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Managerial Economics (MiB) - B

Industrial organization is a field of microeconomics that explores the dynamics of industries and in particular the way firms compete with each other. Therefore, this course focuses on strategic competitive behavior, with special attention being paid to the perspective of newly founded ventures. Within this context we will discuss how to assess market power /structure and its implications, pricing mechanisms, as well as how regulations impact strategy design. The course uses a mixture of case studies, lectures, guest lectures and a final written exam.
Course code
ECON505
Course type
MSc Course
Weekly Hours
2,5
ECTS
5
Term
HS 2023
Language
Englisch
Lecturers
Juniorprof. Dr. Anna Ressi
Please note that exchange students obtain a higher number of credits in the BSc-program at WHU than listed here. For further information please contact directly the International Relations Office.
The main goal of this course is to provide an introduction to the main concepts and analytical tools of the theory of managerial economics. Managerial economics is a broad research stream that aims to provide a framework for managerial decision-making. It applies economic theories to help managers understand complex problems and make better decisions. In this course, we will predominantly confront managerial issues that involvestrategicinteractions between multiple organizational members or market participants, i.e. situations where a person’s action has an identifiable impact on another person and prompt them to react. Examples of strategic situations in a business realm abound and include, for example, hiring and incentivizing employees, sourcing inputs, designing, pricing and distributing products, or investing in advertising and research and development. The course aims to teach students aspiring to manage businesses to use economic reasoning and simple game-theoretic models, which will crucially improve their understanding of managerial decision-making. We use this analysis to investigate questions such as:
  • What factors drive workplace behavior?
  • Which incentive instruments can we use to ensure employees’ motivation and coordination?
  • Should a firm produce a critical input itself or buy it on the market?
  • Which pricing strategies can firms use to maximize profits?

At the end of the course, students should have developed an economic perspectivethatwillbeappropriate for understanding, suggesting, and evaluating managerial policies in a variety of circumstances.

Date Time
Tuesday, 05.09.2023 08:00 - 11:15
Tuesday, 12.09.2023 11:30 - 15:15
Tuesday, 19.09.2023 11:30 - 15:15
Friday, 22.09.2023 13:45 - 17:00
Tuesday, 26.09.2023 11:30 - 15:15
Monday, 02.10.2023 11:30 - 15:15
Tuesday, 10.10.2023 08:00 - 11:15
Thursday, 12.10.2023 11:30 - 13:00
By the end of the course, students will advance their knowledge in different ways:

Learning the concepts of economics and applying them to practical economic issues and real-world scenarios will

  • help you to understand the basic drivers of organizationalbehaviour and be helpful for your master thesis,
  • improve your critical thinking in other courses,
  • teach you to structure a complex problem and reduce it to the important core, which will be useful for your university and business career,
  • and help you to ask the right questions or detect inconsistencies in discussions, which will improve your communication skills.
The course and the lecture slides will go relatively closely along the lines of Jost, Peter-J. (2014). The Economics of Motivation and Organization: An Introduction. Edward Elgar Publishing.Pepall, L., Richards, D., & Norman, G. (2014). Industrial Organization. Contemporary Theory and Empirical Applications. 5thedition. John Wiley & Sons.This is the main text you can access for further reading. It will be supplemented with chapters fromVohra, R.V. (2020). Prices and Quantities. Cambridge University Press.Belleflamme, P., & Peitz, M. (2010). Industrial Organization: Markets and Strategies. 2ndedition. Cambridge University Press.
  • Lecture
  • Case studies
  • Group Presentations
Final grades are determined on the following basis:
  • 60% individual in-class assignments
  • 30% group assignments
  • 10% class participation
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