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The Theory of Industrial Organization
"The Theory of Industrial Organization" is the first primary text to treat the new industrial organization at the advanced-undergraduate and graduate level. Rigorously analytical and filled with exercises coded to indicate level of difficulty, it provides a unified and modern treatment of the field with accessible models that are simplified to highlight robust economic ideas while working at an intuitive level. To aid students at different levels, each chapter is divided into a main text and supplementary section containing more advanced material. Each chapter opens with elementary models and builds on this base to incorporate current research in a coherent synthesis.
Tirole begins with a background discussion of the theory of the firm. In part I he develops the modern theory of monopoly, addressing single-product and multi-product pricing, static and intertemporal price discrimination, quality choice, reputation, and vertical restraints.
In part II, Tirole takes up strategic interaction between firms, starting with a novel treatment of the Bertrand-Cournot interdependent-pricing problem. He studies how capacity constraints, repeated interaction, product positioning, advertising, and asymmetric information affect competition or tacit collusion. He then develops topics having to do with long-term competition, including barriers to entry, contestability, exit, and research and development. He concludes with a "game theory user's manual" and a section of review exercises.
Tirole begins with a background discussion of the theory of the firm. In part I he develops the modern theory of monopoly, addressing single-product and multi-product pricing, static and intertemporal price discrimination, quality choice, reputation, and vertical restraints.
In part II, Tirole takes up strategic interaction between firms, starting with a novel treatment of the Bertrand-Cournot interdependent-pricing problem. He studies how capacity constraints, repeated interaction, product positioning, advertising, and asymmetric information affect competition or tacit collusion. He then develops topics having to do with long-term competition, including barriers to entry, contestability, exit, and research and development. He concludes with a "game theory user's manual" and a section of review exercises.
496 pages, Hardcover
First published January 1, 1988
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Displaying 1 - 5 of 5 reviews
January 2, 2020
Excelent text book for bachelor and graduate programs
October 26, 2025
Three "infinitely deep wells" ...
JTIROLE: Theory of Industrial Organization
JSMILL: On Liberty
THOBBES: De Cive
(possibly also the Federalist Papers ... it's been a while tho. BTW, I am not saying these are my fav works of all time. Just that they are crazy dense with 'pearls'. Also maybe WALTZ'59 and WALTZ'79)
(Anyone who finishes JTIROLE: IO (perhaps subject to a difficult test confirming they have 'internalized' the material) should receive an immediate 20% raise (well let's say that applies up to $350K) ... both because of what it signals about them and by virtue of their brain being SUPER CHARGED with incredible ideas and powerful frameworks.)
("everywhere dense" might be a better mathematical metaphor than 'infinitely deep')
(BTW, I think JTIROLE finished this book when he was ~35!)
JTIROLE: Theory of Industrial Organization
JSMILL: On Liberty
THOBBES: De Cive
(possibly also the Federalist Papers ... it's been a while tho. BTW, I am not saying these are my fav works of all time. Just that they are crazy dense with 'pearls'. Also maybe WALTZ'59 and WALTZ'79)
(Anyone who finishes JTIROLE: IO (perhaps subject to a difficult test confirming they have 'internalized' the material) should receive an immediate 20% raise (well let's say that applies up to $350K) ... both because of what it signals about them and by virtue of their brain being SUPER CHARGED with incredible ideas and powerful frameworks.)
("everywhere dense" might be a better mathematical metaphor than 'infinitely deep')
(BTW, I think JTIROLE finished this book when he was ~35!)
March 9, 2008
A great book. You may find yourself doubling up ever so slightly if you have also got The Theory of Corporate Finance.
March 8, 2008
Best rigourous IO text that I have encountered. Immeasurably useful to me.
April 4, 2017
This book is a real classic. A lof of the theory is decades old now, but a lot of the models illustrated here are still a very good baseline for any more complex structural model you want to built. Sometimes the information is abbrevated a lot, so there is really a lot of info on just one single page and it may take long understanding every detail. Anyway, this book is a must and should not be missing in any library of Industrial Economics.
Displaying 1 - 5 of 5 reviews