MN404      Half Unit
Incentives and Governance in Organisations

This information is for the 2013/14 session.

Teacher responsible

Dr Catherine Thomas NAB5.27


This course is compulsory on the MSc in Management and Strategy. This course is available on the MPA in European Public and Economic Policy, MPA in International Development, MPA in Public Policy and Management, MPA in Public and Economic Policy, MPA in Public and Social Policy, MSc in International Management, MSc in Management and MSc in Management (CEMS MIM). This course is available with permission as an outside option to students on other programmes where regulations permit.

Note this course may be capped if student numbers become too high.


A knowledge of Mathematics and Economics.

Course content

The course uses economic theory to gain insight into issues related to internal organisation and management of firms. The course will draw on various disciplines including management science, industrial organisation and microeconomics. The course deals with three main topics: (i) the provision of incentives in organisations, (ii) the use of information in markets and firms, and (iii) the theory of financial decisions. A major theme concerns the question of how to provide incentives efficiently in organisations. Other important themes include efficiency, coordination, incompleteness of contracts and the use of the market versus internal exchange. A section of the course deals with financial theory. The implications of asymmetric information are examined. Corporate governance is discussed in a principal-agent framework.


30 hours of seminars in the MT.

Indicative reading

Main texts: Roberts J (2004), The Modern Firm. Organizational Design for Performance and Growth, Oxford University Press, UK; Brealey, RS, Myers, and F Allen (2006), Corporate Finance, 8th edition (older editions are fine too), McGraw-Hill International Edition (US edition is titled "principles of corporate finance"; older versions by Brealey and Myers only).


Exam (100%, duration: 2 hours) in the main exam period.

Key facts

Department: Managerial Economics and Strategy Group

Total students 2012/13: 61

Average class size 2012/13: 13

Value: Half Unit

Guidelines for interpreting course guide information

Personal development skills

  • Problem solving
  • Application of information skills