Module 6

Module 6: Competition and Regulation in Network Industries

(16 a.h.¹)

Outline of Course Contents

Lecture 1: Networks (Christos Genekos)
Main topics: network characteristics (lines and nodes, natural monopoly), club effects, indirect network externalities, social networks, monopoly pricing with network effects, competition with network effects

Lecture 2: Network pricing (Richard Green)
Main topics: network cost allocation and recovery, two-part tariffs, peak load pricing, pricing in energy networks

Lecture 3: Regulation, incentive contracts, regulation in practice (Richard Green)
Main topics: what regulation is and isn’t, incentive mechanisms, price regulation in practice

Lecture 4: Competition policy and network effects: Digital antitrust cases (Christos Genakos)
Main topics: abuse of dominance (Microsoft, Google), mergers (AOL/Time Warner; MCI-Worldcom/Sprint, Facebook/WhatsApp)

Lecture 5: Regulating the ICT industry 1 (Christos Genakos)
Main topics: entry, one-way access pricing, ECPR, margin squeeze, two-way access pricing, universal service obligation

Lecture 6: Regulating the ICT industry 2 (Christos Genakos)
Main topics: digital regulation and investment, net neutrality, privacy regulation, data and competition policy

Lecture 7: Regulating the energy industry 1 (Richard Green)
Main topics: unbundling electricity (and gas), wholesale market design, market power in electricity wholesale markets

Lecture 8: Regulating the energy industry 2 (Richard Green)
Main topics: competition in retail markets, environmental policies (carbon markets, renewables, energy efficiency)

Main references

  • Church J. and N. Gandal (1992), “Network effects, software provision, and standardization”, Journal of Industrial Economics, vol. 40, 85-103
  • Crampes C. and T.O. Léautier (2015), “Demand response in adjustment markets for electricity”, Journal of Regulatory Economics, vol. 48, 169–193.
  • Crémer, J., Rey, P. and J. Tirole (2000), “Connectivity in the commercial Internet”, Journal of Industrial Economics, vol. 48, pp. 433-472.
  • Fudenberg, D. and J. Tirole (2000), “Pricing a network good to deter entry”, Journal of Industrial Economics, vol 48, 373-390
  • European Commission (1999), “Liberalisation of network industries. Economic implications and main policy issues”, European Economy, n°4
  • Lopez, A. and P. Rey (2016), “Foreclosing competition through access charges and price discrimination”, Journal of Industrial Economics, vol. 64, 436-465
  • Shy O. (2001) “The Economics of Network Industries”, Cambridge University Press. Read mainly chapters 1-6.
  • TSE debate: “The electricity industry at a crossroads. A series of analysis”, by C. Crampes and T.O. Léautier

… and much more in the slide

¹ a.h. = academic hour (50 minutes)