This course provides an overview of core economic concepts and how they relate to senior executive management. Particular focus will be placed on the theory and practice of internal markets and how organisations have harnessed the knowledge and incentives provided by market mechanisms. Group work will focus on an analysis and assessment of the macro context for a relevant country, looking at monetary and fiscal policy as well as a broader set of social and environmental indicators.
All cases need to be read and prepared in advance. Textbook chapters are not mandatory but are highly recommended for students without a strong background in economics. I’ve also provided a few videos and quizzes which should be helpful.
Day 1: Micro
To verify you have the maths skills necessary for this course, complete this quiz.
An optional online version of this course, which may be helpful for revision, is available here.
Note:
Cases marked with a pound sign (£) are available via the learning platform.
What I’ve been reading:
Ghattas, K, 2020, Black Wave, Wildfire
What I’ve been listening to:
The Tragedy of the Middle East: A Letter from Lebanon, The David McWilliams Podcast, October 1st 2024 – recorded in September 2024, I found this this interview with Carole Nakhle to provide a good perspective on the economic history and current political situation.
I am also a big fan of Anthony Bourdain, who devoted 2 episodes from No Reservations (Beirut, which was filmed in July 2006, and Back to Beirut) as well as one from Parts Unknown:
This course gives participants a coherent view of core economic concepts from the perspective of managers and policymakers. We will look at the principles of microeconomics that are relevant for managerial decisions, including value creation, supply decisions, and the use of markets to allocate scarce resources. Particular techniques involving the interpretation of market data will be explored to provide a useful, practical toolkit.
The course also exposes participants to some of the key frameworks and models in macroeconomic theory, and provides a policy-oriented decision-making context. Newspapers and social media are full of macroeconomic commentary, but many people can feel intimidated by the terms being used and the thinking behind them. Participants will not only understand why certain decisions were made, but formulate their own views on the arguments in favour and against. In doing so, participations will be obliged to think big about the macro policy environment.
Finally, economics is focused on human action and therefore we will look at some key findings from the behavioural economics literature and how they relate to corporate decision making.
“Sun: A CEO’s Last Stand”, Business Week, July 26th 2004 (£)
You should consult the schedule below to see additional instructions for each of these readings. There are also links to relevant sections of the textbook but these are not mandatory.
To verify you have the maths skills necessary for this course, complete this quiz.
After class you should watch this video on Credibility.
Revision
An optional online version of this course, which may be helpful for revision, is available here.
Note:
Sessions marked with an asterix (*) are lectures and have handouts available. Cases marked with a pound sign (£) are available via Canvas. Each session contains a link (+) to additional resources.
There are widespread concerns that social and political divisions are being exacerbated by information technology, and that this is having a profound impact on the capabilities and quality of both global and local institutions. In a similar way to how the advent of the printing press prompted the rise of democracy and the nation state, perhaps digital transformation is contributing to a similar disruption in governance.
Such trends are particularly relevant in regimes where statehood was not an internal process, and was adopted either through colonial or international activity. Rising populism and authoritarianism provides the social and political backdrop to our analysis of the broad impact of technology, and we will consider whether pluralist approaches may help to combat some of the emerging threats to liberal democracy.
This course investigates how digital transformation relates to democracy and governance in an increasingly connected yet potentially polarised world.
Assessment
60% Final exam (MCQ) – this relates to all lecture content and the readings from the content section
For a good example of a subject matter for the group report I highly recommend reading The Story of VaccineCA. In particular, consider how the following elements coincide: the type of organisation chosen to pursue this objective (initially volunteers but then a Delaware corporation; the institutional context (i.e. liberal market democracy where sharing such information wasn’t illegal); and the cultural attitude toward problem solving and tech optimism). For a great interview with Patrick McKenzie about his background and advice listen to his Conversation with Tyler.
Extra reading
“The Adolescence of Technology” by Dario Amodei, January 2026 – this is relevant for the course not only because it provides an insider look at AI risk and governance needs, but also the relevance of social medial (“during the peak of worries about AI risk in 2023-2024, some of the least sensible voices rose to the top, often through sensationalistic social media accounts”) and democracy (“the remedy is what it always is in a democracy: those of us who believe in this cause should make our case that these risks are real and that our fellow citizens need to band together to protect themselves” and “the AI age could lead inevitably and logically to the conclusion that democracy is the only viable form of government if humanity is to have a good future”).
Things Fell Apart, BBC Sounds (a documentary that looks at the different origins of the culture wars, which are defined as “the battle for dominance over conflicting values”, or “the things we shout about on social media”)
12. Conspiracy Theories, The Rest is History, Jan 4th 2021 (a short overview of the history of conspiracy theories, with emphasis on how they tend to satisfy a need for us to try to make sense of shocking events).
Beware the Jabberwock, This American Life, March 15th 2019 (a single episode that provides a detailed look at the origins of the Sandy Hook conspiracy theory and one parents attempt to fight misinformation. The second half of this episode is an interesting, but less relevant profile and interview with Alex Jones).
Four Hours at the Capitol, BBC (a documentary about the storming of the US Capitol building on January 6th 2021)
The Coming Storm, BBC Sounds (7 part podcast documentary on the rise of QAnon)
Death by Conspiracy, BBC Sounds (an 11 part podcast documentary on Gary Matthews, who died from covid in January 2021 having been drawn to social media claims that it was a hoax. I listened to this as a parallel to The Coming Storm but it strayed too far into covid, media ethics, and psychology for me to incorporate it more fully in this course, which attempts to avoid those areas. I didn’t learn much about conspiracy theories aside from episode 9 which provided a good attempt to understand why our common conception is often misplaced. Ultimately I just found this sad.)
The Last Podcast on the Left (Episodes 400-405) – this series was recommended as a deep dive into the original and most important conspiracy theory of all time, but I found it so irritating and juvenile in presentation that I didn’t get past the first episode. I did like the claim that conspiracy theories require a conspiracy vacuum, however.
Good Robot, Vox Media, March 2025 – A bit slow going and more about the rationalist community and effective altruism movement than the dangers of AI (which isn’t a robot!). I considered it a somewhat forced attempt to use those communities as a means to link AI doomerism to religion.
Recommended Video
Matthew Perry on BBC Newsnight, (yes, one can make the contrarian and pedantic point that humans exercise “choice” in every decision we make, but this interview demonstrates the importance of acknowledging the human cost of not being in full/partial/any control of things that are harmful to your well being. Particularly poignant given Perry’s death in 2023).
Command and Control, PBS (a documentary looking at how close we came to a major nuclear accident)
Chris Blattman on War and Centralized Power, Conversations with Tyler, Episode 149, May 4th 2022 – this is a fascinating interview with a global expert on war (Blattman’s core thesis is that violence occurs when centralised groups have no check on their ability to indulge their narrow preferences). It doesn’t have direct relevance to this course but it is very interesting and touches upon the concept of polycentricity (which is the notion of multiple centres of power).
#365 – Sam Harris: Trump, Pandemic, Twitter, Elon, Bret, IDW, Kanye, AI & UFOs, Lex Fridman podcast – a good overview of the ethics of public vs. private conservation (i.e. platforming); the weaponization of social media (i.e. why Harris deleted his Twitter account); the health of democracy and our capacity to deal with social problems such as a potential future pandemic. Also relevant to future AI prospects.
#429 – Paul Rosolie: Jungle, Apex Predators, Aliens, Uncontacted Tribes, and God, Lex Fridman podcast – a fascinating conversation that helps us to link animals, consciousness, intelligence, and AI. The section from 1:41:00 to 1:58:46 is a wonderful conceptualisation of how we, as “meat vehicles on a floating rock”, should think about these things.
#367 – Sam Altman: OpenAI CEO on GPT-4, ChatGPT, and the Future of AI, Lex Fridman podcast – Altman defends OpenAI’s strategy of transparency and iterative progress that gets tested on a wide scale. He believes that AI alignment can keep pace with its capabilities. A good counterexample is nuclear weapons.
#371 – Max Tegmark: The Case for Halting AI Development – Lex Fridman podcast – Tegmark claims that AI development is a suicide race not an arms race, and it’s not obvious that other countries, who might have more to lose from cutting edge technology, will continue regardless. The open letter that he organised was specifically intended to deal with the collective action problem whereby AI developers want everyone else to slow down but can’t do so unilaterally.
Episode 25: Is it the phones? The Studies Show, January 30th 2024 – a look at the evidence relating to social media and teen mental health.
Episode 11: The AI apocalypse debate The Studies Show, September 19th 2023 – two science journalists discuss whether AI will cause the end of human life.
Civil society – Paul Aligica on Human freedom and the Third Sector, Mercatus Center – an interview with an academic (one of my PhD committee!) who articulates the importance of polycentric solutions to solve social problems, and the normative importance of respect for individual autonomy and consent. This is particularly relevant for students who are from former communist countries, or those interested in modern forms of indoctrination.
Jennifer Pahlka on Reforming Government (Ep. 238), Conversations with Tyler – a good interview with the founder of United States Digital Service. I particularly liked her point about seeing legislation as a step-by-step process (where you hand off to someone else) versus a feedback loop. The key issue is the assessment of DOGE, and whether sensible and gradual government reforms are ever really possible.
Recommended movie night
This is not massively related to this course, but I really enjoyed watching Top Gun: Maverick (you may need to watch the original Top Gun first to get the full benefit). It reminded me of how Rocky IV contrasted American individualism, authenticity, and heart against superior Soviet technology. I saw Maverick as a rumination on automation, and the continued role for human emotion, and decision making that is instinctive, impulsive, and emotive, and how that gets managed. The subtext is that unmanned drones and algorithms are the future. In the film, US technology is deemed inferior but it is all about who is in the plane and not the plane itself. Traditional pilots needs to eat, sleep and piss but remain the driving force of future success, and whatever it is that ensures a future is worth achieving.
Here’s an absorbing and fascinating explanation of how the Mach 10 scene resembles a perfect pop song:
The best 3 movies related to AI and our conception of reality (in my opinion) are:
Recommended Activities
Play Moderator Mayhem, a game that helps understand more about internet safety
Perhaps the best case study of the importance of an effective digital transformation is the UK Post Office Horizon scandal (Wikipedia). There is an excellent podcast about it produced by BBC Sounds and in January 2024 ITV aired a documentary.
Giraudo, M., 2022, “On legal bubbles: Some thoughts on legal shockwaves at the core of the digital economy“. Journal of Institutional Economics,18(4), 587-604 – an account of how changes in expectations around how data gets protected as private property has influenced Big Tech. I found the article badly written but conceptual and therefore reasonably accessible to a non academic audience.
Stephan, M., Marshall, G., and McGinnis, M., “An Introduction to Polycentricity and Governance“, 2019, in Thiel, A., Blomquist, W., and Garrick, D., eds. 2019. Governing Complexity. New York: Cambridge University Press, chap. 1, pp. 21-44.
If you detect an attempt to link together the claims that “an important solution to social media addiction is good parenting” and “we have to learn how to raise AI” then this is deliberate. Dario Amodei refers to Anthropic’s constitution in the following terms: “It has the vibe of a letter from a deceased parent sealed until adulthood.” Stuart Ritchie (who works at Anthropic) captures it nicely:
And it’s apt that I teach this course at ESCP. As Martin Luther said, Paris is “the parent of learning”.
The course introduces students to several important and contemporary issues that relate to economics. Having already covered the key insights from Micro and Macroeconomics, we will go deeper into the frontiers of the discipline. Students will challenge their understanding of complex and controversial issues and develop their perspective on how to become managers of the future.
I thought it went without saying that economic growth is good, that America is a phenomenally rich country, and that capitalism is the reason why. But now I’m not so sure. So in this course, I say it!
Other lectures that could be added:
Macro Trends – an overview of global growth prospects and a survey of the key challenges facing policymakers
Macro Risk – a look at the key risk factors affecting the global economy, and a survey of which countries are best positioned to deal with macro shocks
Macro Models – how macroeconomic models should integrate climate concerns
The evolution of money: gold, fiat and crypto
Central banks and digital transformation
The Solow model, and how it relates to growth theory
Sustainability Survey – how we are solving our environmental problems
How can I improve my team effectiveness when facing complex business problems?
Problem Solving and Decision Making is an intensive managerial programme that has been shown to be an enjoyable and successful way to improve team performance and productivity. The course provides practical skills and a management mindset rather than simply transfer knowledge. Participants are taken through the full problem-solving and decision-making cycle: from breaking down the issue, to prioritising and writing the action plan. They also practice communicating their proposal, an important and often overlooked aspect of the decision-making process. The course focuses mostly on experiential, proactive and practical learning: participants engage in individual and team problem-solving and decision-making, and receive constructive feedback to build on personal strengths and address limitations.
How can I become more confident when faced with conditions of uncertainty? How can I contribute to an organisation that utilises effective heuristics?
This 1-2 day course provides a simple framework for how people make decisions. It shows how heuristics have the potential to enable effective judgments, but that they can also lead us to mistakes. It also provides a tool kit – the scenario method – to confront complex and uncertain situations. We will also understand what makes us us, and how this relates to personal and professional activities.
This course provides an overview of basic microeconomic theory and applies it to business decision-making. In particular, it will present the main principles of microeconomics from the perspective of strategic behaviour. The course draws on examples from the business world to illustrate the practical relevance of the models used.
This course provides a thorough and contextual perspective on various forms of macroeconomic policymaking. In addition to looking at how monetary and fiscal policy can be used to manage the domestic economy, we will take an international approach to various forms of economic crisis. By the end of this course students will be able to critically engage with some of the key indicators that may help to predict a currency crisis, and relate this to famous historic cases. We will look at the role played by international institutions during sovereign debt crises, and gain experience at identifying, summarising, and communicating relevant data.
The course introduces students to several important and contemporary issues that relate to economics. Having already covered the key insights from Micro and Macroeconomics, we will go deeper into the frontiers of the discipline. Students will challenge their understanding of complex and controversial issues and develop their perspective on how to become managers of the future.
