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Microeconomic Market Analysis

10 weeks · 0 milestones

Produce a microeconomic analysis of a real, named market using real data (ONS, BLS, industry databases, or equivalent). Analyse supply and demand dynamics, price mechanisms, and market structure; document your data sources and methodology throughout. Proof is the written analysis plus a documented Q&A session with an economics graduate or practitioner who challenges at least one of your data choices or core assumptions — your written response to their challenge is a required part of the proof artifact. 'I stand by my choice' is not a response — the response must engage with the substance of the challenge.

Milestone map

Milestone map

3 milestones

Identify a real market and describe its structure and behaviour

4 weeks

Select a specific real market and identify its structure using standard structural indicators: number of firms, market concentration (HHI or CR4), entry barriers, product differentiation, and price-setting behaviour. Use real data from national statistics agencies, company annual reports, or competition authority decisions. Produce at least one summary statistic supporting the structure assessment.

Proof required

Market structure description document (500+ words) identifying the specific market, describing structure using at least three structural indicators with real data supporting each, and explaining the market behaviour characteristics consistent with that structure.

What gets checked

  • Market is identified specifically — not 'the technology sector'
  • At least three structural indicators are addressed with real data supporting each
  • Market behaviour characteristics are connected to the identified structure

Common mistakes

  • Selecting a market too broad to be analysed — 'the food market' is not analysable; 'the UK ready-to-eat chilled meals market' is
  • Asserting market structure without data — structure must be supported by real concentration or pricing evidence
  • Not connecting structure to behaviour — different structures produce different pricing and differentiation patterns

Powstik Guide

A 500-word description of a real market's structure.

Steps

  1. Name the market and its boundaries.
  2. List main firms and shares.
  3. Estimate concentration.
  4. Describe pricing behaviour.

Template

Market:
| Firm | Share |
|------|-------|
Concentration:
Pricing behaviour:

What gets sent back

  • Under 500 words.
  • Sources uncited.
  • Hypothetical instead of real.

Resources

Foundationstart here

Depthgo deeper

What a verifier looks for

  • Check structural indicators — confirm real data is cited for at least three
  • Review market selection — confirm it is specific enough to be meaningfully analysable
  • Check structure-behaviour connection — confirm market behaviour is tied to the identified structure

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Apply a microeconomic model to explain and predict market behaviour

4 weeks

Apply a named microeconomic model to the M1 market — game theory (oligopoly), monopolistic competition and product differentiation, price discrimination models, or competition policy theory. Explain at least one real observed behaviour in the market using the model, and make a specific prediction about market response to a named change (new entrant, regulatory intervention, or cost shock).

Proof required

Model application document (500+ words) naming the model, applying it to explain at least one real observed market behaviour with evidence, and producing a specific prediction about market response to a named change with model-based reasoning.

What gets checked

  • A named microeconomic model is applied — not 'basic supply and demand'
  • At least one real observed market behaviour is explained with evidence
  • A specific prediction with model reasoning is made about a named change

Common mistakes

  • Describing the model without applying it to generate specific market behaviour explanations
  • Prediction without model reasoning — 'prices will fall' without mechanism is not a microeconomic prediction
  • Applying game theory to markets with too many players — 2–5 key players is the tractable range

Powstik Guide

A named model applied to explain and predict the market.

Steps

  1. Choose the model that fits the number of key players.
  2. Map real firms and choices onto the model's terms.
  3. Explain one observed behaviour with evidence.
  4. Name one change, like entry or a tax.
  5. Predict the response, stating the mechanism.

Template

Model:
Why it fits this market:
Observed behaviour (with source):
Model explanation:
Change:
Predicted response and mechanism:

What gets sent back

  • A model described but not applied.
  • A prediction with no mechanism.
  • Game theory with too many players.

Resources

Foundationstart here

Depthgo deeper

Masteryfor the dedicated

What a verifier looks for

  • Review model application — confirm it produces a specific explanation of observed behaviour
  • Check prediction — confirm it is derived from the model with explicit reasoning
  • Verify appropriate model choice for the market structure identified in M1

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Defend market analysis under economist or competition analyst challenge

1 week

Present the market analysis to an economist, competition analyst, or industry economist. The reviewer must probe structure and model application — 'your HHI is below the normal oligopoly threshold — why classify this as oligopoly?', 'your game theory assumes symmetric players but they are not — how does that affect predictions?'. This Q&A satisfies the ADVERSARIAL VERIFICATION RULE.

Proof required

Q&A notes (250+ words) documenting the reviewer's economics or competition analysis credentials, at least three specific challenges to structure or model with responses, and any analysis updates committed to.

What gets checked

  • Reviewer is an economist, competition analyst, or industry economist
  • At least three specific challenges to structure or model are documented
  • At least one analysis update is committed to

Common mistakes

  • Reviewer validates structural conclusions without probing the evidence
  • Not being able to defend model choice under asymmetric-player challenge
  • No analysis updates after a genuine model-application challenge

Powstik Guide

Your market analysis, challenged by an economist.

Steps

  1. Recheck your concentration figures and sources.
  2. Mark your weakest classification or model choice.
  3. Book an economist or competition analyst.
  4. Ask for three challenges on structure and model.

Template

Challenge session log
Date:            Duration:
Reviewer name:
Reviewer role and credentials:

Challenge 1 (market structure or model choice):
  What they asked:
  My answer:
  Did it hold?
Challenge 2:
  What they asked:
  My answer:
  Did it hold?
Challenge 3:
  What they asked:
  My answer:
  Did it hold?

Update I am committing to:

What gets sent back

  • A reviewer who agrees without probing.
  • No defence of the model choice.
  • No update after a real challenge.

Resources

Foundationstart here

Depthgo deeper

What a verifier looks for

  • Confirm reviewer is an economist, competition analyst, or industry economist
  • Review Q&A notes — confirm at least three specific challenges are documented
  • Check that at least one analysis update is committed to

You'll sign in first, then come straight back here.

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