Syllabus Information

1.1. Introduction

Microeconomics IV is devoted to the economic analysis of oligopolistic markets and market failures caused by both the existence of market power and also due to asymmetric information. Since the main analytic tool that is used in studying oligopolies is game theory, the first part of the course introduces its basic concepts.

5.1. Methodological overview

Microeconomics IV is devoted to the economic analysis of oligopolistic markets and market failures caused by both the existence of market power and also due to asymmetric information. Since the main analytic tool that is used in studying oligopolies is game theory, the first part of the course introduces its basic concepts.

5.2. Learning tasks

The learning process that has been designed for this course is based on the following activities:

1.- Participative lectures. The professor will explain the basic course content. The student must supplement the explanations with the recommended reading. 

2.-  Practical classes.  Students will solve practice exercises, always under the supervision of the instructor. This will be done in smaller groups to facilitate the participation of each student.

The program offered to the students to help them achieve the learning results includes the following activities:

Lectures:

Credits: 1,2.

Methodology: Class attendance and participative problem-solving.

Practical classes:

Credits: 1.2

Methodology: Class attendance, problem-solving and case studies.

Tutorials and seminars:

Credits: 0.6

Methodology: Tutorial and complementary activities.

Personal work:

Credits: 3

Methodology: Problem-solving. Use of ICTs.  Preparation of assignments and exams.

5.3. Syllabus

Part I Introduction to Game Theory

Unit 1. Game Theory I: Simultaneous games

1.1.  Introduction.

1.2.  Dominant and dominated strategies.

1.3   Best response strategies.

1.4.  Nash equilibrium: Properties.

1.5.  Mixed strategies Nash equilibrium.

Unit 2.  Game Theory II: Dymamic games

2.1. Dynamic games with perfect information.

2.2. Dynamic games with imperfect information.

2.3. Repeated games.

Part II Oligopoly Theory

Unit 3. Static Models of Oligopoly

3.1. Cournot model.

3.2  Bertrand model.

3.3. Price competition with capacity constraints.

3.4. Competition with diferentiated product.

Unit 4. Dynamic models of Oligopoly

4.1. Repeated interaction: Price instability and colusion.

4.2..Stackelberg Model

4.3. Entry decisions

4.4. Anti-trust Law.

Part III Economics of Information

Unit 5. Asymmetric Information

5.1. Basic concepts

5.2. Adverse selection

5.3. Signaling

5.4. Self-selection

5.5. Moral hazard

5.4. Course planning and calendar

Timetable

5.5. Bibliography and recommended resources

Varian, H.R. (1992): Análisis Microeconómico. Bosch. Barcelona.

Gibbons, R. (1993): Un primer curso de Teoría de Juegos. Bosch, Barcelona.

Fernández de Castro, J. y J. Tugores (1992): Fundamentos de Microeconomía. McGraw-Hill, Madrid.

Nicholson, W. (1997): Teoría Microeconómica. McGraw-Hill, Madrid.

Recomendada:

Macho-Stadler, I. y Pérez-Castrillo, D. (1994): Introducción a la economía de la información. Ariel Economía S.A. Barcelona.

Segura, J. (2002):  Análisis Microeconómico.  Ed. Alianza Universidad.

Gravelle, H. y Rees, R. (2006):   Microeconomía.  Ed. Pearson. Prentice Hall

Fudenberg, D. y Tirole, J. (1993): Game Theory. The MIT Press. Cambridge, Massachusetts

Cabral, L. (1997): Economía Industrial. McGraw Hill, España.

Martin, S. (2001): Industrial Organization. A European Perspective. Oxford University Press.

Tirole, J. (1990): La Teoría de la Organización Industrial. Ed. Ariel Economía, Barcelona.