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George Mason Law and Economics Center

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1. The instructor will give each member of the class an item or items as a gift. ... 6. You get to keep the gift items you end up with. 5. IDEAS ... – PowerPoint PPT presentation

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Title: George Mason Law and Economics Center


1
George Mason Law and Economics Center PPE
Program, June 2006 MorningHour 2 Wealth
Maximization Game June 15, 2006 Eric Rasmusen,
erasmuse_at_indiana.edu
2
REVIEW Welath maximization
3
Trading Game Rules I I find acting
out helps to learn. My own field of game theory.
1. The instructor will give each member of the
class an item or items as a gift. You will get
to keep these. 2. Write on your scoresheet
your personal values, the amounts for which you
would be willing to sell the items back to the
instructor. Your value might be for your own
consumption, or as a memento of this class, or
the value to you for having the item to give as
a gift to someone else after the class is over.

4
Trading Game Rules II 3. Everyone
will freely trade items. One or more items can
be traded for another, but no money or other
goods may change hands, because we want the
exchange of the gift items to be self-contained.
Also for this reason, please do not consume
(eat, use and throw away, etc.) the items before
the end of the game. 4. Again write on your
scoresheet your personal values, the amounts
for which you would be willing to sell your
current items back to the instructor. Your value
might be for your own consumption, or as a
memento of this class, or the value to you for
having the item to give as a gift to someone else
after the class is over. 5. Hand your list in
to the instructor. 6. You get to keep the gift
items you end up with.
5
IDEAS 1. The dollar
value of wealth increases with trade. This is
what wealth maximization'' means. 2. Trade is
productive just like technology. 3. The total
value is probably less than the cost at the store
to the instructor. He does not know what the
students like. 4. Trade is itself costly. It
takes time and energy. 5. Retailing and
wholesaling is an increasingly big part of GDP.
In 2004-2005 wholesaling was 6 and retailing was
8, a total of 14, compared to 13 for
government and 13 for manufacturing (From the
2004-2005 Statistical Abstract of the US).
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