Business Economics (BIM)
This course will develop student’s capacity for economic analysis and awareness of the insights for management. The focus of the course is on the principles of microeconomics relevant for managerial decision making and the limits of markets, including asymmetric information; monopolies; and ethical frontiers.
📚 Textbook
Evans, Anthony J., 2020 “Economics: A complete guide for business“, London Publishing Partnership
[S] Schotter, A., “Microeconomics: A Modern Approach” South Western (2008, International edition, approx. £60)
🗓️ Content
Topic | Lecture content | Textbook reading | |
1. Consumer theory | 1a. Incentives Matter* (+)
Evans, A.J., Incentive design, December 2020 1b. Max U (+) Evans, A.J., “Maximilian Untergrundbahn”, January 2018 Instructions: Complete the assignment questions |
[E] Ch. 1
[S] Ch. 2, 3, 4 |
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2. Understanding demand | 2a. Value creation* (+)
2b. Value creation activity |
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3. Practical supply decisions | 3a. Understanding cost* (+)
3b. Cost curves* (+) Evans, A.J., “La Marmotte”, January 2012 Instructions: Complete Exhibit 1 and provide suggestions for the two key decisions |
[E] Ch. 2
[S] Ch. 8, 9, 10, 14 |
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4. Real world markets | 4a. Auctions (+)
Hild, M., Dwidevy, A., and Raj, A., 2004, “The Biggest Auction Ever: 3G Licensing in Western Europe”, Darden Business Publishing Discussion question: What are the alternatives to auctions? 4b. Market Applications (+) |
[E] Ch. 3
[S] Ch. 15, 21, 22 |
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5. Limits to markets | 5a. Markets in everything (+)
“I’ve got debts, please buy my kidneys” The Times September 27th 2009 Discussion question: What are some different ways in which we could allocate kidneys? 5b. Shortage DB |
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6. Asymmetric information | 6a. Adverse selection (+) Akerlof, G.A., (1970). “The Market for ‘Lemons’: Quality Uncertainty and the Market Mechanism”. Quarterly Journal of Economics 84(3):488–500 (£)6b. Signalling* (+) Spence, M., (1973). “Job Market Signaling”. Quarterly Journal of Economics 87(3):355–374 (£) |
[S] Ch. 23 | |
7. Pricing strategy | 7a. Price discrimination
Read the following Twitter thread Instructions: Verify as much of the information in the case as possible 7b. Price discrimination DB* (+) |
[E] Ch. 4 | |
8. Competition policy and regulation | 8a. Competition and the market process* (+)
8b. Capital theory* (+) |
[E] Ch. 5, Ch. 6
[S] Ch. 19 |
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🏅 Assessment
- 0% Problem set (download here)
- 40% Group report (see here for instructions)
- 60% Final exam