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ES50153: Game theory, mechanism design, and experimental methods

[Page last updated: 15 October 2020]

Follow this link for further information on academic years Academic Year: 2020/1
Further information on owning departmentsOwning Department/School: Department of Economics
Further information on credits Credits: 10      [equivalent to 20 CATS credits]
Further information on notional study hours Notional Study Hours: 200
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 100%
Further information on unit assessment Assessment Detail:
  • Coursework 1 (CW 60%)
  • Coursework 2 (CW 40%)
Further information on supplementary assessment Supplementary Assessment:
Like-for-like reassessment (where allowed by programme regulations)
Further information on requisites Requisites:
Description: Aims:
The aim of this unit is to provide students with knowledge and skills on how to apply mechanism design and experimental methods from economics and psychology to address practical economic, financial, and business problems.

Learning Outcomes:
At the end of this unit students should be able to:
* Analyze markets and allocation problems with the tools of mechanism- and market design;
* Outline and evaluate the main results in the literature of mechanism design;
* Create solutions to real-life design problems by applying and adapting concepts and tools developed in the unit;
* Detecting incentive problems in the presence of private information and constructing methods of eliciting private information in allocation and matching problems;
* Design experiments to analyse properties of mechanisms in economic, financial, and business contexts;
* Design and program experimental instructions using computer software;
* Construct behavioural predictions drawing on economic theory, behavioural economics or finance, and psychology;
* Empirically investigate experimental results and behaviour using econometric tools;
* Evaluate findings using insights from economic and psychological research.

Skills:
Ability to apply theoretical, algorithmic, and empirical mechanism design techniques to practical problems

Ability to create logically rigorous arguments

Ability to analyse and synthesize information

Ability to plan, design, and execute programming tasks.

Content:
The Mechanism Design Problem

Dominant Strategy Implementation
* Dominant Strategies
* Direct Mechanisms and the Revelation Principle
* The Gibbard-Satterthwaite Theorem
* Groves Clarke Mechanisms

Bayesian Implementation
* Bayesian Revelation Principle
* Expected Externality Mechanism
* Auctions and Revenue Equivalence

Experimental economics and game theory
* Collective action problems
* Zero-sum game
* Coordination problems

Market experiments
* Buying and selling strategies
* Market structure and competition
* Asymmetric information and adverse selection

Auction experiments

Bargaining experiments.
Further information on programme availabilityProgramme availability:

ES50153 is a Designated Essential Unit on the following programmes:

Department of Economics
  • THES-AFM30 : MSc Economics for Business Intelligence and Systems

Notes: