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Economics of Strategy, Binder Ready Version focuses on the key economic concepts students must master in order to develop a sound business strategy. Ideal for undergraduate managerial economics and business strategy courses, Economics of Strategy offers a careful yet accessible translation of advanced economic concepts to practical problems facing business managers. Armed with general principles, today's students--tomorrows future managers--will be prepared to adjust their firms business strategies to the demands of the ever-changing environment. 

David Dranove is the Walter McNerney Distinguished Professor of Health Industry Management at Northwestern University's Kellogg School of Management, where he is also Professor of Strategy. He was previously Director of the Health Enterprise Management program. He has a PhD in Economics from Stanford University.

Professor Dranove's research focuses on problems in industrial organization and business strategy with an emphasis on the health care industry. He has published nearly 100 research articles and book chapters and written five books, including The Economic Evolution of American Healthcare and Code Red. His textbook, The Economics of Strategy, is used by leading business schools around the world. Professor Dranove regularly consults with leading healthcare organizations in the public and private sector and has served on the Executive Committee and Board of Directors of the Health Care Cost Institute. He has also served as an economics expert in several high profile healthcare antitrust cases.

INTRODUCTION: STRATEGY AND ECONOMICS 1

ECONOMICS PRIMER: BASIC PRINCIPLES 8

PART ONE: FIRM BOUNDARIES

1. The Power of Principles: An Historical Perspective 37

2. The Horizontal Boundaries of the Firm 55

3. The Vertical Boundaries of the Firm 90

4. Integration and Its Alternatives 124

PART TWO: MARKET AND COMPETITIVE ANALYSIS

5. Competitors and Competition 155

6. Entry and Exit 186

7. Dynamics: Competing Across Time 214

8. Industry Analysis 247

PART THREE: STRATEGIC POSITION AND DYNAMICS

9. Strategic Positioning for Competitive Advantage 279

10. Information and Value Creation 320

11. Sustaining Competitive Advantage 349

PART FOUR: INTERNAL ORGANIZATION

12. Performance Measurement and Incentives 385

13. Strategy and Structure 419

14. Environment, Power, and Culture 456