Managerial economics

About: Managerial economics is a research topic. Over the lifetime, 1524 publications have been published within this topic receiving 83965 citations.

Economic Theory and Statistical Learning

Abstract: This dissertation presents three independent essays in microeconomic theory. Chapter 1 suggests an alternative to the common prior assumption, in which agents form beliefs by learning from data, possibly interpreting the data in different ways. In the limit as agents observe increasing quantities of data, the model returns strict solutions of a limiting complete information game, but predictions may diverge substantially for small quantities of data. Chapter 2 (with Jon Kleinberg and Sendhil Mullainathan) proposes use of machine learning algorithms to construct benchmarks for “achievable" predictive accuracy. The paper illustrates this approach for the problem of predicting human-generated random sequences. We find that leading models explain approximately 10-15% of predictable variation in the problem. Chapter 3 considers the problem of how to interpret inconsistent choice data, when the observed departures from the standard model (perfect maximization of a single preference) may emerge either from context-dependencies in preference or from stochastic choice error. I show that if preferences are “simple" in the sense that they consist only of a small number of context-dependencies, then the analyst can use a proposed optimization problem to recover the true number of underlying context-dependent preferences.

Redesigning managerial economics to suit the MBA

Abstract: Managerial economics, which seeks to use microeconomic principles to solve managerial problems, has become firmly established in business curricula, particularly at the MBA level. Surveys of MBA directors and MBA alumni, however, have indicated that managerial economics tends to be an unpopular course among students. This paper examines the criticisms and makes recommendations for new directions in the curriculum.

Insurmountable Business Problems and Optimal Managerial Decisions: Significance of Elasticity of Demand

Abstract: Managerial economics is the integration of economic tools and techniques with business practice. The concepts of managerial economics provide practical solutions to business problems. The basic aim of any business firm is profit making. The enhancement of sales is the major for making more profits .If the business entrepreneur is capable to predict the cost-output ratio, fixation of price, income of consumer and impact of advertising expenditure, the firm may improve its sales more proportionately. Therefore, to understand the behaviour of sales and to plan their growth, it is necessary to identify the factors that influence the sales and estimate their affect. For this purpose, management should integrate economic concepts with business decision making practice in order to understand and analyse the sales behaviour of the firm. In this process, the concept of elasticity of demand plays the pivotal role, which helps in providing a quantitative value for the responsiveness of the quantity demanded to change in each of the demand determinants. Therefore, this study find that the concepts of elasticity of demand are essential ingredients of optimal managerial decisions in the short run as well as long run plans of the business firm. Keywords: Managerial Economics, Business firm, Decision making, Elasticity of demand, Sales, Profit.