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DRPS : Course Catalogue : Business School : Common Courses (Management School)

Postgraduate Course: Economics of Strategy (MBA) (CMSE11240)

Course Outline
SchoolBusiness School CollegeCollege of Arts, Humanities and Social Sciences
Credit level (Normal year taken)SCQF Level 11 (Postgraduate) AvailabilityNot available to visiting students
SCQF Credits10 ECTS Credits5
SummaryThis course provides a basis for the analysis of the economic roles and interactions of the stakeholders of a firm, and so it is an essential aid to the development of strategy and a guide to tactics.
Course description This course considers the use of economics to help managers make decisions with regard to: cost and demand, pricing including optimal mark-ups and price discrimination; product differentiation or cost based strategies; strategy in relation to rival firms; the make or buy decision and vertical integration; diversification and the implications of mergers, and the sustainability of profits. There will be an emphasis on the problems created by lack of information and how this affects contracts and hence control of suppliers or distributors (and their management). The emphasis on the motivational analysis of each party is one way of looking at many of the problems of strategy, marketing, and public policy. The course is therefore of particular relevance to those who need to understand the workings of market competition. This would include those giving advice as consultants, investment bankers or at senior management levels.

Basic Principles
Firm Boundaries
Competitive Advantage
Strategic Behaviour
Compensation Schemes
Innovation and Entrepreneurship

Student Learning Experience:
The course uses a mix of lectures and case studies. Lectures are designed to be interactive and to promote autonomous learning.
Entry Requirements (not applicable to Visiting Students)
Pre-requisites Co-requisites
Prohibited Combinations Other requirements For Business School PG students only, or by special permission of the School. Please contact the course secretary.
Course Delivery Information
Academic year 2023/24, Not available to visiting students (SS1) Quota:  None
Course Start Block 5 (Sem 2) and beyond
Course Start Date 29/04/2024
Timetable Timetable
Learning and Teaching activities (Further Info) Total Hours: 100 ( Lecture Hours 20, Summative Assessment Hours 30, Programme Level Learning and Teaching Hours 2, Directed Learning and Independent Learning Hours 48 )
Assessment (Further Info) Written Exam 0 %, Coursework 100 %, Practical Exam 0 %
Additional Information (Assessment) Coursework 50% (group)
Coursework 50% (individual)

Feedback Feedback comprises informal feedback on student contributions in class, marks and formal feedback on group assignment, and feedback relating to individual assignment. Feedback is provided in time to be useful in the completion of summative work on the course. Summative marks will be returned on a published timetable, which has been made clear to students at the start of the academic year.

Students will be provided with electronic written feedback for all coursework.
No Exam Information
Learning Outcomes
On completion of this course, the student will be able to:
  1. Understand and critically discuss Marginal Cost, Average cost, Sunk Costs, Economies of Scale their influence on decisions in the short and long run and their relationship to market structure.
  2. Understand and critically discuss the nature of demand functions, for both differentiated and undifferentiated products
  3. Understand and critically discuss the role of cost and differentiation advantage in strategic decisions
  4. Understand and critically discuss issues involved in the make or buy decision including monopoly power and the trade-off between technical efficiency and agency costs
  5. Understand and critically discuss factors leading to the sustainability of profits.
Reading List
Essential Reading
D. Besanko, D. Dranove, Mark Shanley & Scott Schaefer, Economics of Strategy, 6th Edition, 2013
Additional Information
Graduate Attributes and Skills Cognitive and Subject Specific Skills:
Development of the analytical skills required in the consideration of complex systems
Development of analysis of cause and effect
Ability to scan a range of scenarios and the supporting information to sift evidence logically
Structuring of arguments both verbally in class discussion and in writing

Transferable Skills:
Interpersonal skills arising from practice in classroom activities and discussion
Articulate convincing arguments in writing
Engage in active debate about group cases
Develop self-awareness through active written reflection
KeywordsEconomics Strategy Markets Competition
Course organiserDr Tong Wang
Tel: (0131 6)51 5551
Course secretaryMr Ross Muir
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