Undergraduate Course: The Economics of Corporate Strategy (BUST10021)
Course Outline
| School | Business School |
College | College of Arts, Humanities and Social Sciences |
| Credit level (Normal year taken) | SCQF Level 10 (Year 3 Undergraduate) |
Availability | Available to all students |
| SCQF Credits | 20 |
ECTS Credits | 10 |
| Summary | This 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.
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Information for Visiting Students
| Pre-requisites | Visiting 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.
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| High Demand Course? |
Yes |
Course Delivery Information
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| Academic year 2024/25, Available to all students (SV1)
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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 )
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| Assessment (Further Info) |
Written Exam
0 %,
Coursework
100 %,
Practical Exam
0 %
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| 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
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| 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:
- 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.
- Understand and discuss the factors that determine the type of pay structure for senior management.
- 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.
- Understand and discuss critically the factors which enable firms to remain profitable for relatively long periods, and those which give only temporary advantage.
- 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.
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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.
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Additional Information
| Course URL |
http://www.bus.ed.ac.uk/programmes/ugpc.html |
| 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. |
| Keywords | ECS |
Contacts
| Course organiser | Dr Mustapha Douch
Tel:
Email: Mustapha.Douch@ed.ac.uk |
Course secretary | Ms Morgan Wilson
Tel:
Email: mwilso26@ed.ac.uk |
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