World economics has become more complicated and difficult given developments in the past decade. For one, there has been a lot of developments in technology especially with regard to the internet and the new and social media. Another, times have been tough because of the worldwide economic crisis. Microeconomists have been at the forefront at maximizing the use of new technology and media in business management that have important macroeconomic and worldwide impact. Among the microeconomists who have made a mark in the world are: Preston McAfee, a former California Institute of Technology professor and now at Yahoo!; Steve Tadelis, from University of California at Berkeley and eBay; Florian Zettelmeyer, Northwestern University; Susan Athey, from Stanford University and Microsoft; and, Hal Varian, from Google. (Economist, 2012)
The economists were cited for how they have rethink conventional economic theories, consider the present environment rather than history, and apply their new theories to help their businesses grow. Studying patterns of costumer usage, McAfee helped Yahoo! split its pricing into two categories thereby increasing its revenues. This allowed Yahoo! to segment its customers by time or traffic—heavy during the day and light at night. The move would require total transparency so customers would be able to choose well. Academic wisdom however seem to say that total transparency could lead to lower sales. However, the tests of Tadelis and Zettemeyer proved the contrary: revenues rose with total transparency at eBay. (Economist, 2012)
Meanwhile, Athey challenged conventional belief that there is a trade-off in the benefits of advertisers and users: one’s gain is the other’s loss. Economic theory teaches otherwise. With the proper configuration of scheduling, Athey proved that one party’s could gain could simultaneously be the gain of the other. The ads timing and frequency were reduced but the advertiser still enjoyed the same benefits as before. (Economist, 2012)
Varian demonstrated the impact of using real-time information through Google in addressing certain economic problems. Economists traditionally rely on historical data do analyses. As a result, some policies and decisions can sometimes be irrelevant because the data used are no longer valid. With new media and technology, economists can be able to obtain data that is actionable. Policies based on very current data can thus be more effective. (Economist, 2012)
The work of these economists has made tremendous impact not only in the growth of their respective companies but also in the way people communicate, work and transact business in the world. (Economist, 2012)
References
The Economist. (2012, Nov 24). Micro stars, macro effects: Meet the economists who are making markets work better. The Economist. Retrieved Feb 3, 2013, from http://www.economist.com/news/21567079-meet-economists-who-are-making-markets-work-better-micro-stars-macro-effects
