Lessons learned econ - s1
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1) The document discusses key lessons learned from a microeconomics course including factors that influence firm boundaries such as economies of scope and scale. 2) It also covers market structures like monopoly, perfect competition, and oligopoly. Metrics for measuring market concentration include the Herfindahl index. 3) Porter's Five Forces framework and value chain are presented for industry analysis.
Lessons learned econ - s1
- 1. Lessons Learned Economics
- 2. Disclaimer This is not intended to be a condensed outline of the course, but simply what I took as key takeaways. In some courses there are many areas discussed that aren’t contained in these slides, as they are items I was already familiar with and didn’t feel the need to document or felt they wouldn’t be useful to me in my current career. I think of these as my “cheat sheet” of material that can help me in my current & future roles and are DRAFT…like Google’s Beta are subject to change – Matt Crane Gupta, Barnali & Thomasson, Melissa. (2009). Course presented on Microeconomic Analysis/Managerial Decision Making. Miami University, Oxford & Cincinnati, OH.
- 3. Firm Boundaries • Economies of Scope: produce more than 1 type of good/service causes costs ↓ • Economies of Scale: producing more of a good/service causes costs ↓ • Learning Curve Strategy: expand production quickly to gain learning/cost advantage later (initially won’t be apparent) • Boundaries: – Horizontal: Economies of Scope – Vertical: move up/down supply chain (Porter’s Value Chain)
- 4. Markets • Degree of concentration: – Monopoly: 1 seller/highly concentrated – Perfect competition: many sellers – Herfindahl index(HHI): sum(market shares2) – Oligopoly: few large sellers
- 5. Porter’s Five Forces & Value Chain • PFF for Industry analysis