Managerial economics is the application of economics to assist decision taking in the firm. It has seen considerable growth in recent decades as the area of economics most relevant to business degrees. Most texts in the field are American, consisting largely of applied microeconomics, to which are added small amounts of statistics, econometrics, mathematics and operations research. The texts are typically "made relevant" to the real world using numerous case studies.
Dominick Salvatore's Managerial Economics in a Global Economy fits into this standard US format. The fourth edition runs to more than 700 pages of closely written text. New features include a more international flavour, consideration of trading using the internet, closer links to business strategy and 28 new case studies.
Yet there is something deeply dissatisfying with managerial economics texts of this type. The main problem is simply a lack a credibility. There is a world of difference between what academics believe will be the application of economics in business and what businesses want from economists. Those who have worked as business economists quickly find out that their role is very different from what they anticipated. Ideally, to write a text on managerial economics, one would choose an academic economist who has spent a considerable time working in industry, applying economics to actual business decisions. Few authors can meet this demanding requirement and the result shows in the indifferent quality of most of the books in this field.
In their work, economists in business make extensive use of spreadsheet packages such as Excel or Lotus 123 - mainly for storing data, number crunching, writing simple routines and basic graphics. However, it is hard to see how this could justify writing a whole textbook on managerial economics using Excel, as has been attempted by David Whigham. The result, Managerial Economics Using Excel , is unconvincing, although parts of it may be of use to students as a reference manual. It would have been better to write a slimmed-down version as a supplement to a standard text on managerial economics.
Julian Gough is principal lecturer in economics, University of Teesside.
Managerial Economics Using Excel. First Edition
Author - David Whigham
ISBN - 1 86152 603 2
Publisher - Thomson
Price - £24.99
Pages - 419