Module Identifier EC31920  
Academic Year 2003/2004  
Co-ordinator Mr Dennis A Thomas  
Semester Semester 1  
Pre-Requisite EITHER EC30220 OR EC36420  
Course delivery Lecture   20 Hours  
  Seminars / Tutorials   6 Hours  
Assessment TypeAssessment Length/DetailsProportion
Semester Exam2 Hours  75%
Semester Assessment  25%
Supplementary Exam as stipulated in school module outline  100%

Learning outcomes

On completing this module students will have gained an understanding of the following topics:

? the role of markets and firms as alternative coordinating mechanisms
? transaction cost economics
? the determination of firm boundaries with respect to diversified and vertically integrated activities
? principal-agent theory and incentive contracts
? alternative explanations of firm motivation and behaviour
? market and industry definition and classification
? the structural features of markets and industries
? the form, implications and limitations of the structure-conduct- performance paradigm
? the purpose, design and implementation of competition policy, with particular reference to mergers
? innovation and its promotion
? the rationale for, and alternative forms of, industrial policy


This third year module is divided into two parts. The first section investigates economic explanations of the nature of firms, their organisational form and the scope of their activities. It employs transaction cost economising to explain the circumstances in which the firm is superior to other forms of organisation, and extends the analysis to examine firm growth and development and the determination of firm boundaries. This section also examines the internal organisation and motivation of firms, with particular regard to decision-making and the control problems that may occur within firms. The second section focuses on industry and market structures, and examines the relationship between structural characteristics and firm behaviour and firm and industry performance, with particular reference to innovation. It also examines the form and purpose of competition policy, and the rationale for industrial policy and the arguments relating to its design and implementation.

Reading Lists

D Besanko, D Dranove and M Shanley (2000) Economics of Strategy 2nd edition. Wiley
K Cowling (1999) Industrial Policy in Europe: Theoretical Perspectives and Practical Proposals Routledge
S Douma and H. Schreuder (2002) Economic Approaches to Organizations 3rd Edition. Prentice Hall
D A Hay and D J Morris (1991) Industrial Economics and Organization: Theory and Evidence 2nd edition. Oxford University Press
D Jacobson and B Andreosso-O'Callaghan (1996) Industrial Economics and Organisation: A European Perspective McGraw Hill
R Stead, P Curwen and K Lawler (1996) Industrial Economics: Theory, Applications and Policy McGraw-Hill
S Martin (2001) Industrial Organization: A European Perspective Oxford University Press


This module is at CQFW Level 6