A Market-Clearing Classroom Experiment

Radim Bohacek

CERGE-EI Working Papers from The Center for Economic Research and Graduate Education - Economics Institute, Prague

Abstract: This paper describes a classroom experiment demnstrating the price mechanism and the clearing of the markets in an endowment economy. Participants receive random endowments of two goods they may trade in order to maximize a given utility function. A market-clearing price is reached when no mutually beneficial trades are possible. The outcome is truly endogenous with no reservation prices or willingness to trade imposed on the participants. A problem set allows the participants to study the equilibrium outcome analytically. The experiment can be used in intermediate micro- and macroeconomic courses.

JEL-codes: A20 C91 C92 D50 (search for similar items in EconPapers)
Date: 2002-01
New Economics Papers: this item is included in nep-exp
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.cerge-ei.cz/pdf/wp/Wp193.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cer:papers:wp193

Access Statistics for this paper

More papers in CERGE-EI Working Papers from The Center for Economic Research and Graduate Education - Economics Institute, Prague Contact information at EDIRC.
Bibliographic data for series maintained by Lucie Vasiljevova ().