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Managerial Economics


Aims of the course

This course emphasizes the synthesis of economic theory, decision sciences, and the various fields of business administration studies. It examines how they interact with one another as the firm attempts to reach optimal managerial decisions in the face of constraints. A special emphasis will be made on how managerial decisions are actually made in the real world. The course will increase the effectiveness of decision making by expanding and sharpening the analytical framework used by managers to make decisions.

Course syllabus

1. Theory of demand.
1.1. Classical theory of demand.
1.2. Theory of demand that is based on product characteristics.
1.3. Demand estimation and demand forecasting.
1.4. Business case-Metabical.
2. Production and costs.
2.1. Cost advantages.
2.2. Optimization and supply of the firm.
2.3. Costs analysis for business decisions.
2.4. Business case-Outsourcing opportunities for small businesses: A quantitative analysis.
3. Internal organisation.
3.1. Behavior of firms and their goals.
3.2. Cases-Behavior of firms in countries of former Yugoslavia and Albania
3.3. Markets of asymmetric information.
4. Vertical boundaries of the firm.
4.1. The firm in a vertical chain.
4.2. Costs and benefits of vertical integration.
4.3. Model of vertical integration.
4.4. Business case-Nucleon.
5. Diversification.
5.1. Measures and reasons of diversification.
5.2. Strategic styles of diversified firm.
5.3. Business case-Kolektor.
5.4. Business case-Martifer.
6. Market structures.
6.1. Entry and exit.
6.2. Business case-Ryanair.
6.3. Strategic commitment and game theory.
7. Dynamic pricing policy.
7.1. Business case-Cartel in Turku area?
8. Price discrimination.
9. Strategic positioning and comparative advantages.
9.1. Comparative advantage.
9.2. Strategic positioning.
9.3. Sustaining comparative advantage.
9.4. Business case-Apple.
10. Industrial policy.

Course director(s)

  • Office Hours
  • Wednesday at 14:30 in RZ-406
  • Office Hours
  • Friday at 10:00 in RZ-307
  • Office Hours
  • Friday at 11:00 in RZ-301
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