Industrial Organization
is an applied area of microeconomics. The primary topics include
the structure, behavior and performance of markets. Industrial
Organization economists have played a major role in shaping public
policy in the areas of antitrust law, regulation, and telecommunications.
Faculty
Professors Gary Biglaiser,
Jim Friedman, Claudio Mezzetti, John Stewart, and Helen Tauchen
have research interests in industrial organization. Professors
Biglaiser, Stewart, and Tauchen regularly teach the graduate courses.
Gary Biglaiser
Gary Biglaiser received
his B.S. from the University of Arizona and his Ph.D. from the University
of California, San Diego. He has held visiting positions at
Boston University, Indiana University, and the University of California,
Los Angeles. He was also Assistant Chief Economist at the Federal
Communications Commission and has been a
Co-editor of the Journal of Economics and Management Strategy.
Biglaiser's primary research interests are in industrial organization
and regulation. He has also done work in environmental economics
and political economy. He is currently working on optimal regulation
in a dynamic model with technological progress with Michael Riordan
of Columbia University, the economics of access pricing in a network
industry with Patrick DeGraba of the FCC, and multidimensional competition
when adverse selection is present with Albert Ma of Boston University.
Jim
Friedman
Claudio
Mezzetti
John Stewart
John
Stewart is an empirical industrial organization economist whose
research has included regulatory and antitrust policy and empirical
research on merger behavior. More recently, he has worked on
health care issues in third world countries with special emphasis
on the relationship between the structure of the health care delivery
system and its performance.
Helen Tauchen
Helen
Tauchen is an applied microeconomist. Her research interests
include location, transportation, and regulation. Recently,
much of her work has been on the economics of crime including classical
general deterrence effects and domestic violence. Two of her
current research projects include a study of the effects of involuntary
employment on criminal behavior and the estimation of hedonic models
of housing prices.
Workshops
The UNC Department of
Economics jointly sponsors the Labor/Applied
Microeconomics Workshop with the Department of Economics at
Duke University and the Microeconomic
Theory Workshop with the Department of Economics and The Fuqua
School of Business at Duke University.
Additional Triangle
Economists
Industrial Organization
economists in the Triangle area include Gregory Crawford, Henry
Grabowski, and John Vernon at Duke University and Edward Erickson,
David Flath, Charles Knoeber, and Stephen Margolis at North Carolina
State University.
Current Industrial
Organization Students
Sarah Broome
Sarah Broome is examining
the effect of market factors on the quality of hospital nursing care
with quality measured by the probability of a patient incurring an
adverse event such as a bedsore. She finds that the probability
of a patient having a bedsore is higher in hospitals with a large
fraction of managed care patients holding constant the seriousness
of the patient’s condition as well as the patient’s age and gender.
She also finds that the probability is higher in for-profit and hospitals
and in hospitals competing primarily with for-profits.
Joe Crespo
Joe Crespo is modeling
the outcome of the multiple unit auctions in deregulated electricity
markets. He develops a bid function equilibrium model
for auctions of multiple units of a homogeneous good. Using
data from the British auctions, he tests whether the observed auction
bid functions conform to the equilibrium of the theoretical model.
Michelle
Danis
Michelle Danis is examining
the effects of competition between exchanges on the equilibrium prices
of equity options. She is developing a theoretical model that allows
for both inter-exchange competition and intra-exchange competition
in markets with multiple market makers. Using this model, she
will determine how regulatory changes that permit the trading of a
firm’s options on more than one exchange have affected the equilibrium
bid-ask spreads.
Neal McCall
Neal McCall is estimating
a random coefficients conditional logit model of office firm location
as dependent on both firm and location characteristics. In contrast
to many previous location studies, he measures community amenities
including education with output-based variables such as public school
test scores rather than by input-based measures such as expenditures.
He finds that firms are attracted to areas with positive amenities
as measured by outputs but does not obtain the same result with amenities
measured by inputs.
Amitabh
Singh
Amitabh Singh is using
data on direct foreign investment by Indian firms to determine how
features of the foreign and the Indian markets affect the probability
that a firm invests abroad. He finds that firms subject to domestic
investment controls are more likely to invest abroad. Also,
Indian firms tend to invest in countries that are geographically
distant (in order to avoid shipping costs inherent in exporting the
good from India) and in countries that are culturally similar.
Recent Graduates
in Industrial Organization
John Eiler (1999),
“The Demand for New Features of Durable, Differentiated Products:
The Case of Automobile Air Bags,” Department of the Treasury, Washington,
D.C.
Doohoi Heo (1997),
"Mergers, Junk Bonds, and Economic Welfare," Senior Researcher,
Policy Development and Planning Group, Posco Research Institute,
Korea.
John Nail (1999)
"Hospital Mergers, Consolidations and Acquisitions: Their Effect
on Competition," Microeconomics Inc.
Stephen J. O'Brien
(1995), "Illegal Insider Trading, Mergers, and Market Efficiency,"
(law degree from Harvard University) Partner, Sonnenschein,
Nath & Rosenthal.
Courses
The two graduate courses
in industrial organization are Economics 245 and 248. Economics
245 covers primarily the empirical literature on market structure
and profits, entry and exit, mergers and regulation. Economics
248 covers the theoretical literature on market structure, price
discrimination, strategic interaction, and network effects.
Although the courses may be taken in either order, most students
find it useful to complete the theoretical before the empirical
course.
Requirements of the
Industrial Organization Field
Students with a major
or minor in industrial organization must take Econ. 245 and Econ.
248. Students with a major in industrial organization must
pass the industrial organization field exam after taking these two
courses and must complete a third course approved by the faculty
in the field.
