Dr Kristof Madarasz NAB.5.05

This course is compulsory on the MSc in Management and Strategy. This course is not available as an outside option.

The objective of the two courses (A and B) is to provide students with a critical appreciation of behavioural economics and game theory relevant for strategic management. These two courses will help students to understand how managers in the real world ought to read situations from an economic and strategic angle. Attention will be given to conceptual underpinnings.

The course focuses on decision making in individual and strategic settings also through the lens of behavioural economics. It is an amalgam of insights from economics, game theory,  and strategic management. Some lectures will discuss key aspects of choice under uncertainty, risk perceptions, choice over time, and the social aspects of value. A powerful tool to study strategic situations is game theory. Lectures will then also be devoted to developing the basic concepts of game theory including Nash and sub-game-perfect Nash equilibrium. These issues will be deepened further in the accompanying seminars.

20 hours of lectures and 9 hours of seminars in the MT.

Students on this course will have a reading week in Week 6, in line with Departmental policy.

D Besanko, D Dranove & M Shanley, Economics of Strategy, John Wiley, 6th Edition.; A Dixit & B Nalebuff, Thinking Strategically: The Competitive Edge in Business, Politics and Everyday Life, Norton, 1998;; J Roberts, The Modern Firm: Organizational Design for Performance and Growth, OUP 2007; Angner, E, Behavioural Economics, 2nd edition, 2016.

Exam (100%, duration: 2 hours) in the summer exam period.