Economic Decision Making

When I first decided to teach economics, I reached out to a former professor of mine, Jim Charkins, who is the guy when it comes to economics instruction in California. He emphasized keeping it simple and keeping it real. He talked about Twilight and Bella's decision between Edward and Jacob. If they could understand how she made that decision, they could understand economics.

I'd never read or seen Twilight and I figured that it was 2021, many of my students wouldn't have either. So, I went to Twitter and asked teachers for modern examples of teen girl romance where she had to pick one of two guys. I knew there were dozens, but shockingly, that is not my area of expertise.

Some recommended Never Have I Ever, and it changed everything. First of all, I'm man enough to admit, I fell in love with the show. I was not looking forward to watching an entire season of teen girl drama to find the perfect clip for my students, but I enjoyed every bit of it. (Season 2 is also good, but it falls off hard in Season 3.) It wasn't until the final episode of Season 1 where I found that perfect clip. I had to do a bit of editing to get it short enough, but Devi (the main character) is presented with both options very clearly - Ben or Paxton?

I could have stopped there, but I enjoyed the show, so I kept going, and I'm so glad I did, because I got to see Devi do this:

Not only did Devi's story fit economic decision making, she literally made an economic decision making chart!

This gave me the idea of finding more clips of characters making decisions and then having students create an Economic Decision Making Chart (EDM) for each of them.

Here's a link to the PowerPoint activity (with the videos removed for "I don't want to get sued" reasons):

Economic Decision Making

I open the lesson by having students think of a decision they've made that day, After we discuss, I point out that they've made hundreds, if not thousands already, they just didn't think about them. Next, they make a list of those decisions, starting with the moment they woke up and realized they were awake. I stop them after a few minutes as I just want to get the point across that these decisions are happening all the time, just frequently on autopilot. So, if we are making thousands of decisions a day, even a 1% improvement in our decision-making would lead to huge gains!

We start our analysis by looking at simple cost-benefit analysis. This simple model is how we make most of our choices: will I gain more from this than I will lose?  I use the example of Ariel from The Little Mermaid. I've been unable to find the scene online, but it is the discussion she has with Ursula just before Ursula sings Poor Unfortunate Souls. In this scene we see Ariel identify her costs (her family, her voice) and Ursula identify the benefits ("you'll get your man") and see Ariel weighing each. (We also hear Ursula share the great economic truth that nothing is free!) I ask students to list the costs and benefits for Ariel.

I then point out that she made an awful decision because she did not use economic decision making. She had a goal (get the guy) and was willing to pay a very high cost as a result, but she didn't even consider another alternative. What if there was a better way with an even better cost/benefit ratio? Basic decision making doesn't account for that. 

Next, I show and explain the EDM model. I emphasize that students need to label each box. I want to see the word "Goal" and the word "Choice" on their charts. 

We then review the first step, the goal, with a clip from Alice in Wonderland ( Alice asks for help, but the Cheshire Cat can't until she knows her goal!

Then it is time for the Devi clip and her use of an EDM chart in Never Have I Ever...

Now we're ready for application. We watch the scene from Batman (Batman's Decision, let me know if the think goes dead!)

 and I walk students through what the EDM would look like for him.

For the next clip, the Spiderman one, students are going to create the EDM themselves. They watch the clip (which I often pause after Tony asks "What's your m.o? What gets you up in the morning?" to point out that he recognizes he needs to know Peter's goal to give him any real advice. Give them a few minutes to fill it in and check in with a partner before discussing the answers as a class.

Lastly, I have students create an EDM for their own big upcoming decision: What do I do after high school? I tell them I can't define their goal. Is it to see the world? Serve the country? Get a specific degree? They have to decide and then provide the alternatives to reach that goal.

After some time I share my own decision I faced as a senior (which college to attend) and what an EDM would have looked like for me. Though I never saw down and created a chart, I definitely thought through my decision in this way - weighing the costs and benefits of both alternatives.

The lesson closes with a few reflection questions that I usually don't have time for!

When I first did this lesson a few years go, this was the first lesson I taught in Econ that felt right. It has been cleaned up a bit since, but it still very close to how it started. Students enjoy it. They learn from it. It just works. Check it out!