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PhD Course on the Economics of Exclusion

April 21 - April 26

The University of Bergen is delighted to announce an intensive PhD course by Greg Shaffer (University of Rochester and UoB/BECCLE) on the “economics of exclusion” immediately prior to the 2017 Bergen Competition Policy Conference

Professor Greg Shaffer
Simon Business School, University of Rochester

Class times: 10:15-12:00, 13:15-15:00 (Friday, Saturday, Monday, Tuesday and Wednesday)
Location: TBA



Download full description and syllabus here…

The use of contracts in vertical settings to deter potential rivals is an active area of research and of great interest to policy makers. Firms that have such contracts are often found to be abusing their position of dominance. In May 2009, for example, the European Commission fined Intel 1.06 billion Euros for abusing its dominant position in the market for computer chips and ordered it, among other things, to stop offering discounts to retailers that were contingent on their buying less of a rival’s product. It was the largest such fine ever imposed by the Commission for breach of competition law. In this course, we will consider the pros and cons of contracts of the form engaged in by Intel and other dominant firms, and we will pay particular attention to how these firms are able to induce their downstream buyers to agree to terms that would seemingly not be in their immediate or long-run interest. Among other things, we will look at exclusionary contracts that feature one or more of the following: exclusive-dealing clauses, market-share requirements, loyalty discounts, bundled discounts, all-units discounts, and incremental quantity discounts. We will also discuss their policy implications.

Course Requirements: take-home exam
A take-home exam consisting of four to five questions will be provided to you shortly after the course ends on the 26th April. The exam will be due two weeks from the date you receive it.

Background and reading materials
Relevant papers are listed in the full syllabus for each of the lectures. Required readings are denoted with an asterisk (the remaining readings are supplemental).

A basic knowledge of static oligopoly theory is assumed (i.e., Cournot, Bertrand, and Stackelberg models). A basic knowledge of game theory (e.g., simultaneous and sequential move games, standard solution concepts) is also assumed. A good way to get up to speed on this would be to consult the relevant chapters in one of the standard graduate I.O. textbooks. Two of Shaffer’s favorites are (i) Jean Tirole, The Theory of Industrial Organization, MIT Press, 1988, and (ii) Xavier Vives, Oligopoly Pricing: Old Ideas and New Tools, MIT Press, 1999.


April 21
April 26
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