Strategy & Economic Analysis

Why are markets commonly believed to be the best way of allocating resources and organizing economic activity? This course will answer this critical question while examining its implications for pricing, market entry and exit, short-term and long-term business strategies, and the forecasting of key market variables. The course introduces fundamental topics in the economic analysis of markets, and some of the analytical tools used to study them, as a means to build an economic intuition and fostering an understanding of a variety of market conditions and market forces. After taking this course, you will be able to: - Explain the basics of supply and demand curves. - Characterize variable and fixed costs. - Identify short-run and long-run market exit prices. - Construct short-run and long-run supply curves. - Construct demand curves. - Identify short-run and long-run equilibria in competitive markets. - Predict short-run and long-run market prices. - Interpret a market price path. - Explain firm entry, exit, and profitability in competitive markets. Software requirements: None

“Why do some companies outperform others?” That question is particularly important to ask in industries which are fiercely competitive like the tech sector. Companies competing in these industries find it difficult to achieve competitive advantage and sustain it over the longer run. In this course, you will learn about 21st century competition, the forces driving it, and the challenges it poses for companies. Using that as the backdrop, you will learn how to analyze a company's external and internal environments and develop powerful strategies that allow companies to gain a sustainable competitive advantage even in fast-cycle markets. The course will describe companies that have successfully outperformed their competitors even in the fiercely competitive markets of the 21st century. After completing this course, you will be able to: - Describe what a competitive strategy is and how it is formulated. - Analyze the macro-environmental factors and identify opportunities and threats. - Analyze industry forces and draw conclusions about the industry’s profitability. - Describe the concept of competitive advantage and its importance. - Describe the circumstances under which competitive advantage is sustainable. - Analyze the value chain and understand its contribution to competitive advantage. - Explain how companies compete on price using a cost leadership strategy. - Describe how companies compete on their unique features using a differentiation strategy. - Explain how companies can offer both low prices and unique features simultaneously. - Describe how to choose a value-creating competitive strategy. Software Requirements: None

Good decision making and strategy do not exist in isolation: the success and profitability of a business depend not only on the organization’s own strategic moves but also on those that other firms make, especially competitors. Understanding the strategic linkages among firms can therefore be immensely valuable. Economics and Game theory offer tools that can specifically enhance one's understanding and ability to exploit such strategic linkages. This course will cover one of the most crucial decisions that a firm offering a differentiated product needs to make – how to price its product. In addition, the course will demonstrate some of the consequences of governments and platforms intervening in markets, either because markets may have failed or because the rule-maker may have been persuaded to intervene by key stakeholders. Importantly, the course will layer game-theoretic considerations on top of economic considerations in the marketplace. By the end of the course, students will be able to: • Develop an understanding of the economic concept of elasticity and be able to utilize it in making informed decisions on how, if at all, to alter a product’s pricing. • Identify the implications of market intervention for various stakeholders, including consumers, firms, and government, and incorporate them in analyzing potential policies. • Identify sources of market power and solve for profit-maximizing prices. • Classify forms of price discrimination and develop an understanding of why the practice can be beneficial in customer segmentation and price customization. • Develop an understanding of the dynamics of oligopolistic price and quantity competition. • Describe introductory concepts in game theory, including simultaneous games, sequential games, and auctions, as well as develop an understanding for how asymmetric information can lead to adverse selection issues. Required Textbook: None Software Requirements: None To succeed in this course, learners should possess a basic foundation in economic markets and microeconomics. If you haven't yet developed these skills, we strongly recommend completing Managerial Economics: Buyer and Seller Behavior beforehand. This prior course will equip you with the necessary foundation to excel in this material.