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 Academic Year: | 2016/7 |
| Owning Department/School: | Department of Economics |
| Credits: | 6 [equivalent to 12 CATS credits] |
| Notional Study Hours: | 120 |
| Level: | Intermediate (FHEQ level 5) |
| Period: |
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| Assessment Summary: | CW 60%, EX 20%, PR 20% |
| Assessment Detail: |
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| Supplementary Assessment: |
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| Requisites: | Before taking this module you must take ES20011 |
| Description:
| Aims: 1. To introduce the exciting field of game theory and experimental economics: In recent years the importance of economic experiments has been increasing. Why do we run experiments? There are mainly three reasons: (i) Economists aim to test their theories, as physicians do; (ii) Experiments can be used to discover new economic hypotheses; (iii) They can also illuminate or support policymaking (e.g. David Cameron's 'nudge unit', Google's ad auction model). Experimental economics is a discipline of increasing importance (Nobel prizes). 2. To provide hands-on experience of experimental economics: Typically students will participate in a computerised experiment for each topic. After the experiment, a lecture will explain the related theory and discuss the interpretation of the experimental outcomes. The course should provide enjoyable, interactive and concrete learning experience. 3. To give a good understanding of the basic principles of game theory and to discuss the practical applications of the theories: The use of pedagogical experiments offers an alternative way to understand economics in addition to abstract thinking and math. It is research informed teaching. The course may serve as a preparation for the more advanced courses in the final year - namely, game-theory and behavioural economics. Learning Outcomes: On completing this unit, students should be able to: * Follow the analysis of interactive decision making and construct their own mathematical arguments; * Understand the role of game theory in analysing "real world" problems; * Write answers to the short game theoretic questions. * Discuss the outcome of the experiments in comparison with the prediction of game theory. * Explore better alternative explanations or think critically about the theory when the theory prediction does not fully match the experimental outcome. Skills: Problem solving, abstract thinking and logical and rigorous arguments. Content: Part 1: Introduction to games and strategy * Introduction and the definition of games * Thinking strategically: p-beauty contest game Part 2: Buying, selling and different types of market * Market interaction: market experiment * Cooperation: Bertrand competition experiment * Auctions: private value auction experiment Part 3: Asymmetric information * Adverse selection: the market of lemon experiment * Information cascades: cascade experiment * Bargaining and principal agent relations: ultimatum game Part 4: Different types of game * Collective action problems: public goods game * Zero-sum games and mixed strategies * Coordination games: currency attacks, focal point experiment |
| Programme availability: |
ES20097 is Optional on the following programmes:Department of Economics
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Notes:
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