Digital Economics

Code:

2ME10

Acronym:

DE

Keywords
Classification	Keyword
OFICIAL	Economics

Instance: 2023/2024 - 2S

Active?	Yes
Course/CS Responsible:	Master in Economics

Cycles of Study/Courses

Acronym	No. of Students	Study Plan	Curricular Years	Credits UCN	Credits ECTS	Contact hours	Total Time
ME	14	Official Syllabus after 2021-2022	1	-	3	21	81
MEEE	0	Syllabus	1	-	3	21	81

Teaching language

English

Objectives

The course aims at providing solid foundations for the economic analysis of digital markets. The course presents the introductory concepts and analytical methods adopted within digital environment. The game theory models studied in this course allow students to acquire the tools and capabilities to better understand the firms’ strategic action within the digital economy and the policy implications of such strategies.

Learning outcomes and competences

Students should be able to understand the specifics of new business models emerging in digital industries and markets, relying on appropriate analytical tools and empirical evidence. The teaching and assess methods have been selected in order to allow students to engage in "hands on" activities, where they may apply theoretical concepts and analytical tools to real world problems, developping competences and skills regarding their analysis ability, critical thinking, communication and teamwork.

Working method

Presencial

Pre-requirements (prior knowledge) and co-requirements (common knowledge)

Students may benefit from previous basic knowledge on microeconomics and game theory

Program

1. Introduction

• New trends and challenges in the digital economy


• New business models in the digital age

 2. Basic game theory concepts (revision)

• Nash Equilibrium


• Subgame Perfect Nash Equilibrium


• Mixed-strategy Nash Equilibrium

 3. Platforms Theory

• Network effects: concept and baseline model


• Two-sided markets theory

 4.New business practices in the digital age

• Price discrimination


• Targeted advertising


• Product personalization

 

 

 

 

Mandatory literature

Paul Belleflamme, Martin Peitz; The Economics of Platforms, Cambridge University Press, 2021
Paul Belleflamme; Industrial organization. ISBN: 978-1-107-68789-9
Alexander Osterwalder; Business model generation. ISBN: 978-0-470-87641-1

Complementary Bibliography

Martin Peitz; The^Oxford handbook of the digital economy. ISBN: 978-0-19-539784-0
Carl Shapiro and Hal Varian; Information Rules: A Strategic Guide to the Network Economy . ISBN: 978-0875848631

Comments from the literature

In order to address the most recent problems within the digital economy, students may also have to work additional articles that address topical issues covered in this course.

Teaching methods and learning activities

This course relies on hybrid methods combining a set of theoretical lectures and practical classes (in which students will analyze and present specific case studies and solve selected problem sets).

Evaluation Type

Distributed evaluation with final exam

Assessment Components

Designation	Weight (%)
Apresentação/discussão de um trabalho científico	20,00
Trabalho escrito	20,00
Teste	60,00
Total:	100,00

Amount of time allocated to each course unit

Designation	Time (hours)
Apresentação/discussão de um trabalho científico	7,00
Estudo autónomo	40,00
Frequência das aulas	21,00
Trabalho escrito	13,00
Total:	81,00

Eligibility for exams

Final exam available to all students

Calculation formula of final grade

60% exam grade + 20% written report + 20% presentation of written report

Classification improvement

Students may improve the final grade through final exam either in the normal season or in the re-seat season.