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Experimental Economics Definition
Experimental economics is a branch of economics where experimental methods are applied in the study of economic theories and economic behaviors. This branch of economics relies heavily on data, laboratory-controlled and scientifically developed experiments in the study of economic behaviors and theories.
In experimental economics, data retrieved from experiments are applied in the evaluation of economic theories, questions, and behaviors. This branch of economics tests economic theories in laboratory settings and conditions using scientifically designed experiments.
A Little More on What is Experimental Economics
Experimental economics as a branch of economics was developed by Vernon Smith, a winner of the Nobel Prize in economics in 2002. This branch of economics does not use mathematical models but scientific experiments to study economic theories, human behaviors, and other economic concepts. With experimental economics, individuals are able to gain a clearer understanding of how market functions, how humans behave in the markets and the reasons for these.