Games & Strategy (Seminar)

Course outline
Prerequisites
Audience and Language
Literature
Time and Place
Form of examination
Registration

Course outline

This seminar studies firm strategies in complex market environments from a strategic management perspective. Students will be introduced to the necessary theoretical and practical skills relevant for a career in management, economic policy or business consultancy, to name just but a few appropiate job areas.

A central question of this seminar is “what is the firms’ best response” related to (expected) actions by horizontally related firms (e.g. competitors) or vertically related firms (e.g. customers or suppliers). Another important aims of the seminar is to endow students with the skills to explain actual economic policy for example related to market dominance or mergers from an economic perspective.

Questions to be addressed in this course are:

• How should firms price their products?
• How does pricing depend on the number of competitors, the characteristics of the products, the market segment(s) targeted?
• Why and how do firms collude?
• Why does competition policy fight collusion?
• How come that only one recordable DVD format can survive in the market?
• Why is MS-Windows installed on almost all personal computers?
• Why should Novo Nordisk be afraid when it's most important patent expires?
• Why does Novartis spend USD 6.4 on Research and Development?

Content - key areas:

• Monopoly and Regulation
• Perfect (and almost Perfect) Competition
• Games and Strategy
• Oligopoly Competition
• Collusion
• Market Structure and Market Power
• Price Discrimination
• Product Differentiation
• Mergers
• Research and Development
• Intellectual Property Rights strategies

Prerequisites

The course requires knowledge of basic microeconomics at the level of Varian's "Intermediate Microeconomics: A Modern Approach" as well as a moderate level of proficiency in the use of algebra (taking derivatives, solving maximization problems, etc.). These skills are for example taught within the courses in Microeconomics at the Bachelor level.

Audience and Language

The course is open to all students for audit. Class size is restricted to 40 students. Teaching material will be made available on the Internet.
The course language is English.

Literature

• L. M. Cabral (2000): “An Introduction to Industrial Organization”, MIT Press.

• S. Berry (1994): "Estimating Discrete-Choice Models of Product Differentiation." RAND Journal of Economics, 242-262.

• U. Kaiser and J. Wright (2006): "Price structure in two-sided markets: Evidence from the magazine industry." International Journal of Industrial Organization, 24(1), 1-28.

Time and Place

Form of examination

ECTS points

Full credit (3 ECTS) for successful presentation and discussion (including handouts)

Rules of the game

• Students are requested to present selected topics as listed under "Content - key areas'' in groups of two to three students.

• Each presentation will be discussed by another group of students who needs to ask at least three concrete questions regarding the topic. These questions are to be addressed to the entire audience, not just the presenting group.

• Each group prepares a presentation on its own and submits a handout three days prior to the presentation to ulrich.kaiser@business.uzh.ch. The presentation will be structured as follows: (1.) Introduction (5 min.), (2.) Central results (20 min.) and (3.) Summary (5 min.).

• The discussion is ten minutes; slides are to be prepared and emailed to ulrich.kaiser@business.uzh.ch three days prior to the discussion.

Allocation of topics

Topics and discussions will be allocated during the introductory lecture Thu., Sept. 25.

Grades

The final grade is the weighted average of the presentation and the discussion. Weights are 75 percent for the presentation (including handouts) and 25 percent for the discussion (including handouts).

Registration

Students need to register through the "Buchungstool'' until Fri., Oct. 10, 2008. The course number for master students is MOEC0087 (these students receive a grade), for Diplom students it is HOEC7963 (these are passed/not passed students).

Students need to submit a second application to the Chair for Entrepreneurship (entrepreneurship@isu.uzh.ch) until Fri., Sept. 12, 2008.