84610 - Industrial Organization

Learning outcomes

The course aims to provide students with the ability to understand theoretical models and apply them to the analysis of real situations. In particular, it focuses on the tools necessary for studying the dynamics of businesses and sectors in the new global economy. Topics covered include the birth, survival, and growth of businesses; the management of international outsourcing processes; network externalities; the functioning of network markets and public utility service markets.

Course contents

The central conceptual framework of this course is based on the idea, originally proposed by Joseph A. Schumpeter, that entrepreneurial (productive) activity is the primary driver of the economic cycle and economic development. This idea is closely linked to the process of Creative Destruction, which occurs when waves of innovation transform the economy by replacing outdated products and production methods. This is followed by an imitative process, fueled by the emergence of new businesses.

The course revolves around analysis of determinants and effects of this process of Creative Destruction, illustrating how new firms introduce innovations that can lead to the development of entirely new productive sectors. Students will learn how to empirically study the resulting industry dynamics, with a focus on new firm formation and growth, the emergence and diffusion of technological innovation, and the design and implementation of effective policy measures.

Readings/Bibliography

Parker, S. C. (2018). The Economics of Entrepreneurship. Cambridge University Press, 2nd edition.

Klepper, S. & Simons, K. L. (2005). Industry Shakeouts and Technological Change. International Journal of Industrial Organization, 23(1-2): 23-43.

Chung, B., Franses, P. H., & Pennings, E. (2024). Conditions that make ventures thrive: from individual entrepreneur to innovation impact? Small Business Economics, 62(3): 1177–1200.

Anser, M. K. et al. (2022). Relationship of environment with technological innovation, carbon pricing, renewable energy, and global food production. Economics of Innovation and New Technology, 31(4): 231-267.

Teaching methods

Lectures, class discussions, coursework.

Assessment methods

Students who choose to participate actively in the course will take a two-part assessment, with each part contributing 50% to the final grade. The first part (coursework) consists of the preparation of a business plan for a new entrepreneurial project that exploits the potential of, or explores possible developments in, one of the two domains of Artificial Intelligence: Learning and Symbolic Systems (LS-SYS) and Robotics and Autonomous Systems (RA-SYS). Each business plan will be prepared collaboratively by at least two students. For the coursework, limited, declared, and non-substantial use of AI is permitted for support activities (e.g. summarizing and rephrasing). The second part consists of a written final exam in which students will be required to answer 5 out of 8 questions (4 open-ended questions and 1 multiple-choice question).

For students who are unable to attend classes, the final exam will consist of 8 open-ended questions and 4 multiple-choice questions.

 

Grading criteria:

18-23: the student has sufficient preparation and analytical skills, spread however, over just few topics taught in the course, the overall jargon is correct

24-27: the student shows and adequate preparation at a technical level with some doubts over the topics. Good, yet not to articulate analytical skills with the use of a correct jargon

28-30: Great knowledge about most of the topics taught in the course, good critical and analytical skills, good usage of the specific jargon

30L: excellent and in depth knowledge of all the topics in the course, excellent critical and analytical skills, excellent usage of specific jargon.

Teaching tools

Other teaching material, including slides used during the lectures and papers will be made available to students on a weekly basis through the 'Virtuale' platform.

Office hours

See the website of Enrico Santarelli