Traditionally, the study of economics relied heavily on mathematical abstractions to understand how people behave and how markets work. However, these economic theories and predictions are often difficult to test in natural environments with adequate scientific vigour.
Experimental economics involves taking economic theories and testing them in the controlled environment of a laboratory. Experimenters typically devise a scenario in which human subjects are required to respond to a series of questions either as an individual or as part of a group. To replicate real-world incentives, those participating in experiments usually receive cash rewards based on their responses. While the majority of experiments simulate markets and auctions, experimental economics methodology is also used to study human behaviour more widely.
The Experimental Economics Lab at Melbourne University (E2MU) was established in 2007 to promote the use of experimental methods in economics research and policy. Jointly funded by the Faculty of Business and Economics and the Victorian Government, the facility was opened by Department of Economics Head Professor Nilss Olekalns and Victorian Department of Treasury and Finance Secretary Mr Grant Hehir.
Click the links below to find out more about the research experiments academics at the University of Melbourne have been involved with at E2MU.
Academics outside of the University of Melbourne who would like to conduct academic research at the E2MU facility may contact us for more information.