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Poudre Valley School District Professional Development Elementary Economics (and a little PFL)

Dive into fundamental economics concepts in this engaging professional workshop focusing on scarcity, choice, and cost. Learn how to integrate Economics and Personal Financial Literacy across different grade levels. Discover practical teaching methods to make economics enjoyable and rewarding for your students.

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Poudre Valley School District Professional Development Elementary Economics (and a little PFL)

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  1. Poudre Valley School District Professional DevelopmentElementary Economics (and a little PFL) June 10, 2015 Marc Johnson Education Program Director Colorado Council for Economic Education mjohnson@ccee.net 303-752-2323

  2. Not one more thing!

  3. Not only are you supposed to teach PFL & Economics… It can be enjoyable and rewarding!

  4. As best I can, I’ll use the KISS approach…

  5. Economics • Content Area: Social Studies (4 standards) • History, Geography, Economics, Civics • For each grade level, P-8: • One GLE in Economics • One GLE in Personal Financial Literacy (PFL) Economics & PFL integrate well

  6. Presentation Objectives for Economics • Concepts (technical vocabulary) • Wants / Needs • The economic trilogy • scarcity, choice & cost • Incentives • positive • negative • Goods & services • Productive resources • natural, human, capital, entrepreneurship

  7. Concepts are universal Across space… …to the world, Mexico, Colorado, Denver or your classroom! Across time… …to the present, past or future!

  8. Let’s Get Started!

  9. When I ask ANY group what economics is all about they invariably say… MONEY

  10. When I ask ANY group what economics is all about they invariably say… OR, they cite economic statistics: CO is the 2nd largest aerospace employer in the US, behind CA. Median per capita income in CO in 2013 was $58,823(US figure: $52,250). Colorado’s unemployment rate in December, 2014 was 4%.

  11. Economics is NOT about money or data. No economist likes those answers… Let’s start with some fundamental assumptions of the academic discipline of economics…

  12. Wants & Needs CO Academic Standards make this distinction: “Identify the difference between personal wants and needs.” “Give examples of the difference between something you want versus something you need.” An economist’s reaction And here’s why…

  13. What do you need to survive – the minimum? We’re talking mere existence and basic survival.

  14. In the context of life in the 21st century in an affluent society – what do you need to survive?

  15. The distinctions between needs and wants become blurred. So, economists simply use one category – Wants – and make distinctions about how much we want something… and posit that our wants are unlimited. So, what’s the problem?

  16. A Gift from CCEE • Who would like this ultimate economics & PFL resource? • Wants: ______ • Available: 1 Scarcity THE economic problem?

  17. Scarcity • Wants > Availability • or, • Unlimited wants > Limited resources

  18. ScarcityChoice Economics is: • the study of choice

  19. The Economic Way of Thinking: Key Concept • Scarcity necessitates choice • people must choose

  20. ScarcityChoiceTrade-offs

  21. A World of Choice Grand Slam? Marry the little red-haired girl?

  22. Daily, Small Choices Maybe go shopping at the mall? Should I go to the library today? Should I go hiking today?

  23. Big, Strategic Decisions Should I go to college? Should I work instead of college?

  24. We All Confront Choice A school teacher? A business person?

  25. Develop a Decision-Making Framework for Students • Help make decisions • by learning a process for more careful choice

  26. Decision-Making Model • Define the Problem • outcome to be achieved • List the Alternatives • ways to achieve the outcome • State the Criteria • standards to judge alternatives • Evaluate the Alternatives • apply criteria to each alternative • Make a Decision • select best alternative

  27. Decision-Making Model PACED • Define theProblem • List theAlternatives • State theCriteria • Evaluatethe Alternatives • Make aDecision

  28. PACED Example • My wife and I decide on restaurant for dinner …

  29. Where to Go for Dinner? How about Venice restaurant? How about Shanahan’srestaurant?

  30. Problem: What Restaurant for Dinner? Food quality Menu choice Drive Time Quiet Cost Ajuaa’s + - Venice + + 0 + + - 0 0 Criteria Alternatives • What factors are important to • you in making this decision? • Used to rank one alterative • as “better” than another. - + - + 0 0 +2 Shanahans +1 + = above average - = below average 0 = average

  31. Problem: Choose a Car to Purchase • What factors are important to • you in making this decision? • Used to rank one alterative • as “better” than another. Greatest value is not in the specific answer, but in the process of identifying important factors.

  32. Candy Bar Activity • One Volunteer, please? • Opportunity lost opportunity cost • Value of the best foregone alternative • “Choosing is refusing” • choose A, refuse B – • cost of A is value ofB

  33. The Dismal Science! There’s no such thing as a free lunch! TNSTAAFL

  34. The Economic Way of Thinking: Key Concept • Choice involves cost • opportunity cost

  35. Sample question from Grade 4 Social Studies Practice Test Type your response in the box. Read the paragraph. What should the student do? Explain what her opportunity cost will be and why. A student is trying to decide whether to go roller skating, practice soccer, or read a book today. She has time to do only one activity. She went roller skating yesterday, she has an important soccer game tomorrow, and the book is a new one by her favorite author.

  36. Opportunity Cost Examples • Cost of coming to this workshop today? • Value of next best foregone alternative • joy spending day with family or friends • Cost of using frequent flyer miles to fly to Las Vegas? • Value of using frequent flyer miles to fly to Miami • A student’s cost of going to a movie with friends? • $8.00 movie ticket price • $2.00 transport (gas, etc.) • $20.00 babysitting earnings given up Explicit Implicit

  37. Since ScarcityRequires Choice • … and since choice involves cost Why choose it? • Assume that: • People choose X if: • B(X) > C(X); • otherwise, not B(X) C(X) • where : • B(X) ≡ benefit of choice X • C(X) ≡ cost of choice X

  38. Play It Again, Sam • Raise the cost • if C(X) > B(X), • choose another bar

  39. The Economic Way of Thinking: Key Concept • People respond to incentives

  40. Are You Willing… • … to be a police person? • For: • $20,000 per year? • $40,000 per year? • $60,000 per year? • $80,000 per year? • $160,000 per year? • $320,000 per year?

  41. Practice – Identify Incentives Why do some students want good grades? What makes you want to be a good teacher? What makes a company want to build a ski resort? What made Colorado Territory want to become a state?

  42. Intended Consequences • If people respond to incentives . . . • then behavior can be altered in desired or intended ways • For example …

  43. The Camel Race • Two Bedouins met in the desert, and fell into an argument over their camels, each claiming that his was the slowest, “stubbornest,” most useless camel in all of Arabia. • The argument ended in a bet. They agreed to race to the oasis, two miles away, whichever camel arrived last would be proved slowest, and his owner would win ten dirham from the other.

  44. Camel Race continued • . . . They got on their camels, and set off slowly toward the oasis. More slowly, still more slowly. After a while, it became clear that since each Bedouin was trying to win the bet, they were never going to make it to the oasis. • . . . After a while, a wise sheik rode up on a donkey and asked them why they and their camels were standing still, in the middle of the desert, on a hot day, with the oasis less than two miles away.

  45. The Treasury, Petra, Jordan The Camel Racecontinued • They got off their camels, and all three sat down in the shade of a rock while the two Bedouins explained about their bet. • The wise sheik whispered two words to them. The Bedouins immediately jumped on the camels and rode off as fast as they could towards the oasis. • What were the 2 words? ________ _________ Switch camels!

  46. Consequences • People respond to incentives causing • intended consequences, and • unintended consequences • which can offset the intended benefits

  47. The Tax Man Cometh • April 15, 1987 . . . • IRS rule change: • Instead of merely listing each dependent child, tax filers required to provide Social Security number. Result? 7 million children disappeared

  48. KeyConcept, Once Again • People respond to incentives • …and the rest is commentary • Armchair Economist • Stephen Landsberg • Freakonomics & Super Freakonomics • Steven Levitt

  49. Productive Resources Focus: Grades 3-5 Economics Lesson 1 Rolling for Resources

  50. Goods and Services Goods Things that can satisfy people’s wants. A car A house A dish of ice cream An i-pod Other goods…

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