Economics departments’ Contribution to the Factors Influencing Business Performances

              Introduction

Founded in year 2002 by a group of experienced professionals gathered from various fields of Economics, the department has grown and evolved into an engine that defines the business world. In this blog post, an attempt is made to figure out to what extent academic economics departments’ findings enhance business performance. In understanding the turf between the economics departments’ and businesses, one can be in a better position to decipher economic challenges within specific businesses as well as in applying academic knowledge for strategic reasons.

        The Role and Function of Economics Departments

In the most universities and research institutions, economics departments are the key facilities where knowledge is created. They give essential information about economic theories, models, and system implementations that guide organizational and governmental decisions.

             Research and Innovation

Economics departments fund premier research activities engaging the diverse economic concerns such as the market, economy and policy. This research is often published in academic journals and can influence business practices in multiple ways:

- Market Analysis: Market information about consumers, markets, and competitions is critical to businesses and their inter-stockholders’ understanding of their markets.

- Policy Impact: Research which focuses on the effects of fiscal and monetary policies may help firms in their strategic decision making in unpredictable economies.

- Innovation and Growth:  Innovation economics serve organizations as a source of knowledge about the conditions for generating new growth through technology and organizational changes.

                                   Training and Education

Economics departments prepare the upcoming scholars, businessmen and women, and policy makers. Graduates from these programs bring valuable skills and knowledge to the business world, including:

- Analytical Skills:  Skill to mine data, comprehend the essence of economic models, and give an interpretation of the analysis results.

- Critical Thinking: A sound knowledge in economic theory and policy provides improved problem solving and critical strategic analysis.

- Quantitative Techniques: An understanding of econometric and quantity methods is imperative in the making of data-based decisions in an Organization.

       

 Replacing the Last Barrier Between Academic and Business Worlds

This is the reason why economics departments should engage with businesses in order to help put the economics knowledge into practice. This collaboration can take various forms:

   A review of consulting and advisory services focusing on the nature of engagement, work process, outcomes, impact, and sustainability of the services is as follows.

Many departments of economics holds consultation services with the business organisations where they offer opinion on some economic affairs like entry into a certain market, pricing policies and economic risks. Consulting services that business professionals offer their knowledge to help companies interpret thestate of the economy and harness potential benefits.

                 Research Partnerships

Organizations and certain departments of business economics can undertake research collaborations for solving certain economic problems or some issues relating to business. These collaborations can lead to innovations and improvements in business practices:

- Joint Research Projects: It means businesses can contract research that is relevant to their needs, which gives them primarily valuable information or solutions.

- Case Studies: The case studies also show how theories work in the business world since colleagues consult and compare their data sets.

                 Internships and Placements

Economics departments vet internships and employment opportunities for companies, offering excellent talents within various students’ and graduates’ talents within various specialties. These programs benefit both parties:

- Talent Acquisition: Corporations manage to attract high-quality candidates who can bring in different approaches and create novelties to the organization.

- Practical Experience: Business studies students are able to apply their learning in light of the practical experience hence improving on their learning experience.

    Case Studies: Even Economics Departments can cause an impact!

   Kogod School of Retail Management

The MIT Sloan School of Management is recognized by its focus on research in economics and the management business. Many of its graduates have been formed by the principles of data-oriented decision-making and innovation, which helps the school maintain a stream of successful businessmen and businessmen.

- Data Analytics: One of the many interesting findings of the research done at MIT Sloan School of Management is about data analytics and machine learning.

- Entrepreneurship: With a strong focus on entrepreneurship, the school has developed many successful ventures, which brought new ideas into the economic life.

    London School of Economics and Political Science (LSE)

Department of Economics in LSE is renowned for its research background in policy and economics. The work of the department holds major ramifications to enterprises globally.

- Public Policy Impact: LSE’s work in policy returns relevant information to the governments to enable them make the necessary decisions in the business environment such as the policies on regulations, taxation and trade among others.

- Corporate Strategy: LSE works in partnership with organisations to put forward theoretical economic frameworks that may be used to map organisations’ strategic management and inform the organisations on how to best manage in the complex economic structures.

     In particular there are three economic theories applied to the business strategic plans:

Knowledge of economical concepts is a good tool as it provides a competitive advantage. Here are some key economic theories and their business applications:

     Game Theory

Game theory looks at situations where there is result interdependence that is, the result of any particular participant depends on the resultant action of other participants. It is widely used in business for:

- Competitive Strategy: Knowing how others will respond to change in price, new product or any strategic move of competitors.

- Negotiations: Comparing outcomes achieved in bargaining situations in order to find the best way of negotiating with the suppliers, partners or regulators.

      Behavioral Economics

Behavioural economics define aims to look into the human responses to specifics concerning economics. Businesses apply insights from behavioral economics to:

- Marketing: The way most marketing practitioners develop their campaigns does not consider consumer prejudices and how they think.

- Product Design: Designing properly the products and or services in relation to the perceived consumer behavior patterns.

      Macroeconomic Theory

Macroeconomics is the branch of economics analyzing the structure of an entire economy, and such factors as inflation and unemployment. Businesses use macroeconomic insights to:

Managing today's complex organizations requires understanding personnel dynamics and furthermore, anticipating possible changes that can affect them in the future. This would entail, for instance, forecasting economic indicators relevant to organizational functioning and planning, such as trends in interest rates, business cycles, or patterns of consumer spending.

Another aspect entails identifying the various policies that would be implemented and utilizing them to elaborate approaches for managing and projecting organizational performance amidst economic and political instability.

The Institutions’ Main Purpose: Policy Impact

Given the cited considerations, it is evident that the services of economics departments extend far beyond simply teaching students. For instance, universities may have economic departments which undertake research activities with a view of policy issues and their impact on various sectors of the economy including the business one. In this regard, these institutions consider the following issues:

- Alleges that each area should have principles, and policies should be manufactured taking into account economic growth and the protection of the citizens and the environment.

- Discusses policies that will deter entrepreneurs from excessive investments and encourage stable economic growth through appropriate tax measures.

- Approach to studies which aims at the interests if not of the nation at least of the economy leading to the creation of the policies that are more favorable towards the citizens protecting their economies to international markets.