Theoretical foundations of microeconomic analysis of project activities

Abstract

Abstract. This research addresses a fundamental gap in microeconomic theory by establishing the theoretical foundation for treating projects as autonomous microeconomic subjects. The study challenges the conventional paradigm that confines projects exclusively to organizational-managerial frameworks, demonstrating instead their economic essence as independent production systems. A systematic methodology was developed to examine project activities through the lens of neoclassical microeconomic theory, identifying seven fundamental characteristics that define legitimate economic agents: production transformation capacity, differentiated cost structures, rational resource optimization, strategic external positioning, asymmetric information management, internal coordination mechanisms, and quantitative economic evaluation systems. The research employed comparative analysis between traditional firms and projects across each identified characteristic, revealing complete correspondence of project activities to all established criteria. The study formalized a unique project production function that explicitly incorporates time as a constrained production factor, distinguishing it from conventional firm models. Comprehensive analysis of project cost structures demonstrated the presence of fixed, variable, marginal, and opportunity costs analogous to traditional economic units. Investigation of decision-making processes confirmed that projects systematically apply optimization principles, employing mathematical programming methods including linear programming, integer programming, and multi-criteria analysis to maximize objective functions under resource constraints. Strategic positioning analysis revealed that projects engage in sophisticated interactions with suppliers, customers, competitors, and regulatory bodies, comparable to permanent organizations. The research documented project mechanisms for managing classical economic problems of moral hazard, adverse selection, and information asymmetries through contractual arrangements, monitoring systems, and incentive structures. Analysis of internal coordination demonstrated that projects create hierarchical management structures and planning systems that serve as alternatives to market mechanisms. Examination of quantitative evaluation capabilities showed projects utilize advanced tools including Earned Value Management, financial metrics, and performance indicators for economic assessment. The scientific contribution lies in conceptualizing projects as "temporary firms" possessing complete economic agent characteristics, establishing methodological foundations for applying microeconomic analytical tools to project activities, and creating a theoretical framework that bridges project management practice with microeconomic theory, thereby expanding the boundaries of both disciplines.