U.S. tech titans increasingly hire PhD economists to help solve business problems.

Monica McNeil

2019-03-19 12:35:00 Tue ET

U.S. tech titans increasingly hire PhD economists to help solve business problems. These key tech titans include Facebook, Amazon, Microsoft, Google, Apple, Netflix, and Twitter (FAMGANT). Most PhD economists exhibit at least 2 critical skills that can contribute to effective business solutions. First, many economists implement effective empirical methods and quantitative tools to ferret out *causal relations* in business data. Second, PhD economists can understand the useful design of both *effective incentives and market mechanisms* for better business optimization. In practice, these PhD economists help demystify many empirical puzzles in the tech sector. For instance, some economists empirically find that Uber Express Pool may inadvertently draw in active users from some other Uber products without growing the full Uber user base. Also, several other economists show that eBay tends to syphon off people who would have come through organic search when the online auction website advertises on Google. Moreover, some recent economic research demonstrates that many African-American Airbnb users experience rampant racial discrimination.

If tech platforms involve matching users or businesses, market design economists can likely help guide these key business decisions. Modern examples of disruptive platform design include Amazon, Airbnb, Tinder, TripAdvisor, and so forth. If scale economies are critical for the business, several major mergers, acquisitions, and exclusive deals may dramatically alter the strategic industry structure and market environment. For instance, Apple and Alphabet are the dominant duo in the iOS-Android market for mobile devices; Microsoft remains a primary software market player with its Office Suite and Windows operating system; Intel and Qualcomm specialize and dominate in the tech-savvy market for microchips; Google acquires 90% of U.S. online search traffic; Facebook extracts healthy profits in social media advertisements; and Netflix retains competitive moats and niches in the lucrative business of high-speed original video content distribution.

If tech companies need to analyze large-scale user data to make better business decisions, econometricians apply logistic regressions, panel estimation methods, and time-series models to derive informative business insights into user behaviors, product reviews, and customer interests and preferences. Smart data analyzers include Amazon, Apple, Facebook, Twitter, eBay, PayPal, and IBM etc. In contrast to doctors, engineers, and lawyers who may focus on specific mechanical details and techniques, most economists focus on the bigger picture when they implement empirical methods to solve practical business problems. Overall, most economists can see both the trees and the forest in important business decisions when push comes to shove.

 


If any of our AYA Analytica financial health memos (FHM), blog posts, ebooks, newsletters, and notifications etc, or any other form of online content curation, involves potential copyright concerns, please feel free to contact us at service@ayafintech.network so that we can remove relevant content in response to any such request within a reasonable time frame.

Blog+More

Michael Sandel analyzes what money cannot buy in stark contrast to the free market ideology of capitalism.

Daisy Harvey

2023-06-21 12:32:00 Wednesday ET

Michael Sandel analyzes what money cannot buy in stark contrast to the free market ideology of capitalism.

Michael Sandel analyzes what money cannot buy in stark contrast to the free market ideology of capitalism. Michael Sandel (2013)   What money

+See More

CNBC news anchor Becky Quick interviews Warren Buffett in early-2019.

James Campbell

2019-04-07 13:39:00 Sunday ET

CNBC news anchor Becky Quick interviews Warren Buffett in early-2019.

CNBC news anchor Becky Quick interviews Warren Buffett in early-2019. Buffett explains the fact that book value fluctuations are a metric that has lost rele

+See More

AYA Analytica podcast provides fresh insights into the latest stock market news, economic trends, and investment portfolio strategies.

Andy Yeh Alpha

2018-11-30 12:42:00 Friday ET

AYA Analytica podcast provides fresh insights into the latest stock market news, economic trends, and investment portfolio strategies.

Andy Yeh Alpha (AYA) AYA Analytica financial health memo (FHM) podcast channel on YouTube November 2018 AYA Analytica is our online regular podcast and news

+See More

Precautionary-motive and agency reasons for corporate cash management

Monica McNeil

2022-10-05 08:24:00 Wednesday ET

Precautionary-motive and agency reasons for corporate cash management

Precautionary-motive and agency reasons for corporate cash management Bates, Kahle, and Stulz (JF 2009) empirically find that public firms have doubled t

+See More

Jim Cramer provides 5 key reasons against the purchase and use of cryptocurrencies such as Bitcoin, Ethereum, and Ripple.

Becky Berkman

2017-11-23 10:42:00 Thursday ET

Jim Cramer provides 5 key reasons against the purchase and use of cryptocurrencies such as Bitcoin, Ethereum, and Ripple.

As the TV host of Mad Money, Jim Cramer provides 5 key reasons against the purchase and use of cryptocurrencies such as Bitcoin. First, no one knows the ano

+See More

Tim Berners-Lee suggests that several tech titans might need to be split up in response to some recent data breach and privacy concerns.

Chanel Holden

2018-11-09 11:35:00 Friday ET

Tim Berners-Lee suggests that several tech titans might need to be split up in response to some recent data breach and privacy concerns.

The Internet inventor Tim Berners-Lee suggests that several tech titans might need to be split up in response to some recent data breach and privacy concern

+See More