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Serious Game To Understand The Role Of Monetary Policy In Growing A Healthy Economy

Image credit: Chair the Fed – A Monetary Policy Serious Game

Chair the Fed, a Serious Game created by the educational arm of the Federal Reserve Bank of San Francisco, has won gold honors in the 2019 International Serious Play Awards competition in the Higher Education category.

The purpose of Chair the Fed: A Monetary Policy Game is to develop players’ understanding of the role of monetary policy in growing a healthy economy.

The game accomplishes that by simulating fundamental relationships between monetary policy, price inflation, and the labor market. Using the Federal Reserve’s key monetary policy interest rate, players learn about the impact of rate changes on prices, jobs, and the economy.

The game also provides a hands-on approach to learning about policy time lags, the real rate of interest, supply and demand shocks, and the natural rate of unemployment.

Chair the Fed puts players behind the wheel of the U.S. economy, charged with meeting two key goals: stable prices and high employment. Over the course of 16 quarters of gameplay, players will experience a shock to the economy and must navigate through the issue by setting monetary policy to keep prices and the labor market stable – or not. The immediate goal of the game is to be reappointed as Chair of the Fed.

The fast pace of game play and the multiple, updating pieces of information are designed to keep things interesting and provide enough hints to help players develop skill in guiding the economy. With nine different possible shocks, randomly drawn one per game, players are also given enough variety to engage in multiple games and grow their skill in navigating monetary policy.

At the end of each game, players receive feedback about their time as Chair of the Fed – whether they met the goals of stable prices and high employment to achieve reappointment, a description of the shock they faced, and the level of their key variables at game’s end. This feedback provides valuable information about how they played the game and encourages multiple gameplays.

Chair the Fed: A Monetary Policy Game showcases to perfection the benefits of seamless integration in a Serious Game: game elements and instructional elements are so well integrated in Chair the Fed that the connection is transparent to the player. As a result, the basics of Macroeconomics are easily internalized and some aggregate changes in the economy such as unemployment and inflation contextualized and correlated to Federal Reserve’s key monetary policy interest rate in a fun and enjoyable way.