Joel Dean

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Joel Dean (1906–1979) was an American economist, Professor of business administration at the University of Chicago and Columbia University, and management consultant. He is best known for his contributions to corporate finance theory in general, and particularly to the area of capital budgeting. He is regarded as one of the founders of business economics. His work on pricing remains influential in marketing.



Managerial Economics, 1951


Joel Dean, Managerial Economics, Prentice-Hall, 1951,

  • The purpose of this book is to show how economic analysis can be used in formulating business policies. It is therefore a departure from the main stream of economic writings on the theory of the firm, much of which is too simple in its assumptions and too complicated in its logical development to be managerially useful. The big gap between the problems of logic that intrigue economic theorists and the problems of policy that plague practical management needs to be bridged in order to give executives access to the practical contributions that economic thinking can make to top-management policies.
    • Preface
  • Economic theory makes a fundamental assumption that maximizing profits is the basic objective of every firm. But in recent years, profit maximization has been extensively qualified by theorists to refer to the long run; to refer to management’s rather than to owners’ income; to include non-financial income such as increased leisure for high-strung executives and more congenial relations between executive levels within the firm; and to make allowance for special considerations such as restraining competition, maintaining management control, warding off wage demands, and forestalling anti-trust suits. The concept has become so general and hazy that it seems to encompass most of men’s aims in life.
This trend reflects a growing realization by theorists that many firms, and particularly the big ones, do not operate on the principle of profit maximizing in terms of marginal costs and revenues...
  • p. 28; Cited in: Peter F. Drucker, Management: Tasks, Responsibilities, Practices, New York: Harper & Row, 1973.

Quotes about Joel Dean

  • Joel Dean [is] one of the most brilliant and fruitful of contemporary business economists.
    • Peter F. Drucker, Management: Tasks, Responsibilities, Practices, New York: Harper & Row, 1973.
  • Joel Dean has suggested following possible approaches to the problem of forecasting demand for new products :
  1. Project the demand for the new product as an outgrowth of an existing old product.
  2. Analyse the new product as a substitute for some existing product or service.
  3. Estimate the rate of growth and the ultimate level of demand for the new product on the basis of the pattern of growth of established products.
  4. Estimate the demand by making direct enquiries from the ultimate purchasers, either by the use of samples or on a full scale.
  5. Offer the new product for sale in a sample market, e.g., by direct mail or through one multiple shop organisation.
  6. Survey consumers' reactions to a new product indirectly through the eyes of specialised dealers who are supposed to be informed about consumers' need
  • Arun Kumar, ‎Rachana Sharma (1998), Managerial Economics. p. 122
  • Managerial Economics as a subject gained popularity in U.S.A after the publication of the book “Managerial Economics” by Joel Dean in 1951. Joel Dean observed that managerial Economics shows how economic analysis can be used in formulating policies.
Managerial economics bridges the gap between traditional economic theory and real business practices in two ways. Firstly, it provides number of tools and techniques to enable the manager to become more competent to take decisions in real and practical situation. Secondly, it serves as an integrating course to show the interaction between various areas in which the firm operates.
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