Michael Porter’s Industry Analysis

UNIVERSITY OF MELBOURNE

DEPARTMENT OF ECONOMICS

ECON90015 MANAGERIAL ECONOMICS

SEMESTER 1, 2015

ASSIGNMENT

Assessment

This assignment contributes 20% to the final assessment in this subject.

Word Limit

This assignment should be no longer than 2000 words (excluding tables, footnotes and appendix). Please keep within the word limit as marks may be deducted if the assignment is too long.

Cover sheet

Make sure you put a cover sheet on your assignment identifying the student name and ID number, your tutor’s name and tutorial time.

 Due date

Monday 11 May 2015, 4.00 pm.

Instructions for Assignment

The assignment should be the student’s own work and should not have been submitted previously for assessment in another course.  The assignment mark will be posted on the subject homepage after the marking has been completed.  

The assignment must be submitted electronically using the Assignment Tool which can be accessed from the LMS subject home page.

Students seeking an extension of time to complete the assignment due to health or other genuine personal reasons should approach the MBS Student Centre for advice and complete an Application for Extension of Time to Complete Assignment. 

Extensions of time are NOT granted by the subject lecturer.

Queries relating to the assignment should be directed to the on-line tutor. You will also be able to access other student enquires and replies – your problems or difficulties may be those of others!

All references should be cited in the text and listed at the end of the assignment. Any standard referencing system can be used, such as APA or Harvard [see below].

Assignment Question

In this course we will examine the economics of competition and how market and product characteristics, such as industry concentration, entry barriers and product differentiation can affect price and output decisions and the profits of individual firms and entire industries.

“Industry analysis frameworks, such as Michael Porter’s1 Five Forces and Adam Brandenburger and Barry Nalebuff’s Value Net, provide a structure that enables us to systematically work through these wide-ranging and often complex issues.” 

……

Porter “presents a convenient framework for exploring the economic factors that affect the profits of an industry. Porter’s main innovation is to classify these factors into five major forces that encompass the vertical chain and market competition.”

[Besanko et. al. page 258]