20619 - ECONOMICS OF BUSINESS STRATEGY - MODULE I (MARKET BEHAVIOR)
Course taught in English
Go to class group/s: 22
Class-group lessons delivered on campus
The course provides a broad overview of the conceptual tools needed to understand business strategies and to carry out industry analyses. A special emphasis is placed on understanding how firms interact strategically in imperfectly competitive markets, how they compete or cooperate, and how those interactions affect market structures, firms’ profitability and social welfare. The role played by competition policies and authorities are discussed throughout the course. The course is divided into two parts. The first part provides an introduction to the basic toolkits and models of industrial organization, with a particular focus on the theory of competition policy. The second part of the course is focused on the main economic aspects related to the markets based on information and communication technologies. The topics examined in the second part of the course include price discrimination strategies, increasing returns and network externalities, two-sided platforms, cumulative innovation and patent policies, and finally the role of anti-trust authorities in regulating these markets.
- Static models of imperfect competition.
- Dynamic models of imperfect competition.
- Product differentiation.
- Vertical relations.
- Horizontal mergers.
- Barriers to entry & strategic behavior.
- Price dispersion.
- Digital markets & price discrimination.
- Network externalities.
- Two-sided markets.
- Innovation & patent policy.
- Antitrust in high-tech industries.
- Understand how to formulate business strategies in specific industrial contexts.
- Assess the most important factors and forces affecting competition among firms.
- Understand the role and importance of industrial and competition policies.
- Evaluate the competitive dynamics in ICT sectors.
- Ability to fully understand industry reports, academic case studies and specialized magazine articles such as Economist and Business Week.
- Evaluate and select the most appropriate sources of data and information for the analysis of specific industrial sectors.
- Apply the economic logic to the analysis of data related to competition, industrial dynamics and innovation in different sectoral contexts.
- Ability to write a basic industry report.
- Face-to-face lectures
- Guest speaker's talks (in class or in distance)
- Exercises (exercises, database, software etc.)
The course is articulated into a series of lectures. Lectures are complemented by a few sessions devoted to solving problem sets assigned to students before the class. Furthermore, industry experts may intervene in the classroom, with the purpose of illustrating how the principles of economic logic are adopted and applied in concrete situations.
The exam takes place in written form and can be taken in a single general test or in two partial tests.
- In the case of partial tests, the final grade is equal to the arithmetic average of the marks obtained in the two partial tests.
- The written test consists of one or two problem sets and a series of semi-open questions. The problem sets are aimed at assessing the analytical abilities of students. The semi-open questions refer to a hypothetical situation of an industrial sector and require the student to apply the logic of the economic models learned during the course in order to provide the most probable prediction about the outcome of the competition between companies or the overall results of the competition with reference to social welfare.
The course does not adopt a compulsory textbook.
- Most lectures are accompanied by lecture notes in the form of pdf slides.
- For the second part of the course, compulsory readings (articles from scientific journals) are provided.
- All compulsory readings are made available through the course website (Bboard platform).
- In addition to lectures, the course has also some exercise sessions in the first part. Problem sets and their solutions are posted in the Bboard platform of the course. The contents of class lectures, the problem sets and thecompulsory readings (when indicated) are the only required material for the exam. The lecture notes are made available in the course website (i.e. Bboard platform) after the lecture.