The primary functions of economists are to teach, contribute research and empirical findings and formulate policies. Most of the professional economists are associated with academic institutions and research institutes. Many of them are involved in both teaching and in scientific research. A limited number are associated with the corporate sector.
In many companies economists act as advisors to functional managers in finance, marketing, production, personnel and in other departments.
A knowledge of economics is essential for sound policy making. Decision makers who do not understand the implications of their actions are not likely to reach their goals. Till recently, the functional managers themselves were expected to possess the skills necessary for dealing with the ever arising economic problems. Now-a-days there is a growing demand for specialist economists in the corporate sector to deal with the everchanging economic environment in the wake of liberalization and globalization of the Indian economy. Often, outside consultants are brought in to prepare corporate studies as and when the need arises.
A finance manager may call upon the economist for forecasts relating to the money and capital market, inflation rates, and other trends in the economy. The marketing manager might need the expertise in forecasting market demand, evaluating the impact of price changes and advertising, competitive analysis, etc. Professional economists can help production managers in sales forecasting, inventory control and related decisions. They can associate with the personal executives in preparing manpower plans and help in salary fixations. Finally, as we have discussed, close co-operation between economists and corporate planners is essential in the preparation and execution of corporate plans.