Managerial Economics

Aims of the course

Managerial economics studies the decision-making processes of firms and the actions and reactions of firms. The course aims to achieve two main objectives: First: we want to achieve fluency in the language of economics, where students have a thorough grasp of concepts such as elasticity, sunk costs, barriers to entry, dominant strategy, etc., which they will use in their future work. Second: we want to improve decision-making skills in a dynamic and uncertain business world. The courses in Managerial Economics are based on economic intuition and build logical conclusions that are relevant for the decision-making of managers and other stakeholders in the business world.

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.

2. Production and costs.
2.1. Cost advantages.
2.2. Profit optimization and supply of the firm.
2.3. Costs analysis for business decisions.

3. Vertical boundaries of the firm.
3.1. The firm in a vertical chain.
3.2. Costs and benefits of vertical integration.
3.3. Model of vertical integration.

4. Diversification.
4.1. Measures and reasons of diversification.

5. Internal organisation

6. Market structures
6.1. Entry and exit.
6.2. Strategic commitment and game theory.

7. Dynamic pricing policy.

8. Price discrimination

9. Strategic positioning and comparative advantages.
9.1. Comparative advantage.
9.2. Strategic positioning.
9.3. Sustaining comparative advantage.

10. New business models.

Course director(s)