In this pedagogical contribution the authors extend the traditional three-class tariff employed in the French passenger railway system with the more resonant story of the service quality variations associated with the three passenger classes of the ill-fated RMS "Titanic." In doing so, they provide economics instructors with an…

Traffic congestion and road tolls are familiar economic concepts for most undergraduates; however, students often have difficulty explaining exactly how theoretical principles like externalities and social welfare are related to their real-world experiences, such as driving. The authors present a classroom exercise to demonstrate how congestion…

The authors adapted a lab-in-the-field experiment emulating the dynamic extraction of a fishery to create a Web-based classroom experiment. The game includes a multi-player version analogous to an open-access problem and a single-player version analogous to the social planner problem. This game is helpful in introductory microeconomics courses to…

The Coase Theorem is a fundamental tenet of environmental economics and is taught to thousands of principles of microeconomics students each year. Its counterintuitive conclusion, that a Pareto optimal solution can result between private parties regardless of the initial allocation of property rights over a scarce resource, is difficult for…

In this article, the author describes an exercise in which two pricing problems (product bundling and the sharing of digital information goods) can be understood using the same analytical approach. The exercise allows students to calculate the correct numerical answers with relative ease, while the teaching plan demonstrates the importance of the…

Health care is one of the economy's biggest industries, so it is natural that the health care industry should play some role in the teaching of introductory economics. There are many ways that health care can appear in such a context: in the teaching of microeconomics, as a macroeconomic issue, to learn about social welfare, and even to learn how…

The authors present details of a research-based course in development economics taught at a private liberal arts college. There were three key elements in this class: teaching of applied econometrics, group presentations reviewing published and working papers in development economics, and using concepts taught in class to write an original…

In this article, the authors show that the dividend discount model can be derived using the basic intertemporal consumption model that is introduced in a typical intermediate microeconomics course. This result will be of use to instructors who teach microeconomics to finance students in that it demonstrates the value of utility maximization in…

Although many students have some knowledge of patents, it can be difficult for them to understand the components of an innovator's decision-making process. Key issues, such as whether to patent or to use trade secrecy, how broad a scope to claim, and what to do in the event of patent infringement, can be difficult to grasp from a standard lecture.…

The author describes techniques that he uses to interactively teach economics principles. He describes an experiment on market entry and gives examples of applications of classroom clickers. Clicker applications include (a) collecting data about student preferences that can be used to construct demand curves and supply curves, (b) checking…

The introduction of the concept of network effects is useful at the principles level to facilitate discussions of the determinants of monopoly, the need for standards in high-tech industries, and the general complexity of real-world competition. The author describes a demonstration and an extension that help students understand how consumers make…

Contends that, although most economics students are acquainted with the graphical analysis of the income and substitution effects of a price change, they often fail to appreciate that the same graphs provide information on the income elasticities of the two goods. Illustrates the proof of this concept using mathematical formulae and five graphic…

Contends that, despite ongoing criticism, Allen's arc elasticity formula remains entrenched in the microeconomics principles curriculum. Reviews the evolution and continuing scrutiny of the formula. Argues that the use of the geometric mean offers pedagogical advantages over the traditional arithmetic mean approach. (CFR)

Maintains that teachers and textbook graphics follow the same basic pattern in illustrating changes in demand curves when product prices increase. Asserts that the use of computer graphics will enable teachers to be more precise in their graphic presentation of price elasticity. (CFR)

Contends that the traditional approach to the economics of pollution deals only with the special case of damage coming from the per-period flow of the pollutant. Examines the limitations of the traditional flow approach. Summarizes fundamental advances in the economic theory of stock pollutants using graphical descriptions. (CFR)