My Fall 2017 Ph.d Industrial Organization reading list

It is long, and thus below the fold…

  1. Competition


Einav, Lira and Levin, Jonathan, “Empirical Industrial Organization: A Progress Report,” Journal of Economic Perspectives, (Spring 2010), 145-162.

Bresnahan, Timothy F. “Competition and Collusion in the American Automobile Industry: the 1955 Price War,” Journal of Industrial Economics, 1987, 35(4), 457-82.

Asker, John, “A Study of the Internal Organization of a Bidding Cartel,” American Economic Review, (June 2010), 724-762.

Bresnahan, Timothy and Reiss, Peter C. “Entry and Competition in Concentrated Markets,” Journal of Political Economy, (1991), 99(5), 977-1009.

Whinston, Michael D., “Antitrust Policy Toward Horizontal Mergers,” Handbook of Industrial Organization, vol.III, chapter 36, see also chapter 35 by John Sutton.

“Benefits of Competition and Indicators of Market Power,” Council of Economic Advisors, April 2016.

Klein, Benjamin and Leffler, Keith.  “The Role of Market Forces in Assuring Contractual Performance.”  Journal of Political Economy 89 (1981): 615-641.

Bogdan Genchev, and Julie Holland Mortimer. “Empirical Evidence on Conditional Pricing Practices.” NBER working paper 22313, June 2016.

Sproul, Michael.  “Antitrust and Prices.”  Journal of Political Economy (August 1993): 741-754.

McCutcheon, Barbara. “Do Meetings in Smoke-Filled Rooms Facilitate Collusion?”  Journal of Political Economy (April 1997): 336-350.

Crandall, Robert and Winston, Clifford, “Does Antitrust Improve Consumer Welfare?: Assessing the Evidence,”  Journal of Economic Perspectives (Fall 2003), 3-26, available at

FTC, Bureau of Competition, website,  Read about some current cases and also read the merger guidelines.

Parente, Stephen L. and Prescott, Edward. “Monopoly Rights: A Barrier to Riches.”  American Economic Review 89, 5 (December 1999): 1216-1233.

Demsetz, Harold.  “Why Regulate Utilities?”  Journal of Law and Economics (April 1968): 347-359.

Armstrong, Mark and Sappington, David, “Recent Developments in the Theory of Regulation,” Handbook of Industrial Organization, chapter 27, also on-line.

Shleifer, Andrei. “State vs. Private Ownership.” Journal of Economic Perspectives (Fall 1998): 133-151.

Farrell, Joseph and Klemperer, Paul, “Coordination and Lock-In: Competition with Switching Costs and Network Effects,” Handbook of Industrial Organization, vol.III, chapter 31, also on-line.

Xavier Gabaix and David Laibson, “Shrouded Attributes, Consumer Myopia, and Information Suppression in Competitive Markets,” 

 Strictly optional: Ariel Pakes and dynamic computational approaches to modeling oligopoly:


2. Organization

Gibbons, Robert, “Four Formal(izable) Theories of the Firm,” on-line at

“Make Versus Buy in Trucking: Asset Ownership, Job Design, and Information,” by George P. Baker and Thomas N. Hubbard, American Economic Review, (June 2003), 551-572.

Van den Steen, Eric, “Interpersonal Authority in a Theory of the Firm,” American Economic Review, 2010, 100:1, 466-490.

 Miller, Merton, and commentators.  “The Modigliani-Miller Propositions After Thirty Years,” and comments, Journal of Economic Perspectives (Fall 1988): 99-158.

Myers, Stewart. “Capital Structure.” Journal of Economic Perspectives (Spring 2001): 81-102.

Hansemann, Henry. “The Role of Non-Profit Enterprise.” Yale Law Journal (1980): 835-901.

Optional: Charness, Gary and Kuhn, Peter J. “Lab Labor: What Can Labor Economists Learn From the Lab?” NBER Working Paper, 15913, 2010, Lazear, Edward P. “Leadership: A Personnel Economics Approach,” NBER Working Paper 15918, 2010, Oyer, Paul and Schaefer, Scott, “Personnel Economics: Hiring and Incentives,” NBER Working Paper 15977, 2010.

Cowen, Tyler, Google lecture on prizes, on YouTube.


3. Production 

American Economic Review Symposium, May 2010, starts with “Why do Firms in Developing Countries Have Low Productivity?” runs pp.620-633. 

Nicholas Bloom, Raffaella Sadun, and John Van Reenen, “Recent Advances in the Empirics of Organizational Economics,”

Nicholas Bloom, Raffaella Sadun, and John Van Reenen, the slides for “Americans do I.T. Better: US Multinationals and the Productivity Miracle,”, the paper is here but I recommend focusing on the slides. 

Bloom, Nicholas, Raffaella Sadun, and John Van Reenen. “Management as a Technology?” National Bureau of Economic Research working paper 22327, June 2016.

Syerson, Chad “What Determines Productivity?” Journal of Economic Literature, June 2011, XLIX, 2, 326-365.

Diego Restuccia and Richard Rogerson, “The Causes and Costs of Misallocation,” Journal of Economic Perspectives, Summer 2017, 31, 3, 151-174. 

Dani Rodrik, “A Surprising Convergence Result,, and his paper here

Serguey Braguinsky, Lee G. Branstetter, and Andre Regateiro,The Incredible Shrinking Portuguese Firm,”

David Lagakos, “Explaining Cross-Country Productivity Differences in Retail Trade,” Journal of Political Economy, April 2016, 124, 2, 1-49.

Casselman, Ben. “Corporate America Hasn’t Been Disrupted.” FiveThirtyEight, August 8, 2014.

Decker, Ryan and John Haltiwanger, Ron S. Jarmin, and Javier Miranda. “Where Has all the Skewness Gone?  The Decline in High-Growth (Young) Firms in the U.S. National Bureau of Economic Research working paper 21776, December 2015.  NB: This paper and the three that follow have some repetition, so read them selectively rather than exhaustively.

 Decker, Ryan and John Haltiwanger, Ron S. Jarmin, and Javier Miranda. “The Secular Business Dynamism in the U.S.” Working paper, June 2014.

Haltiwanger, John, Ian Hathaway, and Javier Miranda. “Declining Business Dynamism in the U.S. High-Technology Sector.” Ewing Marion Kauffman Foundation, February 2014.

Haltiwanger, John, Ron Jarmin and Javier Miranda. Where Have All the Young Firms Gone? Ewing Marion Kauffman Foundation, May 2012.

Song, Jae, David J. Price, Fatih Guvenen, and Nicholas Bloom. “Firming Up Inequality,” CEP discussion Paper no. 1354, May 2015.

Andrews, Dan, Chiara Criscuolo and Peter N. Gal. “Frontier firms, Technology Diffusion and Public Policy: Micro Evidence from OECD Countries.”  OECD working paper, 2015.

Furman, Jason and Peter Orszag. “A Firm-Level Perspective on the Role of Rents in the Rise in Inequality.” October 16, 2015.

Mueller, Holger M., Paige Ouimet, and Elena Simintzi. “Wage Inequality and Firm Growth.” Centre for Economic Policy Research, working paper 2015.

Furman, Jason. ”Business Investment in the United States: Facts, Explanations, Puzzles, and Policy.” Remarks delivered at the Progressive Policy Institute, September 30, 2015, on-line at

Scharfstein, David S. and Stein, Jeremy C.  “Herd Behavior and Investment.”  American Economic Review 80 (June 1990): 465-479.

Chen, Peter, Loukas Karabarbounis, and Brent Neiman. “The Global Rise of Corporate Saving.” National Bureau of Economic Research Working Paper 23133, February 2017.


4. Incentives

Edmans, Adam, Xavier Gabaix, and Dirk Jenter, “Executive Compensation: A Survey of Theory and Evidence,” NBER Working Paper 23596, July 2017.

Kaplan, Steven N. “Executive Compensation and Corporate Governance in the U.S.: Perceptions, Facts and Challenges.” Working paper, July 2012. 

Robert J. Gordon and Ian Dew-Becker, “Unresolved Issues in the Rise of American Inequality,”

Stein, Jeremy C. “Efficient Capital Markets, Inefficient Firms: A Model of Myopic Corporate Behavior.” Quarterly Journal of Economics 104 (November 1989): 655-670.

Ben-David, Itzhak, and John R. Graham and Campbell R. Harvey, “Managerial Miscalibration,” NBER working paper 16215, July 2010.


5. Sectors: finance, health care, tech, others

 Gorton, Gary B. “Slapped in the Face by the Invisible Hand: Banking and the Panic of 2007,”, published on-line in 2009. 

Erel, Isil, Nadault, Taylor D., and Stulz, Rene M., “Why Did U.S. Banks Invest in Highly-Rated Securitization Tranches?” NBER Working Paper 17269, August 2011. 

Philippon, Thomas. “Has the U.S. Finance Industry Become Less Efficient? On the Theory and Measurement of Financial Intermediation.” Working paper, September 2014. 

Gompers, Paul and Lerner, Josh.  “The Venture Capital Revolution.” Journal of Economic Perspectives, Spring 2001, 145-168.

Paul Graham, essays,

Optional: consider subscribing to Ben Thompson’s Stratechery, periodic emails on the tech industry, note it is expensive.

Friedman, Milton. “The Social Responsibility of Business is to Increase its Profits.” The New York Times Magazine, September 13, 1970.

Healy, Kieran. “The Persistence of the Old Regime.” Crooked Timber blog, August 6, 2014.

More to be added, depending on your interests.


The link to the Crandall and Winston paper in JEP does not work.

I was going to say, is it the same Robert Crandall that was at American Airlines? That would be something...

This is Robert W. Crandall. AA president was Robert L.

found it:

Completely off topic, but the tone of the thread is appropriate for this question:

Has there ever been any large scale effort to reformulate neoclassical economics using graph theory? As in, treating economic agents as nodes on a graph with their own individual production functions, and transactions as connections between those nodes?

Because I have been going down that track(in my free time, just for fun) and I think a lot of progress can be made in that regard.

While not using graph theory I think Becker's old idea of treating households are productive units rather than consumption units and simply the supply or labor might be in that vien of thought.

Not sure if I'm thinking of the same thing, but perhaps Lazer's work on using social network analysis might be close. I think the sociology-economy intersection around that is really cool.

See "General Equilibrium and the Theory of Directed Graphs", in the Journal of Mathematical Economics, Feb 1997.

If you could find a copy without a paywall, I would be grateful.

Lots of theory on social networks, and applying economics to networks of firms, but to build economic theory on top of graphs, you need to explain not just the nodes and the meaning/behavior of a connection, but also how connections are made and severed, for starters.

Look at Leigh Tesfatsion specifically and agent-based computational economics generally.

@Right wing house music: You are asking the right questions. Unfortunately, I don't have good answers for you either, but if you are interested in discussing the topic, feel free to get in touch.

How long would it take to read all of that? How many students will read all of it? And, since we know the answer to the previous question, what is the point of a reading list that not a single student will slog through?

I have read enough MR to know that the answer to that question is "signaling". I just don't understand what the signal is in this case.

Notice the apparent total absence of any presence of those who actually do the industrial work in industrial organizations.

Pace the R. Crandall paper upstream...if it's the same Crandall.

PhD students, unlike other students, do tend to do the reading, because they are trying to locate the frontiers of knowledge so they can plan their own work. Still, that's a hell of a reading list.

Well, it does include this, which one assumes any GMU PhD student of Prof. Cowen would already know by heart -

Plus, at least this year, he is not asking for suggestions on how to expand it.

They definitely read a lot in order to locate the frontiers of knowledge. But that reading has to be done in a far, far more narrow scope than "Industrial Organization". I stand by my claim that zero of the students will slog through that list.

Well, if they are ardent devotees of Prof. Cowen, maybe will learn to fake it -

From what I know, even in my masters, we did not need to do all the readings but you need to do a good chunk to be part of discussions. Another aspect is that they may be forced to read a lot of this simply because of their comp exams.

As someone who has gone through it, I can tell you that most of the students will read all of it, for a given definition of "read".

You need to know enough to briefly summarize the question, the methods, the result, and whether you buy the main argument (be ready to defend) or not (be ready to point out weaknesses).

Usually the students will coordinate so that at least a few have deeper understanding of each article to promote discussion. But everybody has to have the basics down, or at least be quick enough on their feet to process and react to what others have said.

If you can't filter voluminous amounts of text into something you can hang on to, you're not going to get through a social science PhD.

Yup. One of the purposes of graduate school at the PhD level is to enable the student to become an independent scholar, i.e. one capable of keeping up with (and contributing to) the current state of knowledge and current controversies in the discipline.

I.e. the grad students need to learn how to read journal articles.

Which partly means learning various skills and techniques and theories, and partly means just being brought up to speed with where the discipline is and what economists know and what they don't know.

And that means lots of reading and big long reading lists. It doesn't mean that you've mastered every page of every article, but you need to know what Professor X had to say about Topic Y.

'“Americans do I.T. Better: US Multinationals and the Productivity Miracle,”'

Americans using SAP's software, broadly speaking. Strangely, the world's biggest ERP software company is German, and SAP has made vast sums of money selling business software to American multinationals.

Shame on you, Mr Cowen. What students need is a bit of triage: (i) You must read this, (ii) You will find potentially useful stuff in this, and (iii) I warn you against this as being wrong-headed, or dishonest, or obsolete, or ill written, or mere repetition of stuff that's better done elsewhere.

P.S. Isn't it a bit late to issue such list? Surely you should have issued a summer reading list back in May?

This is GMU - it would be lucky if the bookstore has a list of the books to order. (Yes, who uses the campus bookstore anymore, PhD student number is likely low, etc., etc.)

I am surprised and disappointed by the lack of Zingales. He just came out with this:

Or even Tirole or Aghion for that matter. I imagine the intellectual atmosphere and end-goal of GMU's econ phd is to tend towards libertarian think tanks, versus say government bodies where Tirole is probably more relevant but its weird not having such big profilic names in the sub-field.

Keep in mind this is part I of a two-part sequence, so quite a bit is left off...but covered in the spring by another instructor.

Ah, missed that. Apologies.

And the second half of the reading list will be published too?

Apropos of nothing, it's been said that the world's greatest philosophers wrote no books, but simply lived out their teachings.

Very good list. Add Tirole and Bassu. Didn't see much on network economics either.

I would add some material re a relatively new area: Behavioral Industrial Organization (or Behavioral Economics IO) which encompasses theory of the firm, internal incentives and norms, competitive strategy against or involving naive and informed consumers, and interaction of firms with customers who are not rational consumers (i.e., adding one more payday lender doesn't lower prices but just leads to other ways to exploit a naive)

Just for the fun of it and to add some humility I would also add some books written in the 70's and 80's that predicted how industries would change and look at how industries actually evolved. For example, in the 70's the claim was that because of the cost of a mainframe computer businesses who survived would be those could afford and use an IBM 360. Or, look at some of the predictions re Japan and Japanese industries and processes that would decimate US manufacturing.

I would also add platform economics and IO with respect to IP and innovation.

An omission on sectors section seems to be the defense sector. Note that thinkers on the firm owe a great deal to the stimulation provided by defense problems. For example, Armen Alchian, Ben Klein, William Meckling, Oliver Williamson, and others. It was not just social choice theory under the likes of Kenneth Arrow that sprang from RAND in the 1950-1960s. The problems of determining boundaries of administration, incomplete contracts, innovation management, organization, and so forth, are intimately tied to the provision of defense. The Organization section also seemed a bit light, but I was happy to see "Interpersonal Authority in a Theory of the Firm" included that follows in the tradition of Chris Argyris.

Apropos of nothing, it’s been said that the world’s greatest philosophers wrote no books, but simply lived out their teachings.

i am amazed that you have managed to construct an "io" syllabus with 50% of the papers being macro or finance papers.

Comments for this post are closed