Behavioral economics & game theory in managerial microeconomics Research Paper

Behavioral economics & game theory in managerial microeconomics - Research Paper Example Consequently, rules are set in a complex manner to ensure a win-win situation for all. This creates difficulties and necessitates systematic analysis prior to the actual occurrence of the situation. In some cases, challenges might arise when a situation is in progress, creating much complexity leading to multiple systems being set up to counter the challenge. In managerial microeconomics, managers face similar situations especially in marketing of products and services. Competitors may keep changing their tactics, in order to keep up with the changing trends in the market. Competitors actions as well as micro and macroeconomic factors beyond the control of firms such as government policies on taxation, social corporate welfare, interest rates, and currency deflation or inflation creates complexity in the business world. In addressing the above challenges among others, managers must thus adopt a game like approach. Representing and Solving Games by Managers in the Business World Assum e the following payoff scenario Company a’s actions High price Low price Company B’s action High price 200A 200B 200A -40B Low price -40A -120B 100A 50B Solution If company B has set a high price then A chooses low price, the B high/Ahigh approach can be ignored. If B sets a low price, then A chooses a low price, the Blow/ Ahigh branch will be impractical. Consequently, B is forced to choose between high price (-40) and a low price (50). In these two scenarios, A must follow B price strategy because they are the dominant strategies. The above scenario illustrates a number of key ideas for managers. In decision making, a set of strategies such that each is best for each player, given that the others are playing their own equilibrium is the...This research paper analyzes the place of game theory and behavioral theory in managerial economics in isolation, then integrates them together, in applying their arguments in addressing real business situations Game theory is complex and involves a lot of difficulties in reasoning A game is any circumstance comprising interdependence amongst players. There are different types of games. This study focuses on co-operative versus non-co-operative games because they involve competition among economic entities, challenging leaders and their management skills. They are characterized by aggressive competition in the business world. Behavioral economics assimilates psychology and economics by recognizing systematic inconsistencies in decision making. These are now recognized to be an essential basis of error in business decisions, they deliver the underpinning for both marketing and finance. At the principal of behavioral economics is the principle that increasing practicality of the psychological underpinnings of economic exploration will improve economics on its own terms, creating theoretical insights, making better predictions of field phenomena. Managerial economics encompasses use of economic approaches of thought to scrutinize business condition. It is the incorporation of economic theory with business practice for the resolve of aiding decision making and accelerative forecasting. In attempts to making optimal decisions, managers should be open minded and extremely flexible, as there is no individual with optimal knowledge.

Shariah Law Essay Example | Topics and Well Written Essays - 750 words

Shariah Law - Essay Example It seemed to me that there were no reasons to allow that to happen and yet it seemed that not only was it being allowed by the one being beaten but by those that were watching the beating. I just didn't understand and to be honest it was beyond anything I could imagine. The real sadness it seemed to me came from the fact that tsunami had so devastated this country and now it seemed the new government would devastate what was left. Stopping violence towards women and children is a worldwide concentration right now. The WHO has put major emphasis on it. This new policy seems to make that violence worse and in a part of the world where the respect for women is already very minor. There is also the fact that this police force appears to have a poor view of women as well as the poor. Not only do they have a poor view of women but of the people in general. To parade women in front of men in that culture is degrading and allows men to take advantage of them as well. Being raised in the United States makes one see many things differently. Americans have no real experience with this kind of problem. We cannot imagine allowing someone to beat us, no less in public. Freedom of religion is one of our basic rights and we take full advantage of that. To have any kind of punishment inflicted in the name of a God would be more than we would ever understand. There is a lot of controversy right now about the possibility that there are some cases when culture is incompatible and this may be one of them. How a culture feels about its religion and whether there is a recognition as to the fact that not everyone believes the same thing can affect all other things in life.. That is not the case in Indonesia and it appears the little bit of freedom they might have had for awhile is now gone. Along with freedom of religion, of course, comes freedom of speech. It appears from the example of the women talking among themselves that this is surely not allowed. There also seems to be very little respect for women at all which though it is still being improved, is somewhat better in many countries. Are there any courts This is a question that has to be ask. Punishing someone instantly which appears to the case regularly allows that a court is not necessary. So, another thing that many of us are used to is "innocent until proved guilty." In the United States, we believe that "all men are created equal." We have not shown that through our history but we are getting there. We also believe that we have a government by the people and for the people so it is difficult to imagine that any government has the right to come along and change the religious rules for the country and begin to punish those that do not follow the rules. We can only guess what they are going through. As health professionals, we have caring beliefs. It causes us great discomfort to see the wounded person both physically or mentally. To see a case of purposeful wounding is really quite difficult. Many American surgeons and nurses went to Indonesia after the tsunami and performed great helping services. This is an issue that needs worldwide help. However, we must also remember that the healthcare