| 1 |
Theory of the Firm |
Atkinson, A. and N. Stern. "Pigou, Taxation and Public Goods." Review of Economic Studies 41 (1974): 119-128.
Tirole, Introduction and The Theory of the Firm.
Grossman, S. and O. Hart. "The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration," Journal of Political Economy 94 (August 1986): 691-796.
Holmstrom, B. and J. Tirole. "The Theory of the Firm," in HIO.
- Williamson, O. The Economic Institutions of Capitalism. New York, NY: Free Press, 1985. (Read Chapters 1, 3-6, especially 1 and 3).
Joskow, P. "Contract Duration and Relationship-Specific Investments: Empirical Evidence from Coal Markets." American Economic Review 77 (March 1987): 168- 185.
Baker, G. and T. Hubbard. "Make Versus Buy in Trucking: Asset Ownership, Job Design and Information." mimeo.
Monteverde, K. and D. Teece., "Supplier Switching Costs and Vertical Integration in the Automobile Industry." Bell Journal of Economics 13 (Spring 1982): 206-213.
Shepard, A. "Contractual Form, Retail Pricing and Asset Characteristics in Gasoline Retailing." Rand Journal of Economics 24 (Spring 1993): 58-77.
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| 2 |
Monopoly Pricing and Durable Goods |
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Tirole, Chapter 1 (including supplementary section).
Gul, F., H. Sonnenschein, and R. Wilson. "Foundations of Dynamic Monopoly and the Coase Conjecture." Journal of Economic Theory 39 (1986): 155-190.
Fudenberg, D. and J. Tirole. "Upgrades, Trade-ins, and Buybacks." Rand Journal of Economics 29 (Summer 1998): 235-258.
Ellison, G. and D. Fudenberg. "The Neo-Luddite’s Lament: Excessive Upgrades in the Software Industry." Rand Journal of Economics 31 (Summer 2000): 253-272.
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| 3 |
Price Discrimination, Static Competition and Models of Differentiation |
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Tirole, Sections 3.0-3.5.
Corts, K. "Third Degree Price Discrimination in Oligopoly: All-Out Competition and Strategic Commitment." Rand Journal of Economics 29 (Summer 1998): 306-323.
Perry, M. "Forward Integration by ALCOA: 1888-1930." Journal of Industrial Economics 29 (September 1980): 37-53.
Deneckere, R. and R.P. McAfee. "Damaged Goods." Journal of Economics and Management Strategy 5 (1996): 149-174.
Maskin, E. and J. Riley. "Monopoly with Incomplete Information." Rand Journal of Economics 15 (Summer 1984): 171-96.
McAfee, R.P., J. McMillan, and M. Whinston. "Multiproduct Monopoly, Commodity Bundling, and Correlation of Values." Quarterly Journal of Economics 104 (May 1989): 371-83.
Borenstein, S. and N. Rose. "Competition and Price Dispersion in the U.S. Airline Industry." Journal of Political Economy 102 (August 1994): 653-683.
Shepard, A. "Price Discrimination and Retail Configuration." Journal of Political Economy 99 (February 1991): 30-53.
Graddy, K. "Testing for Imperfect Competition at the Fulton Fish Market." Rand Journal of Economics 26 (Spring 1995): 75-91.
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| 4 |
Static Competition and Models of Differentiation |
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Tirole, Section 2.1 and Chapter 5.
Fisher, F. "Games Economists Play: A Noncooperative View." Rand Journal of Economics 20 (1989): 113-124.
Baye, M. and J. Morgan. "Price Dispersion in the Lab and on the Internet: Theory and Evidence." mimeo.
Klemperer, P. "The Competitiveness of Markets with Switching Costs." Rand Journal of Economics 18 (Spring 1987): 138-150.
Shaked, A. and J. Sutton. "Relaxing Price Competition through Product Differentiation." Review of Economic Studies 49 (January 1982): 3-14.
Fudenberg, D. and J. Tirole. "Customer Poaching and Brand Switching." Rand Journal of Economics 31 (Spring 2000): 634-657.
Spector, D. "The Noisy Duopolist." mimeo.
Bresnahan, T. "Competition and Collusion in the American Automobile Industry: The 1955 Price War." Journal of Industrial Economics 35 (June 1987): 457-482.
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| 5 |
Search |
Diamond, P. "A Model of Price Adjustment." Journal of Economic Theory 3 (June 1971): 156-168.
Stahl, D. "Oligopolistic Pricing with Heterogeneous Consumer Search." International Journal of Industrial Organization 14 (April 1996): 243-268.
McAfee, R.P. "Multiproduct Equilibrium Price Dispersion." Journal of Economic Theory 67, no. 1 (October 1995): 83-105.
Baye, M. and J. Morgan. "Information Gatekeepers on the Internet and the Competitiveness of Homogeneous Product Markets." American Economic Review 91, no. 3 (June 2001): 454-474.
Sorensen, A. "Equilibrium Price Dispersion in Retail Markets for Prescription Drugs." Journal of Political Economy 108 (August 2000): 833-850.
Sorensen, A. "Price Dispersion and Heterogeneous Consumer Search for Retail Prescription Drugs." mimeo.
Ellison, G. and S.F. Ellison, "Search, Obfuscation, and Price Elasticities on the Internet." mimeo.
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| 6 |
Dynamic Competition |
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Tirole, Chapter 6.
Rotemberg, J. and G. Saloner. "A Supergame-Theoretic Model of Price Wars During Booms." American Economic Review 76 (June 1986): 390-407.
Green, E. and R. Porter. "Non-cooperative Collusion Under Imperfect Price Information." Econometrica 52 (January 1984): 87-100.
Maskin, E. and J. Tirole. "A Theory of Dynamic Oligopoly II: Price Competition, Kinked Demand Curves, and Edgeworth Cycles." Econometrica 56 (May 1988): 571-599.
Stigler, G. "A Theory of Oligopoly." Journal of Political Economy 72 (February 1964): 44-61.
Fershtman, C. and A. Pakes. "A Dynamic Oligopoly with Collusion and Price Wars." Rand Journal of Economics 31 (Summer 2000): 207-236.
Porter, R. "A Study of Cartel Stability: The Joint Economic Committee, 1880-1886." Bell Journal of Economics 14 (Autumn 1983): 301-314.
Ellison, G. "Theories of Cartel Stability and the Joint Executive Committee." Rand Journal of Economics 25 (Spring 1994): 37-57.
Noel, M. "Price Cycles in Retail Gasoline Markets: A Microstudy of Firm Behavior." mimeo.
Genesove, D. and W. Mullin. "Rules, Communication, and Collusion: Narrative Evidence from the Sugar Institute Case." American Economic Review 91 (June 2001): 379-398.
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| 7 |
Firm Conduct |
Schmalensee, R. "Interindustry Studies of Structure and Performance." in HIO.
Bresnahan, T. "Empirical Studies of Industries with Market Power. " in HIO.
Domowitz, I., R. Hubbard and B. Petersen. "Business Cycles and the Relationship Between Concentration and Price-Cost Margins." Rand Journal of Economics 17 (Spring 1986): 1-17.
Bresnahan, T. "The Oligopoly Solution Concept is Identified." Economics Letters 10 (1982): 87-92.
Lau, L. "On Identifying the Degree of Competitiveness from Industry Price and Output Data." Economics Letters 10 (1982): 93-99.
Corts, K. "Conduct Parameters and the Measurement of Market Power." Journal of Econometrics (November 1998): 227-250.
Coterill, R. "Market Power in the Retail Food Industry: Evidence from Vermont." Review of Economics and Statistics 68 (August 1986): 379-386.
Nevo, A. "Measuring Market Power in the Ready-to-Eat Cereal Industry." mimeo.
Genesove, D. and W. Mullin. "Testing Static Oligopoly Models: Conduct and Cost in the Sugar Industry, 1890-1914." Rand Journal of Economics 29 (Summer 1998): 355-377.
Wolfram, C. "Measuring Duopoly Power in the British Electricity Spot Market." American Economic Review 89 (September 1999): 805-826.
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| 8 |
Empirical Models of Demand |
Deaton, A. and J. Muellbauer. Economics and Consumer Behavior . New York, NY: Cambridge University Press. (read Parts 1 and 2)
Anderson, S., A. De Palma and J. Thisse. Discrete Choice Theory of Product Differentiation. Cambridge, MA: MIT Press, 1992. (read Chapters 2-5)
Epple, D. "Hedonic Prices and Implicit Markets: Estimating Demand and Supply Functions for Differentiated Products." Journal of Political Economy 95 (February 1987: 59-80.
Palmquist, R. "Estimating Demand for the Characteristics of Housing." Review of Economics and Statistics 66 (August 1994): 394-404.
Berry, S. "Estimating Discrete-Choice Models of Product Differentiation." Rand Journal of Economics 25, no. 2 (Summer 1994): 242-262.
Berry, K.S., J. Levinsohn, and A. Pakes. "Automobile Prices in Market Equilibrium." Econometrica 63 (July 1995): 841-890.
Nevo, A. "A Practitioner’s Guide to Estimation of Random Coefficients Logit Models f Demand." Journal of Economics and Management Strategy 9, no. 4 (Winter 2000): 513-548.
Goldberg, P. "Product Differentiation and Oligopoly in International Markets: The Case of the U.S. Automobile Industry." Econometrica 63 (July 1995): 891-952.
Ellison, S., I. Cockburn, Z. Griliches and J. Hausman, "Characteristics of Demand for Pharmaceutical Products: An Examination of Four Cephalosporins." Rand Journal of Economics 28 (Autumn 1997): 426-446.
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| 9 |
Entry |
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Tirole, Sections 7.1-7.2.
Sutton, J. Sunk Costs and Market Structure. Cambridge, MA: MIT Press, 1991. Chapters 1-2.
Jovanovic, B. "Selection and the Evolution of Industry." Econometrica (May 1982), pp. 649-670.
Bresnahan, T. and P. Reiss, "Entry and Competition in Concentrated Markets." Journal of Political Economy 99 (October 1991): 977-1009.
"Comments on Bresnahan and Reiss." Brookings Papers on Economic Activity: Special Issue on Microeconomics 3 (1987): 872-882.
Dunne, T., M. Roberts, and L. Samuelson, "Patterns of Firm Entry and Exit in U.S. Manufacturing." Rand Journal of Economics 19 (Winter 1988): 495-515.
Berry, S. and J. Waldfogel, "Free Entry and Social Inefficiency in Radio Broadcasting." Rand Journal of Economics 30 (Autumn 1999): 397-420.
Golder, P. and G. Tellis, "Pioneer Advantage: Marketing Logic or Marketing Legend." Journal of Marketing Research 30 (May 1993): 158-170.
Seim, K. "Spatial Differentiation and Firm Entry: The Video Retail Industry." mimeo.
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| 10 |
Strategic Investment |
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Tirole, pp. 207-8, Chapter 8.
Schmalensee, R. "Entry Deterrence in the Ready-to-Eat Breakfast Cereal Industry." Bell Journal of Economics 9 (Autumn 1978): 305-327.
Judd, K. "Credible Spatial Preemption." Rand Journal of Economics 16 (Summer 1985): 153-166.
Aghion, P. and P. Bolton."Entry Prevention Through Contracts with Customers," American Economic Review 77 (June 1987): 388-401.
Chevalier, J. "Capital Structure and Product Market Competition: Empirical Evidence from the Supermarket Industry." American Economic Review 85, no. 3 (June 1995): 415-435.
Ellison, G. and S. Ellison. "Strategic Entry Deterrence and the Behavior of Pharmaceutical Incumbents Prior to Patent Expiration." mimeo.
Kadiyali, V. "Entry, its Deterrence, and its Accommodation: A Study of the U.S. Photographic Film Industry." Rand Journal of Economics 27 (Autumn 1996): 452-478.
Lieberman, M. "Post Entry Investment and Market Structure in the Chemical Processing Industry." Rand Journal of Economics 18 (Winter 1987): 533-549.
Smiley, R. "Empirical Evidence on Strategic Entry Deterrence." International Journal of Industrial Organization 6 (June 1988): 167-180. (3.3 Social Security, Saving, and Benefit Adequacy Issues.)
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| 11 |
Networks |
Farrell, J. and G. Saloner. "Standardization, Compatibility, and Innovation." Rand Journal of Economics 16 (1985): 70-83.
Katz, M. and C. Shapiro. "Technology Adoption in the Presence of Network Externalities." Journal of Political Economy 94 (1986): 822-841.
Fudenberg, D. and J. Tirole. "Pricing Under the Threat of Entry by the Sole Supplier of a Network Good." Journal of Industrial Economics 48 (2000): 373-390.
Bresnahan, T. "Network Effects and Microsoft." mimeo.
Gandal, N., M. Kende, and R. Rob. "The Dynamics of Technological Adoption in Hardware/Software Systems: The Case of Compact Disc Players." Rand Journal of Economics 31, no. 1 (Spring 2000): 43-61. (This paper will be handed out in class.)
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| 12 |
Asymmetric Information |
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Tirole, Sections 9.0-9.7.
Ordover, J. and G. Saloner. "Predation, Monopolization and Antitrust." in HIO.
Fudenberg, D. and J. Tirole. "A 'Signal-Jamming' Theory of Predation." Rand Journal of Economics 17 (Autumn 1986): 366-76.
Milgrom, P. and J. Roberts. "Limit Pricing and Entry Under Incomplete Information: An Equilibrium Analysis." Econometrica 50 (March 1982): 443-460.
Milgrom, P. and J. Roberts, "Predation, Reputation, and Entry Deterrence." Journal of Economic Theory 27 (August 1982): 288-312.
Doyle, M. and C. Snyder. "Information Sharing and Competition in the Motor Vehicle Industry." Journal of Political Economy 107, no. 6(December 1999): 1326-1364.
Genesove, D. "Adverse Selection in the Wholesale Used Car Market." Journal of Political Economy 101 (August 1993): 644-665.
Hubbard, T. "An Empirical Examination of Moral Hazard in the Vehicle Inspection Market." Rand Journal of Economics 29 (Summer 1998): 406-426.
Hendel, I. and A. Lizzeri. "The Role of Commitment in Dynamic Contracts: Evidence from Life Insurance." mimeo.
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| 13 |
Advertising |
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Tirole, Sections 2.2-2.4, 7.3.
Becker, G.S. and K.M. Murphy. "A Simple Theory of Advertising as a Good or Bad." Quarterly Journal of Economics (November 1993): 941-964.
Milgrom, P. and J. Roberts. "Price and Advertising Signals of Product Quality." Journal of Political Economy 94 (1986): 796-821.
Ackerberg, D. "Empirically Distinguishing Informative and Prestige Effects of Advertising." Rand Journal of Economics 32 (Summer 2001): 316-333.
Milyo, J. and J. Waldfogel. "The Effect of Price Advertising on Prices: Evidence in the Wake of 44 Liquormart." American Economic Review89 (December 1999): 1081-1096.
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| 14 |
Auctions |
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Klemperer, P. "Auction Theory: A Guide to the Literature." Journal of Economic Surveys 13 (July 1999): 227-286.
McAfee, P. and J. McMillan. "Auctions and Bidding." Journal of Economic Literature (June 1987): 699-738.
Milgrom, P. "Auctions and Bidding: A Primer." Journal of Economic Perspectives (Summer 1989): 3-22.
Hendricks, K. and R. Porter. "An Empirical Study of an Auction with Asymmetric Information." American Economic Review (December 1988): 865-83.
Bajari, P. "Econometrics of the First Price Auction with Asymmetric Bidders." mimeo.
Kagel, J., R. Harstad and D. Levin. "Information Impact and Allocation Rules in Auctions with Affiliated Private Values: A Laboratory Study." Econometrica 55 (1987): 1275-1304.
Lucking-Reiley, D. "Using Field Experiments to Test Equivalence Between Auction Formats: Magic on the Internet." American Economic Review 89 (December 1999): 1063-1080.
Laffont, J.J., H. Ossard, and Q. Vuong. "Econometrics of First Price Auctions." Econometrica (July 1995): 953-80.
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| 15 |
Patents |
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Tirole, Sections 10.1-10.5, 8.1.3.
Kremer, M. "Patent Buy-outs: A Mechanism for Encouraging Innovation." Quarterly Journal of Economics (November 1998): 1137-1167.
Bessen, J. and E. Maskin. "Sequential Innovation, Patents, and Imitation." mimeo.
Green, J. and S. Scotchmer. "On the Division of Profit in Sequential Innovation." Rand Journal of Economics 26 (Spring 1995): 131-146.
Hopenhayn, H. and M. Mitchell. "Innovation, Variety, and Patent Breadth." Rand Journal of Economics 32 (Spring 2001): 152-166.
Pakes, A. "Patents as Options: Some Estimates of the Value of Holding European Patent Stocks." Econometrica 54 (July 1986): 755-784.
Jaffe, A., M. Trajtenberg, and R. Henderson. "Geographic Localization of Knowledge Spillovers as Evidenced by Patent Citations." Quarterly Journal of Economics (August 1993): 577-598.
Lerner, J. "Where Does State Street Lead? A First Look at Finance Patents, 1971-2000." mimeo.
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| 16 |
Diffusion of Technologies |
Ellison, G. and D. Fudenberg. "Rules of Thumb for Social Learning." Journal of Political Economy 101 (1993): 612-643.
Rogers and Shoemaker. The Diffusion of Innovations: A Cross-Cultural Approach. New York, NY: Free Press, 1971.
Griliches, Z. "Hybrid Corn: An Exploration in the Economics of Technological Change." Econometrica 25, no. 4 (October 1957): 510-522.
Saloner, G. and A. Shepard. "Adoption of Technologies with Network Effects: An Empirical Examination of the Adoption of Automated Teller Machines." Rand Journal of Economics 13 (Autumn 1995): 479-501.
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| 17 |
Managerial Incentives |
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Tirole, pp. 34-55.
Holmstrom, B. "Managerial Incentive Problems – A Dynamic Perspective." Review of Economic Studies 66 (1999): 169-182.
Fershtman, C. and K. Judd. "Equilibrium Incentives in Oligopoly." American Economic Review 77 (December 1987): 927-940.
Masson, R. "Executive Motivation, Earnings, and Consequent Equity Performance." Journal of Political Economy 79 (December 1971): 1278-1292.
Healy, P. "The Effect of Bonus Schemes on Accounting Decisions." Journal of Accounting and Economics 7 (April 1985): 85-107.
Chevalier, J. and G. Ellison. "Career Concerns of Mutual Fund Managers." Quarterly Journal of Economics 114 (May 1999): 389-432.
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