Business Economics Professional

Business Economics Professional

What is economics about? Economics is the problem of using the available resources as efficiently as possible so as to achieve the maximum fulfilment of society's unlimited demand for goods and services. The ultimate purpose of economic endeavour is to satisfy human wants for goods and services.

The problem is that whereas wants are virtually without limit, the resources - natural resources, labour and capital (machinery) - available at any one time to produce goods and services are limited in supply. Resources are scarce. This fact of scarcity means that we must always be making choices about what to produce, how to produce it and for whom.

Decisions must be made so that these scarce resources are allocated optimally or efficiently to their end use. This implies they could not be used more beneficially elsewhere. This is the criterion economists use to judge many economic phenomenon and is the focus of our study of the economic approaches to organisations.

 

Unit 1: Perspectives on the Economic Approaches to Organisation

• Introduction
• Objectives
• The economic problem
• The basic concepts
• Markets and organisations
• Information
• Summary
• References
• Further reading

Unit 2: Co-ordination through the Market Mechanism

• Introduction
• Objectives
• Determinants of demand
• Determinants of supply
• Theory of demand
• Theory of production
• Microeconomic theory
• Market failure
• Summary
• References
• Further reading

Unit 3: Organisational Co-ordination

• Introduction
• Objectives
• The firm
• Organisational co-ordination
• Organisational configurations
• Review activity
• Summary
• References
• Further reading

Unit 4: Information and Co-ordination Mechanisms

• Introduction
• Objectives
• Co-ordination and information
• Uncertainty and contracting
• Informational asymmetry
• Adverse selection and moral hazard
• Value of information
• Summary
• References
• Further reading

Unit 5: Game Theory

• Introduction
• Objectives
• Methodological backdrop
• One- and two-shot games
• Auctions
• The prisoner's dilemma: single stage
• Repeated games in the prisoner's dilemma
• Review activity
• Summary
• References
• Further reading

Unit 6: Agency Theory

• Introduction
• Objectives
• A firm's relationships
• Positive theory of agency
• Entrepreneurial firms and team production
• The firm as a nexus of contracts
• Theory of principal and agent
• The agency contract
• Second-best efficient contract
• Modifications to the principal-agent model
• Summary
• References
• Further reading

Unit 7: Transaction Cost Economics

• Introduction
• Objectives
• Markets and organisations
• An example of transaction cost economics
• Transaction costs
• Critical dimensions of transactions
• Fundamental transformation and the hold-up problem
• Organisational structures
• Complex hierarchies
• Markets and hierarchies: is that all?
• Hybrid forms of co-ordination
• Summary
• References
• Further reading

For a more detailed syllabus on this course, click here