LEARNING OUTCOMES
The purpose of the course is to familiarize students to advanced topics and methods in Empirical Industrial Organization (IO). At the end of the course, students have learned how to estimate static demand and supply using both market level and individual level data, and how the estimation results can be used in applications. The course will start the process of preparing economics Ph.D. students to conduct thesis research in this area.
Credits: 6
Schedule: 28.02.2022 - 11.04.2022
Teacher in charge (valid for whole curriculum period):
Teacher in charge (applies in this implementation): Iivo Vehviläinen
Contact information for the course (applies in this implementation):
Practical matters: iivo.vehvilainen@aalto.fi
Other lecturers: otto.toivanen@aalto.fi, tanja.saxell@vatt.fi, ari.hyytinen@hanken.fi
Exercises: tuomas.markkula@aalto.fi, jaakko.m.markkanen@aalto.fi
CEFR level (valid for whole curriculum period):
Language of instruction and studies (applies in this implementation):
Teaching language: English. Languages of study attainment: English
CONTENT, ASSESSMENT AND WORKLOAD
Content
valid for whole curriculum period:
The course starts with a reminder of logit and nested logit models before moving on to BLP models, identification issues, and the choice of optimal instruments. In addition, we will cover market power and merger analysis, and other applications.
Assessment Methods and Criteria
valid for whole curriculum period:
Exercises (60 %), exam (40 %)
DETAILS
Substitutes for Courses
valid for whole curriculum period:
Prerequisites
valid for whole curriculum period:
FURTHER INFORMATION
Further Information
valid for whole curriculum period:
Teaching Language : English
Teaching Period : 2022-2023 No teaching
2023-2024 Spring III
Details on the schedule
applies in this implementation
Week 1
Mon, 28 Feb 2022, 14.15-15.45 – Lecture 1 – Otto
Wed, 2 Mar 2022, 14.15-15.45 – Lecture 2 – Otto
Introduction: Structural econometrics, modelling
Discrete choice models: Logit and nested logit, (welfare, interpretation of parameters, market& individual level data)
Exercise #1 (logit, nested logit)
Week 2
Mon, 7 Mar 2022, 14.15-15.45 – Lecture 3 – Tanja
Wed, 9 March 2021, 14.15-15.45 – Lecture 4 – Tanja
Random coefficient models, BLP
Exercise #2 (BLP)
Week 3
Mon, 14 March 2022, 14.15-15.45 – Lecture 5 – Ari
Wed, 16 March 2022, 14.15-15.45 – Lecture 6 – Ari
Econometric identification, normalizations in identification, instruments for and identification in BLP
No exercise
Week 4
Mon, 21 March 2022, 14.15-15.45 – Lecture 7 – Otto
Wed, 23 March 2022, 14.15-15.45 – Lecture 8 – Otto
Topics: Reading group style treatment of a chosen paper
Supply side (start from simple logit / one product per firm).
Exercise #3 (Simulate data)
Week 5
Mon, 28 March 2022, 14.15-15.45 – Lecture 9 – Iivo
Wed, 30 March 2022, 14.15-15.45 – Lecture 10 – Riku Buri / KKV + Iivo
Applications: 1) Merger simulation, 2) Market power
Exercise #4 (Merger simulation)
Week 6
Mon, 4 April 2022, 14.15-15.45 – Lecture 11 – Otto
Wed, 6 April 2022, 14.15-15.45 – Lecture 12 – Tanja
Applications: 3) Consideration sets, 4) Demand estimation: Choice frictions
No exercise
EXAM: 11 April 2022 13.00 – 16.00