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[she_ra]

I'm planning a seminar in which a small group of 1st year social science undergraduates will learn about how markets operate.  I want to give them a basic grounding in price mechanisms in particular, particularly focusing on Smith's 'invisible hand' and the idea of positive or negative externalities.  If they can get confident with this now, so many other ideas will open up more easily later.

I'm in the process of trying to dream up an in-class market modelling activity to illustrate these ideas (for example, using different types of confectionary and monopoly money).  

How do those of you from an economics or social science (or human geography) background here choose to approach introducing these very basic economic ideas in the classroom?

(I promise to come back here and post about what I eventually do and how it works!)

[tamiam]

Check out gameseconomistsplay.com (i think it's .com - maybe .org?)

There is a plethora of classroom activities for teaching all sorts of economic concepts in an interactive way.

I've tried many of them; once you've taken a look feel free to ask me if I've tried them and how they work.

[zharkov]

There are a few books on active learning and econ in-class exercises. I like Economics Live by Diane Keenan. 

You may also want to look through the Resources for Economists web site, www.rfe.org. It is really more of a portal, and you can find lots of links to neat stuff there.

[tamiam]

Oh, I just remembered a couple of specific from that Games Economists Play site. There's an activity called "the paper river" which models externalities. I've used it with some success, although it can get a little involved. It's supposed to show Coase's theorem, but all I've been able to successfully get through to them is the idea of externalities.

There's another activity under the heading of macroeconomics where you divide the students into low, medium, and high levels of development and they need to compete for economic gains. (I used Hershey's kisses to stand for "environmental quality" in that game - I firmly believe that 90% of economic concepts can be explained via a combination of hershey's kisses and skiing analogies.)

It's a great, great web resource.

[she_ra]

Just wanted to come back, say thank you and let people know what I did/how it went.  Thanks to both of you, tamiam and zharkov, for your help.  I'll definitely be returning to these online resources when I need to tackle the idea of externalities later this year.

My recent tutorial was really an attempt to make sure that everyone was on board with the basics of the price mechanism and Smith's 'invisible hand', partly as a preparation for looking at Marxism.  It's a very small group so I can't do 'milling about' type excercises where you set up a whole market in the classroom.

Instead I brought 3 chocolate bars (of the type that have recently been involved in a salmonella scare in the UK) and gave them each a unit cost of production.  Without seeing my costs I got each student to write down how much they would pay for a chocolate bar of this type.

I explained that three manufacturers had made chocolate bars and that these were their costs of production.  The students 'revealed' how much they would be prepared to pay and we talked about how these 2 factors interact to arrive at the final price.

By taking 2 of the bars away, I was able to illustrate how commodities become more expensive when in short supply.  Then we talked about the recent salmonella scare and the way that if demand drops so will the price.

So it was incredibly basic, not to say simplistic - but it brought all of the students to a point where they could talk about ideas about capitalism and production more confidently.