31E13000 Industrial Organization (Micro III)

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Was the course worth attending? Were the lectures useful? What questions did the exam have? Give us your honest opinion on the course!

  1. Did the course in Spring 2017.

    Definitely one of the most useful and interesting courses in Masters Economics. The professor Mikko Mustonen was already one of my department favorites from Bachelor level ”mathematics methods” course, and his style of teaching and enthusiasm about industrial organization really sticks with you. His lectures are worth attending – he can teach really well and make complicated-sounding issues and theories easy to approach. However, the lecture slides of the course are rather notorious, as they contain animations which work well in lectures, but not so much when they are uploaded to MyCourses. One extra motivation to attend the lectures! I highly recommend getting the course book, it’s easily available at the Uni Library and helps a lot with understanding the cluster-effy slides and problem sets.

    Course consists of the exam, two calculation problem sets, one empirical description paper (2 pages, nothing special, but the book is necessary, as the cases are available only there!) and the strategy game. Especially the strategy game was an interesting study method: the idea is to take over a firm and compete against the rivals in different markets by setting prices and production capacities. Really takes the theories from slides into practice. If you can attend the lectures and meet with your firm team mates regularly, I recommend doing the strategy game instead of doing the alternative essay writing.

    The exam had four questions:
    1) straight from problem sets, how do the market shares of identical duopoly firms change if the other firm manages to decrease its marginal cost by 50%?
    2) – show that the firm’s profit is decreasing in cost when we know that cost function is always increasing
    – show that the consumer surplus is increasing in monopolist’s optimal price
    3) infinite games and collusion: finding the discount rate in which the collusive agreement is stable, and how does this change if N firms partake in the collusion instead of 2 firms, and also how does a finite time period affect the game outcomes
    4) – 3p essay about horizontal merger paradox
    – 1p essay about the guest lecture: how to empirically evaluate merger impacts

    A very good course, highly recommended especially for those into micro.

    Teemu R | 16.2.2017 @ 13:15

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