The Theory of Industrial Organization

This book covers the main subjects in this field, with very clear and readable expositions and solid formalizations. Mathematics is not difficult (basic notions of calculus and optimization are required) and some exercises have been included at the end of the chapters "...to help the reader become familiar with the subjects and to broaden his or her knowledge..."A bonus track: the book is also an excellent bibliographical guide to those who want to expand their reading.

This book is absolutely the "classic" in IO. The author amazingly provided very clear and coherent exposition to this huge, but diverse field. But, this book is not for everyone as some reviews below implied. First, consultants or managers may not find this book useful for the real-life application, because this is a (rather serious) "theory" book. It has no detailed cases, no practical managerial implications, and so on. For that purpose, there are many other good books like Schere, or Carlton & Perloff, etc. The virtue of this book lies in the author's capability to make accessible otherwise very complicated and abstruse models, which would be mainly the concern of grad students in econ, not consultants. Therefore, econ students who are interested in theory development in IO would quickly grasp the essence of important IO models with a simple algebra. I don't understand what part of the book some people think is useful as a reference for the consultants or even everyone.Second, simple algebra in the book does not mean it is accessible to "everyone." At the introductory grad level, game thoery and information economics use only basic algebra, but it is still not easy at all. Of course, this book introduces almost all important topics usually taught in the first-year micro sequence at graduate school, like repeated game (Ch 6), basic mechanism design technique (non-linear pricing in Ch 3), principal-agent problem (Ch 1), and so on. It would be misleading if one says these topics are accessible to everyone because of "minimal use of math." Even chapter 1, the theory of firm, is a very deep discussion, introducing the concept of "incomplete contract."In my opinion, this book will be ideal for econ grad students, who would want to quickly review relevant chapters before moving into more recent IO literature (of course, now with full rigor).

I studied Economics, soon after found myself working as a consultant, and still I keep this book on the shelf as reference in case I need it. IO is the most important branch of Economics with direct applications on the business world. This book is entirely theoretict and contains only the most significant models, along with references to other papers related the subject. The only addition I would make to this book is to incorporate some practical information to see the power of the models explaining the real world. Before starting to shout that a "New Economy has come!", people should focus more on the intrincate models already developed by economists ranging so different subjects as: differentiation, entry, information, innovation, etc. When I wrote my thesis on e-commerce, ... A word of advice: You need very good grounding in Game Theory (beyond the initial stuff you learn at intermediate Microeconomic level), if not, try reading the appendix on Game Theory before inmersing on the subject.

Tirole's book is, without doubt, a comprehensive and detailed explanation of modern IO theory. Although, at first, the structure of the book seems a bit awkward, the truth is that when you need detailed information on any aspect of IO it presents you with a complete, easy to understand review of its theory. I think that after reading Martin's Advanced Industrial Organisation,as an intermediate approach to IO, which is a fine, well structured book, if you want to get a deeper knowledge about IO, Tirole's book is, in my opinion, an excellent buy.

Although the book is now 12 years old, it is still the most recommended reference in top academics departments. The clarity of the writing and the width of the content (from the basics to a very advanced level) are some obvious qualities. The use of math is restricted at its minimum, with many graphics to emphasize intuition. The author, known as one of the leading scholars in micro theory, has also introduced many examples of applications and exercices. In the age of the Microsoft trial and antitrust issues, this is a book that will interest everyone. For the record, I have heard it will soon be translated in Chinese (mandarin) !