REGULATION AND COMPETITION POLICY 1. Course Information Course Number: 21935 – 21233 Term: First (October‐December) Language: English Course Dates:  Lectures: Week 2‐11, Thursday and Friday, 15.00‐16.30  Tutorials: Weeks 4‐11, Monday 14.30‐16.00, 16.00‐17.30, 17.30‐19.00 Professor: Carlos García  Office hours: as agreed with students via e‐mail Prerequisites: Introduction to microeconomics 2. Aims and Objectives of the course The objective of the course is to introduce the student to the main concepts of modern competition policy and regulation. The course will give an overview of the main theoretical foundations and economic models used as well as its practical implications in real life cases. In the lectures, we will focus on the theoretical principles of competition policy and regulation, which will be complemented by real examples of competition cases and regulatory decisions. Tutorials will be used to the study of practical case studies in which there will be a reasoned application and analysis of the underlying principles and theories to each case. Student will have an active role in the presentation of the cases. 3. Course Outline (it can be subject to modifications according to students’ suggestions. Not all sections will be devoted the same amount of time) PART I. COMPETITION POLICY 1. Introduction to Competition Policy 1.1 History of Competition Policy 1.2 Definition and Objectives of Competition Policy 1.3 The main features of European and US Competition Law 1.4 Differences between European and US Competition Policy 2. Basics Concepts of Competition Policy 2.1 Market power and Welfare 2.2 Allocative Efficiency. Productive Efficiency. Dynamic Efficiency. 2.3 Product Market Definition and Geographic Market Definition 2.4 European Commission on the Definition of Relevant Market 2.5 Assessment of Market Power 3. Cartels and Horizontal Agreements 3.1 Facilitating factors for cartels 3.2 What is the appropriate approach: ex ante or ex post? 3.3 Allowed conduct vs. forbidden conduct: how to prove? 3.4 Joint ventures and horizontal agreements in general 3.5 Case study 4. Horizontal Mergers 4.1 Unilateral effects 4.2 Pro‐collusive effects 4.3 Efficiency gains from mergers 4.4 Merger remedies 3.5 Case study 5. Vertical Restrains and Vertical Mergers 5.1 Intra‐brand competition 5.2 Inter‐brand competition 5.3 Leverage and foreclosure 5.4 Case study PART II. PRINCIPLES OF ECONOMIC REGULATION 6. Introduction to Economic Regulation 6.1 Definition and history of Economic Regulation 6.2 The theory of Economic Regulation 6.3 Instruments of Economic Regulation: quantity, price, entry/exit 6.4 Why regulate? 7. Regulation of Natural Monopolies 7.1 Definition of natural monopoly 7.2 Subadditivity and sustainability 7.3 Price regulation in single‐product case 7.4 Price regulation in multi‐product case 7.5 Applications in regulated sectors 8. Access Regulation 8.1 Access in the public utility industries 8.2 One‐way access pricing 8.3 Two‐way access pricing 8.4 Applications in regulated sectors 9. Regulation in EU and Spain 8.1 Energy 8.2 Telecommunications 8.3 Other sectors (transport, postal…) Last week will be dedicated to recap and any outstanding issues with a possible mock exam 4. Assessment The final mark of the course will be calculated as follows:  20% of the final mark will be based on the practical tasks assigned to each student in the tutorials.  Up to 10% additional can be obtained for an active participation in lectures/tutorials  80% of the final mark will be accounted from the written exam taken in December 5. Bibliography Textbooks Competition part: 
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Motta, M. (2004), Competition policy: Theory and Practice. Cambridge University Press Lyons, B. (2009), Cases in European Competition Policy: The Economic Analysis, Cambridge University Press Jones, A. and Sufrin, B. (2014), EU Competition Law: Text, Cases, and
Materials, Oxford University Press Whinston, M. (2006), Lectures on Antitrust Economics, MIT Press Regulation part 
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Viscusi, W. et al. (2005), Economics of Regulation and Antitrust, MIT Press Decker, C. (2015), Modern Economic Regulation; An Introduction to Theory and Practice, Cambridge University Press Joskow, P. (2005), Regulation of Natural Monopolies, MIT Press Articles, reports and guidelines Different articles, legislation and reports will be provided as a support for the practical cases studies in tutorials. Some interesting references and links that will be addressed in lectures are the following: Competition 
Kovacic, William E. (2008): Competition Policy in the European Union and the United States: Convergence or Divergence? 
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(https://www.ftc.gov/sites/default/files/documents/public_statements/compe
tition‐policy‐european‐union‐and‐united‐states‐convergence‐or‐
divergence/080602bateswhite.pdf) OECD Competition (2014) , Guide for helping competition authorities assess the expected impact of their activities (http://www.oecd.org/daf/competition/Guide‐competition‐impact‐
assessmentEN.pdf) – there is also a version in Spanish European Commission (1997) Commission Notice on the definition of relevant market for the purposes of Community competition law (http://eur‐
lex.europa.eu/legal‐content/EN/TXT/?uri=celex:31997Y1209(01) ) Office for Fair Trading (2004) Guidelines on assessment of market power (https://www.gov.uk/government/uploads/system/uploads/attachment_data/
file/284400/oft415.pdf ) Ivaldi M. et al (2003): The economics of tacit collusion, Final Report for DG Competition, ICE Toulouse (http://ec.europa.eu/competition/mergers/studies_reports/the_economics_of
_tacit_collusion_en.pdf ) Motta, M. (2007) Cartels in the European Union: Economics, Law, Practice, Barcelona Graduate School of Economics ( http://www.barcelonagse.eu/tmp/pdf/motta_cartelseulaw.pdf ) Federal Trade Commission, Horizontal Merger Investigation Data 1996‐2011, (https://www.ftc.gov/reports/horizontal‐merger‐investigation‐data‐fiscal‐
years‐1996‐2011 ) European Commission (2014) White Paper: towards a more effective EU merger control ( http://eur‐lex.europa.eu/legal‐
content/EN/TXT/PDF/?uri=CELEX:52014DC0449&from=EN ) Commision notice of 10 May 2010: Guidelines on vertical restraints [SEC (2010) 411] (http://eur‐lex.europa.eu/legal‐
content/EN/TXT/PDF/?uri=CELEX:52010SC0411&from=EN ) Calzolari G., Denicolo V. (2013) Competition with exclusive contracts and market‐share discounts, (http://www2.dse.unibo.it/calzolari/web/papers/competition_exclusive_contr
acts.pdf ) Nestle – Perrier Case (http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_
M_190 ) Intel Case http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=1_
37990 General Electric/Honeywell case http://ec.europa.eu/competition/mergers/cases/decisions/m2220_en.pdf Google case (http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=1_
39740) Regulation 
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Newbery D. (1997): Privatisation and Liberalisation of Network Utilities, University of Cambridge, Department of Applied Economics (http://www.econ.cam.ac.uk/people/emeritus/dmgn/files/istanbul.pdf) Glachant, Jean‐Michel (2012) Regulating Networks in the New Economy, Review of Economics and Institutions, Volume 3, Number 1, 2012, pp. 1‐27 ( http://www.rei.unipg.it/rei/article/view/49/66 ) M. Bourreau, C.Cambini and P. Dogan (2013). Access regulation and the transition from copper to fiber networks in telecoms, RSCAS Working Papers 2013/52 http://cadmus.eui.eu/bitstream/handle/1814/27597/RSCAS_2013_52.pdf?seq
uence=1 Parcu P. (2013) Electronic communications regulation in Europe : an overview of past and future problems, Florence School of Regulation ( http://cadmus.eui.eu/handle/1814/29137 ) Federico G. and Vives X. (2008): Competition and Regulation in the Spanish Gas and Electricity Markets, Reports of the Public‐Private Sector Research Center, , Business School, University of Navarra (http://www.iese.edu/en/files/energy%20report_Eng_tcm4‐27082.pdf ) Joskow (2005) Incentive Regulation in Theory and Practice: electricity distribution and transmission network, AEI‐Brookings Joint Center Working Paper (http://web.mit.edu/ceepr/www/publications/workingpapers/2005‐
014.pdf ) Ofgem, Network regulation – the RIIO model, https://www.ofgem.gov.uk/network‐regulation‐riio‐model