© Liuc 2004 Copyright
Economics of innovation
Year
ECTS
Language of Instruction
Faculty
1
8
ITALIAN
ECONOMICS
Lecturers:
Christian Garavaglia, Giancarlo Origgi
Aims
The study of the economics of innovation has gained increasing relevance in recent years. Innovation is in fact becoming an ever more central and decisive factor shaping the development of economic systems, the international competitiveness of nations and the performance of companies. According to an article published in "The Economist" (20 February 1999): "[…] innovation has become the industrial religion of the late 20th century. Companies see it as the key tool for increasing profits and market share. Governments rely upon it when seeking to improve the economy […]". The purpose of this course is to study and analyse innovation, the innovatory strategies of companies and the role of innovative technology and systems, also with reference to the methods of industrial economics.
The field of industrial economics is today also of interest to students of business disciplines, who can usefully employ its instruments as an aid in analysing the markets in which companies operate. Using this approach, students will learn to identify and analyse the factors that lead companies to choose particular strategies in different market contexts.
The subject matter therefore runs the gamut from an examination of the behaviour of companies, to the role of market power and its measurement and identification, to competitive mechanisms in the presence of differentiated goods, to entry into a market by new enterprises, to the role of research and development and the strategies of innovative companies, to interventions by political authorities.
The course will also include illustrations of real-world case studies at the level of individual companies or entire sectors, to assist in interpreting and understanding the evolution and attributes of industrial sectors.
Syllabus
I) INTRODUCTORY PART
1. Technological innovation: initial definitions
2. Knowledge, enterprise and innovation
3. The Innovative Enterprise
4. National Innovation Systems and Technology Policies
5. The economics of innovation and industrial economics: the Glaxo-Wellcome case and fact summary of industrial economics
II) COMPETITION AMONG ENTERPRISES
6. Competition among enterprises: Analysis of market forms. Basic ideas
7. Competition among enterprises: Analysis of market forms. Monopoly and perfect competition
8. Competition among enterprises: Bertrand's Paradox and its avoidance: I) Capacity constraints
9. Competition among enterprises: Cournot competition
10. Competition among enterprises: Avoiding the Bertrand paradox: II) Dynamic competition and collusion
III) PRODUCT DIFFERENTIATION AND INTRODUCTION OF NEW PRODUCTS
11. Competition among enterprises: Avoiding the Bertrand paradox: III) Product differentiation
12. Advertising
13. Proliferation of products as a deterrent to entry: the case of breakfast cereals
IV) MARKET STRUCTURE AND MARKET POWER
14. Market power and concentration
15. Structure of the market, technology and cost of entry
Cabral Ch. 14 (paragraphs 14.1-14.2.1: pg. 293-306: the example on the telecommunication market is for reading only.)
V) NEW COMPANIES
16. Entry of new companies and entrepreneurship
17. Mergers and acquisition and antitrust policy: the Heineken-Birra Moretti case
18. Deterrence and barriers to entry
VI) INNOVATIVE STRATEGIES AND TECHNOLOGY
19. Strategies of the innovative enterprise
20. Innovation and R&D (Research & Development)
21. Technology, networks and standards: the case of video recorders and the case of QWERTY keyboards
22. The spread of innovations: the case of mobile telephony
23. The industrial dynamics: the case of the automotive sector
VII) TECHNOLOGICAL INNOVATION IN ECONOMIC THOUGHT (Prof. Origgi)
24. Joseph Schumpeter
Examination
There will be a written exam at the end of the course.
Reading list
The required reading materials (for the specified parts of the course) are:
- (edited by) Malerba F. (2000), Economia dell'Innovazione, Carocci editore
- Cabral L. (2002), Economia Industriale, Carocci editore
to be completed with:
- Materials and slides supplied by the lecturers (NOTE: The lecture slides and materials distributed by the lecturers during the course are an integral and required part of the examination programme. The slides can be downloaded from the course website)
- Lecture notes
Additional texts and reading materials for further study will be given during the lectures.
Ultimo aggiornamento:
22/10/2004