# Activities, competitions and games for prospective students

This page has a range of games and other activities that can be used on open days, student conferences or other events. Some could be played over a period of time in conjunction with schools and thereby help to develop a link with them.

- The International Trade Game
- Group presentations on a topical economic issue
- Trading in a pit market
- Public goods game
- Tendering for a contract (a rent seeking game)
- Sunk cost and Marginal Cost: Auctioning a £1 coin

### The International Trade Game

This has been used by at least two universities in the UK as part of a Year 12 conference. It is also ideal as an induction game for new students. The game takes less than two minutes to introduce to the students. The game itself lasts about 75 minutes, plus 5-20 minutes feedback.

It can be played in two parallel games of 60 students each in a large room with just one lecturer as game leader. More than one room could be used allowing multiple games to be played at large conferences.

All the necessary equipment can be simply made and the room takes no more than 10 minutes to set up. Details of the equipment and templates for the materials are given in the case study.

The game illustrates a large number of economic concepts, including specialisation and division of labour, opportunity cost, supply and demand and the determination of price, prices as signals and incentives, cartels and oligopolistic collusion, game theory (strategy, bargaining, trust, etc.), the law of comparative advantage, terms of trade, the importance of market power in international trade, imperfect information and acting on expected prices.

### Group presentations on a topical economic issue

The students are first given some preliminary information, though handouts, short video/audio clips and a very brief lecture (5 to 10 minutes). The students are then sorted into groups of 5 or 6 and then have 30 to 40 minutes to prepare a group presentation on the topic. The remaining students then vote on each group's presentation, giving a two marks for each group of 1, 2 or 3 according to (a) academic content; (b) the entertainment value of the presentation.

With large numbers of students, the exercise can be done in two rounds. Round 1 would be in two or more separate rooms containing 3 or 4 groups per room. Each room has a set of presentations and voting as above, and there is a winning group from each room. Everyone then meets for the finals, where the winning groups from each room repeat their presentations. Voting takes place again as above to select the overall winner. Prizes can be given!

### Trading in a pit market

Access to this game can be found on the Classroom Expernomics site here. This site contains a whole series of games, many of which could be used with school students at an open day or Year 12 conference.

As the introduction on the site states, 'Playing cards are used to assign buyer and seller values in pit auction. Students mingle in a common area to negotiate trades over a number of trading periods. The prices and number of trades then form the basis of class discussion regarding the theoretical power of the basic competitive model.'

The game can be played with up to 25 students and neatly illustrates the interaction of supply and demand by simulating trading on the floor of a commodities market. It is great fun and requires only a deck of playing cards and copies of the instruction and record sheets given in the appendix to the above paper. The game takes about 45 minutes and is simple to run, but some attention needs to be paid to detail (see page 5 in the paper).

Where there are many students at an open day or conference, you could run several parallel games. Colleagues would find running a game an enjoyable way of spending an hour and could be a way of introducing them to the pedagogical benefits of using games.

### Public goods game

This is another game devised by Charles Holt along with Susan Laury. The game can be played with up to 13 students per game leader. You could play several games in the same room, provided that you had enough leaders (who could be university staff, teachers or trained university students).

Again, the only equipment required is one pack of cards per 13 students plus a one-side photocopied instruction sheet per student. The instruction sheet plus all the details of the game are given in the above link, which is to a paper by Charles Holt and Susan Laury.

As the introduction to the paper states, "Students choose whether to contribute to the provision of a public good in a situation where it is privately optimal not to contribute, but socially optimal to contribute fully. This exercise motivates discussion of altruism, strategies for private fund-raising, and the role of the government in resolving the public goods problem."

The game is simple, fun to play and illustrates several economic principles, including public goods, private versus social interests, externalities and markets. It raises a number of policy issues, which are ideal for a post-game discussion. This could be in the form of a question-and-answer session with a panel of lecturers/teachers.

### Tendering for a contract (a rent seeking game)

This is another game devised by Charles Holt along with Jacob Goeree and could easily be played in the same session as either or both of the above two. Each game is played with four teams and each team should have 2-4 members. A single game leader could run up to four games simultaneously, making a total of up to 64 students per game leader. You could have more than one set of four games in a large room, provided that you had the appropriate number of game leaders.

The only equipment you need is (a) one pack of cards per game of four teams; (b) one envelope per team; (c) an instruction sheet per student. This can be photocopied or amended from the paper in the above link.

The game takes about 50 minutes. Each team is given 13 playing cards of the same suit and bids for a 'contract' worth $16,000 (or £16,000) against the other three teams by submitting any number of its 13 playing cards placed in its envelope. Each bid (i.e. each card) costs $3000 (£3000), although that amount can be varied in subsequent rounds. The game leader then draws at random one of the submitted cards and team of that suit wins the $16,000.

The game neatly illustrates the cost of rent-seeking behaviour and could make a nice informal introduction to Nash equilibrium and the importance of game theory in economics. As the abstract from the paper states, "This game illustrates the extent to which rents can be dissipated in non-market allocations. The exercise can be used to motivate discussions of the efficiency and fairness properties of lotteries, auctions, and effort-based contests." As with the other games, it is simple and fun to play and forms the ideal basis for a post-game discussion.

### Sunk cost and Marginal Cost: Auctioning a £1 coin

This game is described by Michael J. Haupert in the Spring 1994 edition of Classroom Expernomics (see). It is suitable for groups of up to 20 students.

The game consists of an auction for a £1 coin. The game leader offers the coin and students bid for it. It is like a regular auction except that the highest **two** bidders^{(note)} have to pay their highest bid at the end of the auction, with, of course, only the higher of the two actually winning the coin.

Typically the winning bid is well over £1, as the second highest bidder will not want to lose the amount they have bid.

The game neatly illustrates the difference between sunk costs and marginal costs and can lead to a nice discussion of the meaning of opportunity cost.

After playing one or two rounds, the students can be allowed, or even encouraged, to collude. The game leader can even withdraw from the room to encourage the process. When bidding resumes, it is likely that collusion will break down. This variant thus allows discussion of the conditions under which successful collusion is likely to take place.

So that students do not leave the game feeling resentful, the leader's profit can be returned to them. The students can be asked to decide how the profit should be divided up. "The resulting discussion among students can lead to an interesting foray into further questions of allocation and fairness."

As with the other games on this site for smaller groups, if there are many students at an open day or conference, you could run several parallel games. Colleagues would find running a game an enjoyable way of spending an hour and could be a way of introducing them to the pedagogical benefits of using games.

**Note:** In the version described by Haupert, **all** the bidders have to pay their highest bid, but in the original version of the game created by Martin Shubik in 1971, just the two highest bidders have to pay, and this probably results in a higher final bid. See William Poundstone (1992) *Prisoner's Dilemma: John Von Neumann, Game Theory and the Puzzle of the Bomb* pp.280-282 (online extract).

- 18984 reads