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overview
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each round, each firm chooses between a
Clean and a Dirty factory
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•
•
•
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Clean factory more costly to the firm
Dirty factory emits pollution
total pollution depends on how many dirty
factories
the more total pollution in a round, the higher
each firm’s healthcare cost
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game screen
current round/total rounds
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game screen
total number of firms
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game screen
cumulative payoff
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game screen
press to make choice
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game screen
to view previous rounds
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happy playing!
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payoffs
•
payoff = profits – healthcare costs
profitclean = (1.5#clean) × 10
profitdirty = (1.5#clean) × 100
healthcare costs = 1.5#dirty
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example
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10 of your 19 competitors choose Clean
your choice
profit
− healthcare =
choose clean (1.511) × 10 −
choose dirty (1.510) × 100 −
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1.59
1.510
payoff
= $826.53
= $5,708.84
9A Playground for Decisions
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