Details for Economics Experiments

Initial Publication Date: June 24, 2010
For the most part teaching economics with experiments is very similar to using them any other discipline. A "How To" tutorial lays out the general steps for conducting a successful classroom experiment. But unlike a classroom experiment used in another discipline, in an economics experiment, the students are both witnesses to the experiments and decision makers who produce the data. Some key differences between classroom experiments in economics versus other disciplines include:

1. Private Information

Students in an economics experiment often need specific information in addition to the general instructions given to the class. Examples are:
  • Their role assignment - For example, are they a buyer or a seller?
  • Private Role Information - For example, there may be things that all sellers know about the market that no buyer knows.
  • Private Individual Information - For example, at what price can they profitably buy or sell? What quality good do they have to offer in the market
Because it is often essential to a successful running of the experiment to manage this information carefully, it is best to distribute it during class. For example, in a monopoly experiment, it is important that the person who is the monopolist shows up to class that day. Handing out private information during class is one way to avoid mishaps.

2. Time

All classroom experiments take time away from lectures and other classroom activities. One advantage of economics experiments is that most of them don't require any actual equipment to conduct - economics experiments are typically done with paper and pencil, a random generating device like dice and maybe some playing cards. Experienced instructors can start an experiment "on the fly" if they sense that the class needs a change of pace. While some experiments take longer than others there are a variety of possibilities to help instructors to incorporate experiments into their classes. For more information see How Much Time Does it Take?

3. Incentives

A difference between experiments in economics and other fields is the importance of behavioral incentives. Since some would define economics as the study of people's behavior when faced with incentives they are an important component of research experiments in economics and can be used in classroom experiments as well. On the other hand, they are not necessary. For more discussion see Should I Provide Incentives?.

4. Dealing with Less than Ideal Classroom Environments

The ideal classroom environment for running a classroom experiment is probably a traditional classroom setting with tables in the classroom, 30 or fewer students enrolled and at least an hour for class. Fortunately there are a lot of strategies you can use to Make it Work if your classes are less than idea.