London School of Economics and Political Science (LSE)

Modules

28
Managerial economics

Prerequisites – 02 Introduction to economics and 05a Mathematics 1.

Basic microeconomics i.e. supply, demand, consumer theory, labour supply, neo-classical theory of the firm, production, costs, factor demands, perfect competition, monopoly, monopolistic competition, government intervention, regulation, public goods, welfare etc. Alternative theories of the firm, internal organisation of the firm, market structure, efficiency wages, incentive structures, human resource management etc. as well as some industrial organisation theories of commonly used pricing practices, resale price maintenance and transfer pricing.

Individual (one person) decision making under uncertainty, attitudes to risk and the value of information. Theory of games i.e. strategic decision making, with applications to oligopoly, collusion, product differentiation, entry deterrence etc. The effects of asymmetric information in areas such as bargaining, bidding and auctions. Situations of moral hazard and adverse selection.

A knowledge of constrained maximisation and lagrangian functions would be helpful for students taking this subject.