ECONOMICS 4820

Industrial Organization and Public Policy

Tu Th 2:45 - 4:00, BU 208
FALL 2014

Instructor: Charles F. Mason
Office: 372 BU
Telephone: Office #: 766-5336, Department #: 766-2175
Office Hours: Tuesday-Thursday 12:00 PM 1:00PM, or by appointment.
E-Mail: BAMBUZLR@UWYO.EDU

Course Description: This course is designed to analyze industrial behavior. The focus is
primarily on oligopolies (industries with a small number of sellers): how their behavior might be
modeled: how observed oligopolies in the U.S. economy appear to behave: what policy
approaches to managing oligopoly are appropriate. This course assumes a solid background in
economics (intermediate microeconomics is a prerequisite), and I may occasionally use calculus.
I try to use examples from current events, and will likely use examples from contemporary US
industries to illustrate various elements of course material.

Course Prerequisites: Intermediate microeconomics and business calculus or consent of instructor.

Course Objectives The objective of this course is to provide students with the ability to apply
and communicate microeconomic principles for industrial policy and planning issues.

Grading and Course Requirements: The course grade will be based on a midterm (30%), final
examination (35%), homeworks (20%) and in-class participation (15%). The midterm will likely
be given in late October, depending on how we are able to keep to the schedule. I expect to use the
newly authorized +/- grading scheme.

Attendance Policy: I do not take attendance, but it is in your best interests to attend each class.

Academic Dishonesty: A little guy walked into a bar, and saw Joe Lewis (who was, at the time,
the heavyweight champion of the world). The little guy started needling Joe Lewis, making
claims about his ability to take on the champ. After a while, Lewis got fed up, and said to the
little guy if you ever hit me, and I ever find out about it, youre gonna be in big trouble. The
moral of the story: dont do it. Cheat, that is. If you have any doubts as to whether something is
academically dishonest, ask.

Group Work Guidelines: You are encouraged to work on any homework problems as a team,
but each student must turn in his or her own work. Coordination on tests is not allowed.

Disclaimer: This syllabus is subject to change as circumstances warrant. All changes will be
announced in class and posted on the class home page.

Student Services If you have a physical, sensory, cognitive, or psychological disability and
require accommodations, please let me know as soon as possible. You will need to register with,
and provide documentation of your disability to University Disability Support Services (UDSS)
in SEO, Room 330, Knight Hall. You may also reach them at 766-6189, TTY: 766-3073.


Course Schedule and Assignments

Most readings are from Modern Industrial Organization, Dennis Carlton and Jeffrey Perloff
(denoted by CP in the schedule below); there will be occasional readings from Perloffs
Intermediate Microeconomics text (denoted by P in the schedule below; I will try to get pdf copies
posted at the course website); and there will likely be some readings from Antitrust Economics,
Oliver Williamson (denoted by W in the schedule below; I will try to get a copy placed on reserve at
Coe). The reading schedule below is tentative; it may occasionally be revised. If and when this
happens I will let you know in class.

The class schedule will most likely be:

Topic lectures readings

Review Intermediate Microeconomics 1-4 CP 1-6; P 5, 6 11
Game theory and strategic behavior 5-8 P 14
Decision-making under uncertainty 9-10 P 17
Non-cooperative Oligopoly models 11-15 CP 1-6; P 13

{midterm}

Cooperative Oligopoly models 17-18 CP 1-6; P 13
Evidence 19-20 CP 12-15; W 2
Information economics 21-23 CP 17, 18; P 19
Antitrust 24-26 CP 22; W 3, 4, 13
Slack time for catchup, extensions, whatever 27-30