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ES50121: Experimental economics

[Page last updated: 02 August 2022]

Academic Year: 2022/23
Owning Department/School: Department of Economics
Credits: 6 [equivalent to 12 CATS credits]
Notional Study Hours: 120
Level: Masters UG & PG (FHEQ level 7)
Semester 2
Assessment Summary: CW 60%, EX 30%, PR 10%
Assessment Detail:
  • Coursework 1 (CW 30%)
  • Coursework 2 (CW 30%)
  • Practical (PR 10%)
  • Exam (EX 30%)
Supplementary Assessment:
Like-for-like reassessment (where allowed by programme regulations)
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.

* 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.

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.

Programme availability:

ES50121 is Optional on the following programmes:

Department of Economics


  • This unit catalogue is applicable for the 2022/23 academic year only. Students continuing their studies into 2023/24 and beyond should not assume that this unit will be available in future years in the format displayed here for 2022/23.
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