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ES20097: Games and experiments

Follow this link for further information on academic years Academic Year: 2017/8
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: CW 60%, EX 20%, PR 20%
Further information on unit assessment Assessment Detail:
  • Coursework 1 (CW 30%)
  • Coursework 2 (CW 30%)
  • Practical (PR 20%)
  • Exam (EX 20%)
Further information on supplementary assessment Supplementary Assessment:
ES20097 Mandatory Extra Work (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.

Problem solving, abstract thinking and logical and rigorous arguments.

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)