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Industrial Economics: Competition, Strategy and Policy B

Module Code: ECU33072 (old code EC3171)

Module Title: Industrial Economics: Competition, Strategy and Policy B

  • ECTS Weighting: 5
  • Semester/Term Taught: Semester 2
  • Contact Hours: 22 hours of lectures and 4 hours of tutorials
  • Module Personnel: Lecturer - Mr Benoit Voudon

Module Content

A key emphasis in the module is on drawing on the insights of theory to examine analytically the strategic actions of firms and the response required, if any, of public policy. The analysis, when linked to welfare economics (reviewed in Semester 1 in module ECU33071), provides the basis for competition policy and the appropriate regulation of markets. The following topics are likely to be covered in the module: dominant firms, monopolistic competition and product differentiation; price discrimination; predation; innovation and R&D; network effects; advertising and market structure; state aid and European competition policy. 

The module is an applied economics course, with an emphasis on the use of case studies to illustrate the economics and policy responses. Students are required to complete problem sets and make presentations. Students are strongly advised to review their EC2110 notes on microeconomics and EC1131 notes on mathematics (or equivalents) as familiarity with material from these modules is presumed.

Module Learning Aims

This module aims to:

  • Extend students analysis of microeconomics to an examination of market structure and the theory of the firm
  • Provide students with insights into the behaviour of dominant firms and certain forms of firm conduct such as predatory pricing, innovation, product differentiation and advertising
  • Provide students with a greater understanding of everyday headlines on these topics and the tools for determining when firm conduct might warrant government intervention
  • Enable students to critically evaluate the conduct of dominant firms and effectively communicate their arguments using economic principles
  • Use economic principles, tools and examples of relevant cases to form, support and communicate arguments and opinions

Leaning Outcomes

 On successful completion of this module, students will be able to:

  • Identify what is meant by a dominant firm and analyse how dominant firms use different business strategies to achieve and maintain dominance 
  • Use economic reasoning to critically evaluate the competition effects of a range of business strategies, in particular, strategic pricing, advertising and innovation 
  • Explain the goals of competition policy and the techniques used by competition authorities to assess deviations from legitimate competitive behaviour
  • Describe the institutional background to competition policy and regulation in Ireland, Europe and the US, and account for any differences
  • Analyse what is meant by state aid, its impact on competitive conditions and the maintenance of the single European market
  • Use economic principles, tools and examples of relevant cases to form, support and communicate arguments and opinions

Recommended Reading List

There is no core module textbook. However, students should have fairly regular access to one of the following textbooks or their equivalents:

Martin, S., Industrial Organisation in Context, Oxford University Press, 2010;

Lipczynski, J., J.O.S. Wilson and J.Goddard , Industrial Organization: Competition, Strategy and Policy, Pearson Education Ltd., 4th edition, 2013; or

Carlton, D and J. Perloff, Modern Industrial Organization, Pearson: Addison-Wesley, 4th/Global edition, 2015.

In addition, the following book contains interesting competition policy case studies:

J. Kwoka & L. White (eds.), The Antitrust Revolution: Economics, Competition and Policy, Seventh Edition, Oxford University Press, 2018.

Module Pre Requisite

EC2110 & EC2111 Intermediate Economics and ECU33071 Industrial Economics A.

Assessment Details

The presentation of a case study will account for 30% of your overall grade. The penalty for no show for the assignment is 100 per cent; there will of course be no penalty imposed on late submission provided that there is an appropriate medical certificate (or equivalent). The final exam will account for the remaining 70% of your overall grade.

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