Describe the role and responsibility of a managerial economist in business management.

Managerial economists have occupied an important role in modern business. In real practice, firms do not behave in a deterministic world. They strive to attain a multiplicity of objectives. Economic theory makes the fundamental assumption of maximizing profits as the basic objective of every firm. The application of pure economic theory seldom leads us to direct executive decisions. Present business problems are either too obvious in their solution or purely speculative and they need a special form of insight. A managerial economist with his sound knowledge of theory and analytical tools can find out the solution to a business problem. In advanced nations, big firms appoint a managerial economist to assist the management. A managerial economist post is similar to a policymaker because the role of a managerial economist is to improve the quality of policies adopt by the business. It affects short-term operations and long-term operations as well. The factors which influence the business over a period may lie within the firms and outside of the firms as well. The role of a managerial economist is very important for business purposes so here in this guide, we will discuss it. There are a few points listed below. Providing knowledge about the environment The prime duty of an economist is to provide information about the environment because the business cannot operate in isolation. Businesses are affected by internal and external environmental factors. Businesses can control the internal factors of business but they are not able to control external factors and have to bear effectively in business. The correct external factor information helps businesses to make wise decisions according to their requirement of business and perform effectively. Economists can analyze for study the economic trends and use the information in the best possible way for their firms’ growth. Involvement in public debates The managerial economists usually indulge in the market surveys and they take participle in the economic discussion of the nation. The public debates help them to better understand the problems of consumers and the situation of the market and this will help them study and find the solution to problems. This will give a lot of information about the government policies which are imposed on business and advises business on how they can use effectively use these policies in their business. Analysis of competition The managerial economists have to undertake an economic analysis of competition among the firms. They should also undertake investment appraisal, project evaluation, and feasibility study. It is one of the most important duties to provide information about market competition and guide firms on how they can difference the competition and make their better position. Participate in several functions The managerial economist has to perform certain specific functions. He helps to coordinate practices related to production, investment, price, sale, and inventory schedules of the firms. He also takes participle in the decision-making and gives his opinion on several other activities as well. Responsibilities of the managerial economist The managerial economist plays a vital role by assisting management in using the increasingly specialized skills and sophisticated techniques which are required to solve various problems of business. There are many responsibilities of the managerial economist such as interpretation of the data, advisers, profit maximization, and many more. Here in this guide, we are highlighting some of the responsibilities. Interpretation of data The functions of a managerial economist can be broadly defined as the study and interpretation of data in light of the problems of the management. The managerial economist should be in the position to spare more time and thought on the problem of an economic nature than the firm’s administration. Data interpretation can make easy day-to-day activities of the business. Adviser role The managerial economist is employed primarily as a general adviser. The advisory service refers to the opportunities open to the managerial economist because of the growing role of government in business life. An economist is responsible for the working of the whole business concern. Accurate forecast The other most important responsibility of a managerial economist is to try to make as accurate a forecast as possible. The managerial economist has to forecast not only the various components of the external business picture, but he has also to forecast the various phases of the company’s activities, that is the internal picture of the company. A managerial economist should recognize his responsibilities to make a successful forecast. The nearest accurate forecast helps make great planning and policies for the business. Various functions Several areas have attracted the attention of the managerial economist, such as maximizing profits, reducing stocks, forecasting sales, etc. If the inventory level is not appropriate then it hampers production. The managerial economist also contributes in maximizing the growth and profits of business. Economic and political advises The managerial economist must be alerted to new developments both economic and political to appraise their possible effects on business. Because the managerial economist should establish and maintain many contracts and data sources that are not available to any other person. This is the reason that businesses hire economists for providing advice. Conclusion All the mentioned information proves that the managerial economist contributes a significant role in the business for the growth and realistic attitude. I hope this piece of information help you the understand impedance and role of the managerial economist in several areas of business.