ECM620-Economics of Corporate Strategy

Module Provider: School of Politics, Economics and International Relations
Number of credits: 20 [10 ECTS credits]
Level:7
Terms in which taught: Spring term module
Pre-requisites:
Non-modular pre-requisites:
Co-requisites:
Modules excluded:
Current from: 2021/2

Module Convenor: Dr Minyan Zhu
Email: minyan.zhu@reading.ac.uk

Type of module:

Summary module description:

This module seeks to provide a foundation to the Ìýeconomic analysis of Ìýcorporate decision-making – such as price-setting, output-setting, mergers, and anti-competitive behaviour. In this context, Ìýfirms’ incentives and strategic interactions among firms are emphasised. ÌýBoth the role of market competition Ìýand the imperatives for Ìýgovernment intervention are discussed.

Aims:

The aims of this module are:

• to provide knowledge and understanding of the economic analysis that underlies the functioning of markets and industries and the behaviour of firms within them;


• to give students analytical skills to understand problems in business economics;


• to provide students with the ability to analyse different forms of government intervention in terms of their implications for social welfare and economic efficiency.

The module includes an introductory coverage of game theory, giving students the knowledge necessary for the topics that follow.

Assessable learning outcomes:

Students will be assessed on their ability to apply economic analysis to the problems of modern business enterprises. This will include the ability to analyse: the influence on corporate strategy of competition among rivals; the strategies of dominant firms and firms operating in oligopolistic markets; how firms’ practice can impact economic welfare; the rationale for government intervention and its potential consequences Students may also be assessed on game theory.

Additional outcomes:

The module provides the opportunities to improve students’ ability to work with case studies, to translate abstract concepts/theories into practical problem solving and enhance their facility with decision-making analysis including incentives, equilibrium and marginal analysis.

Students should be able to apply the techniques discussed to enterprises and markets in different countries and at different times.

Outline content:

The module aims to cover the following economic aspects of corporate strategies: an introduction to the game theoretical tools /models to the understanding firms’ strategic behaviour; the strategies of dominant firms and firms operating in oligopolistic markets; contractual relations between firms including mergers; the impact of firms’ practice on economic welfare; and different forms of government intervention.

Brief description of teaching and learning methods:

A combination of lectures, group discussions of assigned topics and problems, and assessed essays.