Checking date: 16/04/2018

Course: 2019/2020

Competition and decision making
Study: Bachelor in Tourism (209)

Coordinating teacher: MORALES AGUILAR, MARIA JOSE

Department assigned to the subject: Department of Economics

Type: Compulsory
ECTS Credits: 6.0 ECTS


Competences and skills that will be acquired and learning results. Further information on this link
- Tools for decision making with perfect, partial and imperfect information: decision trees, the value of information, Bayes rule - Tools for decision making in strategic environments: static and dynamic game theory - Theory of the firm: notions of marginal and average costs, marginal and average productivity - Analysis of competitive and monopolistic markets - Analysis of oligopolistic markets: Cournot, Bertrand, Stackelberg, entry and exit
Description of contents: programme
THEME 1: "Consumer Theory: Preferences and demand functions" 1.1 Preferences 1.2 Utility functions: meaning and representation 1.3 Demand functions THEME 2: "Decision Theory (I): Representation and decision methods" 2.1 Decision making 2.2 Graphical representation of decision making 2.3 Matrix representation of decision making 2.4 Decision methods THEME 3: "Decision Theory (II): Attitude towards risk and the value of the perfect information" 3.1 Certainty Equivalent and Risk Premium 3.2 Attitude towards risk 3.3 The value of perfect information (1 and 2 variables) 3.4 The value of partial information THEME 4: "Theory of the decision (III): The Value of the imperfect information" 4.1 Conditional Probability and Bayes theorem 4.2 The value of imperfect information THEME 5: "Theory of the firm (I): Production" 5.1 Production function: returns 5.2 Marginal productivity and average productivity THEME 6: "Theory of the firm (II): costs and offer" 6.1 Cost functions 6.2 Supply function THEME 7: "Competitive markets and monopolistic markets" 7.1 Perfect competition 7.2 Monopoly THEME 8: "Game theory (I): static games ¿ strategies" 8.1 Elements of a game 8.2 Representation of a game 8.3 Strategies THEME 9: "Game theory (II): static games ¿ Nash equilibrium" 9.1 Nash Equilibrium in pure strategies 9.2 Nash Equilibrium in mixed strategies THEME 10: "Game theory (III): dynamic games" 10.1 Representation 10.2 Subgame perfect equilibrium 10.3 Bayesian equilibrium THEME 11: "Oligopolistic competence" 11.1 Cournot 11.2 Stackelberg 11.3 Bertrand THEME 12: "Collusion" 12.1 Collusive equilibrium 12.2 Incentives to break agreements THEME 13: "Strategic behavior: entry and exit"
Learning activities and methodology
The course will be taught through lectures, in which the main concepts will be discussed, and practice classes, in which exercises will be solved. The students will also be required to do some research on practical cases. These cases will be taken from the recent news and will allow the students to apply the toldos they have learned in classes. In addition, the students will have to solve exercises on their own.
Assessment System
  • % end-of-term-examination 60
  • % of continuous assessment (assigments, laboratory, practicals...) 40
Basic Bibliography
  • Juan Carlos Aguado Franco. Teoria de la Decision y de los Juegos. Delta Publicaciones. 2007
Additional Bibliography
  • Robert S. Pindyck and Daniel L. Rubinfeld. Micreconomia. Pearson Prentice Hall. 2009

The course syllabus and the academic weekly planning may change due academic events or other reasons.