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Supply and Demand Review: Competitive Market

MobLab Game: Competitive Market

Key Teaching Points:

  • The “invisible hand” of the market: how individual profit maximization leads to competitive market equilibrium.
  • Price discovery: the equilibrium market-clearing price results from the valuations of different buyers and costs of different sellers.
  • Shifts in either supply or demand change equilibrium outcomes.

Additional variations: Can include price floors, ceilings, and taxes.

Monopoly

MobLab Game: Monopoly

Key Teaching Points:

  • Profit maximization involves thinking on the margin.
  • In the absence of price discrimination, the uniform price case will lead to a sub-optimal price for both markets. Third degree price discrimination can lead to improved welfare across both markets.

MobLab Game: Double Marginalization

Key Teaching Points:

  • Double marginalization approximates the relationship between professional and amateur leagues.
  • Review concepts of marginal revenue and monopoly pricing.
  • Show how, in the absence of communication or contract to help coordinate decisions, the successive exercise of market power leads to higher market prices and a loss in economic efficiency.

Cartel Behavior and the NCAA

MobLab Game: Bertrand

Key Teaching Points:

  • Communication and repeat interaction facilitates collusive behavior in a market that would otherwise experience vigorous competition.

Monopsony Power of Sports Leagues and Unions

MobLab Game: Simple Labor Market (With group size 4)

Key Teaching Points:

  • Show that with one employer in the market they have incentive to offer the lowest acceptable wage.
  • Can use the Simple Labor Market game with group size 16 first, and compare the equilibrium wage to when there is a monopsony.

Add in minimum wages or unemployment insurance into the game to simulate the influence of Unions on the market outcome.

Contract Negotiations

MobLab Game: Common Value Auction

Key Teaching Points:

  • A rough approximation, however, players can be thought to have a common value for each team (bidder) and each team has a signal of that player's value.
  • If the true common value is an average of all the signals then the winner will have overbid for the player, i.e., the winner's curse.

MobLab Game: Ultimatum Game

Key Teaching Points:

  • Demonstrates how social norms such as fairness and altruism may factor in the decision-making process for economic actors.

MobLab Game: Bargaining: Alternating Offer

Key Teaching Points:

  • Players learn about tradeoffs and fairness in negotiations.
  • Promotes learning about backward induction and subgame perfect equilibria in sequential games.

MobLab Game: Principal-Agent

Key Teaching Points:

  • Students learn how the optimal contract offered to the worker depends on the information environment (full information v. asymmetric information).
  • Students learn how the magnitude of different contract features (flat-fee and bonus) depend on worker outside option and cost of effort.

Related to contracts and negotiations, instructors may find our time and risk preferences surveys as a helpful companion.

Social Dilemmas and Team Incentives

MobLab Game: Prisoner’s Dilemma (Push/Pull)

Key Teaching Points:

  • Key features of games: payoff matrices, best response, dominant strategies, and Nash equilibrium.
  • The tension between individual and group interest.
  • Can be applied to a number of sports economics topics related to antitrust, doping, the regulation of sports such as helmets, etc.

Additional Game: Prisoner’s Dilemma (

Social Dilemmas and Team Incentives

MobLab Game: Prisoner’s Dilemma (Push/Pull)

Key Teaching Points:

  • Key features of games: payoff matrices, best response, dominant strategies, and Nash equilibrium.
  • The tension between individual and group interest.
  • Can be applied to a number of sports economics topics related to antitrust, doping, the regulation of sports such as helmets, etc.

Additional Game: Prisoner’s Dilemma (

Social Dilemmas and Team Incentives

MobLab Game: Prisoner’s Dilemma (Push/Pull)

Key Teaching Points:

  • Key features of games: payoff matrices, best re

    Supply and Demand Review: Competitive Market

    MobLab Game: Competitive Market

    Key Teaching Points:

    • The “invisible hand” of the market: how individual profit maximization leads to competitive market equilibrium.
    • Price discovery: the equilibrium market-clearing price results from the valuations of different buyers and costs of different sellers.
    • Shifts in either supply or demand change equilibrium outcomes.

    Additional variations: Can include price floors, ceilings, and taxes.

    Monopoly

    MobLab Game: Monopoly

    Key Teaching Points:

    • Profit maximization involves thinking on the margin.
    • In the absence of price discrimination, the uniform price case will lead to a sub-optimal price for both markets. Third degree price discrimination can lead to improved welfare across both markets.

    MobLab Game: Double Marginalization

    Key Teaching Points:

    • Double marginalization approximates the relationship between professional and amateur leagues.
    • Review concepts of marginal revenue and monopoly pricing.
    • Show how, in the absence of communication or contract to help coordinate decisions, the successive exercise of market power leads to higher market prices and a loss in economic efficiency.

    Cartel Behavior and the NCAA

    MobLab Game: Bertrand

    Key Teaching Points:

    • Communication and repeat interaction facilitates collusive behavior in a market that would otherwise experience vigorous competition.

    Monopsony Power of Sports Leagues and Unions

    MobLab Game: Simple Labor Market (With group size 4)

    Key Teaching Points:

    • Show that with one employer in the market they have incentive to offer the lowest acceptable wage.
    • Can use the Simple Labor Market game with group size 16 first, and compare the equilibrium wage to when there is a monopsony.

    Add in minimum wages or unemployment insurance into the game to simulate the influence of Unions on the market outcome.

    Contract Negotiations

    MobLab Game: Common Value Auction

    Key Teaching Points:

    • A rough approximation, however, players can be thought to have a common value for each team (bidder) and each team has a signal of that player's value.
    • If the true common value is an average of all the signals then the winner will have overbid for the player, i.e., the winner's curse.

    MobLab Game: Ultimatum Game

    Key Teaching Points:

    • Demonstrates how social norms such as fairness and altruism may factor in the decision-making process for economic actors.

    MobLab Game: Bargaining: Alternating Offer

    Key Teaching Points:

    • Players learn about tradeoffs and fairness in negotiations.
    • Promotes learning about backward induction and subgame perfect equilibria in sequential games.

    MobLab Game: Principal-Agent

    Key Teaching Points:

    • Students learn how the optimal contract offered to the worker depends on the information environment (full information v. asymmetric information).
    • Students learn how the magnitude of different contract features (flat-fee and bonus) depend on worker outside option and cost of effort.

    Related to contracts and negotiations, instructors may find our time and risk preferences surveys as a helpful companion.

    Social Dilemmas and Team Incentives

    MobLab Game: Prisoner’s Dilemma (Push/Pull)

    Key Teaching Points:

    • Key features of games: payoff matrices, best re

      Supply and Demand Review: Competitive Market

      MobLab Game: Competitive Market

      Key Teaching Points:

      • The “invisible hand” of the market: how individual profit maximization leads to competitive market equilibrium.
      • Price discovery: the equilibrium market-clearing price results from the valuations of different buyers and costs of different sellers.
      • Shifts in either supply or demand change equilibrium outcomes.

      Additional variations: Can include price floors, ceilings, and taxes.

      Monopoly

      MobLab Game: Monopoly

      Key Teaching Points:

      • Profit maximization involves thinking on the margin.
      • In the absence of price discrimination, the uniform price case will lead to a sub-optimal price for both markets. Third degree price discrimination can lead to improved welfare across both markets.

      MobLab Game: Double Marginalization

      Key Teaching Points:

      • Double marginalization approximates the relationship between professional and amateur leagues.
      • Review concepts of marginal revenue and monopoly pricing.
      • Show how, in the absence of communication or contract to help coordinate decisions, the successive exercise of market power leads to higher market prices and a loss in economic efficiency.

      Cartel Behavior and the NCAA

      MobLab Game: Bertrand

      Key Teaching Points:

      • Communication and repeat interaction facilitates collusive behavior in a market that would otherwise experience vigorous competition.

      Monopsony Power of Sports Leagues and Unions

      MobLab Game: Simple Labor Market (With group size 4)

      Key Teaching Points:

      • Show that with one employer in the market they have incentive to offer the lowest acceptable wage.
      • Can use the Simple Labor Market game with group size 16 first, and compare the equilibrium wage to when there is a monopsony.

      Add in minimum wages or unemployment insurance into the game to simulate the influence of Unions on the market outcome.

      Contract Negotiations

      MobLab Game: Common Value Auction

      Key Teaching Points:

      • A rough approximation, however, players can be thought to have a common value for each team (bidder) and each team has a signal of that player's value.
      • If the true common value is an average of all the signals then the winner will have overbid for the player, i.e., the winner's curse.

      MobLab Game: Ultimatum Game

      Key Teaching Points:

      • Demonstrates how social norms such as fairness and altruism may factor in the decision-making process for economic actors.

      MobLab Game: Bargaining: Alternating Offer

      Key Teaching Points:

      • Players learn about tradeoffs and fairness in negotiations.
      • Promotes learning about backward induction and subgame perfect equilibria in sequential games.

      MobLab Game: Principal-Agent

      Key Teaching Points:

      • Students learn how the optimal contract offered to the worker depends on the information environment (full information v. asymmetric information).
      • Students learn how the magnitude of different contract features (flat-fee and bonus) depend on worker outside option and cost of effort.

      Related to contracts and negotiations, instructors may find our time and risk preferences surveys as a helpful companion.

      Social Dilemmas and Team Incentives

      MobLab Game: Prisoner’s Dilemma (Push/Pull)

      Key Teaching Points:

      • Key features of games: payoff matrices, best response, dominant strategies, and Nash equilibrium.
      • The tension between individual and group interest.
      • Can be applied to a number of sports economics topics related to antitrust, doping, the regulation of sports such as helmets, etc.

      Additional Game: Prisoner’s Dilemma (Classic Matrix).

      MobLab Game: Public Good: Punishment and Reward

      Key Teaching Points:

      • When group output depends on individual efforts, but benefits are shared in common, individuals have an incenti

        Supply and Demand Review: Competitive Market

        MobLab Game: Competitive Market

        Key Teaching Points:

        • The “invisible hand” of the market: how individual profit maximization leads to competitive market equilibrium.
        • Price discovery: the equilibrium market-clearing price results from the valuations of different buyers and costs of different sellers.
        • Shifts in either supply or demand change equilibrium outcomes.

        Additional variations: Can include price floors, ceilings, and taxes.

        Monopoly

        MobLab Game: Monopoly

        Key Teaching Points:

        • Profit maximization involves thinking on the margin.
        • In the absence of price discrimination, the uniform price case will lead to a sub-optimal price for both markets. Third degree price discrimination can lead to improved welfare across both markets.

        MobLab Game: Double Marginalization

        Key Teaching Points:

        • Double marginalization approximates the relationship between professional and amateur leagues.
        • Review concepts of marginal revenue and monopoly pricing.
        • Show how, in the absence of communication or contract to help coordinate decisions, the successive exercise of market power leads to higher market prices and a loss in economic efficiency.

        Cartel Behavior and the NCAA

        MobLab Game: Bertrand

        Key Teaching Points:

        • Communication and repeat interaction facilitates collusive behavior in a market that would otherwise experience vigorous competition.

        Monopsony Power of Sports Leagues and Unions

        MobLab Game: Simple Labor Market (With group size 4)

        Key Teaching Points:

        • Show that with one employer in the market they have incentive to offer the lowest acceptable wage.
        • Can use the Simple Labor Market game with group size 16 first, and compare the equilibrium wage to when there is a monopsony.

        Add in minimum wages or unemployment insurance into the game to simulate the influence of Unions on the market outcome.

        Contract Negotiations

        MobLab Game: Common Value Auction

        Key Teaching Points:

        • A rough approximation, however, players can be thought to have a common value for each team (bidder) and each team has a signal of that player's value.
        • If the true common value is an average of all the signals then the winner will have overbid for the player, i.e., the winner's curse.

        MobLab Game: Ultimatum Game

        Key Teaching Points:

        • Demonstrates how social norms such as fairness and altruism may factor in the decision-making process for economic actors.

        MobLab Game: Bargaining: Alternating Offer

        Key Teaching Points:

        • Players learn about tradeoffs and fairness in negotiations.
        • Promotes learning about backward induction and subgame perfect equilibria in sequential games.

        MobLab Game: Principal-Agent

        Key Teaching Points:

        • Students learn how the optimal contract offered to the worker depends on the information environment (full information v. asymmetric information).
        • Students learn how the magnitude of different contract features (flat-fee and bonus) depend on worker outside option and cost of effort.

        Related to contracts and negotiations, instructors may find our time and risk preferences surveys as a helpful companion.

        Social Dilemmas and Team Incentives

        MobLab Game: Prisoner’s Dilemma (Push/Pull)

        Key Teaching Points:

        • Key features of games: payoff matrices, best response, dominant strategies, and Nash equilibrium.
        • The tension between individual and group interest.
        • Can be applied to a number of sports economics topics related to antitrust, doping, the regulation of sports such as helmets, etc.

        Additional Game: Prisoner’s Dilemma (Classic Matrix).

        MobLab Game: Public Good: Punishment and Reward

        Key Teaching Points:

        • When group output depends on individual efforts, but benefits are shared in common, individuals have an incenti

          Supply and Demand Review: Competitive Market

          MobLab Game: Competitive Market

          Key Teaching Points:

          • The “invisible hand” of the market: how individual profit maximization leads to competitive market equilibrium.
          • Price discovery: the equilibrium market-clearing price results from the valuations of different buyers and costs of different sellers.
          • Shifts in either supply or demand change equilibrium outcomes.

          Additional variations: Can include price floors, ceilings, and taxes.

          Monopoly

          MobLab Game: Monopoly

          Key Teaching Points:

          • Profit maximization involves thinking on the margin.
          • In the absence of price discrimination, the uniform price case will lead to a sub-optimal price for both markets. Third degree price discrimination can lead to improved welfare across both markets.

          MobLab Game: Double Marginalizationeaching Points:

          • Profit maximization involves thinking on the margin.
          • In the absence of price discrimination, the uniform price case will lead to a sub-optimal price for both markets. Third degree price discrimination can lead to improved welfare across both markets.

          MobLab Game: Double Marginalization

          Key Teaching Points:

          • Double marginalization approximates the relationship between professional and amateur leagues.
          • Review concepts of marginal revenue and monopoly pricing.
          • Show how, in the absence of communication or contract to help coordinate decisions, the successive exercise of market power leads to higher market prices and a loss in economic efficiency.

          Cartel Behavior and the NCAA

          MobLab Game: Bertrand

          Key Teaching Points:

          • Communication and repeat interaction facilitates collusive behavior in a market that would otherwise experience vigorous competition.

          Monopsony Power of Sports Leagues and Unions

          MobLab Game: Simple Labor Market (With group size 4)

          Key Teaching Points:

          • Show that with one employer in the market they have incentive to offer the lowest acceptable wage.
          • Can use the Simple Labor Market game with group size 16 first, and compare the equilibrium wage to when there is a monopsony.

          Add in minimum wages or unemployment insurance into the game to simulate the influence of Unions on the market outcome.

          Contract Negotiations

          MobLab Game: Common Value Auction

          Key Teaching Points:

          • A rough approximation, however, players can be thought to have a common value for each team (bidder) and each team has a signal of that player's value.
          • If the true common value is an average of all the signals then the winner will have overbid for the player, i.e., the winner's curse.

          MobLab Game: Ultimatum Game

          Key Teaching Points:

          • Demonstrates how social norms such as fairness and altruism may factor in the decision-making process for economic actors.

          MobLab Game: Bargaining: Alternating Offer

          Key Teaching Points:

          • Players learn about tradeoffs and fairness in negotiations.
          • Promotes learning about backward induction and subgame perfect equilibria in sequential games.

          MobLab Game: Principal-Agent

          Key Teaching Points:

          • Students learn how the optimal contract offered to the worker depends on the information environment (full information v. asymmetric information).
          • Students learn how the magnitude of different contract features (flat-fee and bonus) depend on worker outside option and cost of effort.

          Related to contracts and negotiations, instructors may find our time and risk preferences surveys as a helpful companion.

          Social Dilemmas and Team Incentives

          • Profit maximization involves thinking on the margin.
          • In the absence of price discrimination, the uniform price case will lead to a sub-optimal price for both markets. Third degree price discrimination can lead to improved welfare across both markets.

          MobLab Game: Double Marginalization/p>

          Key Teaching Points:

          • Students learn how the optimal contract offered to the worker depends on the information environment (full information v. asymmetric information).
          • Students learn how the magnitude of different contract features (flat-fee and bonus) depend on worker outside option and cost of effort.

          Related to contracts and negotiations, instructors may find our time and risk preferences surveys as a helpful companion.

          Social Dilemmas and Team Incentives

          MobLab Game: Prisoner’s Dilemma (Push/Pull)

          Key Teaching Points:

          • Key features of games: payoff matrices, best response, dominant strategies, and Nash equilibrium.
          • The tension between individual and group interest.
          • Can be applied to a number of sports economics topics related to antitrust, doping, the regulation of sports such as helmets, etc.

          Additional Game: Prisoner’s Dilemma (Classic Matrix).>

          Contract Negotiations

          MobLab Game: Common Value Auction

          Key Teaching Points:

          • A rough approximation, however, players can be thought to have a common value for each team (bidder) and each team has a signal of that player's value.
          • If the true common value is an average of all the signals then the winner will have overbid for the player, i.e., the winner's curse.

          MobLab Game: Ultimatum Game

          Key Teaching Points:

          • Demonstrates how social norms such as fairness and altruism may factor in the decision-making process for economic actors.

          MobLab Game: Bargaining: Alternating Offer

          Key Teaching Points:

          • Players learn about tradeoffs and fairness in negotiations.
          • Promotes learning about backward induction and subgame perfect equilibria in sequential games.

          MobLab Game: Principal-Agent

        • Show how, in the absence of communication or contract to help coordinate decisions, the successive exercise of market power leads to higher market prices and a loss in economic efficiency.

        Cartel Behavior and the NCAA

        MobLab Game: Bertrand

        Key Teaching Points:

        • Communication and repeat interaction facilitates collusive behavior in a market that would otherwise experience vigorous competition.

        Monopsony Power of Sports Leagues and Unions

        MobLab Game: Simple Labor Market (With group size 4)

        Key Teaching Points:

        • Show that with one employer in the market they have incentive to offer the lowest acceptable wage.
        • Can use the Simple Labor Market game with group size 16 first, and compare the equilibrium wage to when there is a monopsony.

        Add in minimum wages or unemployment insurance into the game to simulate the influence of Unions on the market outcome.

      • Show how, in the absence of communication or contract to help coordinate decisions, the successive exercise of market power leads to higher market prices and a loss in economic efficiency.

      Cartel Behavior and the NCAA

      MobLab Game: Bertrand

      Key Teaching Points:

      • Communication and repeat interaction facilitates collusive behavior in a market that would otherwise experience vigorous competition.

      Monopsony Power of Sports Leagues and Unions

      MobLab Game: Simple Labor Market (With group size 4)

      Key Teaching Points:

      • Show tPoints:

  • The “invisible hand” of the market: how individual profit maximization leads to competitive market equilibrium.
  • Price discovery: the equilibrium market-clearing price results from the valuations of different buyers and costs of different sellers.
  • Shifts in either supply or demand change equilibrium outcomes.

Additional variations: Can include price floors, ceilings, and taxes.

Monopoly

MobLab Game: Monopoly

Key Teaching Points:

  • Profit maximization involves thinking on the margin.
  • In the absence of price discrimination, the uniform price case will lead to a sub-optimal price for both markets. Third degree price discrimination can lead to improved welfare across both markets.

MobLab Game: Double Marginalization

Key Teaching Points:

  • Double marginalization approximates the relationship between professional and amateur leagues.
  • Review concepts of marginal revenue and monopoly pricing.
  • Show how, in the absence of communication or contract to help coordinate decisions, the successive exercise of market power leads to higher market prices and a loss in economic efficiency.

Cartel Behavior and the NCAA

MobLab Game: Bertrand

Key Teaching Points:

  • Communication and repeat interaction facilitates collusive behavior in a market that would otherwise experience vigorous competition.

Monopsony Power of Sports Leagues and Unions

MobLab Game: Simple Labor Market (With group size 4)

Key Teaching Points:

  • Show tPoints:

  • The “invisible hand” of the market: how individual profit maximization leads to competitive market equilibrium.
  • Price discovery: the equilibrium market-clearing price results from the valuations of different buyers and costs of different sellers.
  • Shifts in either supply or demand change equilibrium outcomes.

Additional variations: Can include price floors, ceilings, and taxes.

Monopoly

MobLab Game: Monopoly

Key Teaching Points:

  • Profit maximization involves thinking on the margin.
  • In the absence of price discrimination, the uniform price case will lead to a sub-optimal price for both markets. Third degree price discrimination can lead to improved welfare across both markets.

MobLab Game: Double Marginalization

Key Teaching Points:

  • Double marginalization approximates the relationship between professional and amateur leagues.
  • Review concepts of marginal revenue and monopoly pricing.
  • Show how, in the absence of communication or contract to help coordinate decisions, the successive exercise of market power leads to higher market prices and a loss in economic efficiency.

Cartel Behavior and the NCAA

MobLab Game: Bertrand

Key Teaching Points:

  • Communication and repeat interaction facilitates collusive behavior in a market that would otherwise experience vigorous competition.

Monopsony Power of Sports Leagues and Unions

MobLab Game: Simple Labor Market (With group size 4)

Key Teaching Points:

  • Show that with one employer in the market they have incentive to offer the lowest acceptable wage.
  • Can use the Simple Labor Market game with group size 16 first, and compare the equilibrium wage to when there is a monopsony.

Add in minimum wages or unemployment insurance into the game to simulate the influence of Unions on the market outcome.

Contract Negotiations

MobLab Game: Common Value Auction

Key Teaching Points:

  • A rough approximation, however, players can be thought to have a common value for each team (bidder) and each team has a signal of that player's value.
  • If the true common value is an average of all the signals then the winner will have overbid for the player, i.e., the winner's curse.

MobLab Game: Ultimatum Game

Key Teaching Points:

  • Demonstrates how social norms such as fairness and altruism may factor in the decision-making process for economic actors.

MobLab Game: Bargaining: Alternating Offer

Key Teaching Points:

  • Players learn about tradeoffs and fairness in negotiations.
  • Promotes learning about backward induction and subgame perfect equilibria in sequential games.

MobLab Game: Principal-Agent

Key Teaching Points:

  • Students learn how the optimal contract offered to the worker depends on the information environment (full information v. asymmetric information).
  • Students learn how the magnitude of different contract features (flat-fee and bonus) depend on worker outside option and cost of effort.

Related to contracts and negotiations, instructors may find our time and risk preferences surveys as a helpful companion.

Social Dilemmas and Team Incentives

MobLab Game: Prisoner’s Dilemma (Push/Pull)

Key Teaching Points:

  • Key features of games: payoff matrices, best response, dominant strategies, and Nash equilibrium.
  • The tension between individual and group interest.
  • Can be applied to a number of sports economics topics related to antitrust, doping, the regulation of sports such as helmets, etc.

Additional Game: Prisoner’s Dilemma (Classic Matrix).

MobLab Game: Public Good: Punishment and Reward

Key Teaching Points:

  • When group output depends on individual efforts, but benefits are shared in common, individuals have an incentive to free ride.
  • Individuals in a group can incur a cost to punish or reward other group members.
  • Show how incurring these costs results in preserving norms for cooperation.

Public Finance of Sports

MobLab Game: Externalities with Policy Interventions

Key Teaching Points:

  • With externalities, the equilibrium of a competitive market without interventions is inefficient.
  • By reducing transactions, a tax can increase efficiency (total surplus) in a market with a negative externality
  • Marketable permits for an activity generating a negative externality leads to efficiently reducing that activity.

MobLab Game: Blank Survey

Key Teaching Points:

  • Create your own survey-based experiment on contingent valuation using our Blank Survey tool. You can create different frames to elicit student WTP and WTA for non-market goods.

MobLab Game: Voter Turnout (One Candidate)

Key Teaching Points:

  • Explore the paradox of voting and the "size effect" with students to see how stadium projects persist even if they are known to be inefficient.