Teaching with food has some serious advantages, but it also has the potential to go very badly. I first started teaching with food by auctioning donuts during my morning class so that I could map out a supply schedule and a demand curve. I quickly found that it was much easier to cover the shifts of demand when they were already part of the market. That auction morphed into pizza around lunch time and cookies in the afternoon. Each year I try to think of a different topics that I could teach with food as an example. To the left you'll find topics that I've taught using some kind of food. I provide the supplies you'll need as well as some prompts for your students.

Demand Schedule & Curve

Early in the semester, the concept of demand schedule versus demand curve can be a bit tricky, especially considering the various factors at play. Doing an English auction in class for a pizza (or donuts if you teach a morning class) is a great way to explore the relationship between price and quantity demanded while also focusing on willingness and ability to pay.

Needs:

  •  Medium pizza

  • 2-3 bottles of soda

  • Plates/napkins/utensils

  • Google Survey asking for sealed bids 

Setup:

Order a pizza to your classroom and place it at the front of the room. Start the auction at $1 for the entire pie and ask students to raise their hands if they'd like to purchase the pie. Depending on the size of the class, the combination can get as high as $20-$30. I remind students that if they are selected then they are expected to pay. If they do not wish or are unable to pay then they are not part of the market and should not raise their hands.

Classroom Prompts:

I will graph the demand schedule and plot the demand curve based on their results. I will pick a few students to ask why they don't participate and it will help with the discussion on factors influencing the demand curve. Some students won't participate because of income constraints or because they have already eaten. Using the plot of the demand curve, ask students what would happen to the quantity of pizza demanded if the class was half (or double) the size of its current setting. 

 

Price Discrimination

One of the things that's hard to get across with teaching price discrimination is the tradeoff between the efficiency and equity issues surrounding price discrimination. James Tierney and I both auction food early in the semester to demonstrate demand curves, but he came up with a creative extension for teaching price discrimination. This activity has you auctioning cupcakes (or pizza slices) to the highest bidder is a closed auction. The top bids are selected and asked to come up and pay for their prizes based on their bid, not on the lowest of the 5. Each person pays a unique price in this auction.

Needs:

  •  Half dozen cupcakes

  • Plates/napkins/utensils

  • Google Survey asking for sealed bids 

Setup:

Prompt students that you will be auctioning a cupcake (don't mention the quantity) and that you'd like students to submit their maximum willingness to pay for a cupcake at that moment. I remind students that if they are selected then they are expected to pay. If they do not wish or are unable to pay then they are not part of the market and should not submit a bid.

After bids are submitted, select the top picks based on the number of items you are auctioning. Have students pay you in cash (we used Venmo) and then give them their item.

Classroom Prompts:

The first thing most students notice is that different students paid different prices. Ask whether the class believes that was a fair thing to do and whether it was the "right" thing. I often often calculate consumer surplus and producer surplus for them had I charged only the lower price and then calculate my producer surplus with price discrimination. 

 

Product Differentiation

One of the important outcomes of product differentiation (and monopolistic competition) is that societies "pays" for differentiation with prices greater than the minimum average total cost. Companies often advertise their products as being of a higher quality or made with better ingredients, but consumers may not be able to tell the difference between the brands. The ice cream taste test allows students to attempt to identify 5-6 brands of ice cream (usually vanilla or chocolate) to see if they can identify the high quality brand.

I prepare 6 containers of ice cream with 5 store brands and 1 national brand (like Haagen Daz). I provide bowls, spoons, napkins and a score card for students. I ask students to circle what they believe was their favorite ice cream of the group. During the reveal, I also tally which brands were selected as the favorites to show that the best tasting ice cream may not be the most expensive ice cream available. The follow-up to the activity asks students whether having 6 brands of chocolate ice cream is efficient or should we allow one producer to be the sole provider.

Needs:

  •  6 pints of ice cream (1 premium, 5 store/regional brands)

  • 6 storage containers labeled A-F

  • Plates/napkins/utensils/table cloth

  • Scorecards with ice cream brands 

Setup:

Ask students to circle a table of labeled "mystery" chocolate ice creams. Let them know the brands and ask them to identify the brands on their score cards. Remind them to circle their favorite when they turn it in. On an overhead projector, I track their ability to identify the premium brand. 

Classroom Prompts:

While students are sampling, I prompt non-participators and ask if their family has a certain brand that is only purchased. I also try to get students thinking about which brand they find the grossest and why. While the students are sampling, remind students of differentiation by quality and the efficiency impacts of this type of advertising.

 

Diminishing Marginal Utility

A fun way to demonstrate marginal analysis and diminishing returns is through a donut eating competition. Students are offered points for each donut that they consume in a given amount of time. Afterwards, we discuss the benefits from a monetary standpoint (the points), but also from a utility standpoint. Students are usually excited and smiling to start, but appear miserable at the end. This visible exhibit can be used to discuss diminishing marginal returns. The marginal cost can also be seen as students toward the end of the timer sit and contemplate the risk of sickness from an additional donut. I often set the timer at 3 minutes for one carton of donuts (about 20 mini donuts)

Needs:

  •  Carton of mini donuts

  • Plates, napkins, table cloth

  • Overhead timer 

Setup:

I often divide the classroom into sections and have students elect a representatitive to eat donuts. Eaters are awarded 1 point for each donut consumed and their section receives 1/2 point for each donut consumed. If a "reversal-of-fortune" occurs, then no one receives points. This ensures that the class is involved in cheering for their champion, but that they are cognizant of whether their eater may "turn."

I set a 3-minute time on an overhead and turn on "Happy" by Pharrell as background music. I usually check in throughout the timer to give the sections and update on consumption. I do not allow students to consumer water during the process, but that's done to arbitrarily slow them down. 

Classroom Prompts:

The easiest thing to point out is the expression on the faces before and after consumption. At the start of the exercise, participants are excited, but 3 minutes can have a huge impact. I ask students to name other items that have diminishing returns or to let me know a time they had done "too much" of an item. Students will often talk about working out too hard or how they got bored with a tv show after too many episodes.

 
Jadrian Wooten, PhD

@Wootenomics