IO17

Advanced Studies in Industrial Organization (212.669) Fall 2017

Course web page: https://sites.google.com/site/oyvindthomassen/io17

Information about the exam is here.

Lectures:

Tuesdays 15.30-16.45, room 502, building 83

Thursdays 15.30-16.45, room 217, building 16

No classes on the following days:

3 October (Chuseok), 5 October (Chuseok), 26 October (reading period)

Exam dates:

12 December (written exam), 14 December (programming exam). Both exams are at normal lecture hours.

Aim:

To teach methods for (static, discrete choice) demand estimation used in empirical industrial organization, and programming (in Matlab) to implement these methods.

Prerequisites:

No particular background knowledge in industrial organization or programming is needed. Basic familiarity with concepts from econometrics, such as generalized method of moments and maximum likelihood, is useful.

Grading:

Final written exam 60%, final programming exam 40%

Background (not required reading):

1. Joshua Angrist and Jörn-Steffen Pischke (2010): The Credibility Revolution in Empirical Economics: How Better Research Design is Taking the Con out of Econometrics, Journal of Economic Perspectives

2. Aviv Nevo and Michael Whinston (2010): Taking the Dogma out of Econometrics: Structural Modeling and Credible Inference, Journal of Economic Perspectives

Lectures are based on the following papers (and book chapters):

1. Kenneth Train (2009): Discrete Choice Methods with Simulation ch. 1.1-1.2, 2.1-2.3, 3 (especially 3.1, 3.6, 3.7.1), 6.1-6.2, 6.4, 6.6, Cambridge University Press

2. Steven Berry (1994): Estimating Discrete-Choice Models of Product Differentiation, RAND Journal of Economics

3. Steven Berry, James Levinsohn and Ariel Pakes (1995): Automobile Prices in Market Equilibrium, Econometrica

4. Aviv Nevo (2001): Measuring Market Power in the Ready-to-Eat Cereal Industry, Econometrica

5. Steven Berry, James Levinsohn and Ariel Pakes (2004):  Differentiated Products Demand Systems from a Combination of Micro and Macro Data, Journal of Political Economy

6. Austan Goolsbee and Amil Petrin (2004): The Consumer Gains from Direct Broadcast Satellites and the Competition with Cable TV, Econometrica

7. Matthew Gentzkow (2007): Valuing New Goods in a Model with Complementarity: Online Newspapers, American Economic Review

8. Øyvind Thomassen, Howard Smith, Stephan Seiler and Pasquale Schiraldi (2017): Multi-Category Competition and Market Power: A Model of Supermarket Pricing, American Economic Review

If there is time, the following papers may be discussed in lectures or student presentations:

1. Michelle Sovinsky Goeree (2008): Limited Information and Advertising in the US Personal Computer Industry, Econometrica

2. Gregory S. Crawford and Ali Yurukoglu (2012): The Welfare Effects of Bundling in Multichannel Television Markets, American Economic Review

3. Ying Fan (2013): Ownership Consolidation and Product Characteristics: A Study of the US Daily Newspaper Market, American Economic Review

4. Nathan H. Miller and Matthew C. Weinberg (forthcoming): Understanding the Price Effects of the MillerCoors Joint Venture, Econometrica

Lecture notes (and same content but in slides format) [Some updates Tuesday 26 September].

Short introduction to BLP (posted 10 October).

Plan for remaining lectures, with finalized reading list (from 24 October)

Matlab code used in class.

Software:

Updated instructions (14 Sep), thanks to Noelia:

1. Create an account on mathworks' webpage with mysnu email.

2. Follow this link:

http://board.snu.ac.kr/apiboard/575/10000000145560?langKnd=en

3. Click the save button under the download section

**This should be done with SNU member wifi network (or any internal IP)**

4. Once download is complete, enter the credentials you created on step 1.

Link to register for an account with Mathworks in order to download your own copy of Matlab: https://www.mathworks.com/mwaccount/register Free for SNU students, so use your snu.ac.kr email. After creating an account, you can download Matlab to your own computer for free, using your SNU email.

During installation you will be asked to 'select products to install'. To speed up the installation (which might otherwise take quite long) you can uncheck everything except

MATLAB

Econometrics Toolbox

Financial Toolbox

Global Optimization Toolbox

Optimization Toolbox

Parallel Computing Toolbox

Statistics and Machine Learning Toolbox

Symbolic Math Toolbox