SAM15 Firm Strategy and Competition

• Topics

  The course focuses on firms' different decision problems and strategic interaction between firms. The course will be based on various cases focusing on markets such as airlines, telecommunication, gasoline and the grocery sector. We will aim towards providing an understanding of how economics can be used to understand and predict firms' behavior and strategic interaction. The main elements in competition policy rules will also be discussed. Thus, we will distinguish between legal and illegal behavior and thereby gain insight in business ethical issues.

  Examples on topics will be:

  • Market definition
  • Barriers to entry
  • Cartel behaviour
  • Pricing and price discrimination
  • Product differentiation
  • Mergers & acquisitions
  • Auctions

• Learning outcome

  Knowledge - After completion of the course a student will:

  • Have a broad knowledge about topics such as market definition, barriers to entry, cartel behavior, pricing and mergers & acquisitions

  Skills - After completion of the course a student will:

  • Understand how one can apply academic knowledge in order to understand strategic interaction between firms in a specific market
  • How the outcome in a market, for instance in prices and sales, changes when the basic assumption about the market structure changes
  • Be able to find, evaluate and refer to information and scholarly subject matter and present it in a manner that sheds light on a problem seen from a firm's perspective

  General competence - After completion of the course a student will:

  • Distinguish and combine theory and factual data
  • Identify and execute individual assignments within a group activity

• Teaching

  Regular lectures

• Recommended prerequisites

  The course requires introductory knowledge in microeconomics, e.g., the SAM2 micro course.

• Requirements for course approval

  Two group based assignments, and all students must pass on both assignments. There will be a maximum of three students in each group.

• Assessment

  Four hours written school exam, calculator not allowed. All answers must be written in English

• Grading Scale

  Grading scale A - F

• Computer tools

  None

• Literature

  Dennis W. Carlton and Jeffrey M. Perloff, Modern Industrial Organization, Global Edition, 2015, Pearson, fourth edition (not all the chapters are required reading)