Econ 846-001
Prof. Alex Tabarrok
Carow Hall
Email: Tabarrok@gmu.edu
Tel: 703-993-2314
Web: https://alextabarrok.com/
Office Hours: T-Thr: 10-12, 2-4
If you are on the Fairfax campus, feel free to drop by any time or call for an appointment. Email is a good way to contact me. All students should periodically check their GMU email account for important information.
The primary resource are the articles. Carlton and Perloff's Modern Industrial Organization (Addison-Wesley) is the best undergraduate IO book. The best graduate text is Industrial Organization: Markets and Strategies by Belleflamme and Peitz. Paul Klemperer's book Auctions: Theory and Practice is a very nice introduction to the topic.
These books cover some of the topics that I will cover but I do not follow any book systematically. You do not need to buy the books. The articles are the primary resource for which the books are secondary.
The largest share of your grade will be determined by a paper. Ideally, the paper will serve as a draft for a dissertation chapter and eventually a publication. I am looking for a 10-20 page, well-written theory or empirical paper in IO. You may work in a group of two or at most three but note that you cannot all have the same dissertation chapter! Papers are due on the last teaching day of class — no exceptions. You are encouraged to think about topics early and see me for some possible guidance. You will also be required to make a 15 minute class presentation on the subject of your paper.
IO Paper: 35%
Presentation: 10%
Homework: 25%
MidTerm/Final: 30%
A+: 90%+ | A: 85-89% | A-: 80-84% | B: 70-79% | C: 60-69% | D: 50-59% | F: <50%
If you are a student with a disability and you need academic accommodations, please see me and contact the Disability Resource Center (DRC) at 703-993-2474. All academic accommodations must be arranged through that office.
* Starred topics I will cover in class. Other papers are there for your reference and further study.
CP, 87-105
BP Part IV; CP, chapter 9, 10
*Ayres, I., and P. Siegelman. 1995. Race and Gender Discrimination in Bargaining for a New Car. American Economic Review 85 (3):304-21.
*Kline, Patrick M., Evan K. Rose, and Christopher R. Walters. 2021. Systemic Discrimination Among Large U.S. Employers. NBER Working Paper 29053.
Varian, H. 1985. Price Discrimination and Social Welfare. American Economic Review 75 (4):870-75.
Bakos, Y., and E. Brynjolfsson. 1999. Bundling Information Goods: Pricing, Profits, and Efficiency. Management Science 45:1613-30.
*Nalebuff, Barry. 2004. Bundling as an Entry Barrier. Quarterly Journal of Economics 119 (1):159-188.
*Lott, J. R., and R. D. Roberts. 1991. A Guide to the Pitfalls of Identifying Price Discrimination. Economic Inquiry XXIX (Jan):14-23.
Dana, J. D. J. 1998. Advance-Purchase Discounts and Price Discrimination in Competitive Markets. Journal of Political Economy 106 (2):395-422.
*Levine, M. E. 2002. Price Discrimination Without Market Power. Yale Journal on Regulation 19:1-36.
*U.S. Court of Appeals for the 6th District. 2015. Spirit Airlines v. Northwest Airlines.
*Rochet, Jean-Charles, and Jean Tirole. 2006. Two-Sided Markets: A Progress Report. The RAND Journal of Economics 37 (3):645-67.
Rysman, Marc. 2009. The Economics of Two-Sided Markets. Journal of Economic Perspectives 23 (3):125-43.
*Wright, Julian. 2004. One-Sided Logic in Two-Sided Markets. Review of Network Economics 3 (1).
CP, chapter 15
Barzel, Y. 1976. An Alternative Approach to the Analysis of Taxation. Journal of Political Economy 84 (6):1177-97.
*Bulow, J. I. 1982. Durable Goods Monopolists. Journal of Political Economy 90 (2):314-32.
Coase, R. H. 1972. Durability and Monopoly. Journal of Law and Economics 15 (April):143-49.
*Groseclose, Tim, and Alexander T. Tabarrok. 2023. A Test of the Coase Conjecture Using Prices of Online Books. SSRN Working Paper.
Akerlof, G. A. 1970. The Market for Lemons: Quality Uncertainty and the Market Mechanism. Quarterly Journal of Economics 84:488-500.
*Shapiro, C. 1983. Premiums for High Quality Products As Returns to Reputations. Quarterly Journal of Economics 98 (4):659-79.
*Waldman, M. 2003. Durable Goods Theory for the Real World Markets. Journal of Economic Perspectives 17 (1):131-54.
*Bond, E. W. 1982. A Direct Test of the "Lemons" Model: The Market for Used Pickup Trucks. American Economic Review 72 (4):836-40.
Cawley, J., and T. Philipson. 1999. An Empirical Examination of Information Barriers to Trade in Insurance. American Economic Review 89 (4):827-46.
Hemenway, David. 1990. Propitious Selection. The Quarterly Journal of Economics 105 (4):1063-1069.
Finkelstein, Amy and Kathleen McGarry. 2006. Multiple dimensions of private information: evidence from the long-term care insurance market. American Economic Review 96(4):938-958.
CP, chapter 10
Deneckere, R. J., and P. R. McAfee. 1996. Damaged Goods. Journal of Economics and Management Strategy 5 (2):149-74.
*Alpert, Abby, Darius Lakdawalla, and Neeraj Sood. 2023. “Prescription Drug Advertising and Drug Utilization: The Role of Medicare Part D.” Journal of Public Economics 221 (May). https://doi.org/10.1016/j.jpubeco.2023.104860.
*Sinkinson, Michael, and Amanda Starc. 2019. “Ask Your Doctor? Direct-to-Consumer Advertising of Pharmaceuticals.” The Review of Economic Studies 86 (2): 836–81. https://doi.org/10.1093/restud/rdy001.
Klemperer, Paul. 2000. Auction Theory: A Guide to the Literature. Journal of Economic Surveys.
*Klemperer, Paul. 2003. Why Every Economist Should Learn Some Auction Theory. Advances in Economics and Econometrics.
*Klemperer, Paul. 2002. How (Not) to Run Auctions: the European 3G Telecom Auctions. European Economic Review 46:828-845.
Milgrom, P. 1989. Auctions and Bidding: A Primer. Journal of Economic Perspectives 3 (3):3-22.
*David Lucking-Reiley. 1999. Using Field Experiments to Test Equivalence Between Auction Formats: Magic on the Internet. American Economic Review 89 (5):1063-1080.
*Roth, Alvin E. and Axel Ockenfels. 2002. Last-Minute Bidding and the Rules for Ending Second-Price Auctions: Evidence from eBay and Amazon Auctions on the Internet. American Economic Review 92 (4):1093-1103.
Tideman, T. N., & Tullock, G. 1976. A New and Superior Process for Making Social Choices. Journal of Political Economy 84(6):1145-1159.
*Varian, H. R., & Harris, C. 2014. The VCG Auction in Theory and Practice. The American Economic Review 104(5):442-445.
*Prendergast, C. 1999. The Provision of Incentives in Firms. Journal of Economic Literature XXXVII (1):7-63.
*Brown, Jennifer. 2011. Quitters Never Win: The (Adverse) Incentive Effects of Competing with Superstars. Journal of Political Economy 119 (5):982-1013.
*Knoeber, Charles R. 1989. A Real Game of Chicken: Contracts, Tournaments, and the Production of Broilers. Journal of Law, Economics, & Organization 5 (2):271-92.
Lazear, E. P., and S. Rosen. 1981. Rank Order Tournaments As Optimum Labor Contracts. Journal of Political Economy 89 (5):841-64.
Baker, G. P. 1992. Incentive Contracts and Performance Measurement. Journal of Political Economy 100 (3):598-614.
Holmstrom, B., and P. Milgrom. 1991. Multitask Principal-Agent Analyses: Incentive Contracts, Asset Ownership, and Job Design. Journal of Law, Economics, and Organization 7 (sp):24-52.
Lazear, Edward. P. 1996. Performance Pay and Productivity. NBER Working Paper 5672.
*Rosen, Sherwin. 1986. Prizes and Incentives in Elimination Tournaments. The American Economic Review 76 (4):701-15.
*Gneezy, U., M. Niederle, and A. Rustichini. 2003. Performance in competitive environments: Gender differences. Quarterly Journal of Economics, August 2003, p. 1049-1074.
*Hart, O., A. Shleifer, and R.W. Vishny. 1997. The Proper Scope of Government: Theory and Application to Prisons. Quarterly Journal of Economics 112:1127-162.
*Kane, T. J., and D. O. Staiger. 2002. The Promise and Pitfalls of Using Imprecise School Accountability Measures. Journal of Economic Perspectives 16 (4):91-114.
Dranove, D., D. Kessler, M. McClellan, and M. Satterthwaite. 2003. Is More Information Better? The Effects of "Report Cards" On Health Care Providers. Journal of Political Economy 111 (3):555-88.
*Dan Pink. TED Talk: The Surprising Science of Motivation.
*Gneezy, Uri, and Aldo Rustichini. 2000. A Fine Is a Price. The Journal of Legal Studies 29 (1):1-17.
Amabile, T. M. 1985. Motivation and Creativity: Effects of Motivational Orientation on Creative Writers. Journal of Personality and Social Psychology 48 (2):393-399.
Glucksberg, S. 1962. The influence of strength of drive on functional fixedness and perceptual recognition. J. exp. Psychol. 63:36-41.
Eisenberger, Robert, and Linda Rhoades. 2001. Incremental effects of reward on creativity. Journal of Personality and Social Psychology 81 (4):728-741.
*Benabou, Roland, and Jean Tirole. 2003. Intrinsic and Extrinsic Motivation. Review of Economic Studies 70 (3):489-520.
*Ariely, Dan, Uri Gneezy, George Loewenstein, and Nina Mazar. 2009. Large Stakes and Big Mistakes. The Review of Economic Studies 76:451-469.
*Frey, Bruno S., and Margit Osterloh. 2005. Yes, Managers Should Be Paid Like Bureaucrats. Journal of Management Inquiry 14 (1):96-111.
Laibson, David. 1997. Golden Eggs and Hyperbolic Discounting. Quarterly Journal of Economics 112(2):443-477.
*Shapiro, Jesse. 2005. Is There a Daily Discount Rate? Evidence from the Food Stamp Nutrition Cycle. Journal of Public Economics 89(2-3):303-25.
DellaVigna, Stefano, and Ulrike Malmendier. 2006. Paying Not to Go to the Gym. American Economic Review 96(3):694-719.
*Bloom, N., Eifert, B., Mahajan, A., McKenzie, D., Roberts, J. 2013. Does Management Matter? Evidence from India. The Quarterly Journal of Economics 128:1-51.
*Bloom, N., Van Reenen, J. 2010. Why Do Management Practices Differ across Firms and Countries? Journal of Economic Perspectives 24:203-224.
*Atkin, David, et al. 2017. Organizational Barriers to Technology Adoption: Evidence from Soccer-Ball Producers in Pakistan. The Quarterly Journal of Economics 132 (3):1101-1164.
Hsieh, C.-T., Klenow, P.J. 2009. Misallocation and Manufacturing TFP in China and India. The Quarterly Journal of Economics 124:1403-1448.
*Goldschlag, Nathan, and Alexander T. Tabarrok. 2018. Is Regulation to Blame for the Decline in American Entrepreneurship? Economic Policy.
*Hopenhayn, Hugo, Julian Neira, and Rish Singhania. 2018. From Population Growth to Firm Demographics: Implications for Concentration, Entrepreneurship and the Labor Share. NBER Working Paper.
Karahan, Fatih, Benjamin Pugsley, and Aysegul Sahin. 2015. Understanding the 30 Year Decline in Business Dynamism: A General Equilibrium Approach. Society for Economic Dynamics.
Syverson, C. 2011. What Determines Productivity? Journal of Economic Literature 49:326-365.
*Tabarrok, Alex. 2011. Launching the Innovation Renaissance. TED Books.
Machlup, F. 1958. An economic review of the patent system. Study No. 15, U.S. Senate.
Mansfield, E. 1986. Patents and Innovation: An Empirical Study. Management Science 32:173-81.
Arrow, K. J. 1962. Economic Welfare and the Allocation of Resources for Invention. In The Rate and Direction of Inventive Activity. Princeton University Press.
Klemperer, P. 1990. How Broad Should the Scope of Patent Protection Be? RAND Journal of Economics 21 (1):113-30.
Scotchmer, S. 1998. Incentives to Innovate. In The New Palgrave Dictionary of Economics and the Law.
*Moser, P. 2003. How Do Patent Laws Influence Innovation? Evidence from Nineteenth-Century World Fairs. NBER Working Paper 9909.
*Murray, F. et al. 2009. Of Mice and Academics: Examining the Effect of Openness of Innovation. NBER Working Paper 14819.
*Galasso, Alberto, and Mark Schankerman. 2015. Patents and Cumulative Innovation: Causal Evidence from the Courts. The Quarterly Journal of Economics 130 (1):317-69.
*Starr, Evan, J. Prescott, and Norman Bishara. 2021. “Noncompete Agreements in the US Labor Force.” Journal of Law and Economics 64 (1). https://chicagounbound.uchicago.edu/jle/vol64/iss1/3.
*Dourado, E., & Tabarrok, A. 2015. Public choice perspectives on intellectual property. Public Choice 163(1):129-151.
*Tabarrok, A. 2002. Patent Theory Versus Patent Law. Contributions to Economic Analysis and Policy 1 (1), Article 9.
*Kremer, M. 1998. Patent Buyouts: A Mechanism for Encouraging Innovation. Quarterly Journal of Economics 113:1137-67.
Wright, B. D. 1983. The Economics of Invention Incentives: Patents, Prizes, and Research Contracts. American Economic Review 73 (4):691-707.
Shavell, S., and van T. Ypersele. 2001. Rewards Versus Intellectual Property Rights. Journal of Law and Economics XLIV (2):525-48.
*Ahuja, Amrita, et al. 2021. Preparing for a Pandemic: Accelerating Vaccine Availability. AEA Papers and Proceedings 111:331-335.
*Castillo, Juan Camilo, et al. 2021. Market Design to Accelerate COVID-19 Vaccine Supply. Science.
*Buterin, Vitalik, Zoe Hitzig, and E. Glen Weyl. 2019. A Flexible Design for Funding Public Goods. Management Science 65 (11):5171-5187.
*Tabarrok, Alexander. 1998. The Private Provision of Public Goods via Dominant Assurance Contracts. Public Choice 96 (3):345-362.
*Cason, Timothy N., Alex Tabarrok, and Robertas Zubrickas. 2021. Early Refund Bonuses Increase Successful Crowdfunding. Games and Economic Behavior 129:78-95.
*Lichtenberg, Frank R. and Joel Waldfogel. 2003. Does Misery Love Company? Evidence from Pharmaceutical Markets Before and After the Orphan Drug Act. NBER Working Paper 9750.
*Kremer, Michael and Christopher M. Snyder. 2003. Why are Drugs more Profitable than Vaccines? NBER Working Paper 9833.
Peltzman, S. 1973. An Evaluation of Consumer Protection Legislation: The 1962 Drug Amendments. Journal of Political Economy 81 (5):1049-91.
Klein, Daniel and Alexander Tabarrok. 2004. Do Off-Label Drug Practices Argue Against FDA Efficacy Requirements? Testing an Argument by Structured Conversations with Experts. Working paper.
DiMasi, Joseph A., Ronald W. Hansen, and Henry G. Grabowski. 2003. The Price of Innovation: New Estimates of Drug Development Costs. Journal of Health Economics 22 (2):151-85.