HS 440 : Industrial Economics

The course aims to provide basic theoretical and empirical analysis of contemporary topics in industrial economics. It uses economic theory to analyze important issues facing firms, and examines the practical challenges of empirical applications of theory.  In all parts of the course industrial organization theory will be mixed with applications.

The course begins by reviewing the theory of the firm and basic models of perfect competition, monopoly, and oligopoly, and moves to learning Game theory and cooperative and non-cooperative models of firm behaviour.

Behaviour of firms: Strategies with regard to entry, pricing, advertising, and R & D and innovation.

The development of Firms, and Market and Industrial Structure: Stochastic models of firm growth, and market structure, inter-industry differences in growth rate variance, economies of scale, technical change, mergers and market concentration.

Development of Competitive capabilities: Role of Technology and Skills, FDI and Technology Transfer, Technological Spillovers, Globalisation and Technology Intermediation.

Organization of firms and industries, specifically the way that costs can influence organization and the way in which organization can influence performance.


Carton, D. and J. Perloff .  Modern Industrial Organization (Reading, Massachusetts: Addison-Wesley), 1999.

Hay, Donald A. and Derek J. Morris.  Industrial Economics and Organization: Theory and Evidence, 2nd Edition (Oxford: Oxford University Press), 1991.

Lall, Sanjaya.  Competitiveness, Technology and Skills (Cheltenham: Edward Elgar), 2001.

Scherer, F. M. and D. Ross.  Industrial Market Structure and Economic Performance, 3rd Edition (Houghton: Mifflin), 1990.

Schmalensee, R.,  Inter-industry studies of Structure and Performance, in Schmalensee, R. and R. D. Willig (eds.): Handbook of Industrial Organization [Amsterdam: North-Holland] Vols. 2 Chapter 16, pp. 951-1009, 1989.

Siddharthan, N. S. and Y.S. Rajan.  Global Business, Technology and Knowledge Sharing: Lessons for Developing Country Enterprises (New Delhi: Macmillan), 2002.

Tirole, Jean.  The Theory of Industrial Organization (Cambridge, MA: The MIT Press), 1988.

Varian, Hal. Intermediate Microeconomics: A Modern Approach, Fifth Edition (New York: Norton), 1999.

Waterson, Michael.  Economic Theory of the Industry (Cambridge: Cambridge University Press), 1984.