Igami's Page

Mitsuru (Michi) Igami, associate professor at Yale Department of Economics (and visiting associate professor at MIT Department of Economics for 2017–2018), empirically studies strategic industry dynamics.

TOPICS: (i) innovation/productivity, (ii) mergers & acquisitions, and (iii) cartels/collusion.

FIELDS: Industrial Organization, Economics of Innovation, International Trade.

e-mail: mitsuru.igami@gmail.com

Curriculum Vitae: html & pdf


Keio University (3/13/2017)

IIOC (4/8/2017)

Yale (4/11/2017)

Georgetown University (4/19/2017)

Cornell University (5/3/2017)

National Institute of Science and Technology Policy, Japan (7/28/2017)

Japan Fair Trade Commission (8/4/2017)

Riken, a natural sciences research institute (8/7/2017)

Summer Workshop on Economic Theory (IO), Otaru University of Commerce, Japan (8/9/2017)

Summer Workshop on Economic Theory (Game), Otaru University of Commerce, Japan (8/10/2017)

Hitotsubashi University Institute of Innovation Research, IIR Summer School (8/23/2017)

Conference on Implementation of Structural Dynamic Models: Methodology and Applications, University College London, UK (8/29-30/2017)

NYU IO Day (9/8/2017)

Microsoft Research New England (10/13/2017)

Pennsylvania State University (10/16/2017)

Rochester Simon (10/25/2017)

University of Pennsylvania/Wharton (10/31/2017)

Northwestern University (11/20/2017)

Econometric Society 2018 North American Winter Meeting, Philadelphia (1/5–7/2018)


  1. "Industry Dynamics of Offshoring: The Case of Hard Disk Drives," American Economic Journal: Microeconomics, forthcoming. This paper uncovers a novel pattern of offshoring dynamics in a high-tech industry, and proposes a structural model to explain it. Specifically, the hard disk drive industry (1976–98) witnessed massive waves of entry, exit, and the relocation of manufacturing plants to low-cost countries, in which shakeouts occurred predominantly among home firms and almost all survivors were offshore firms. I build and estimate a dynamic offshoring game with entry/exit to measure the benefits and costs of offshoring, investigate the relationship between offshoring and market structure, and assess the impacts of hypothetical government interventions.
  2. "Estimating the Innovator’s Dilemma: Structural Analysis of Creative Destruction in the Hard Disk Drive Industry, 1981–1998," the Journal of Political Economy, 125:3 (June 2017), 798–847. [Link to SSRN working paper version]. This paper studies strategic industry dynamics of creative destruction in which firms and technologies experience turnover. Theories predict cannibalization between existing and new products delays incumbents’ innovation, whereas preemptive motives accelerate it. Incumbents’ cost (dis)advantage relative to that of entrants would further reinforce these tendencies. To empirically assess these three forces, I develop and estimate a dynamic oligopoly model using a unique panel data set of hard disk drive (HDD) manufacturers (1981–98). The results suggest that despite strong preemptive motives and a substantial cost advantage over entrants, cannibalization makes incumbents reluctant to innovate, which can explain at least 57% of the incumbent-entrant innovation gap. I then assess hypothetical policy interventions concerning broad patents and license fees, and find the industry’s welfare trajectory difficult to outperform.
  3. "Unobserved Heterogeneity in Dynamic Games: Cannibalization and Preemptive Entry of Hamburger Chains in Canada," with Nathan Yang, Quantitative Economics, 7:2 (July 2016), 483–521. We develop a dynamic entry model of multi-store oligopoly with heterogeneous markets, and estimate it using data on hamburger chains in Canada (1970–2005). Because more lucrative markets attract more entry, firms appear to favor the presence of more rivals. Thus unobserved heterogeneity across geographical markets creates an endogeneity problem and poses a methodological challenge in the estimation of dynamic games, which we address by combining the procedures proposed by Kasahara and Shimotsu (2009), Arcidiacono and Miller (2011), and Bajari, Benkard, and Levin (2007), respectively. The results suggest the omission of unobserved market heterogeneity attenuates the estimates of competition, and the tradeoff between cannibalization and preemption is an important factor behind the evolution of market structure.
  4. "Market Power in International Commodity Trade: The Case of Coffee," the Journal of Industrial Economics, 63:2 (June 2015), 225–248. [Link to SSRN working paper version]. This paper studies the impact of market power on international commodity prices. I use a standard oligopoly model and exploit historical variations in the structure of the international coffee bean market to assess the impact of a cartel treaty on coffee prices and its global welfare consequences. The results suggest the International Coffee Agreement (ICA, 1965-89) raised its price by 75% above the Cournot-competitive level, annually transferring approximately $12 billion from consumers to exporting countries, and its lapse in 1989 explains four-fifths of the subsequent price decline, that is, the "coffee crisis."
  5. "Does Big Drive Out Small? - Entry, Exit, and Differentiation in the Supermarket Industry," the Review of Industrial Organization, 38:1 (January 2011), 1-21. This paper measures the impact of the entry of large supermarkets on incumbents of various sizes. Contrary to the conventional notion that big stores drive small rivals out of the market, data from Tokyo in the 1990s show that large supermarkets' entry induces the exit of existing large and medium-size competitors, but improves the survival rate of small supermarkets. These findings highlight the role of store size as an important dimension of product differentiation. Size-based entry regulations would appear to protect big incumbents, at the expense of small incumbents and potential entrants.


  1. "Mergers, Innovation, and Entry-Exit Dynamics: Consolidation of the Hard Disk Drive Industry, 1996–2016," with Kosuke Uetake (July 7, 2017). How far should an industry be allowed to consolidate when competition and innovation are endogenous? We extend Rust's (1987) framework to incorporate a stochastically alternating-move game of dynamic oligopoly, and estimate it using data from the hard disk drive industry, in which a dozen global players consolidated into only three in the last 20 years. We find plateau-shaped equilibrium relationships between competition and innovation, with systematic heterogeneity across time and productivity. Our counterfactual simulations suggest the optimal policy should stop mergers when six or fewer firms exist, highlighting a dynamic welfare tradeoff between ex-post pro-competitive effects and ex-ante value-destruction side effects.
  2. "Privatization and Productivity in China," with Yuyu Chen, Masayuki Sawada, and Mo Xiao (March 8, 2017). Privatization of state-owned enterprises (SOEs) since the late 1990s has been credited for China's productivity growth, but the literature has not formally incorporated privatization and it productivity dynamics. We augment Ackerberg, Caves, and Frazer's (2015) model to estimate the TFP impacts of ownership types while allowing for flexible transition dynamics. Results suggest private firms are 192% more efficient than SOEs in the long run. Privatized SOEs do not achieve this gain overnight but close most of the gap within six years on average. We also find the private TFP premium is larger in the final-good sector than in "strategic" (i.e., heavily regulated) industries including petroleum, metals, and car manufacturing.
  3. "Measuring the Incentive to Collude: The Vitamin Cartels, 1990–1999," with Takuo Sugaya (July 12, 2017). Why do some cartels survive for a decade whereas others collapse within a few years? Models of collusion are difficult to identify, but the vitamins case, one of the largest in history, entails direct evidence from American courts and European agencies. We provide a theory-based measurement of the incentive to collude, and test a fundamental prediction of game theory that cooperation is self-enforcing if and only if it is incentive compatible. Our simple repeated-game model could explain the life and death of various vitamin cartels. Simulations suggest a hypothetical merger could have prolonged the vitamin C cartel.


  1. Acquiring a String of Pearls (with Yasin Özcan), since June 2015.
  2. Moore's Law, since June 2013.
  3. Patent Statistics as an Innovation Indicator? Evidence from the Hard Disk Drive Industry, with Jai Subrahmanyam (January 9, 2015).
  4. Age, Experience, and Artistic Creativity: the Case of Weekly Jump (March 2012).
  5. Game AI & Empirical Dynamic Games: Part 1 & Part 2