Diffraction refers to a kind of optical phenomena which occurs when light approaches an element (object or aperture) whose features are in the range of the illuminating wavelength (small apertures, sharp edges). It can be explained by means of the undulatory nature of light or also geometrically by using simple ray optics. Diffraction phenomena…

The author investigates the learning efficiency of economic experiments, an innovative instructional tool that re-creates the outside world within the classroom. This tool enables the instructor to create an economic environment whereby students experience how their decisions and interactions create the market forces predicted by the economic…

Deception detection is a topic covered in many psychology and communication courses. We designed and implemented an engaging class activity to facilitate the students' learning of several key concepts related to sender and receiver variability in lie detection. The pedagogical effectiveness of the activity was measured. In line with previous…

The authors develop a two-stage classroom experiment to illustrate convergence to long-run equilibrium in a market where price-taking firms are capacity-constrained. Once equilibrium in the first stage is established, capacity constraints are introduced by imposing discontinuities in the fixed costs of several firms. The experiment demonstrates…

The authors propose a classroom experiment implementing a simple version of a New Keynesian model suitable for courses in intermediate macroeconomics and money and banking. Students play as either the central bank or members of the private sector. The central banker sets interest rates to meet twin objectives for inflation and the output gap or to…

In this article, the authors describe a classroom experiment aimed at familiarizing students with different types of price discrimination (first-, second-, and third-degree price discrimination). During the experiment, the students were asked to decide what tariffs to set as monopolists for each of the price discrimination scenarios under…

Data collection can be a frustrating experience for student researchers due to difficulty in scheduling appointments with participants. To increase the efficiency of research project data collection, we organized a Research Participation Night in which volunteers were incentivized to participate in as many experiments as time allowed. By offering…

The authors describe a classroom experiment designed to present the idea of two-sided matching, the concept of a stable assignment, and the Gale-Shapley deferred-acceptance mechanism. Participants need no prior training in economics or game theory, but the exercise will also interest trained economists and game theorists. (Contains 5 tables, 2…

Adverse selection as it relates to health care policy will be a key economic issue in many upcoming elections. In this article, the author lays out a 30-minute classroom experiment designed for students to experience the kind of elevated prices and market collapse that can result from adverse selection in health insurance markets. The students…

The hold-up problem is central to the theory of incomplete contracts. This can occur if, after making a sunk investment in a relationship, one party can be taken advantage of by the other party, leading to inefficient underinvestment. The authors describe a simple teaching experiment that illustrates the hold-up problem, and address how to…

This classroom experiment introduces students to the notion of credit risk and expected return, by allowing them to trade on comparable corporate bond issues from two types of markets: investment-grade and high-yield markets. Investment-grade issues have a lower probability of default than high-yield issues and thus provide a lower yield.…

The authors outline a pair of classroom activities designed to provide an intuitive foundation to the theoretical introduction of advertising in monopoly markets. The roles of both informative and persuasive advertising are covered. Each student acts as a monopolist and chooses the number of (costly) advertisements and the price. The experiments…

Many students probably take pictures daily. Whether snapshots of their friends at a Justin Bieber concert or of their latest skateboard trick, these images document changes in a student's life. Digital cameras can do more, however, than record memories to post on Facebook. They can also help students examine changes in their environment. This…

The authors ask whether writing a report on a classroom experiment increases a student's performance in an end-of-course test. To answer this question, the authors analyzed data from a first-year undergraduate course based on classroom experiments and found that writing a report has a large positive benefit. They conclude, therefore, that it is…

Once relegated to cinema or history lectures, bank runs have become a modern phenomenon that captures the interest of students. In this article, the authors explain a simple classroom experiment based on the Diamond-Dybvig model (1983) to demonstrate how a bank run--a seemingly irrational event--can occur rationally. They then present possible…