Advanced Business Economics:
Semester 1

Outline
Strategic decision making in imperfectly competitive
markets
A.
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Monopoly, oligopoly, game theory (revision); collusion and
entry deterrence; case studies: e.g. professional sport
Externalities and regulation
B.
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Positive and negative externalities in consumption and
production e.g. health, education, sport and exercise,
pollution, roads,
Regulation of externalities e.g. pollution control
Managerial and individual decision problems in the
context of asymmetric information and risk
C.

Contextualised examples: e.g. second hand markets,
health, labour markets
Aims



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This part of the course is designed to help you:
Enhance your understanding of ideas and theories that underpin the
economic analysis of decision making by economic agents in the
context of the economic environment.
Study the interplay between economic theory and economic policy
and to critically examine some of the arguments for external
regulation of business
Gain some appreciation of the complexity of the economic
environment in which individuals, firms and governments operate.
Sharpen your analytical skills.
Assessment

A class test – the penultimate week of this term
 Questions
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will relate directly to the lecture topics
Half of the final exam
 Essay/problem

style questions
Hints:
 Revision questions

Practice working with theories and models, drawing
diagrams, thinking about data
Suggested background reading

For theory and business context


Allen et al. 2007. Managerial Economics 7th edition. Norton
Kreps, D. M. 2004. Microeconomics for Managers. Norton
 Frank, R. H. 2008. Microeconomics and behaviour. McGraw Hill
 Wall,S., Minocha, S. and Rees, B. 2010. International Business,
Pearson
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For contextual examples

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Grimes, P, Register, C. and Sharp, A. 2009. Economics of Social
Issues, McGraw Hill
For more on game theory
Dixit, A., Reiley, D. H. and Skeath, S. 2009. Games of Strategy, 3rd
Edition , Norton
 Rasmusen, E. 2007. Games and Information, Blackwell
 Carmichael, F. 2004. A Guide to Game Theory, Pearson
