Economics encompasses almost every area of modern life from taking day-to-day decisions at home to handling managerial tasks efficiently in an organisation. It is the study of making choices while keeping in mind the optimum utilisation of resources. Managerial Economics is a sub-branch of this academic discipline and involves the application of economic tools, theories and methods to facilitate various decisions in a business organisation. Through this blog, we aim to delve deeper into the field of Managerial Economics, its key features and the major courses offered in this area of study.
This Blog Includes:
What is Managerial Economics?
Managerial Economics is concerned with the application of the principles and theories of both microeconomics and macroeconomics in facilitating various strategies and decisions in a business organisation. It is a field of management studies that implement economic theories and methodologies. Majority of the forecasts, assumptions and investments are derived from the detailed theories of this field. It involves certain processes that are used in allocating resources in a way which leads to minimalising the cost of production. If there are scarce resources, the managerial economists take proficient and adequate decisions regarding suppliers, customers and the organizations. Concepts of Managerial Economics are categorized under three main sections some focusing on customer satisfaction while others on ensuring an efficient production. Here are the two major types of Managerial Economics:
Normative Managerialism: In this sub-branch, the economic principles are based on the real-life practices and situations along with a functional approach to forecasting, cost management, product design, demand and promotion.
Liberal Managerialism: The market is considered to be a place full of liberty and the economists have to make their decisions according to the demand and trend of the market to prevent the business failures. Liberal Managerialism is concerned with the demand and supply aspects of a market and how it correlates with and impacts a product or a service’s sales.
Principles of Managerial Economics
Responsibilities of a Managerial Economist
A Managerial Economist plays a key role in advising the management of a firm on various trade decision and needs to be aware of recent market trends and happenings in the economy. Let’s take a look at the various roles and responsibilities that a Managerial Economist handles:
- Carrying out a cost-benefit analysis.
- Studying and analysing the macro-economic patterns of a particular firm.
- Finding and securing the possibilities of change in the economic environment of the organization.
- Advising the decisions on public relations, foreign exchange and trade.
- Conducting detailed research of the industrial market.
Here is a list of major prerequisites which you need to possess if you want to secure a career in Managerial Economist:
- Good with Numbers
- Excellent communication skills
- Problem-solving abilities
- Observational Skills
- Organisational Skills
- Team Handling Abilities
Curriculum of Managerial Economics
Generally, a degree program or short-term course in Managerial Economics involves a mixture of concepts of Business Administration and Economics. Following are the core subjects that are usually included in the curriculum of a prospective program in this academic discipline:
- Marketing Management
- Business Statistics
- Financial Management
- Macroeconomics and Microeconomics
- Human Resource Management
- Organizational Behaviour
- Business Environment
Moreover, under the above given key subjects, here is a list of various Economic concepts that you will get to study during a course in Managerial Economics:
- Measures of productivity, production of services and goods.
- Different types of markets
- Concepts of demand, supply, market equilibrium.
- Planning strategies about the hiring process and infrastructure.
- Elasticity of demand and supply, subsidies and taxes.
- Targeting pricing and selling decisions under competitive pressures.
- Problems with market and strategies to solve them.
Scope of Managerial Economics
Top 10 Universities[optin-monster-shortcode id=”xf2mlnjiouddzrshykdb”]
There are numerous universities and institutes around the world that offer plentiful programs in Managerial Economics, ranging from degree courses to diplomas. To assist you further in your research, here is a list of top 10 universities providing an array of courses in this field:
- Bocconi University, Italy
- Hong Kong University of Science and Technology
- University of Toronto, Canada
- ETH Zurich, Switzerland
- University of Melbourne, Australia
- University of Oxford, UK
- Erasmus School of Economics, Netherlands
- London School of Economics and Political Science, UK
- Harvard University, UK
- Massachusetts Institute of Technology, USA
What are the methods of Managerial Economics?
Managerial Economics deals with techniques, concepts and tools. The major factors that are a part of managerial Economics methods are:
1. Statistical Estimation
2. Numerical Analysis
3. Game Theory
4. Decision Making
What is managerial Economics with examples?
Most of the big business houses require experts of Managerial Economics to contribute to major decisions related to funds assessment, product choice, business area selection, price determination, sales, promotion, optimization and many other functions.
What are the objectives of Managerial Economics?
Managerial Economics deals with the broadening of business goals. It helps in optimizing the output of organisation. It also maintains the marketing techniques and procedures.
Is Managerial Economics a good major?
Yes, Managerial Economics is a great major provided you have a good hold over mathematics and statistics. After completing your undergraduate degree with this major, you can get lucrative jobs in MNCs.
Thus, if you want to pursue a lesser-known domain of Economics and Business Administration, then Managerial Economics might be the right field for you. Since the course revolves around the industrial market, graduates acquiring this degree remain in consistent demand of the major organizations and companies. Take the help of Leverage Edu‘s AI tool to browse through a wide range of courses in Managerial Economics and find the right one that fits your interests and career aspirations.