Llicenciatura en Economia (3322)
Llicenciatura en Administració i Direcció d'Empreses (3323)

Economia Experimental (11867) 

Mecànica del curs

Students in the Experimental Economics course will be instructed on the experimental method and its applications, and will have to design, perform and analyze two experiments, one of them original.

The course will be divided in two parts. During the first part we will show you how economists use the laboratory tools. For that purpose we will focus on some particular series of experiments in markets and industrial organization, bargaining, public goods, coordination and individual decision making. Students will be grouped in lab teams and every team will have to replicate and analyze in class one classical experiment. The presentation of the experiment should include a motivation, a complete description of the related literature and a careful comparative analysis of the results obtained in class. A quiz may be prepared to test the students' knowledge of the experimental literature.

During the second part of the course, every team will chose, in coordination with the course instructor, a topic to be experimentally explored. The experiment, this time an original one, will again be run and discussed in class. A complete paper on the experiment, with a motivated introduction, a description of the literature, results and conclusions including an indication of further research, plus an appendix with instructions will have to be handed in June 20th.

We expect that this course will help you think about economics as an experimental science and to provide you with a working knowledge of techniques for conducting laboratory experiments in economics. Your grade will be based on your performance as an experimentalist, which means on the quiz, on your class participation, on how you run your experiments, on your class presentations, and on the term paper. Of course, there shall be no exam either in June or September.

You should be aware that I will assume that you are familiar with the contents of Experimental Methods: A Primer for Economists, by Friedman and Sunder (1994). This is a short and basic book, very informative and easy to read. Some copies of the book are available in the UPF library.

The following is a more detailed program of the course lectures. The rest of the scheduled time is devoted to your experiments and your analysis of your experiments, as described in the accompanying timetable.

Rules of the Game

ROTH, A. E. "Introduction to Experimental Economics". A: KAGEL, J.; ROTH, A. E. The Handbook of Experimental Economics. Nova York: Princeton University Press, 1995. Pàg. 1-98.

SMITH, V. "Microeconomic Systems as an Experimental Science". American Economic Review. Desembre de 1982. Pàg. 923-955.

SMITH, V. "Experimental Methods in Economics". A: EATWELL, J. i d’altres (eds). The New Palgrave: A Dictionary of Economics. Londres: Macmillan, 1988.

SMITH, V. "Experimental Methods in Economics". UPF Working Paper. Juny de 1992.

Individual Decision Making

GRETHER, D.; PLOTT, C. "Economic Theory of choice and the Preference Reversal Phenomenon". AER, 69. 1979. Pàg. 623-638.

HEY, John. Experiments in economics. Oxford: Blackwell, 1991. Capítols 4, 5 i 6.

LOOMES, G. "Evidence of a New Violation of the Independence Axiom". Journal of Risk and Uncertainty, 4. 1991. Pàg. 91-108.

Conflict and Cooperation; Coordination

ANDREONI, J.; MILLER, J. H. "Rational Cooperation in the Finitely Repeated Prisoner’s Dilemma: Experimental Evidence". EJ, 103. 1993. Pàg. 570-585.

AXELROD, R. The Evolution of Cooperation. Nova York: Basic Books, 1984.

CAMERER, Colin F. Experiments in Strategic Interaction. 1999. Cap. 7. [En premsa].

SELTEN, R.; STOECKER, R. "End Behavior in Sequences of Finite Prisoner’s Dilemma Supergames". Journal of Economic Behavior and Organization, 7. 1986. Pàg. 47-70.

VAN HUYCK, J. B.; BATTALIO, R. C.; BEIL, R. O. "Tacit Coordination Games, Strategic Uncertainty and Coordination Failure". AER, 80. 1990. Pàg. 234-248.

Public Goods

ANDREONI, J. "Cooperation in public-goods experiments: Kindness or confusion". American Economic Review, 85-4. 1995. Pàg. 891-904.

ISAAC, R. M.; McCUE, K.; PLOTT, C. "Public Goods Provision in an Experimental Environment". Journal of Public Economics, 26. 1985. Pàg. 51-74.

ISAAC, R. M.; WALKER, J. "Group size effects in public goods provision: The voluntary contributions mechanism". Quarterly Journal of Economics, 103. 1988. Pàg. 179-199.

ISAAC, R. M.; WALKER, J.; WILLIAMS, A. "Group size and the voluntary provision of public goods: Experimental evidence utilizing large groups". Journal of Public Economics. 1994.

LEDYARD, John O. "Public Goods: A Survey of Experimental Research". A: DAGEL, J.; ROTH, A. E. The Handbook of Experimental Economics. Princeton (N. J.): Princeton, 1995. Pàg. 111-181.

Games with Iterated Dominant Strategies

BOSCH, A.; GARCÍA-MONTALVO, J.; NAGEL, R.; SATORRA, A. One two (Three),…, Infinity. 1999. [En premsa].

McKELVEY, R.; PALFREY, T. P. "An experimental Study of the Centipede Game". Econometrica, 60. 1992. Pàg. 803-836.

NAGEL, R. "Unravelling in Guessing Games: An experimental Study". AER, 85 (5). 1995. Pàg. 1.313-1.326.

Bargaining

CAMERER, Colin F. Experiments in Strategic Interaction. 1999. Cap. 3. [En premsa].

CAMERER, C.; THALER, R. "Anomalies: Ultimatums, Dictators, and Manners". Journal of Economic Perspectives, 9 (2). 1995. Pàg. 209-219.

GUETH, W.; SCHMITTBERGER, R.; SCHWARZ, B. "An experimental Analysis of Ultimatum Bargaining". Journal of Economic Behavior and Organization, 3. 1982. Pàg. 367-388.

PRASNIKAR, V.; ROTH, A. "Considerations of Fairness and Strategy: Experimental Data from Sequential Games". Quarterly Journal of Economics, 1992. Pàg. 865-888.

ROTH, Alvin i d’altres. "Bargaining and Market Behavior in Jerusalem, Ljubljana, Pittsburgh, and Tokyo: Some experimental Evidence". AER, 81. 1991. Pàg. 1.068-1.095.

ROTH, A. E.; MURNIGHAN, J. K.; SCHOUMAKER, F. "The Deadline Effect in Bargaining: Some Experimental Evidence". AER, 78. 1988. Pàg. 806-823.

Learning

CAMERER, Colin F. Experiments in Strategic Interaction. 1999. Cap. 3. [En premsa].

ROTH, A. E.; EREV, I. "Learning in Extensive-Form Games: Experimental Data and Simple Dynamic Models in the Intermediate Term". Games and Economic Behavior, 8. 1995. Pàg. 164-212.

Market Organization

GODE, D.; SUNDER, S. "Allocative Efficiency of Markets with ZI Traders". Journal of Political Economy, 1993. Pàg. 119-137.

HOLT, Charles A.; LANGAN, L.; VILLAMIL, Anne P. "Market Power in Oral Double Auctions". Economic Enquiry, gener de 1986. Pàg. 107-123.

HOLT, Charles A. "Industrial Organization: A Survey of Laboratory Research". A: KAGEL, J.; ROTH, A. E. The Handbook of Experimental Economics. Princeton (N. J.): Princeton, 1995. Pàg. 349-435.

SMITH, V. "Markets as Economizers of Information: Experimental Examination of the Hayek Hypothesis". Economic Inquiry, abril de 1982. Pàg. 165-179.

Asset Markets

SMITH, Vernon L.; SUCHANEK, Gerry L.; WILLIAMS, Arlington W. "Bubbles, Crashes, and Endogeneous expectations in Experimental Spot Asset Markets". Econometrica, 56 (6). 1988. Pàg. 1.119-1.152.

SUNDER, Shyam. "Experimental Asset Markets: A Survey". A: KAGEL, J.; ROTH, A. E.The Handbook of Experimental Economics. Princeton (N. J.): Princeton, 1995. Pàg. 445-495.

Auctions

COX, J.; SMITH, V.; WALKER, J. "Theory and Individual Behavior of First Price Auctions". Journal of Risk and Uncertainty, març de 1988. Pàg. 61-99.

HARRISON, G. "Theory and Misbehavior in First Price Auctions". AER, setembre de 1989. Pàg. 749-762.

KAGEL, John H.; LEVIN, Dan. "The Winner’s Curse and Public Information in Common Value Auctions". AER, desembre de 1986. Pàg. 894-920.

KAGEL, J. H. "Auctions: A Survey of Experimental Research". A: KAGEL, J.; ROTH, A. E. The Handbook of Experimental Economics. Princeton (N. J.): Princeton, 1995. Pàg. 501-557.

RUST, J.; MILLER, J. H.; PALMER, R. "Behavior of Trading Automata in a Computerized Double Auction Market". A: FRIEDMAN, D.; RUST, J. (eds). The Double Auction Market: Institutions, Theories and Evidence. Reading (Mass.): Addison-Wesley, 1992.