Economics of regulation and competition policy
Scientific Disciplinary Sector (SSD)
SECS-P/03 - PUBLIC ECONOMICS
Secondo Semestre Magistrali dal Feb 27, 2017 al Jun 1, 2017.
The aim of the course is to provide students with rigorous economic tools for the analysis of competition and regulation policies.
We will analyse and discuss the economic motivations underlying public intervention for regulation of markets and with particular interest on the analysis of the main regulatory tools and on economic issues underlying antitrust policies. In the first part of the course we will focus on the analysis of auctions and procurement mechanisms. The second part will focus on the analysis of regulation and competition policies from the theoretical point of view with attention also to the empirical evidence. Particular attention will be paid to the analysis of predatory pricing and monopolization practices.
At completion of the course students should be able to:
- Understand and evaluate critically the justifications for the public intervention in the regulation of markets.
- Analyse and assess rigorously the economic implications of auction and procurement mechanisms.
The course involves 36 hours of lectures
The program is divided into two parts.
Part I The economics of auctions and procurement:
- Introduction to the tools for the analysis of strategic interaction
- Applications to the analysis of auctions and procurement with particular attention to the analysis of public tenders
Part II Market regulation and tariffs
- Relation between market power, efficiency, social welfare and natural monopoly
- Economic analysis of regulatory mechanisms.
- Assessment of market power with applications related to collusive behavior, predatory behavior and abusive practices.
Textbooks and teaching materials:
Part of the teaching material will be indicated in class and will be taken from different textbooks and papers.
Teaching material will be taken also from these textbooks:
- Motta M. e Polo, M. (2005): Antitrust. Economia e politica della concorrenza. Il Mulino, Bologna.
- Muraro, G. e Valbonesi P. (2003): I servizi idrici tra mercato e regole. Carrocci, Roma.
A detailed outline of the course together with indications of additional teaching material, lecture notes, specimen exam questions and example of exercises will be made available on-line during the lectures period, on the University e-learning website.
Students should be able to demonstrate:
- Understanding and mastering of the relevant aspects of game theory and their application to the analysis of strategic behaviour of firms. In particular students should be able to apply these concepts to both numerical problems and case studies related to the definition of optimal pricing and quality strategies for firms in general auctions or procurement auctions.
- To be able to presenting their arguments rigorously in a limited amount of time by identifying and selecting the relevant aspects to focus on.
- To have acquired appropriate competence on the issues discussed in the module, so that to be able to apply the related concepts to the analysis of case studies.
The exam is composed by open questions, exercises and brief analysis of case studies. Each question can be divided into sections that may cover all these method of evaluation. The contribution of each question to the final evaluation is made explicit in the exam.
A sample copy of exam paper is available at the e-learning web page of the module.