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Winter 2019

ISSN 0890-913X

Volume 34, Number 4

Categories: Winter 2019 | Economic Systems

Incentives and Economic Systems: A Classroom Exercise

James R. Bruehler, Eastern Illinois University

Linda S. Ghent, Eastern Illinois University

Alan P. Grant, Baker University

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TheJournalofPrivateEnterprise34(4),2019,99–114EDUCATIONALNOTEIncentivesandEconomicSystems:AClassroomExerciseJamesR.BruehlerEasternIllinoisUniversityLindaS.GhentEasternIllinoisUniversityAlanP.GrantBakerUniversity__________________________________________________________AbstractThissetofclassroomsimulationshighlightsthedifferentincentivesindividualsfaceundereconomicsystemsdefinedbyprivateproperty,bycommonproperty,andbyablendofthetwo.Ineachsystem,participantsmustchoosehowhardtheywillworktoproduceaconsumptiongood,balancingthepleasureofconsumingthatgoodagainstthedispleasureofwork.Inadditiontoillustratinghoweacheconomicsystemcreatesdifferentincentivestoputfortheffort,thesimulationscanillustratemarginalreasoning,facilitatetheexplicitcalculationofdeadweightloss,andillustrateimportantconceptsingametheory.__________________________________________________________JELCodes:A20,A22Keywords:capitalism,communism,mixedeconomy,economicsystems,classroomexperimentI.IntroductionInmostintroductoryeconomicscourses,studentslearnthethreebasicquestionsthatmustbeansweredinsettingupaneconomicsystem:Whatisproduced?Howisitproduced?Andwhoreceivesthegoodsandservicesoncetheyareproduced?Thislessonisgenerallyfollowedbyadiscussioncomparingmarket-basedeconomiesandcommand-typesystems.Studentsentereconomicscoursesbelievingthattheyknowwhatcapitalismandcommunismareandhoweachsystemimpactstheindividualslivingwithinit.However,a2016surveybytheglobalpublicopinionanddata

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Metadata [hide]

Title	Incentives and Economic Systems: A Classroom Exercise
Authors/Creators:	James R. Bruehler, Eastern Illinois University Linda S. Ghent, Eastern Illinois University Alan P. Grant, Baker University
Year:	2019
Volume:	34
Number:	4
Pages:	99 - 114
Publisher:	The Association of Private Enterprise Education
ISSN:	0890-913X
Document Type:	Educational Notes
Keywords:	capitalism, communism, mixed economy, economic systems, classroom experiment

Citation:
Bruehler, James R.; Ghent, Linda S.; Grant, Alan P. / 2019. "Incentives and Economic Systems: A Classroom Exercise." The Journal of Private Enterprise, 34(4): 99-114.