The aim of this course is to guide the students through some of the most important models in Industrial Economics. In this area we investigate the behavior of firms, both in monopolistic and oligopolistic markets. In oligopolistic markets we study small numbers of firms that compete with each other by choosing quantities, prices, product characteristics, or marketing strategies. We often use game theory to investigate such competition models. This is natural since in these settings firms must reason about the decisions of other firms before deciding about their own strategy. Hence, such competition models can be seen as games between firms. In this course we will not only analyze the various models game theoretically, but will also discuss the findings in these models from an intuitive economic point of view. A good conceptual understanding and economic intuition is considered very important.

Every week of this course consists of one theory lecture and one exercise session. During the exercise session we will discuss some exercises about the theory of that week. These exercise sessions will be highly interactive, as students will be asked to explain an exercise, or a part of it, to their fellow students on the whiteboard.
Some topics that we will discuss are: Static and dynamic models of quantity and price competition, horizontal and vertical product differentiation, price discrimination, asymmetric information, signaling by prices and advertising, cartels, and models of strategic entry.

"Industrial Organization: Markets and Strategies" by Paul Belleflamme and Martin Peitz, Cambridge University Press, Cambridge, 2015 (second edition).

This course is in transition for the master Business Research.
See the Master Education and Examination Regulations for more information.

The following rule applies to master Business Research students who started the programme prior to academic year 2024-2025.
TRANSITIONAL REGULATION (EBC4007):
The master Business Research has been discontinued.
Courses of the Business Research master’s programme will continue to be offered until and including academic year 2025-2026 with exam opportunities running until and including 2026-2027.


PREREQUISITES:
A good understanding of micro economics, and a basic knowledge of game theory.