5IE478 – Regulation, State Aid and Business
The course will meet on Fridays from 12.45-2.15 pm in Room SB 335, 4 ECTS credits
This course surveys the economic, legal, and policy framework that governs businesses. The objective is to gain an understanding of both – government intervention in selected markets as well as of business strategies including investment decisions, pricing, advertisement or innovation. We will examine the economic rationales of legal rules in selected areas of regulation. By explaining the main statutes of related legislation, its enforcement and implications for businesses and managements, the course will supply students with arguments useful for their future carrier. The focus will be on empirical studies and the competition on global markets and EU single market. The core of the course will be not only lectures but also presentation and discussion of cases with active participation of students.
Each student will write a test and a short paper related to certain area of regulation (rooming fees of mobil services or deregulation of energy markets) or state aid (banks during financial crisis) or antitrust (mergers or illegal cartel). Students can select their own topic or choose one from a list of suggested ones. It will count for 40% of the grade. The mid-tem test will count for 30% of the grade. Finally, class active participation in discussions and presentations will count for another 30% of the grade.
There exist no standard textbook which would cover the course. Knowledge of selected chapters of several books will be required (copies will be available). Additional readings may be handed out in the lecture preceding their discussion. Students are encouraged to scan Financial Times, Hospodarske noviny or The Economist magazine for articles relevant to the topics covered in the course.
1) Firm, market, state and institutions. Market entry and exit. Firm establishment and firm bancrupcies. Firm size and firm growth.
2) Regulation and deregulation: reasons, methods, effects
3) Competition policy and regulation of network industries
4) State aid to enterprises: reasons, forms, effects, laws and instituions (EC, WTO)
5) Industrial policy, trade policy and competition
6) From competition to monopoly: teoretical concepts of competition and sources of monopoly
7) Market structure, efficiency, market entry regulations and entry barriers: cases
8 ) Business strategies and protection of competition: antitrust laws, institutions: cases
9) Mergers and approval of mergers, multinational mergers and ascquisitons: cases
10) Cartels and collusion: history, laws, economic analysis: cases,
11) Innovation activity of firms, patents and state subsidies: cases
12) Advertisement regulation: cases