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ECON 611
Instructor Ingo BÖBEL, Dr. rer. pol., Dr. rer. pol. habil.
Professor of Economics at IUM, Monaco
Member of the MOC Network at Harvard Business
School (ISC, Professor Michael E. Porter)
ibobel@monaco.edu
For detailed readings and supplementary information
see the « Sidebar » on my personal website at
http://ibobel.pbwiki.com
Credits 3
Course Description Sound economic analysis has never been more important
- regardless whether the decision-making unit is an
individual, household, firm, non-profit organization, or
government. We use a modern treatment of economic
theory to help students both understand and improve the
managerial decision-making process whereby we
concentrate on microeconomic and macroeconomic
topics of particular importance. The integrative approach
used in this course demonstrates that important
managerial decisions are interdisciplinary as effective
management is seen to involve an integration of the
accounting, finance, marketing, personnel and production
functions. Therefore, the business firm is treated as a
unified whole, rather than a series of discrete, unrelated
parts.
We start out to cover basic microeconomic theories, i.e.,
the underlying economic behaviour of actors participating
in individual markets (theory of markets, especially the
theories of supply and demand), firms (production, cost
Professor Dr. Ingo Böbel IUM – EMBA Program May 2009
ECON 611 Managerial Economics Page 2
Course Material
Textbook:
1. Ivan Png and Dale Lehman, Managerial
Economics, 3rded, Malden, MA: Blackwell
Publ., 2007 (= PL)2
Additional Reading:
2. Ingo Bobel, Global Economic Strategy and
Competitive Analysis, (draft – work in
progress) Monaco 2009 (pdf file in English
language) (additional copies are available from
the author)
Recommended Reading:
3. You find an excellent collection of articles in:
“Competitive Strategy”, Harvard Business
Fundamentals Series, HBS Publ. 2002
(available from IUM library) Highly
recommended!
Basic Revision:
The Nature and Scope of Economics
Relevance of the subject for executives; the added value
of economic concepts; more specifically: the role of
market power. Fundamental economic principles. The
nature and scope of Managerial Economics: the
economic approach to business decisions and business
strategy.
The Decision Process: how to make the right choices?;
Cost, value and price as the major determinants for
creating economic profit. Remarks on costs, opportunity
cost, hidden costs, sunk costs. The application of cost-
value-price logic: The role of trade offs, efficiency,
inefficiency.
Day 2
Monopoly
Monopoly, dominant firms, market (monopoly) power
revisited, market structure and the degree of competition,
characteristics of monopoly
Perfect Competition
The Basic Competitive Model: the firm’s decisions in
perfect competition; output, price and profit: entry and
exit in a competitive market
Day 3:
Microeconomics:
L.M.B. Cabral, Industrial Organization, Cambridge,
Mass.: MIT Press, 2002
Disclaimer: This outline is a guideline and subject to change at the professor’s discretion.