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Nanoeconomics: A Statistical Model of Company Profit Influenced by Individual Interests of Managers

Applied Economics and Finance

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Field Value
 
Title Nanoeconomics: A Statistical Model of Company Profit Influenced by Individual Interests of Managers
 
Creator Sokolov, Igor
Katyshev, Anatoly
 
Description A concept and mathematical model of modern economics are formulated in which a company profit is defined when taking into account possible interests of individual decision makers rather than based exclusively on benefits of either the company (ground of microeconomics) or the whole society (ground of macroeconomics). We call this approach “nanoeconomics” as a terminological step down from macro- and micro- economics. The growing gap between interests of the business owner and decision makers in large corporations is obviously detrimental for the company performance. Here we formulate a statistical model to describe this situation quantitatively. In this model, the company profit is an accumulative effect of statistical contributions of a variety of decisions of individual decision-makers, rather than looking at the company as a whole (microeconomics). The model demonstrates the decrease of profit of the company compared to the microeconomic estimation. We study a relative contribution to the profit decrease from different human factors considered in the model, “careerism” and “expertise” of the decision-making managers, their “loyalty” to the company, and the lack of strong company management (“decentralization”).
 
Publisher Redfame Publishing
 
Contributor —
 
Date 2016-10-11
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article
 
Format application/pdf
 
Identifier http://redfame.com/journal/index.php/aef/article/view/1862
10.11114/aef.v4i1.1862
 
Source Applied Economics and Finance; Vol 4, No 1 (2017); 53-71
2332-7308
2332-7294
 
Language eng
 
Relation http://redfame.com/journal/index.php/aef/article/view/1862/2085