Posted by Jan-Eric Nilsson on March 18, 1997 at 04:40:35:
Hi,
Since I am now wrapping up the course, I would like to share some of the lessons we have learned with other readers of the discussion group.
We have primarily been interested to use experiment 6 in order to clarify the significance of economic tools to handle externalities. We first ran a few markets with experiment 1 to make the students used to the standard double auction stuff; then came experiment 6. Our main conclusion is, never the less, that it is difficult to bump right into one specific chapter of the book in this way. Students don't have the training to realise what really takes place, in particular the dichotomy between redemption values and theoretical predictions on the one hand and actual outcome in the sessions on the other seems to bee difficult to grasp.
Some detail questions/remarks: I found it useful to summarise the results for the students by plotting experimental trade against the predicted levels on the same sheet. This made it obvious that outcomes iterated towards predictions in a way which did not come out immediately from the textbook. Is this done during previous experiments? If not, I suggest that it should be.
In 'Homework' you have these small tables where consumer & producer surplus etc. is set out. The table is set out for the market with externality but without any corrective measure (p 204) as well as with the pollution tax (p 205); why not include it also for the marketable permits. I find the tables very instructive, not least in order to point to how the aggregate surplus and surpluses of buyers/sellers vary.
We did, by the way, order the Instructor's Manual, but it took well over a month to receive it, although premium postage was payed! We now realise that this will be a valuable aid for the future.
In summary, we look forward to using major parts of the book for our micro course this fall.
Jan-Eric