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Advanced Topics in Industrial Organization

  • Teacher(s): J.Montez , C.Bach (AR)
  • Course given in: English
  • ECTS Credits: 6 credits
  • Schedule: Spring Semester 2018-2019, 4.0h. course (weekly average)
  •  séances
  • site web du cours course website
  • Related programme: Master of Science (MSc) in Economics



The course is made of three parts.

In the first part of the course we study nonstrategic market behavior, i.e., situations where a firm takes the actions of rivals as given, which leads us to a in depth discussion of monopoly power.

This part is taught by Joao Montez. It covers Part I of Jean Tirole’s book (chapters 1 to 4), and complements it with related topics, readings and applications that are not in that book. We essentially follow the sequence of the book: simple pricing, product selection, price discrimination and vertical control.

In the second part of the course we study models of strategic interaction in imperfectly competitive markets, approaching topics such as strategic pricing, collusion, and mergers.

This part is taught by Christian Bach. It covers parts of chapters 5, 6, 8 and 9, and other related topics that are not in that book. Before starting this part, you should refresh your knowledge of Game Theory (e.g. chapter 11).

In the third part students are invited to explore and present to the rest of the class a topic of their interest. This enables all students to experience how formal investigation can help them better understand real world markets, and a wide range of topics of their choice can be covered.


The course essentially takes place every other week (see exact dates below). Each 6 hour course week is made of 4 hours on Monday afternoon (13:15 to 17:00) in Anthropole/3017 and an additional two hours taking place on Tuesday morning (8:30 to 10:00) in Anthropole/3185.

Lecture topics and dates

18 & 19 Feb.: Single product (pricing, durability and planned obsolescence)

5 & 6 March: Multi product (complements and substitutes, bundling, price discrimination)

18 & 19 March: Vertical control (double margins, solutions, and downstream moral hazard) and two-sided monopoly

1 & 2 April: Short-run Oligopoly Models (Bertrand, Cournot and capacity constraints)

15 & 16 April: Dynamic Competition and Collusion

29 & 30 April: Horizontal Mergers

13 & 14 May: Strategic incumbents and entry deterrence

20 & 21 May: Competition policy and student presentations

27 & 28 May: Student presentations and feedback


The Theory of Industrial Organization, Jean Tirole, Cambridge, Massachusetts, The MIT Press.

Additional readings specific to each topic will be handed out during the course.


Microeconomic Theory (Analyse économique: Microéconomie)


First attempt

Without exam (cf. terms)  

There is no exam. The grade will be determined based on: participation during lectures (10%), three take home problem sets (40%), class presentation of a journal article (25%) and a short written report on that same presentation (25%).

Participation during lectures includes asking and answering your colleagues’ questions. If at some point you cannot follow the lecture, then you should ask for a clarification.

Take home problem sets (PS) are individual. PS1 is worth 15% and is due on March 25, PS2 is worth 12.5% and is due on April 22, and PS3 is worth 12.5% and is due on May 20.

The journal article can be either a theoretical, empirical, or an experimental study in the field of Industrial Organization. Each student should prepare a 20 minute presentation of the article with more or less the following guidelines: (1) research question, (2) motivation, (3) the model, (5) main result(s), (6) sketch of proof(s) of main result(s), (7) economic intuition behind the main result(s), (8) discussion of assumptions or methodology, and (9) conclusion.

The presentations take place on the last 2 weeks of the course. You must send the assistant Noemi Jacober and Joao Montez (in cc) an email before April 14th with your article choice (please send the complete reference of the article in the email and the article in attachment). If two or more students choose the same article, then the article is assigned to the student who chooses first.

The written report should have the same structure and cover the same topics as the presentation. Format details will be provided in due time. It is due on June 4.


Written 2h00 hours
Not allowed
Allowed with restrictions

If you fail the course, you will do a retake exam. The retake exam is written and closed book. The duration is 2 hours. The retake exam then determines 100% of your final grade.

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