INFO 234/134 Information Technology Economics, Strategy, and Policy

Spring 2019

Tentative Schedule and Readings (Subject to Change)

Assignments and projects are posted on bCourses.

Lecture slides will be available on bCourses at the beginning of lecture.

Many of the assigned readings are licensed by the UC Berkeley Library, and can be accessed from a computer with a campus IP address. You can also access these materials from off-campus by using the library's proxy server.

Reading assignments will be adjusted throughout the course of the semester.

Week 1. Introduction

January 23: Course Overview
January 23: Assignment 1 posted

Week 2. Economics of information goods, services, platforms

January 28: Economies of Scale and Scope
  • Read: McAfee, P., et al., Introduction to Economic Analysis, Version 2.1, 2009. Section 10.2 on "Economies of Scale and Scope". [This book is released under a CC 3.0 license. It serves as a good microeconomics reference at the introductory/intermediate level.]

  • Optional: Luenberger, D. Markets, Chapter 7 of Information Science, Princeton University Press, 2006. [Brief intro/refresher of basic microeconomics concepts]
  • Optional: John Perry Barlow, The Economy of Ideas, Wired 2.03, 1994. [Visionary of his time.]
January 30: Economic Modeling and Analysis
January 30: Assignment 1 due; Assignment 2 posted

Week 3. Network Effects, Switching Costs, Strategic Pricing

February 4: Network Effects and Switching Costs
  • Read: Shapiro, C. and Varian, H. Network Effects, Notes to accompany Information Rules: A Strategic Guide to the Network Economy, Harvard Business School Press, 1998.

  • Skim: Briscoe, B., Odlyzko, A., and Tilly, B. Metcalfe's Law is Wrong. IEEE Spectrum, July 2006, pp. 26-31.

  • Optional: Varian, H., Section 6 "Switching costs and lock-in" in Economics of Information Technology. Mattioli Lecture at Bocconi University, Milan, Italy, 2001.
February 6: Business strategy: strategic pricing

Week 4. Business Strategy: Pricing, Bundling

February 11: Price Discrimination
February 13: Bundling
February 13: Assignment 2 due; Assignment 3 posted

Week 5. Business Strategy: Versioning

February 18: President's Day -- No Class
    February 20: Versioning
    • Read: Shapiro, C. and Varian, H. Versioning: The Smart Way to Sell Information Harvard Business Review, 1998.

    • Optional: Shapiro, C. and Varian, H. Versioning, Notes to accompany Information Rules: A Strategic Guide to the Network Economy, Harvard Business School Press, 1998.

    Week 6. Business Strategy: Price Conditioning; Models of Competition

    February 25: Price Conditioning
    February 27: Competition Models
    February 27: Assignment 3 due; Assignment 4 posted

    Week 7. Models of Competition: Game Theory

    March 4: Game Theoretic Models
    March 6: Game Theoretic Models

    Week 8. Complements, Substitutes, and Platforms

    March 11: Complements and Substitutes
    March 13: Platforms and Two-Sided Markets

    Week 9. Industry Structure

    March 18: Loci of Competition
    March 18: Assignment 4 due; Assignment 5 posted; Final Project posted
      March 20: Market Power

      Week 10. Spring Break

      March 25: No Class

      March 27: No Class

      Week 11. Industry Structure

      April 1: Vertical Control
      April 3: Guest Lecture and Group Exercise on Platform Design (Dr. Andrew Brooks)
      • Read: TBD

      Week 12. Regulation; Economics of Information

      April 8: Regulation & Network Neutrality
      April 8: Assignment 5 due; Assignment 6 posted

      April 10: Value of Information

      Week 13. Economics of Information

      April 15: Information Asymmetries
      April 17: Economics of privacy

      Week 14. Economics of Security; Network Cascades

      April 22: Economics of information security
      April 22: Assignment 6 due
        April 24: Network cascades and social epidemics

        Week 15. Network Structure; Peer Production

        April 29: Network structure, network formation
        May 1: Peer production

        Week 16. RRR Week

        May 6: No Class

        May 8: No Class

        Week 17. Finals Week

        May 13: Final Project Report due