Economics Games

Classroom Games For Teaching Economics

Economics Games : Inter-University Student Tournament!

We are launching a new (free) inter-university student tournament, based on an industrial organization simulation (close to those that are described here: https://lud.io).

The qualification phase consists in playing 6 years of a mono-player simulation, between now and before November the 23th, 2017 (vs robots behaving like humans did, in previous experiments) .  You can play when you want, at your own pace. The 12 best teams will be qualified for the finals (and scores will be reset).

The finals will be played between November the 27th and December the 2nd, 2017: Players will have to enter one decision every day, before 21h CET.

Both phases are played online.

 

iogame

 

The winning team will be awarded a voucher around 300€ as a first prize (on amazon or a similar site).

Students can participate on their own, with no need of support from their instructors: The game will require some strategic thinking but there is no prerequisite in economics.
This should be fun, so join the tournament!

One team (2-4 players) from any university or school is welcome to participate (Registration is now closed)

You can also register to the facebook event, to stay informed: https://www.facebook.com/events/1963638390559162

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“Can Contracts Solve the Hold-Up Problem?”

This week, we are adding “Can Contracts Solve the Hold-Up Problem?” by Eva Hoppe and Patrick Schmitz (Games and Economic Behavior 2011).

The paper is available on the site of the journal, and the game is in the “industrial organization section” on our site.

 

holdup

 

Abstract of the paper:

In the contract-theoretic literature, there is a vital debate about whether contracts can mitigate the hold-up problem, in particular when renegotiation cannot be prevented. Ultimately, this question has to be answered empirically. As a first step, we have conducted a laboratory experiment with 960 participants. We consider investments that directly benefit the non-investing party. While according to standard theory, contracting would be useless if renegotiation cannot be ruled out, we find that option contracts significantly improve investment incentives compared to a no-contract treatment. This finding might be attributed to Hart and Mooreʼs (2008) recent idea that contracts can serve as reference points.”

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“Judgemental Overconfidence, Self-Monitoring, and Trading Performance in an Experimental Financial Market.”

This week, we add an asymmetric information trading game, derived from Biais, Hilton, Mazurier, Pouget (RES 2004) and Plott & Sunder (Econometrica 88).

The paper is available on the site of the journal, and the game is in the “finance section” on our site.

 

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Abstract of the paper:

We measure the degree of overconfidence in judgement (in the form of miscalibration, i.e. the tendency to overestimate the precision of one’s information) and self-monitoring (a form of attentiveness to social cues) of 245 participants and also observe their behaviour in an experimental financial market under asymmetric information. Miscalibrated traders, underestimating the conditional uncertainty about the asset value, are expected to be especially vulnerable to the winner’s curse. High self-monitors are expected to behave strategically and achieve superior results. Our empirical results show that miscalibration reduces and self-monitoring enhances trading performance. The effect of the psychological variables is strong for men but non-existent for women.”

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“Teaching Collective Action Problems without Contextual Bias: The Red/Green Simulation”

This week we are adding the Red/Green Simulation, by James R. Bruehler, Alan P. Grant, and Linda S. Ghent (Journal of Economics and Finance Education 2017).

The paper is available on the site of the (open access) journal, and the game is in the “externalities and public goods section” on our site.

 

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Abstract of the paper:

“Collective action problems are at the heart of many economic issues. Often, students have trouble comprehending how society ends up with a less than optimal outcome, and may incorrectly assume that someone must want the outcome that occurs. Correcting this error is made difficult by the biases that students bring to these issues.
The Red/Green simulation demonstrates the tension between self-interest and the social good in a context-free manner allowing students to see that these sub-optimal outcomes may not be desired by anyone, but instead can result from unhealthy systems of incentives.”

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New: “The Carbon Trading Game”

This week, we are adding “The Carbon Trading Game” by Roger Fouquet (Climate Policy 2003), on our site, in the “Externalities and public goods” section.

 

carbontrading

Abstract of the paper:

“In response to the Kyoto Protocol, an international market for carbon dioxide tradable permits is likely to be created. Two of the key issues involved are explaining the concepts of tradable permits to industrialists, policy-makers and the man on the street, and anticipating how the market will evolve. A simple game of the market for carbon dioxide tradable permits has been developed and used that can help deal with both issues. As a pedagogical tool, this game benefits from simplicity (just a few pieces of paper are needed) and enables students to grasp the concepts and remember them through the intensity and fun of a trading ‘pit’. The experiences also provide substantial insights into the evolution of the carbon dioxide permit market, particularly related to the evolution of trade volume, permit prices and country strategies.”
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