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ES20097: Games and experiments

Follow this link for further information on academic years Academic Year: 2018/9
Further information on owning departmentsOwning Department/School: Department of Economics
Further information on credits Credits: 6      [equivalent to 12 CATS credits]
Further information on notional study hours Notional Study Hours: 120
Further information on unit levels Level: Intermediate (FHEQ level 5)
Further information on teaching periods Period:
Semester 2
Further information on unit assessment Assessment Summary: EX 80%, OT 20%
Further information on unit assessment Assessment Detail:
  • Coursework (OT 20%)
  • Exam (EX 80%)
Further information on supplementary assessment Supplementary Assessment:
Reassessment exam (where allowed by programme regulations)
Further information on requisites Requisites: Before taking this module you must take ES20011
Further information on descriptions 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
Further information on programme availabilityProgramme availability:

ES20097 is Optional on the following programmes:

Department of Economics
  • UHES-AFB03 : BSc(Hons) Economics (Year 2)
  • UHES-AAB03 : BSc(Hons) Economics with Study year abroad (Year 2)
  • UHES-AKB03 : BSc(Hons) Economics with Year long work placement (Year 2)
  • UHES-AFB01 : BSc(Hons) Economics and Politics (Year 2)
  • UHES-AAB01 : BSc(Hons) Economics and Politics with Study year abroad (Year 2)
  • UHES-AKB01 : BSc(Hons) Economics and Politics with Year long work placement (Year 2)
  • UHES-ACB01 : BSc(Hons) Economics and Politics with Combined Placement and Study Abroad (Year 2)
  • UHES-ACB03 : BSc(Hons) Economics with Combined Placement and Study Abroad (Year 2)

Notes: