Help required – brainiacs only

We have a regular reader named Ronald J and he’s a college student. He has a 10-page paper to complete for his microeconomics class and his initial choice is to do it about Saab.

He can choose to write about Saab from one of the following perspectives:

1. Economic Foundations
2. Trade-offs
3. Supply and Demand schedules
4. Government & Taxes
5. Externalities and Public Goods
6. Consumer Choice
7. Demand and Supply Schedule Elasticities
8. Production & Costs
9. Perfect Competition
10. Oligopoly
11. Monopolistic Competition
12. Monopoly


Personally, if the parameters of the paper allow it, my advice would be to take the auto industry as a whole and write about consumer choice. There’s plenty of raw data at hand for that combination. But that’s just me.

If you’ve got some thoughts (and more importantly, some microeconomic expertise) then Ronald would appreciate any suggestions you might care to make.

Saabs United – helping kids graduate since 2005.


12 thoughts on “Help required – brainiacs only”

  1. Saabs United – helping kids graduate since 2005.

    haha lol

    I think consumer choice and economic foundations are the only two topics that have enough information about it available…

  2. I add to Lala the Government and Taxes piece. Particularly with the government loans and all of the debates about government ownership of GM prior to sale of Saab, I’m sure that you could hammer that together.

    Saab also had government subsidies in the 1990s during the Swedish financial crisis that lead to the Walburgs selling Saab to GM in the first place.

    Finally, since Saab came from the Saab that builds military and commercial aircraft, I’m sure that there were several government factors that indirectly affected Saab during most of the car marque’s history, starting with the production capacity driven by World War II.

  3. In a “micro-economics” class, and for a 10 page paper, it could be interesting perhaps to analyse car buying consumer behaviour in different countries i.e. Norway where there are prohibitive taxes with that of some other country with virtually no taxes and cheap petrol. There is sufficient data on the “net” as to the average age of the “vehicle population”, number of cars bought per 1000 inhabitants vis-a-vis purchasing power etc. Good luck !!

  4. I’d do the Government and Taxes one too. There are so many things you could write about, as others have said. Take here in Ireland, we changed our motor tax system in summer 2008. Previously a car was taxed on it’s engine CC. Now it’s based on our CO2 level. Because of this, nearly all cars sold are diesel – as these have lower CO2 outputs (for the moment). The sales of petrol cars have dropped off a cliff. Unfortunately, we don’t have great highways and autobahns in Ireland, so most people use these diesel cars around town, and their DPF’s are not re-generated, and from my understanding, because of this, these cars are pumping out far worse emissions than any petrol car would have. So, the government, with all its knowledge has achieved exactly the opposite of their goal. In addition, they’ve wiped out the luxury car market, and many dealers have gone out of business. I think 1 Porsche has been sold in Ireland in 2010. Okay, our economy is a lot of the problem, but this hasn’t helped.

    Another point on government, I mentioned it in a comment to Swade the other day, Saab sold around 1000 cars in Ireland in 2000, ~1300 in 2005, and 80 so far this year. I know for a fact that most of the cars sold in previous years were BioPower cars, classed as petrol, which for a few years qualified for a €2,500 grant from… the government! This was for hybrids/alternative fuel cars. So, a Lexus LS600 was entitled to a €2,500 discount for being ‘green’…! Yet, a 600CC Smart car was not. Anyway, with this grant now finished, and with petrol cars heavily taxed, needless to say, there are no petrol Saabs selling here – and the only Saab 9-5 on the market here is the TiD, when the 2.0t BioPower was once their best seller…

    Also, in the budget on December 7th (a day that will live in infamy), the government raised the price (tax) of diesel by €0.02, and petrol by €0.04. Now, how fair is that?

    Good luck with the paper!

  5. Thanks everyone so far who has answered!
    Everyone has valid points..still undecided though.

    Its very interesting that no one has mentioned Perfect Competition, hmmm.

    I am thinking of following what Eggs, J Fan, and Ken said and do Government & Taxes, but do the auto industry as a whole (but put special emphasis on Saab).

    But like I said, still undecided. 🙂

  6. Many decades ago I did something similar! I focused on Production and in particular Saab’s worker orientated plant in Malmö, Sweden.

    This could be compared with lean and line production methods (cue American versus Japanese approaches to production) and how this affects quality and cost.

    Usefully, a great deal has been written about it and this continues to be the case even now, so plenty of resources and materials are abound.

    You may wish to schedule a telephone interview with Saab to add some original sources to embellish your report.

    This clip may whet your appetite and it really explains Saab’s short lived Malmö facility where both C900s and 9000s were produced and, reputed by some to be the highest quality cars ever made by Saab.

    Good Luck!

  7. Do not know if I qualify as a brainiac (however I have seen the TV show) 

    When writing a paper there are some things that do matter, came up with a few things

    Lets start with some limiting variables when writing a paper:
    – Limited time
    – Accessibility to information – without info, no paper.

    What do you want to achieve with your paper:
    – It should get you your diploma
    – It should be useful when applying for a job (if you want to work with something, write about that)
    – Take an area where something is written before, do not go into new territory, you do not have time with that (more work, usually not as good of a paper)

    My advice
    Do a bit of a search of what you can find data about, to choose an area where you have a hard time finding data is not really useful. You will just waste time before you change subject or you will get a bad paper together after a lot of work.

    I would probably go for taxation effects on purchasing behaviors of consumers, there are high taxation countries (Denmark and Norway), countries with different tax rates on different sizes of Engines. Or look into the taxation effects on petrol for purchasing behavior (US and Gulf states low , Europe high). I would probably not do a SAAB specific study as I expect it to be hard to get access to data (but that is just a guess).

  8. First of all want to wish Ronald J the best for his paper.

    I did micro at undergraduate level, then later in MBA and it can be tedious.

    The area I would find most interesting is supply and demand elasticity, ie how elastic or inelastic demand based on retail price points. This approach could also provide a framework for discussion of optimising sales numbers and profits by getting the price points correct for different markets at least from a theoretical perspective.

  9. Go for the consumer choice topic. My guess is it will take a lot of work to get a good job done (as always) but plenty of fun while doing it (as it should be). Then send Swade a copy for him to publish here. Should be quite interesting for us all to read. Good luck!

  10. Definitely consumer choice, especially if he’s going to be writing about the overall dynamics of the auto industry (which would be interesting) and how Saab fits into the big picture (which would be very interesting). Consumer choice could go a couple of different ways: one, how choice is molded by manufacturers through design, pricing, distribution/dealers, advertising, marketing, branding, etc.; two, how car buyers actually make a choice when they’re in the market for a new car.

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