Timetable information in the Course Catalogue may be subject to change.

University Homepage
DRPS Homepage
DRPS Search
DRPS Contact
DRPS : Course Catalogue : Business School : Business Studies

Undergraduate Course: The Economics of Corporate Strategy (BUST10021)

Course Outline
SchoolBusiness School CollegeCollege of Arts, Humanities and Social Sciences
Credit level (Normal year taken)SCQF Level 10 (Year 3 Undergraduate) AvailabilityAvailable to all students
SCQF Credits20 ECTS Credits10
SummaryThis course aims to help students obtain a comprehensive understanding of the major strategic behaviours and decisions of the modern corporation. The discussion is generally non-mathematical, and real cases will be examined in all sessions.
Course description We will consider market policy in relation to decisions as to whether to pursue a strategy of product differentiation or cost reduction, and whether these are indeed mutually exclusive approaches. We discuss issues of sustainability of profits, and policies towards innovation. We then discuss such decisions as whether to make or buy inputs or channels of distribution. These issues are shown to depend critically on Transactions Costs, and following that line we examine the reward structure in the company. Having looked at the decisions relating to the component units of the corporation, we then round off the course by analysing strategic interactions between firms. Throughout the course, the issues of managerial interests and the conflict with shareholders' interests and the implied information asymmetry and reputation concern provide an underlying theme.

Outline Content

1. Basic Economic Principle and Competitive Advantage
2. Creating and Sustaining Competitive Advantage
3. Strategic Interactions between Firms
4. Innovation
5. Agency Problems and Incentive Design
6. Vertical Boundaries: Transaction costs and Vertical Integration

Student Learning Experience

Much of the student's learning will be achieved through reading and classroom activities. The reading list specifies the most important and less important items. For each topic on the reading list, a question is specified which helps students to focus their thoughts whilst carrying out the reading. Also, each topic contains at least one classroom activity, in which students have the chance to practice the theories that they learn from lectures and reading.

Classroom activities are designed to promote more student engagement and are closely related to Lectures. Lectures provide a detailed synthesis of the literature with illustrative examples. Because the class is typically small and the scheduled time for each lecture is quite long, students are given ample opportunities to both discuss the results of classroom activities and the ideas put forward by the lecturer.
Entry Requirements (not applicable to Visiting Students)
Pre-requisites Students MUST have passed: ( Business Economics (BUST08005) OR Economic Principles and Applications (ECNM08002) OR Economics 1 (ECNM08013)) OR ( Economic Applications (ECNM08003) AND Economic Principles (ECNM08004))
Prohibited Combinations Other requirements Pre-requisite: Business Studies Honours entry.
Information for Visiting Students
Pre-requisitesVisiting students must have at least 4 Business/Management courses at grade B or above. This MUST INCLUDE at least one Economics course at intermediate level. This course cannot be taken alongside BUST08005 Business Economics; ECNM08002 Economic Principles and Applications; ECNM08013 Economics 1; ECNM08003 Economic Applications; or ECNM08004 Economic Principles. We will only consider University/College level courses.

High Demand Course? Yes
Course Delivery Information
Academic year 2024/25, Available to all students (SV1) Quota:  None
Course Start Semester 2
Timetable Timetable
Learning and Teaching activities (Further Info) Total Hours: 200 ( Lecture Hours 20, Summative Assessment Hours 2, Programme Level Learning and Teaching Hours 4, Directed Learning and Independent Learning Hours 174 )
Assessment (Further Info) Written Exam 0 %, Coursework 100 %, Practical Exam 0 %
Additional Information (Assessment) 50% individual Essay
50% Individual case study

Individual essay: based on course materials and your own research
Case study: students will be provided a case and they will answer associate questions
Feedback Formative: Feedback will be provided throughout the course.

Summative: Feedback will be provided on assessments within agreed deadlines.
No Exam Information
Learning Outcomes
On completion of this course, the student will be able to:
  1. Understand and critically discuss what determines the internal structure of the firm in relation to vertical integration and diversification, and how both of these are largely determined by transactions costs.
  2. Understand and discuss the factors that determine the type of pay structure for senior management.
  3. Understand and discuss critically the underlying factors affecting strategy in relation to differentiated products or cost advantage, and the implications for management style of these two directions.
  4. Understand and discuss critically the factors which enable firms to remain profitable for relatively long periods, and those which give only temporary advantage.
  5. Understand and discuss critically the way in which information asymmetry and the structure of the firm, in terms of vertical or horizontal integration, affects the managerial structure of the company.
Reading List
The course follows the textbook:
D. Besanko, D. Dranove, M. Shanley, S. Schaefer, Economics of Strategy, 6th Edition, Wiley, 2013. (Students are strongly advised to buy a copy of this outstanding text.)
Other useful reading:
1. Sharon M. Oster ( 1994 ) Modern Competitive Analysis, OUP, Oxford;
2. M. Porter (1985) Competitive Advantage, Free Press, New York;
3. H. Simon (1996) Hidden Champions, Harvard Business School Press, Boston Mass;
4. R. Simons (1994) Levers of Control, Harvard Business School Press, Boston Mass.

Additional Information
Course URL
Graduate Attributes and Skills Knowledge and Understanding

After completing this course, students should be able to:

-Demonstrate a thorough knowledge and understanding of contemporary organisational disciplines; comprehend the role of business within the contemporary world; and critically evaluate and synthesise primary and secondary research and sources of evidence in order to make, and present, well informed and transparent organisation-related decisions, which have a positive global impact.

-Identify, define and analyse theoretical and applied business and management problems, and develop approaches, informed by an understanding of appropriate quantitative and/or qualitative techniques, to explore and solve them responsibly.

Cognitive Skills

After completing this course, students should be able to:

-Be self-motivated; curious; show initiative; set, achieve and surpass goals; as well as demonstrating adaptability, capable of handling complexity and ambiguity, with a willingness to learn; as well as being able to demonstrate the use digital and other tools to carry out tasks effectively, productively, and with attention to quality.

Communication, ICT, and Numeracy Skills

After completing this course, students should be able to:

-Critically evaluate and present digital and other sources, research methods, data and information; discern their limitations, accuracy, validity, reliability and suitability; and apply responsibly in a wide variety of organisational contexts.

Autonomy, Accountability and Working with Others

After completing this course, students should be able to:

-Act with integrity, honesty and trust in all business stakeholder relationships, and apply ethical reasoning to effective decision making, problem solving and change management.
Additional Class Delivery Information Weekly lecture and 1 out of 2 weekly seminars.
Course organiserDr Mustapha Douch
Course secretaryMs Morgan Wilson
Help & Information
Search DPTs and Courses
Degree Programmes
Browse DPTs
Humanities and Social Science
Science and Engineering
Medicine and Veterinary Medicine
Other Information
Combined Course Timetable
Important Information