230352 :Competition and Regulation (CentER)

General info

Instruction language English
Type of Instruction Reading group / Lectures (Lecture schedule)
Type of exams Oral final exam (80%) and preparation for reading groups (20%) (No data available yet)
Level:Master
Course load:3 ECTS credits
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Lecturer(s)


dr.ir. B.R.R. Willems (Coordinator)


Objectives

This course familiarizes students with some aspects of modern economic regulation theory and competition in regulated sectors, using tools from industrial organization, game theory and information economics.

It aims at presenting a selection of standard models on regulation and competition, review some concepts of industrial organization and contract theory, and introduce a number of topical research questions for specific sectors.

Students will discuss recent papers as part of the reading group “Applied Economic Theory”. 


Contents

The following topics will, if time permits, be covered in the course:

Principles of economic regulation / Adverse selection
Review of standard adverse selection models and a number of extensions (commitment, multi-dimensional types, multiple tasks). Practical implementation.

Competition: Cournot / Strategic substitutes and complements / Commitment
Review of Cournot model (equilibrium, Kreps and Scheinkman), first and second-mover advantages, incentives of firms to commit future actions, Supply function equilibria, the effect of financial markets on product market competition

Competition on a regulated network / Ramsey Pricing
Review of Ramsey pricing, one-way and two-way access pricing in the telecommunications sector, competitive effects of transmission rights in electricity sector

Security of supply in the electricity market / Capacity Markets
Balancing market power and security of supply, designing capacity markets, short and long term effects, discussion on role of government.

Platform competition / Network effects
Review of network effects, canonical models of two-sided markets, implications for competition policy, empirics.

Reading Group Applied Economic Theory
In this part students will present and discuss a number of recent papers. This part of the course will be attended by faculty members (PhD-students and senior academics) with an interest in economic theory.


Specifics

Students will have to read, summarize and discuss papers in the reading group. They will be asked to check proofs in detail. This preparation will require a considerable amount of work. The quality of your preparation will count for 20% of the final grade.

The Syllabus of the couse will be posted here.


Before enrolling all non-CentER students should ask permission to the Director of Graduate Studies in Economics. Please send your request for permission to CentER Graduate School at center-gs@uvt.nl.

 


Required Prerequisites

A solid background in micro-economics, such as Micro-economics 1, 2 and 3 in the CentER Research Master Economics year 1 program


Recommended option for

(25-aug-2017)