Thomas E. Merz

Active Learning with Monty Hall in a Game Theory Class.

The authors describe a game that students can play on the first day of a game theory class. The game introduces the 4 essential elements of any game and is designed so that its sequel, also played on the first day of class, has students playing the well-known Monty Hall game, which raises the question: Should you switch doors. By implementing a procedure proposed some 45 years ago, students not only quickly grasp the correct answer, but also become keenly aware of the importance of the assumption that players have common knowledge of the essential elements of a game.

Explaining Voter Behavior toward Local School Expenditures: The Impact of Public Attitudes.

Abstract Two logit models are presented to explain voter turnout and voter choice for a referendum considering a millage increase to finance a new high school building. The models incorporate attitudinal variables, along with demographic and economic variables. This approach suggests that interested parties, such as school officials, can systematically influence the outcome of local school referenda.

Willie Mays: Meet John Nash

An alleged strategy by Willie Mays is presented to introduce some basic ideas of game theory to students.

The pricing of water in a university town: An economic analysis of draining a cash cow

This paper analyzes some economic issues involved with the common practice of using metered water rate revenue to fund debt retirement associated with the provision of municipal water and wastewater services. We conclude that rather than simply raising the metered rate, city officials should seriously consider increasing the tax rate levied under the local property tax. There is an important trade-off in the choice of a price policy. An increased property tax rate can result in tax savings to some home owners, which lowers their net expenditure for water. However, a corresponding decrease in the metered rate may increase water consumption, which in turn raises operating cost. In order to do what is best for home owners, it might make sense to give other customers (e.g., a university) an easy ride, even if the latter, because of its low (inelastic) price elasticity of demand for water, is viewed by the municipality as a cash cow.