Teacher Activity: Create Your Own Economic Mystery
Step 1:
Scan the news for an example of mysterious behavior. Radio, TV, and newspapers provide a wealth of material.
For example, the following examples of mysterious behavior on the part of the airlines was discovered in a Denver newspaper:
In November, 1996, United Airlines offered a $50 fare from Denver to any regular United destination in the continental United States over the Thanksgiving holiday. Closer examination of the offer revealed that the only restrictions on the offer were that the outgoing flight had to take place on Thanksgiving Day and the return flight had to depart no later than the following Saturday by midnight.
Now this is truly a mystery; "everyone" knows that Thanksgiving is the busiest holiday for the airlines. Further "everyone" knows that the fewer days between your outbound and return flights, the higher the airfare.
Step 2:
Identify the economic concept and the steps in economic reasoning that unravel the mystery.
Note: Although mysteries often contain links to more than one principle of economic reasoning, the KIS guideline - Keep It Simple - applies here - especially when the mysteries activity is new to students. (Even when they become more sophisticated, resist the impulse to include more than 2 principles. The mystery format is an effective learning tool because it so vividly illustrates to students the power of the selected principle to explain human behavior.)
In the example of the above newspaper article, marginal analysis is the key to unraveling the mystery of the $50 tickets. Simply put, the relevant question is: "What is the marginal cost of a passenger?" In other words, what does it cost the airlines to put one more person on an airplane if there is an empty seat?
Some costs are not related to the number of people in the plane. For example, the pilot and crew must be paid, even if the plane flies empty. On the other hand, some costs are related to the number of people on the plane. One more passenger means one more meal. As more weight - passenger weight and/or baggage weight - is added, more fuel is used during the flight.
In order to solve the mystery, we need to focus on the marginal, or additional cost of carrying one more passenger. Considering the examples above leads us to the conclusion that the marginal costs are quite small - an additional meal and a small amount of fuel. And anyone who has eaten an airline meal would have no trouble believing that $50 would cover that additional cost!
United Airlines' offer was designed to fill the empty seats on the planes by encouraging people to fly home for a short Thanksgiving holiday on the days that most Thanksgiving vacationers avoid. Since the planes were scheduled to fly the routes anyway, United could charge $50 and more than cover its marginal costs. United predicted (and correctly) that many consumers who didn't think it worthwhile to schedule a 2 day holiday for regular fare would change their minds for a $50 fare.
Step 3:
Frame the mystery question in such a way as to focus students on the primary issue.
In the airline mystery, try to frame the question so that students concentrate on the behavior of the seller (the airline) rather than on the behavior of the buyer.
Practice writing a mystery question for the $50 ticket example:
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Using information in the news article and your knowledge of the underlying economic principles, frame the clues to the mystery. Start with the clues necessary to reach a solution. The challenge is to write them in such a way as to give only the minimum information necessary for students to use the economic knowledge they already possess. Especially as students' economic knowledge increases, you want them to make inferences, connections, and applications. Don't give them too much, but keep the key concepts clearly in mind.
Reminder: The key concept in the airline mystery is: ____________________
Write no fewer than 3 and no more than 5 clues that, taken together, solve the ticket mystery. Frame the clues so that none contains more than one piece of information, and so that all are necessary to solve the puzzle.
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Step 5:
Using information from the news article, other sources, or your own general knowledge of the situation, write the rest of the clues. The additional clues should be "true;" that is, students should not have to fear that they are being tricked or that false information has been deliberately inserted to lead them astray. Good clues are those that contain relevant information that is not useful in this situation. Tailor the number of clues to reasonable group discussion size. Each student in the group should have at least one clue. As students become more sophisticated mystery solvers and more confident in their use of economics, it is ok to change the group size or to give each student more than one clue.
For example, the fact that Denver is one of United Airlines' hub cities is true, but it doesn't help us to solve the mystery. It does, however, entice some students to stretch for connections, especially if that is the clue they're holding. When individual students insist on the relevance of this clue, the discussion group as a whole must examine the connection and come to a consensus.
Below is a sample discussion that might occur in a group of students trying to decide whether the clue about Denver being a United Airlines hub is important to solving the mystery.
Hopefully, as the exchange continues, the students will decide that, while the clue in question may be true and interesting, it doesn't help to explain the mystery. The clue is then set aside (sometimes very reluctantly).
Again, remember that good clues are succinct and while each may offer details, it should not offer more than one major item of information.
Additional clues:
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More Practice:
The instructor will give you another mystery article. In your group, write the activity from beginning to end. Don't forget to start by solving the mystery yourself and identifying the economic principle(s) involved.
Copyright © 1999 Foundation
for Teaching Economics
Permission granted to copy for classroom use.