 1982, Contestable Markets and the Theory of Market Structure,
, Harcourt Brace. New York
- Bresnahan, T. and P. Reiss, 1991, “Entry and Competition in Concentrated Markets”, Journal of Political Economy, 99: 977-1009.
- Davies, S. and C. Morris, 1995, “A New Index of Vertical Integration; Some Estimates for
Manufacturing”, International Journal of Industrial Organization, 13: 151-78. UK
I., R. Hubbard, and B. Peterson, 1988, “Market Structure and Cyclical Fluctuations in Manufacturing”, Review of Economics and Statistics, 70, 55-66.
- Eaton, B. and
N. Schmitt, 1994, “Flexible Manufacturing and Market Structure,”, American Economic Review, 84, 875-88.\
- Gilligan, T, M. Smirlock, and
W. Marshall, 1984, “Scale and Scope Economics in the Multi-Product Banking Firm, Journal of Monetary Economics, 13, 1393-405.
- Graham, John and Beverly Robson, 2000, Prescription Drug Prices in
Canadaand the – Part I, A Comparative Price Survey, Frasier Institute, Public Policy Sources No. 42 US
- Hall, R., 1988, “The Relation between Price and Marginal Cost in US Industry”, Journal of Political Economy, 96: 921-47.
- Hotelling, H., 1929,”Stability in Competition”, Economic Journal, 39: 41-57.
- Panzar, J., 1989, “Technological Determinants of Firm and Industry Structure”, In R. Schmalensee and R. Willig Eds, Handbook of Industrial Economics, Vol 1, Amsterdam, New Holland, 3-60.
- Stocking, G. and
W. Mueller, 1955, “The Cellophane Case and the New Competition”, American Economic Review, 45: 29-63.
- Sutton, John, 2001, Technology and Market Structure,
, The MIT Press. Cambridge, MA
- Varian, Hal, 1989, “Price Discrimination”, In R. Schmalensee and R. Willig Eds, Handbook of Industrial Economics, Vol 1, Amsterdam, New Holland, 3-60.
(July 18th): Midterm
Day VI (July 19th): The Basics of Game Theory
- Hirschey, Chapter 13,14,15
- Fudenberg, D., and Tirole, J.,1991, Games and Economic Behavior,
, MIT Press Cambridge
- Myerson, R., 1991, Game Theory,
Cambridge, Press Harvard University
Day VII (July 20th): Strategic Interaction
- Hirschey, Chapters 13,14,15
- Bulow, J., J. Geanakopolos, and P. Klemperer, 1985, “Multi-market oligopoly; Strategic Substitutes and Complements”, Journal of Political Economy, 93, 488-511.
- Kreps, D. and J. Sheinkman, 1983, “Quantity Precommitment and Bertrand Competition Yield Cournot Outcomes”,
Journal of Economics, 14: 326-37. Bell
- Liebermanm Marvin and D. Montgomery, 1998, “First Mover (Dis)Advantages; Retrospective and Link With Resource Based Views”, Strategic Management Journal, 19. 1111-25
- Marvel, H., 1989, “Concentration and Price in Gasoline Retailing”, in Leonard Weiss Ed., Concentration and Price,
, The MIT Press Cambridge, MA
- Rosenthal, R. 1981, “Games of Perfect Information; Predatory Pricing and the Chain Store Paradox”, Journal of Economic Theory, 25, 92-100.
- Selton, R. , 1978, “The Chain Store Paradox”, Theory and Decision, 9: 127-59
- Sutton, J., 1991, Sunk Cost and Market Structure, MA, The MIT Press
Day VIII (July 21st): Anti-competitive Strategies and Collusion
- Hirschey, Chapter 13,14,15
- Baldwin, J., 1995, The Dynamics of Industrial Competition,
Cambridge, MA, Press. Harvard University
- Benoit J., 1984, “Financially Constrained Entry in a Game With Incomplete Information”, RAND Journal of Economics, 15, 490-9
- Benoit J., and V. Krishna, 1985, “Finitely Repeated Games”, Econometrica, 53: 890-904.
- Bolton, P., J. Brodley, and M. Riordan, 2000, “Predatory Pricing; Strategic Theory and Legal Policy”,
Law Review, 88 Georgetown
- Caves, R.E., 1988, “Industrial Organization and New Finding on the Turnover and Mobility of Firms”, Journal of Economic Literature, 36, 1947-82
- Dixit, A, 1980, “The Role of Investment in Entry Deterrence”, The Economic Journal, 90, 95-106.
- Dunne, T., M. Roberts, and L. Samuelson, 1989, “The Growth and Failure of US Manufacturing Plants”, Quarterly Journal of Economics, 104, 671-98.
- Fudenberg, D. and J. Tirole, 1986, “A Signal Jamming Theory of Predation”, RAND Journal of Economics, 17: 366-76.
- Gilbert, R., 1989, “Mobility Barriers and the Power of Incumbency”, in R. Schmalensee and R. Willig, Handbook of Industrial Organization, Vol.1,
Amsterdam: North Holland: 476-535.
- Jovanovic, B., 1982, “Selection and the Evolution of Industry”, Econometrica, 50, 649-670.
- Klepper, S., 2002, “Firm Survival and the Evolution of Oligopoly”, RAND Journal of Economics, 33: 37-61.
- McGee, J. , 1958, Predatory Price Cutting, The Standard Oil Case”, Journal of Law and Economics, 1: 137-69.
- Milgrom, P. and J. Roberts, “Limit Pricing and Entry Under Incomplete Information; an Equilibrium Analysis”, Econometrica, 50: 443-60.
- Philips, L, 1995, Competition Policy; A Game Theoretic Analysis.
Cambridge, MA Press. Cambridge University
- Porter, R. and J. Zona, 1993, “Detection of Bid Rigging in Procurement Auctions”, Journal of Political Economy, 101: 518-38.
- Saloner G., 1987, “Predation, Mergers and Incomplete Information”, RAND Journal of Economics, 18: 165-86.
- Spence, A.M., 1977, “Entry, Investment, and Oligopolistic Pricing”,
Journal of Economics, 8: 534-44. Bell
Day IX (July 22nd): Optimal Mechanism Design and Auction Theory
- Hirschey, Chapter 13,14,15
- Bulow, J. and P. Klemperer, 2002, “Prices and the Winners Curse”, RAND Journal of Economics, 33, 1-21.
- Crampton, P. and J.A. Schwartz, 2000, “Collusive Bidding; Lessons from FCC Spectrum Auctions”, Journal of Regulatory Economics,17, 229-52
- Klemperer, P, 1998, “Auctions With Almost Common Values: The “Wallet Game” and its Applications, 1998, European Economic Review, 42, 757-69
- Klemperer, P, 2002, “What Really Matters in Auction Design?” , Journal of Economic Perspectives, 16, 161-89.
- Lucking-Reily, David, 2000, “Vickrey Auctions in Practice: From 19th Century Philately to 21st Century E-Commerce”, Journal of Economic Perspectives, 14: 183-92
- Milgrom, P and R. Weber, 1982, “ A Theory of Auctions and Competitive Bidding”, Econometrica, 50: 1089-1122.
- Myerson, R., 1981, “Optimal Auction Design”, Mathematics of Operations Research, 6: 58-73.
- Riley, J. and W. Samuelson, 1981, American Economic Review, 71: 381-92.
- Riley, J. and H. Li, 1961, Counter speculation and Competitive Sealed Tenders, Journal of Finance, 16: 8-37.
Uncertainty and Information Economics (Time Permitting)
Chapters 17, 19
Akerlof, G., (1970), “The Market for Lemons; Quality, Uncertainty, and the Market Mechanism”, Quarterly Journal of Economics, 89: 488-500
J., 1964, “Risk Aversion in the Small and in the Large”, Econometrica,
S., 1976, A Simple Approach to the Valuation of Risky Streams”, Journal of
Business, 51, 453-475
X (July 25th): Final Exam