Journal of Economic Perspectives: Vol. 10 No. 2 (Spring 1996)


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Classroom Games: Understanding Bayes' Rule

Article Citation

Holt, Charles A., and Lisa R. Anderson. 1996. "Classroom Games: Understanding Bayes' Rule." Journal of Economic Perspectives, 10(2): 179-187.

DOI: 10.1257/jep.10.2.179


This paper uses the technique of experimental economics to set up a classroom situation where students learn to make Bayesian decisions. The exercises allow students to discover for themselves a natural counting heuristic that corresponds to Bayes's rule and is much quicker to use in many situations. In the context of balls and urns, this heuristic involves adjusting ball counts to reflect prior probabilities. It provides a natural bridge between simple intuition and the mathematical formula for Bayes's rule that is presented in undergraduate courses in economic statistics, game theory, and managerial economics.

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Holt, Charles A. (U VA, Charlottesville)
Anderson, Lisa R. (American U)

JEL Classifications

A22: Economic Education and Teaching of Economics: Undergraduate
C11: Bayesian Analysis


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