Download Summary Verbal Instructions PO tax on seller

Summary
• Buyer or Seller: You will be randomly assigned to the role of a
Buyer or Seller by the computer. Your role will remain the same
throughout the entire experiment and will be known only to you.
• Buy or Sell: Depending on your role you will buy or sell units of a
fictitious commodity.
• Keeping track of time: You are given a limited time to make your
decisions.
• Trading Rounds: There are multiple trading rounds.
• Tax per unit: A tax per unit in the amount of $12.00 is collected
from the Sellers in the market.
What does a Seller do in this
experiment?
• Sellers move first.
• What is known to Sellers? You will know your costs per unit and
the number of units you have available to sell. This will be private
information.
• What decisions do Sellers make? You specify an Offer price, and
you specify the number of units that you would like to sell at the
specified Offer price. You can sell as many units as you have
available.
• How do Sellers make money in this experiment? By selling units at
a price greater than your costs plus tax per unit.
• An Offer price can be any price between $0 and $100.
What does a Buyer do in this
experiment?
• Buyers move after the Sellers make their decisions. Buyers
enter the market one by one, in random order.
• What is known to Buyers? Buyers know their value per unit
minus the tax per unit. This is private information. Buyers also
know the Offers made by all the Sellers in the market.
• What decisions do Buyers make? Buyers decide whether to
accept any of the Sellers’ Offers. You can buy as many units as
are available in the market.
• How do Buyers make money in this experiment?
By buying units at prices less than your values per unit.