Pedagogy in Action > Library > Classroom Experiments > Examples > Energy and the Environment

Energy and the Environment

Sheryl B. Ball, Virginia Tech
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This experiment illustrates how people's decision to drive instead of using more environmentally friendly means of transportation can lead to negative externalities. Students develop policy recommendations to solve the resulting public health problems and these recommendations are tried in the experiment. Policy recommendations can be evaluated to see whether they solve the externality problem as well as to evaluate their efficiency and justice implications.

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Learning Goals

This activity is designed to help students learn about how individual decisions can result in consequences for others and to examine solutions to the resulting externality problem. By the end of this activity, students will be able to

Context for Use

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Description and Teaching Materials

The first step in conducting the experiment is the instruction stage. In this stage distribute instructions and an optional test of understanding for students.

The experiment starts with stage 1. In this stage all students have the same cost and benefit information - that contained in the instructions you have already distributed. It is important to read the instructions aloud and give students the opportunity to ask questions before starting the experiment. Stage 1 is mostly to familiarize students with the game will involve 2-3 rounds - your guideline is to end Stage 1 when you think that students have gotten the hang of things. The sequence of events is:

Stage 2 of the experiment is very similar to Stage 1 except that students get new private information.

Stage 3 of the experiment asks students to come up with policy solutions to the externality problem.
You might want to review a flow chart of the steps involved in carrying out this experiment.

Here is some Sample Data (Acrobat (PDF) 44kB Mar1 10) to help you get a feel for what will happen in the experiment. In the highly unlikely case that your class experiment doesn't go well a backup plan is to show students these results.

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Teaching Notes and Tips

Features about the exercise the instructor should be aware of:

This entire exercise can be conducted in a 50 minute class or split so that it takes part of two classes.

Make sure to bring to class:

This exercise requires at least 9 students to work but can easily be modified for large classes - I have used it in a class of 130 with difficulty by dividing students into groups of 4 and asking each group to make a single decision. If you have them available, clickers could be used to poll students about their decision in each round making the exercise feasible in large classes. I accomplished this by show of hands.

Prior to conducting this activity, the instructor needs to:

During the session of conducting the group activity,

  1. Most decisions have both private and external benefits and costs. This creates the "Tragedy of the Commons"
  2. People often think more about private than external when making decisions
  3. This can mean that society tends to suffer from too many external costs
  4. It probably is going to take more than just "awareness of the problem" to make the problem go away.
  5. A purpose of government is to create policies that can keep society from ending up having a bad outcome
  6. Some policies are better than others

The use of this activity beyond introductory level:

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Students are assessed using:

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References and Resources

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