Getting bored over the holiday break, or need to kill time waiting for the New Year to arrive? Board games provide a great diversion but if you are like me, you find some of the classic board games to be a bit dull. Fortunately, I have found a couple of games that are not only loads of fun to play, but also offer some great economic lessons.
When considering board games and economic you might think of Monopoly, since it deals in money, trading, mortgages and rent. But Monopoly is one of the worst games there is, both in terms of game design and the economic concepts taught.
Why Everyone Hates Monopoly
First, Monopoly is hated by many people who are regular game players. A popular board game ranking site, boardgamegeek.com, ranks Monopoly at 11,689 on its list, a few places behind games like Old Maid. Why? The game follows a tired sequence that gamers like to call the ‘roll your dice, move your mice’ mechanic, so most players are bored while it is not their turn. It also is a game where once one person gets the upper hand, everyone else must play out the game in despair with little hope of winning.
More importantly, Monopoly teaches bad economic concepts. Unlike real life, there are rarely any situations where people are forced to pay someone for a service they do not want or need. Yes, some real estate or hotels may be more expensive than we would like, but there are always alternatives, even more so now with the rise of services like Airbnb. Also, contrary to popular belief, while monopolies are a theoretical economic possibility, there have never been any monopolies in history that have actually succeeded.
Settlers of Catan – A Game of Trade
Instead, one of my favorite board games is Settlers of Catan, a game where people attempt to settle the small island of Catan by collecting resources and building things like cities and roads. One of the most important economic concepts in the game is the value of trade. Since players are near tiles that produce some resources, but not others, players need to trade with each other to get what they need. As in real life, trade is always voluntary and is therefore always a win-win in the game. Those who are successful in finding opportunities for trade will almost always be more successful in the game.
The game is won by reaching a certain number of points, so while players compete against each other to get to ten points first – and may jostle against each other for space – the island is developed in a (mostly) harmonious manner. The mechanics of the game also allow for every person to be engaged, constantly looking to collect resources even when it is not their turn, making the game much more exciting.
Agricola – Opportunity Cost and Capital Goods
Finally, for the more adventurous, I would suggest a game called Agricola. The game is more complex than Settlers, but can be very rewarding if the learning curve is overcome. In Agricola, you play the role of a medieval family who must try to develop their small plot of land into a thriving farm. Opportunities abound including expanding your home, having kids, plowing fields and raising animals.
The game looks deceptively easy. While there are multiple things to pursue, you are only allowed one action per family member, so actions must be considered carefully, especially as you balance expanding your farm while still taking appropriate steps to keep your family from starving.
Therein lies the fundamental economic lesson of Agricola: the concept of opportunity cost. Each action taken necessarily means an alternative action cannot be taken. Plowing a field may mean not being able to fence a pasture. This is the heart of the entire study of economics — scarcity. For even if everyone were super wealthy, the fact that we all have limited time means we still face the scarcity and opportunity cost of time.
Agricola also offers another economic lesson about capital goods. These are goods created to increase productivity. For example, in Agricola you are able to eat your harvested grain raw, but if you invest some time and resources into a clay oven, you can bake bread which allows you to stretch the grain further and feed more family members. Or perhaps you can buy a better plow, allowing you to plow more fields at a time. This is how economies and countries progress and become wealthier. Consumption must be delayed in one period in order to save up resources to build capital goods, which then allows people to be more productive in subsequent periods.
I personally love board games for the interaction and socialization they bring with friends and family as well as just plain entertainment. So if you are going to play some board games this winter, why not choose some that are not only well-designed games, but also games that teach sound economics?
Chris Kuiper, CFA is currently a student and researcher at George Mason University, pursuing a Master’s of Economics. His previous experience includes asset management, investing and banking.