ECO 260
Industrial
Organization and Public Policy
Fall 2005
Professor Ross Weiner
Office: NAC 5/139D
Phone: (212) 650-6213
Email: [email protected]
Website: www.geocities.com/ccnyeconprof
Required Text: (On reserve at Cohen Library)
Shy, Oz. 1995. Industrial Organization: Theory and Applications. Cambridge and London: MIT Press.
Purpose: Introduce students to the modern approach to industrial organization. Modern approaches to industrial organization rely heavily on the use of game theory and strategic approaches to economic behavior. This course seeks to explain the behavior of firms under perfect and imperfect competition through the use of game theory. Game theory provides powerful insight into economic behavior by allowing economic actors to have an impact on each other’s (rational) decisions.
Prerequisites: While the prerequisites for this course are some combination of ECO 100, 101, 102, 103, or 104, knowledge of the material covered in an intermediate level microeconomics course such as ECO 220 will be quite helpful. Exposure to calculus and algebra will prove quite useful as well.
Grading Policy: Two exams: 40% of final grade each
Homework: 20% of final grade
There are NO MAKE UP EXAMS for this course. Unexcused absence from an exam will result in a grade of zero for that exam. Employment responsibility, broken alarm clocks, travel plans, exams in other courses, etc. do not constitute excused absences. If you must miss an exam, be sure to see me ASAP (at least TWO WEEKS) prior to the exam to arrange alternative plans. I remain the sole decision maker as to whether or not an excuse from an exam will be granted.
Emergencies (e.g., medical) resulting in an absence may be granted an excuse upon review by the instructor.
Homework is due at the beginning
of class on the date specified. All
homework received late will receive a grade of zero.
Additionally, I do not offer extra-credit work under any circumstances. You are expected to perform at your best on all regularly assigned work. Doing so avoids the need for any type of extra-credit work.
I will not grant grades of incomplete. The expected workload for this course is
spelled out in this syllabus. If you
have any reason to believe that you will not be able to handle the expected
work during the course of the semester, it is strongly recommended that you
drop the course immediately.
Exam Dates: Exam I: Monday, October 31, 2005
Exam
II: Wednesday, December 14, 2005
Cell Phones, Beepers, and Other Noise-Creating Devices:
Please shut off all noise making
devices before class. They are
distracting to your fellow classmates as well as the instructor.
Course Outline: (* = Required reading)
*Shy, Chapter 1, 1-8.
*Shy, Chapter 2, 11-28.
B. Theory of the Firm (not covered in class)
Shy, Chapter 3, 43-53.
III. Assumptions Regarding Consumer and
Firm Behavior: Perfect and Imperfect
Competition
A. Perfect Competition: Firms and Consumers as Price Takers and
Quantity Makers
*Shy, Chapter 4, 63-70.
B. Firms with Market Power: Monopoly
*Shy, Chapter 5, Sections 5.1 –
5.4
C. The Case of Several Firms with
Market Power: Oligopoly
*Shy, Chapter 6, 97-132, Chapter
2, Section 2.3
D. Maintaining and Measuring Market
Power
*Shy, Chapter 8, 169-218.
IV. Technology
and Market Structure
A. Research and Development
*Shy,
Chapter 9, 221-252.
V. Marketing
A. Advertising
*Shy,
Chapter 11, Sections 11.1-11.2.
B. Capturing Consumer Surplus
*Shy,
Chapter 13, 341-360.
VI. Models
with Imperfect Information
A.
Getting the Employee to Work
Hard: The Role of Effort
*Shy,
Chapter 15, Sections 15.1-15.3.