| The study examines whether subjects exposed to instruction in economic theory perform better in simulated markets than subjects without such instruction. Previous research has examined whether experiments are useful teaching tools, but not whether teaching improves market efficiency.; The subjects were over 200 students enrolled in principles of economics classes at a small liberal-arts college in Ohio. Three types of experiment were conducted: a Posted-Offer market simulation resembling familiar retail environments; an Expectations experiment using the same basic methodology with the added challenge of predicting the effects of continuing inflation on prices in the market; and a Monopoly market in which subjects searched for the profit-maximizing combination of price and quantity.; Subjects were divided into control and experimental groups and confronted with the decision task before or after, respectively, they had received instruction on these theory underpinning the task. The resulting data was analyzed to determine how close subjects had come to matching the ideal outcome. An effect of instruction would have manifested itself as lower divergences in the knowledgeable subjects compared to their untutored peers.; In none of the three cases has instruction been found to have a significant effect in increasing the efficiency with which the subjects completed the tasks before them. It is, therefore, questionable whether students gain anything of practical value from studying economics in college, although such study may be satisfying in other ways. |
