BUSINESS AND BEHAVIOURAL ECONOMICS

In today’s dynamic and complex world, understanding the
intricate relationship between traditional economics and human
behavior is critical for making sound business decisions. This book,
“Business and Behavioural Economics”, is designed to bridge the gap
between foundational economic theories and the growing field of
behavioral economics, which examines the psychological factors that
influence how individuals and firms make economic choices.
The book is structured to cover core concepts such as cost and
revenue, market structures, and pricing strategies under both perfect and
imperfect competition. These topics provide readers with a
comprehensive understanding of classical economic principles that
continue to shape modern business practices. However, in recognition
of the evolving nature of economic analysis, the book also introduces
behavioral economics—a field that challenges the notion of perfectly
rational decision-makers and explores how cognitive biases, emotions,
and social factors drive economic behavior.

By integrating these two perspectives, this book offers a well-
rounded exploration of economic theory, with practical implications for

real-world business scenarios. Whether you are a student, a
professional, or an academic, this text will help you appreciate how
businesses operate within both traditional market frameworks and
behavioral-driven environments.
The journey begins with an in-depth analysis of costs and
revenue, guiding you through the behaviors of cost curves and revenue
models in both short and long runs. From there, we explore pricing
strategies under varying market conditions—ranging from perfect
competition to monopoly and oligopoly—while providing comparative
analyses of different competitive structures.

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In the latter chapters, the book delves into factor pricing and the
theories behind rent, wages, interest, and profit, grounding readers in
how businesses allocate resources and generate income. A special
section on behavioral economics addresses the interdisciplinary nature
of the subject, highlighting its growing relevance in explaining
economic outcomes that traditional theories may overlook.
Each chapter is designed to build upon the previous one,
equipping readers with the tools to analyze both rational and behavioral
elements of economics. Through examples, case studies, and applied
problems, the book encourages critical thinking and equips readers with
the ability to apply these concepts to modern business challenges.
In summary, “Business and Behavioural Economics” is not just
a textbook on economic theory—it is a guide to understanding the
human side of economics and the decision-making processes that drive
success in business.