Managerial Economics: A Game Theoretic Approach

by Fisher; Tim

• ISBN13: 9780415272889
• ISBN10: 0415272882
• Format: Hardcover
• Copyright: 2002-09-13
• Publisher: Routledge

Summary

The beauty of a book on managerial economics is that it can be used as a way of introducing business and management students to economic concepts as well as providing economics students with a clear grasp of how to use the skills they will need in the world of business. What sets this book apart is its use of game theory as its theoretical underpinning. Previous texts have taught concepts without taking into account notions of strategy and the motivations ofallthe agents involved in a particular economic situation. This book will redress that balance. Topics considered include: *international trade (essential in this era of globalization) *product differentiation and advertising *price discrimination *human capital

Author Biography

Robert G. Waschik is Senior Lecturer in the Department of Economics and Finance at La Trobe University, Australia.

Table of Contents

List of figures	vii
List of tables	x
Preface	xi
Acknowledgments	xii
Introduction	1	(10)
The use of game theory	2	(1)
Traditional managerial economics	3	(1)
Overview of the book	3	(2)
Partial equilibrium and general equilibrium	5	(1)
The role of the consumer	6	(5)
Part I Theory	11	(52)
The manager and the firm	13	(8)
Why do firms exist?	13	(2)
Objectives of the firm	15	(2)
The market environment	17	(1)
The role and effect of government	18	(3)
Monopoly and perfect competition	21	(19)
Classifying markets	22	(2)
The basic profit maximization problem	24	(7)
Monopoly	31	(3)
Perfect competition	34	(6)
Price discrimination	40	(23)
The basic idea behind price discrimination	41	(2)
First-degree price discrimination	43	(2)
Third-degree price discrimination	45	(4)
Second-degree price discrimination	49	(14)
Part II Strategic Interaction between Firms	63	(174)
Game theory	65	(17)
Introduction	65	(1)
The need for game theory	66	(1)
Definition of a game	67	(2)
Nash equilibrium	69	(6)
The strategy space for a firm	75	(7)
Strategy in a market with two firms	82	(22)
Quantity competition	84	(8)
Price competition	92	(6)
Stackelberg equilibrium	98	(6)
Product differentiation	104	(25)
The characteristics approach	105	(1)
The notion of product space	106	(7)
Equilibrium in prices	113	(4)
Equilibrium in locations	117	(12)
Advertising	129	(21)
Issues in advertising	130	(5)
Advertising in a monopoly	135	(6)
Advertising in a duopoly market	141	(9)
The role of information	150	(14)
Adverse selection and moral hazard	151	(3)
Quality and information with a single producer	154	(10)
Entry deterrence and accommodation	164	(27)
Strategic choice of capacity	165	(10)
Limit pricing	175	(3)
A summary of deterrence and accommodation strategies	178	(13)
Government regulation of industries	191	(25)
The basic rationale for regulation	191	(4)
Regulation of monopolies	195	(5)
Regulation of oligopolies	200	(5)
Intellectual property regulation	205	(1)
Environmental regulation	206	(5)
Government regulation and globalization	211	(5)
International trade	216	(21)
Why do nations trade?	217	(3)
Strategic trade policy	220	(8)
Trade liberalization	228	(9)
Part III Strategic Interaction within Firms	237	(79)
Vertical and horizontal integration	239	(19)
Horizontal integration	240	(5)
Vertical integration	245	(13)
Labor markets	258	(16)
Perfectly competitive labor market	259	(11)
Compensating wage differentials	270	(4)
Training and motivating workers	274	(21)
Training	275	(3)
Motivation	278	(7)
Motivating managers	285	(2)
Motivating non-managers	287	(8)
Trade unions	295	(21)
Unions around the world	296	(2)
Collective bargaining and union power	298	(9)
Strikes and lockouts	307	(2)
Effects of unions	309	(7)
Answers to odd-numbered problems	316	(9)
Index	325