Each resident—whether a buyer or a seller of RobotDogs—is bothered by the barking of his neighbors' RobotDogs. We call this a personal nuisance cost.
How to Play
Half of you are buyers, half are sellers.
Buyers can submit Bids. Sellers can submit Asks.
Use the slider to choose a value and press Bid or Ask
You buy a RobotDog if:
you click "Buy at Lowest Ask" OR
you have the highest Bid and someone either clicks "Sell at Highest Bid" or asks less than your Bid.
You sell a RobotDog if:
you click "Sell at Highest Bid" OR
you have the lowest Ask and someone either clicks "Buy at Lowest Ask" or bids more than your Ask.
The price of every transaction in your group is depicted in the chart on your screen.
Payoff Computation
Buyers: The item's value is displayed on your screen. For each item you purchase
Payoff = item value - price you pay - personal nuisance cost
Sellers: The item's cost is displayed on your screen. For each item you sell
Payoff = price you receive - item cost - personal nuisance cost
All: Also bothered by each dog they didn't purchase in community
Nuisance = Others' RobotDogs purchased × Community Nuisance ÷ Number in Community
Total payoff is equal to the sum of the individual payoffs from all your transactions minus nuisance from others' purchased RobotDogs.
Example
10 community members; Community Nuisance per dog = $5
Personal nuisance cost=$5 ÷ 10 = $0.50
Buyer A (value=$8.75) pays price=$5.25 to Seller B (cost=$1.50)
Seller C does not sell a RobotDog
Buyers
Value
–
Price
–
Personal nuisance cost
=
Payoff
Buyer A
$8.75
–
$5.25
–
$0.50
=
$3.00
Sellers
Price
–
Cost
–
Personal nuisance cost
=
Payoff
Seller B
$5.25
–
$1.50
–
$0.50
=
$3.25
Seller C
–
$0.50
=
–$0.50
To calculate the total payoff, each person sums their per transaction payoffs and then considers the RobotDog transactions of others.
If there were two other transactions in this market, and each person in our example was not party to those transactions, their payoffs would be lower by 2 × $0.50 = $1.00.