01567 - Economics of the firm

Learning outcomes

First Part: The purpose of this course is to introduce students to the concept of industrial organization. First  we analyse briefly some of the most important concepts in microeconomics. The concepts of consumer surplus, producer surplus, and allocative efficiency play a central role in any discussion regarding public policy. Second, we analyse perfect and imperfect competition, collusion policies and the relationship between market structure and market power. Finally we analyse the role of the technology in the competition strategies.

Second  part: The aim of this course is to study organizational issues inside the firm. Coordination problems are analyzed and special emphasis is given to contracts and incentives in environments with asymmetric information .

Course contents

FIRST COURSE (previously Impresa, Mercati e Strategie Competitive)

Part One: Introduction and brief resume of microeconomics studies:  Basic Microeconomics; The Firm; Games and Strategy. (Luis Cabral ch 1, 2, 3, 4, 5, 6, 10)

Part Two: From monopoly to perfect competition: Monopoly and Regulation; Perfect (and Almost Perfect) Competition; Oligopoly Competition; Collusion. Luis Cabral ch. 7, 8, 9

Part Three: Market Structure and Market Power: Price and non price strategies; Entry and exit; Luis Cabral ch. 11, 12, 13, 14, 15

Part Forth: Technology: Research and Development; Networks and Standards. Luis Cabral ch. 16,17

additional readings (no compulsory)  Will Hutton ch. 4, Hal Varian  ch. 34, Stephen Martin ch. 2

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SECOND COURSE (previously Economia dell'impresa)

The following topics will be treated. The theory of the firm. Moral hazard and adverse selection problems inside the firm. Revenue and incentives. Intrinsic and extrinsic motivations of workers. Coordination and efficiency inside the firm.

P.Milgrom - J.Roberts, Economia, organizzazione e management,  

First book. read ch 1, study ch 2, 3,4,5,6,7

Second book.  study ch 11,12,13;  read ch 15,16

L. Frey, Non solo per denaro, Mondadori 2005.  Read deeply

Readings/Bibliography

First Course

(1) Luis Cabral, “Economia Industriale”, Carocci editore, Roma 2002

suggested

(2) Stephen Martin, “Industrial Organization – A European Perspective”, Oxford University Press, Oxford 2001: capitolo 2.

(3) Will Hutton, “EUROPA vs. USA“, Fazi Editore, Roma 2003: capitolo 4.

(4) Hal Varian, “Microeconomia”, Cafoscarina, Venezia; capitolo 34, “Tecnologie dell'informazione”.

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Second Course

P.Milgrom - J.Roberts, Economia, organizzazione e management, Il Mulino 2005 (2 books).
L. Frey, Non solo per denaro, Mondadori 2005.

Assessment methods

Written examination

Teaching tools

Slides

Office hours

See the website of Pierpaolo Giannoccolo