Since the 1960's, many Americans eligible to vote have not bothered to do so- not even in presidential elections. Low rates of participation in voting have been worrisome to people interested in preserving our democratic traditions. Economists have tried to explain why people didn't vote. They have suggested that people who chose not to vote were acting rationally in that the costs associated with voting (such as time spent on registration, rearranging work schedules, getting to the polls, and gathering information on the candidates) appeared to outweigh the benefits (influencing the outcome of an election or gaining the satisfaction of being a good citizen). More recently, however, voter-participation rates have gone up again. What has caused the trend to change? Why are more people voting? This lesson will examine factors that affect voter turnout.
Students examine tradeoffs and profit- maximization decisions in the case study of Kaiser Aluminum, which decided to shut down aluminum production in favor of reselling electricity.
COMPELLING QUESTION Under what circumstances do people not behave like rational Econs? Students will participate in a version of the classic behavioral economics experiment entitled the Ultimatum Game. The class will be divided in halves, with one half being the proposers and the other half being the responders. Each proposer will be given the choice of how to split a reward of 10 items with the responder. This reward can be 10 extra credit points, 10 pieces of candy, 10 stickers, or some other small reward that can easily be divided and has at least some value to the students. The proposer remains anonymous to the responder so that no influences, such as friendship or a fear of retaliation, influence decision-making. The proposer will put forth an offer. It is up to the responder to choose to accept or reject the offer. If the offer is accepted, both the proposer and the responder get the agreed upon amount. If the responder rejects the offer, neither the responder nor the proposer receive any reward (no one gets anything). Students will play two rounds of this game. The discussion of the results includes comparisons between the thought and decision making process of “Econs” and “Humans.” The rational decision-making of an Econ is contrasted with that of the fairness-minded human. Students will also learn and discuss the results of an experiment in which other emotions matter, such as the meaningfulness of the work that one does and how it can affect our productivity and the amount a worker would demand in payment for their work.
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This publication contains 10 lessons that reintroduce an ethical dimension to economics in the tradition of Adam Smith, who believed ethical considerations were central to life.
1 out of 12 lessons from this publication relate to this EconEdLink lesson.