A rewarding aspect of using experimental techniques in my research is that classroom versions of these experiments are very effective as teaching tools. The use of such classroom games is gaining attention and becoming more widespread. In this article I present some arguments for using classroom games and some suggestions on how to run them.
A classroom game can be almost any interactive exercise that gets students involved in the economic problem that is being taught. In its most basic form, students simply role-play, pretending to be a buyer or seller of, say, a used car. More commonly, students are given information about the potential costs and benefits associated with decisions, and then brought together to make these decisions. For example, in an auction market, some students are assigned to be sellers and others to be buyers. After sellers are privately told their costs of production and buyers are privately told their values for obtaining a unit of a good, they negotiate prices and makes sales. (Holt, 1996, provides details on how to implement an auction market).
There are many reasons why instructors find it worthwhile to use games in the classroom. They can be fun and provide a welcome break from the traditional lecture format for both the student and instructor. Furthermore, as economics becomes less obscure and more "hands-on," interest and enthusiasm grow. The discussion period that follows most classroom games allows students to discover economic ideas themselves. Through their participation in the exercises, students typically feel more comfortable with their insights and are more willing to take part in the discussion. In my experience, a student who observes price convergence in an auction never forgets the "law of one price." Also, the impact on teaching evaluations shouldn't be overlooked; students frequently list these exercises as a strength of the course. Students also feel that their own participation in the class has been greater, and that the instructor has listened to their questions and comments.
An example illustrates many of these points. A colleague at another university was preparing to conduct her first classroom game: an auction market. She had been teaching for several years and was a successful instructor, but wanted to try something new. Still she was worried, wondering what she would do if it "didn't work." I gave her some tips about how to handle whatever happened, but found her concern illuminating. Inherent in it was a basic doubt about the supply and demand model that we teach to our students as truth. She called me as soon as she finished her class, excited. The game had gone well, her students were more enthusiastic than she had seen them, and she was already thinking about new exercises that she could use with her students. This isn't unusual. I've heard from many instructors who have been astonished at how well experiments work in the classroom.
Although I am an outspoken advocate for the use of classroom games, one should also think about how to use them most effectively. Classroom exercises are certainly no substitute for lectures, and they don't do a good job of teaching everything. That said, I believe that you can effectively use interactive exercises to teach many key points. Sprinkled throughout the semester, they keep the class lively and help students to develop a more in-depth knowledge of the topics they cover. When I've conducted a market exercise early in the semester, my students typically ask after just a few weeks when we will play another game. Classroom games have been used more widely in microeconomics classes rather than macroeconomics classes, primarily because there have been more games that teach micro-related topics: this is changing. I use at least one or two classroom games in every course I teach, including Principles of Economics classes (either micro or macro), intermediate economics, public economics, international trade, game theory (at any level) and MBA economics. I have even worked with grade school teachers that are beginning to teach economic concepts to their students as a result of state-mandated standards of learning in economics. At the other end of the spectrum, conducting an auction exercise with Ph.D. students can remind them of the markets behind the mathematical expressions that they are learning.
If you are thinking about running your first classroom experiment, try one that someone else has successfully conducted. Below I list sources for these games. An auction market is an excellent place to start. Students enjoy it and the results are very reliable. A public goods experiment (see Holt and Laury, 1997) is another easy-to-run first game; the discussion for this game can be tailored to any outcome that might occur. Before class read through the instructions carefully and do whatever advance preparation is necessary. Typically this involves photocopying instructions, deciding on the specific parameters for your class size, and organizing materials. The first time you conduct a classroom exercise, it will probably take as much preparation time as getting ready for a lecture. However, the preparation time is reduced considerably when you use the game again. Many of these games offer an option of paying one student (randomly chosen at the end of class) a small percentage of their earnings. While some instructors choose to do so, I don't think this is necessary. However, if you find that your students aren't taking the games seriously, this may help. Typically the cost is less than two or three dollars. Some instructors also use extra credit to motivate participation.
Be sure to leave time for discussion. One of the reasons classroom games are so effective is that students are actively involved in the learning process. Group discussion allows them to put into words what they have learned, and also allows the instructor to guide students to the right conclusions. Many of the sources listed below provide suggestions for the discussion period. Finally, it is important to be flexible. Results don't always turn out the way you expect them to, and sometimes they don't turn out the way theory predicts. When this happens, explain to students what you expected (and why) and then get their input into why things didn't turn out this way. Often students will figure out reasons why things turned out as they did, or how results might have been different. Keep a positive attitude about this, and remember that you do not have to be theory's defender.
The increasing interest in using classroom experiments is evident in the number of publications on the topic. Several journals contain regular or periodic features on the use of classroom experiments. These include the "Classroom Games" columns in the Journal of Economic Perspectives, the Southern Economic Journal,, and the Journal of Economics Education. Many examples of classroom games can be found in these, as well as in back issues of Economic Inquiry. There is an electronic newsletter produced by Greg Delemeester and John Neral available on the web at: http://mcnet.marietta.edu/~delemeeg/expernom.html. Each issue includes submissions from several instructors about games they have successfully used. There is a new principles textbook, Experiments with Economic Principles, by Ted Bergstrom and John Miller, that is designed around the use of classroom experiments. In addition, several principles textbooks suggest the use of classroom games in supplements. For example, Delemeester and Neral have written a supplement to Taylor's Economics and Ortman and Colander have written a supplement to Colander's Economics. I have a section of my web page (http://theweb.badm.sc.edu/laury) devoted to classroom games. It contains abstracts of some papers as well as instructions that can be downloaded. If you have a game that you use when teaching, contact me and I will add a link on my page so that you can share your idea with others.
Although there is little quantitative evidence on whether or not classroom games raise test scores or in what ways they enhance learning, I have no doubt that they are an effective teaching tool. Students are usually more enthusiastic about studying economics after they have participated in one or two classroom games. In addition, I am more interested in what I am teaching and have gained new perspectives on the course material after observing how students behave in these exercises. The good news is that, with the resources that are currently available, classroom games are no longer only the domain of experimental economists. They can be effectively used by anyone with an interest.
Bergstrom, T.C. and J.H. Miller, 1997, Experiments with Economic Principles, The McGraw-Hill Companies, Inc.
Delemeester, G. and J. Neral, 1995, Classroom Experiments to Accompany Taylor's Economics: A User's Guide. Boston: Houghton Mifflin.
Holt, C.A., 1996, "Classroom Games: Trading in a Pit Market." Journal of Economic Perspectives 10 (1): 193-203.
Holt, C.A. and S.K. Laury, 1997, "Classroom Games: Voluntary Provision of a Public Good." Journal of Economic Perspectives 11 (4): 209-215. Ortman, A. and D.C. Colander, 1995, Experiments in Teaching and in Understanding Economics, to Accompany Economics (2nd ed.) by D.C. Colander. Chicago: Irwin.