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ES50121: Experimental economics

Follow this link for further information on academic years Academic Year: 2019/0
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: Masters UG & PG (FHEQ level 7)
Further information on teaching periods Period:
Semester 2
Further information on unit assessment Assessment Summary: CW 60%, EX 20%, PR 20%
Further information on unit assessment Assessment Detail:
  • Coursework 1 30% (CW 30%)
  • Coursework 2 30% (CW 30%)
  • PracticalIn-class experiments 20% (PR 20%)
  • Exam 20% (EX 20%)
Further information on supplementary assessment Supplementary Assessment:
ES50121 - Re-assessment 100% Exam (where allowed by programme regulations)
Further information on requisites Requisites:
Further information on descriptions Description: Aims:

* 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).
* 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.

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 economic theory in analysing "real world" problems;
* Write answers to the short theoretic questions;
* Discuss the outcome of the experiments in comparison with the theory prediction;
* 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 Experimental Economics
* 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 experiments.
Further information on programme availabilityProgramme availability:

ES50121 is Optional on the following programmes:

Department of Economics

Notes: