94293 - ANTITRUST IN THE FINANCIAL AND INSURANCE SECTOR

Conoscenze e abilità da conseguire

This course studies the economics of competition and antitrust, with a special focus on financial, banking and insurance markets. Students learn how to define the relevant markets; how to measure the market power of agents and the degree of market concentration. They are then introduced to the major antitrust violations and the typical measures taken to stop competition harming behavior (from price fixing to abuse of dominance). They consider antitrust implications of network interconnectedness in different segments of financial markets (included payment systems) The economic analysis of merger regulation is also examined. At the end of the course, the student knows how to apply the most important economic models to antitrust cases, and knows how to use rigorous models in the analysis of competition policy issues.

Contenuti

1. Introduction to competition policy: definition, history, and the law

Definition of competition policy

History of competition policy in the EU and in the US

Structure of EU competition Rules

Introduction to Art 101 TFEU, Art 102 TFEU, ECMR

Objectives of Competition Policy

2. Market power and Welfare

Definition of market power

Allocative efficiency, productive efficiency, and dynamic efficiency

Public policies and incentives to innovate

The validity of the competition paradigm of antitrust for the financial and insurance sector: the “too big to fail” argument

3. Market definition and the assessment of market power

The definition of the relevant market.

Relevant markets in the banking system.

Concentration Ratios and market power

4. Art 101 TFEU : Collusion and Horizontal Agreements

Horizontal agreements

Collusion: an economic definition

The sustainability of collusion in a repeated game

Factors that facilitate collusion

Competition policies against collusion

The Antitrust implications of network interconnectedness in financial markets: the case of payment systems

5. Horizontal mergers

Unilateral effects

Pro-collusive effects

Remedies: structural and behavioral remedies

Merger policy in the EU

An antitrust analysis of US health insurance markets

6. Vertical mergers

Intra-brand competition

Inter-brand competition

Anti-competitive effects

7. Predation, monopolization, and other abusive practices

Predatory pricing

Price Discrimination

Non-price monopolization: strategic investment, bundling, tying, exclusive contracts.

Interoperability in Financial markets.

Testi/Bibliografia

M. Motta (2004), Competition Policy. Theory and Practice. New York, Cambridge University Press.

Other material and readings might be added or distributed during lectures and/or through the course website (see https://www.unibo.it/sitoweb/m.alvisi/didattica). The course website will also contain a sample exam. 

Metodi didattici

Lectures and interactive discussions of antitrust cases in class. Students are advised to read the material before the class comes. The material for each lecture will be indicated in the detailed calendar published on the official website (see https://www.unibo.it/sitoweb/m.alvisi/didattica) at the beginning of the course.

Modalità di verifica e valutazione dell'apprendimento

Students attending lectures

1) Final written test, 75 minutes long, consisting of

• 2 open questions, each assigning from 0 to 4 points max,  depending on the correctness, completeness and exhaustiveness of the answers, together with a correct use of the economic jargon.

• 6 multiple choice questions, each assigning from 0 to 4 points max. Specifically, for each question, the student must select the correct answer and briefly motivate his/her choice in the space assigned (the motivation may include an explanation of why the other alternatives are wrong). Correct answers with no motivation: 2 points. Incorrect answers: 0 points.

The maximum score of the written test will then be 32.  

2) A 25-minute presentation of an antitrust case in the financial or insurance sector, chosen with the help of the professor by the end of the third week of the course. The presentation can be prepared in collaboration with one fellow student at most.

The presentation will be evaluated for each student with a score ranging from 0 to 32, as follows:

0-17: The student shows insufficient knowledge and analytical skills, spread over just few components of the case-study, the overall jargon is often imprecise.

18-23: The student shows sufficient knowledge and analytical skills, spread however over just few components of the case-study, the overall jargon is correct

24-27: The student shows an adequate preparation at a technical level with some doubts over single parts of the case-study. Good, yet not articulate analytical skills, with the use of a correct jargon

28-30: Great knowledge about most of the elements of the case-study, good critical and analytical skills, good usage of the specific jargon

31-32: excellent and in depth knowledge of the different elements of the case-study, excellent critical and analytical skills, excellent usage of specific jargon.

 

The score of the written test counts for 60% of the total course score. The score of the presentation counts for the remaining 40%. The course score is expressed into thirties, from 18 to 30, and if the weighted average is above 30, the professor may assign an honor mark (lode). 

Note: the exam is passed ONLY IF the student obtains a minimum score of 18 in both the written test and the presentation. 

 

Students not attending lectures

Final written test, 105 minutes long, consisting of

• 3 open questions, each assigning from 0 to 4 points max, depending on the correctness, completeness and exhaustiveness of the answers, together with a correct use of the economic jargon.

• 10 multiple choice questions, each assigning from 0 to 2 points max. Specifically, for each question, the student must select the correct answer and briefly motivate his/her choice in the space assigned (the motivation may include an explanation of why the other alternatives are wrong). Correct answers with no motivation: 1 point. Incorrect answers: 0 points.

The maximum score of the written test will then be 32. The course score is expressed into thirties, from 18 to 30, and if score of the written test is above 30, the professor may assign an honor mark (lode).

Strumenti a supporto della didattica

- Slides and other material will be available on the course website.

- During the first three weeks a tutor will offer 1-2 review sessions on the economic tools that the Professor will use in the remainder of the course.

Orario di ricevimento

Consulta il sito web di Matteo Alvisi