Rational Expectations in the Classroom: A Learning Activity

Calvin Blackwell

Journal for Economic Educators, 2010, vol. 10, issue 2, 1-6

Abstract: The author describes a technique whereby students truthfully reveal their perceptions regarding the difficulty of an assignment. After completing the assignment, each student guesses his/her class' average score on the assignment. The student is informed that if his/her guess is within one percentage point of the actual class average, then he/she will earn two extra points on the assignment. This mechanism gives each student the incentive to truly express his/her opinion regarding the difficulty of the assignment. The author provides evidence that students, as a group, are quite adept at guessing the class average. In addition to its usefulness in explaining the rational expectations hypothesis, this activity is helpful for assessing the students' perceptions of the difficulty of particular assignments.

Keywords: teaching practices; rational expectations (search for similar items in EconPapers)
JEL-codes: A2 (search for similar items in EconPapers)
Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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