The International Business Society held its first event of the year with a taster session on Tuesday 17th October.
The International Trade Game
The International Trade Game began with the attendees split onto five tables, each representing a country.
- 1 Developed country,
- 2 Transitional countries,
- 2 Developing countries,
The objective of the game is for the countries to produce shapes cut out of paper, which they could then sell to the central trader for cash. The country that made the most money won.
Each country was given an envelope with their starting resources, with each country type having different resources. For example, the developed country began with all of the ‘machinery’ to produce the shapes – scissors, compasses, etc., while given only a few sheets of paper (the raw materials), they did however start with the largest liquid cash. Transitional countries were given large quantities of paper, some ‘machinery’ – rulers, and a medium amount of cash. The Developing countries were given few just a few sheets and even fewer other resources – no rulers, and very little starting cash.
The key to winning would be not only be selling shapes produced, but also trading with other tables for the materials to produce further shapes once their initial resources were exhausted.
The game began in expected fashion with the developed country getting stuck in, and the transitional and developing countries finding ways to produce shapes without the equipment to cut paper.
Within minutes shapes were starting to be sold to the trader and economic theory started to take place… A large supply of small triangles led to the price suddenly halving. Throughout the game prices would fluctuate depending on the type of shape being sold, with shapes that had few or none sold increasing in value while common shapes decreased. A simple case of supply and demand.
After 10 minutes a pair of scissors went to auction, and despite having the ability to, the Developed country declined to place the highest bid, the winning bid going to a developing country. This turned out to be a reoccurring theme as at the second auction, for 10 sheets of paper, the same country won the bid.
Just after starting the game coloured stickers, representing rare materials, were given to the developing countries, but were not informed of their purpose. The developed country was informed that shapes with coloured stickers on would be worth double their value. Failing to act on this however, the developed country declined to trade with the developing countries.
After 35 minutes it was made common knowledge to all countries that shapes with coloured stickers on would be worth double. However at this point only one was able to effectively take advantage of this.
With a surprise win, a developing country that won the game. Having taken advantage of both auctions to increase productivity and resources (paper and scissors) and being in the best position to make use of the rare materials
Further details of the game can be found here: https://www.economicsnetwork.ac.uk/showcase/sloman_game.
The debrief was led by Dr. Imko Meyenburg, a lecturer at ARU and the BSc (Hons) Economics course leader. Linking the actions during the game with economic theory, including price elasticity that he had given a lecture on just the day before to first year undergraduates!
Overall the event was well received, with positive feedback and new members joining the Society.