Industrial Organization. A
Strategic Approach
Through an effective blend of
analysis and examples this text integrates the game theory revolution with the traditional
understanding of imperfectly competitive markets. The book's focus is on strategic
competition and how firms can shelter their market power and economic profits from
competitors. This focus establishes the intellectual foundation for determining business
practices that warrant antitrust examination and prohibition and underlines recent
activist antitrust policy. The author's stress an integrated understanding of industrial
organization and the development of students' analytical abilities.
Features:
- Unique Approach: An
emphasis on strategic behavior as an organizing principle for understanding non-price
competition. There are separate, chapter-length, treatments of strategic behavior, entry
deterrence, two-stage games, advertising, product differentiation, and R&D.
- Current Coverage:
Comprehensive coverage and extended treatments of such recent developments as incomplete
contracts, property rights, and the boundaries of the firm; durable goods monopoly;
nonlinear pricing; address models of product differentiation; supergames, tacit collusion,
and facilitating practices; the new empirical industrial organization; the efficient
component pricing rule and access pricing; regulatory and industry restructuring in
network industries; and regulation under asymmetric information.
- Anti-Trust Emphasis: An
unmistakable and unique emphasis on antitrust, from using antitrust cases to illustrate
theory to separate, up-to-date chapter-length treatments of market definition, raising
rivals' costs, predatory pricing, horizontal mergers, and vertical restraints.
- Illustrative Models and
Graphs: An accessible development and presentation of theory through the use of simple
explicit functional forms, numeric examples, and/or graphical interpretations. The text
works through the details of simplified models, the logic of the arguments, and the
conclusions. The approach is rigorous without using mathematics beyond that of high school
algebra. A prior course in intermediate microeconomics is an advantage but not a
requirement.
- Numerous Case Studies and
Examples: The applicability and power of theory in understanding firm behavior and market
outcomes is established with extensive case studies and examples, all integrated into the
discussion in a way that enables students to make the leap from theory to practice.
- Pedagogy: Careful attention
to pedagogy and extensive efforts to make the study of industrial organization interesting
and rewarding. Extensive pedagogy includes chapter-opening vignettes; key terms; 2-color
diagrams; integrated cases, examples, and numeric exercises; suggestions for further
reading that provide detailed guides to the literature and frontier developments; and
extensive end-of-chapter materials - summaries, problems, and discussion questions.
- On-Line Instructor's
Manual, full of teaching tips, solutions, web links, and more.
Table of Contents
- 1.
Introduction
- 2.
The Welfare Economics of Market Power
- 3.
Theory of the Firm
- 4.
Market Power and Dominant Firms
- 5.
Nonlinear Pricing and Price Discrimination
- 6.
Market Power and Product Quality
- 7.
Game Theory I
- 8.
Classic Models of Oligopoly
- 9.
Game Theory II
- 10.
Dynamic Models of Oligopoly
- 11.
Product Differentiation
- 12.
Identifying and Measuring Market Power
- 13.
An Introduction to Strategic Behaviour
- 14.
Entry Deterrence
- 15.
Strategic Behavior: Principles
- 16.
Strategic Behavior: Applications
- 17.
Advertising and Oligopoly
- 18.
Research and Development
- 19.
The Theory of the Market
- 20.
Exclusionary Strategies I: Raising Rivals' Costs
- 21.
Exclusionary Strategies II: Predatory Pricing
- 22.
Vertical Integration and Vertical Restraints
- 23.
Horizontal Mergers
- 24.
Rationale for Regulation
- 25.
Optimal Pricing and Natural Monopoly
- 26.
Issues in Regulation
Appendix: The Legal Framework
of Antitrust
926 pages