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I. TRADING GAME

Designing trading game

( Right click on a Game: 05_general_equilibrium.mgd to download it)

NOTE: Function editor can be accessed with mouse right click.

1. Adding .

a. Drag and drop into a design window to create a market.

b. Double click on to rename it to . Note this is not necessary. Markets can be named by the default name.

c. Open by double clicking on the edge or by selecting or clicking on to choose a tick size:

d. Repeat the steps for .

2. Creating

a. Drag and drop a icons into a design window.

b.Double click on the edge of to rename it to . Then repeat the process for and .

c. serves the same function as in extensive and strategic form. In order to determine conditions for each market you have to use . It also allows more than one subject per session to have the same role.

3. Adding .

a. Create to capture the profit during the game as follows:

· Drag and drop a and rename it to

· Open by double clicking on the edge of the icon or by selecting and clicking on .

· Select

· Leave initial value empty.

v_profit_int_value .

· Select in order for each subject to get a different draw.

· Repeat the steps for , , and . A fast way is to duplicate by selecting and clicking on . Then rename the new variable.

· Create and to record the accumulated endowment by builder with the following properties:

. Clay and wood endowment is set to zero. Once a builder buys the raw material it gets updated by appropriately defining it in in the editor (see point 3 below).

3. Open to update the trading conditions for each player

a. Open by double clicking on the edge of icon.

b. The following conditions should be selected or written in for .

- . Cash allows subjects to buy items. Subjects would be able to purchase items up to the cash amount stated in . In our case a is allocated 1000 units.

- Under assets all the created assets are listed. The lighter gray color shows the current page. In this example is the current page.

- Select because is allowed only to buy wood .(The other trading options for buying are and . means that can not set a price. The current best price at the market determines the sale’s price. can only change the quantity if she is willing to buy. allows to select a particular outstanding seller from whom to buy a product and not to the buyer with the best price. Similar explanation can be given for selling )

- Choose that a starts with. Select the wood endowment by right clicking in the editor and selecting wood endowment from the list of variables. The other option is to type wood endowment, select it and use “Shift+Ctrl+v” at the same time to color it to rose color.

- Valuation is empty: because does not value any of the purchased goods.

- Graph variables: Select under “graph variables”: to graph the current transaction price. The selected variables will be graphed for a particular market if the graph option was selected on that market.

- Repeat the steps for .

c. In order for , , , , and to be updated with each transaction, click on .

- click on and select the appropriate Transaction event variables. Then write a condition for each of them:

and are defined as follows:

transaction_endowment

The function endowment() means current endowment and can be selected from the function editor. Inside the brackets the appropriate asset has to be selected by double clicking on in the function editor or by writing wood, selecting it and clicking at the same time “Ctrl+Shift+a”. “a” stands for asset.

Also is selected next to each of the function in order for the calculation to be used in the variables : and .

- Note that it was necessary to define and variables. In endowment(wood) could have been used directly.

Cumulative is defined in the following way:

function_builder_cost where builder costs captures the accumulated costs and price()*quantity() multiplies current transaction price with the transaction quantity and it is not asset specific.

Also is selected next to builder cost function in order for the calculation to be used in . If is not selected the costs are not updated in the later calculations within the same transaction.

is calculated in the following way:

where the revenue to the builder is calculated as wood endowment raised to the power 0.333 and multiplied by clay endowment raised to the power 0.333. To get the profit builder costs are subtracted.

Note we could have used endowment(wood) instead of wood endowment and endowment(clay) instead of clay endowment.

price() captures current transaction price.

d. Use to graph variables for all markers. In our example the builder profit and builder costs will be shown on each market. graf_variables

If you want to graph it only for a specific market use the option under asset_grapf

4. Adding instructions

1. Drag and drop a .

2. Open the stage and write instructions.

3. Make sure that you select at the bottom of the instruction page.

4.If you want everybody to see and make decisions on the same page, drag and drop from ( means that those that are left in do not see the information in that )

- If you want some assignment just to observe information in the but they cannot make decisions drag and drop into . In the case of instructions we could have dropped , , and into box.

- means that any value of a or that is inserted into is not observed by a that is placed in that box.

- To create a new page within a stage, click on and a new page is created: new_page

Write the instructions and select the assignment which will see the page.

This is the example of a stage. Click here to see how it looks when designing a game. Click here to see how subjects will see the instructions. To close the instructions, just click on x. To open, click on that is located within the market or within a stage, depending on a design of a game. In the 05_general_equilibrium.mgd (right click to download the game) there is only a trading window and .

5. Settings on

Number of subjects is set to zero. It means that subjects can start to play once they login in, and they do not need to wait for a certain number of subjects to login.

At the bottom right corner of the design window there are the following options:

· Concurrent means that is run at the same time as market game or when is used for description. In the described example above we do not have any stages except for description which does not count as a stage game.

· When is selected, the stage game is first played and when subjects made decisions it moves to the market game.

c. By default each is assigned to a subject in the order that is listed in . Because we selected . By default 1 is given to each which means that the first subject who logins is assigned a, the next is , and then . Because we have 0 for the continuous until subjects are login in. If we changed a number to 2 for then the first two subjects who login will be assigned to .

d. If are selected then each of the numbers represent the weight. In out example it will mean that each is assigned with probability 1/3.

e. We can also specify the conditions for the .of each

Each subject is in this case to a specific according to the condition. To select the function right click in the edit part. “subject_number()%3=0” means that subject number that is divisable with 3 is assigned to . Only when is selected we can use this option.

Example of a trading game that uses specific valuations, buy select and profit calculations

( Right click on a Game: 03_recruiter_graduate.mgd to download it)

Specific initial values for

a. In this game there are two :

and. .

b. Valuations for start with one and go up to the last graduate who logs in to the game in increments of one. For example if we have 10 graduates in this game their valuations will be 1, 2,,3...,10. Similarly the valuations are determined for recruiters. Variable has the following function for the initial value:

subject_number()/2

that gives the valuations for graduates exactly the way that is described above:

valuation_edit

· Select in order for each subject to get a different value.

c. Valuations for start with one and go up to the last recruiter who logs in to the game in increments of one. Variable has the following function for the initial value:

(subject_number()+1)/2

that gives the valuations for recruiters exactly the way that is described above. Remember that recruiters will have valuations 1, 3,5,…

recruiter_edit

· Select in order for each subject to get a different value.

and updates in the .

a. Open icon by double clicking on the edge of the icon or select and click on . b.Select on page. c. Insert Valuation recruiter under Valuation by using “Function editor” (right click to access it) or just write the name of the variable, select it and use “Ctrl+Shift+V” to color it into rose color.	d. Given that is allowed to select only one , write 1 under maximal quantity: e. For insert endowment and valuation on page: .

Select for . · Select recruiter profit and write the following expression: The value of the match to the recruiter is the product of the recruiter's valuation and the graduate's valuation. Recruiter’s valuation is captured with asset_valuation(). The graduate’s valuation is captured with asset_valuation(“false”). To get the profit price() which was advertised has to be subtracted from the value of the match.		g.Select for . · Select graduate wage and write the following expression: .The price that he submits is wage and the function is price() (use Function editor to access the functions).