Unit 5: Silk Road & Trade 11.17.15

Entry Task If you did NOT finish yesterday’s webquest, please grab a computer and log in. Find your webquest document and get working If you did finish, do something productive & quietly wait for everyone else to finish

Entry Task When finished, save the document with your name Email it to me at mccarvillek@issaquah.wednet.edu Log off your laptop and put it back on the cart On the CORRECT shelf Plug it in!!!!!!

Activity – Follow Directions Do NOT look inside your bag until I tell you to. Look at the item in your bag BUT Don’t take it out Don’t tell anyone what it is

Glee Index How happy are you with your item? 1 3 5 1 3 5 Not Satisfied Extremely Satisfied Satisfied

Trade Op 1 Please trade bags with your partner. This is not optional.

Glee Index How happy are you with your item? 1 3 5 1 3 5 Not Satisfied Extremely Satisfied Satisfied

Trade Op 2 You have the opportunity to trade items with someone else. Rules: Trade is completely voluntary No coercion No pitching products You can only trade with people in your row

Glee Index How happy are you with your item? 1 3 5 1 3 5 Not Satisfied Extremely Satisfied Satisfied

Trade Op 3 You have the opportunity to trade items with someone else. Rules: Trade is completely voluntary No coercion No pitching products

Glee Index How happy are you with your item? 1 3 5 1 3 5 Not Satisfied Extremely Satisfied Satisfied

Discussion Do we see any trends happening? What motives are there for trading? What motives are there for NOT trading? How do restrictions affect trade?

Major Concepts Economics

DECISIONS MEAN COSTS Getting something of value always costs something “There is no such thing as free lunch”

DECISIONS MEAN COSTS Every decision you make has an opportunity cost Opportunity Cost: the next best alternative, not all of the possibilities Choosing is refusing Because people value different things, everyone’s opportunity costs might be different Because people’s values differ, the opportunity cost of the same decision may differ from person to person

INCENTIVES MATTER Incentives drive behavior Resources owned in common tend to be overused When a resource isn’t owned, people don’t have a clear incentive to protect it The “tragedy” of the commons isn’t an issue of greed or stupidity, but one of the rules of the game. Private ownership comes with its own costs

VOLUNTARY TRADE Voluntary trade creates value The benefits of trading far outweigh the costs in almost every situation Trade improves people’s wealth and satisfaction People won’t trade if the good being offered is worth less than the good they are asked to exchange