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Research School of Economics · ANU College of Business and Economics
Organisational Economics studies the design of firms and other economic institutions. It develops frameworks which are applied to the problems faced by managers and entrepreneurs. How should incentives be designed in organisations? How should an organisation optimally choose its staff, allocate individuals to tasks within the organisation and then coordinate their actions? Which tasks should be outsourced? How do the answers to these questions depend on external factors such as market competition and technological developments? Tools from game theory, information economics and behavioural economics are introduced and applied to analyse these (and other) problems.
Problem sets
Learning outcomes 1, 2, 3, 4
Mid-semester exam
Learning outcomes 1, 2, 3, 4
Final exam
Learning outcomes 1, 2, 3, 4
2 hours of lecture and 1 hour of tutorial per week. Plus approximately 7 hours of works outside class. Other Information The majority of economic activity occurs not in markets but in firms and other kinds of economic institutions like hospitals, schools and government agencies. This course will undertake an economic analysis of which activities occur within organisations, how these activities are structured and why. The main tools developed will be the design of incentive contracts, the theory of the firm (boundaries of the firm), models of authority relations and modern economic decision-making theory.
Gibbons, R., and J. Roberts. 2013. R. Gibbons and J. Roberts (eds.), The Handbook of Organizational Economics. Princeton, NJ: Princeton University Press. Preliminary Reading Bolton, P. and M. Dewatripont. 2005. Contract Theory . Cambridge, MA: M.I.T. Press.