Role of a Managerial Economist
A managerial economist helps the management by using his analytical skills and highly developed techniques in solving complex issues of successful decision-making and future advanced planning.
The role of managerial economist can be summarized as follows:
- He studies the economic patterns at macro-level and analysis its significance to the specific firm he is working in.
- He has to consistently examine the probabilities of transforming an ever-changing economic environment into profitable business avenues.
- He assists the business planning process of a firm.
- He also carries cost-benefit analysis.
- He assists the management in the decisions pertaining to internal functioning of a firm such as changes in price, investment plans, type of goods /services to be produced, inputs to be used, techniques of production to be employed, expansion/ contraction of firm, allocation of capital, location of new plants, quantity of output to be produced, replacement of plant equipment, sales forecasting, inventory forecasting, etc.
- In addition, a managerial economist has to analyze changes in macro- economic indicators such as national income, population, business cycles, and their possible effect on the firms functioning.
- He is also involved in advicing the management on public relations, foreign exchange, and trade. He guides the firm on the likely impact of changes in monetary and fiscal policy on the firms functioning.
- He also makes an economic analysis of the firms in competition. He has to collect economic data and examine all crucial information about the environment in which the firm operates.
- The most significant function of a managerial economist is to conduct a detailed research on industrial market.
- In order to perform all these roles, a managerial economist has to conduct an elaborate statistical analysis.
- He must be vigilant and must have ability to cope up with the pressures.
- He also provides management with economic information such as tax rates, competitors price and product, etc. They give their valuable advice to government authorities as well.
- At times, a managerial economist has to prepare speeches for top management.
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