Discovery Learning in the Middle Level Economics Classroom Free

Economic literacy refers to how well students perform on nationally normed and standardized tests of economic knowledge, which is the most common way of assessing economic literacy. Every 2 years, the CEE (2010) conducts a comprehensive look into the state of K–12 economic and financial education in the United States, collecting data from all 50 states and the District of Columbia. The data are based on the assessments of economic understanding that rely upon these standardized tests (i.e., Basic Economics Test—elementary school, Test of Economic Knowledge—middle school, Test of Economic Literacy—high school, Test of Understanding of College Economics—college). Subsequently, the CEE releases a report, the Survey of the States. The biennial Survey of the States is an essential benchmark for progress. However, this report indicates that there has been no measurable economic education understanding improvement in recent years (CEE, 2016).

Most scholarly research relies on data from the CEE-based standardized assessments (Highsmith, 2017). One noteworthy result of various studies repeatedly points out that young adults seem to find it difficult to answer questions on economic issues correctly (e.g., Förster & Happ, 2019). One reason is that the implementation of economic content in the curricula is diverse and often not comprehensive enough. Further, studies tend to focus mainly on the effect of formal learning opportunities or standardized tests (Förster & Happ, 2019; Highsmith, 2017; Walstad & Rebeck, 2001).

Highsmith (2017) speculated a list of reasons for the failure to deliver on the economic literacy at all levels of education. Highsmith, former vice president of the National Council on Economics Education, indicated the lack of:

1. Influential voices on state and national economic education boards from organized labor, business, government, and the academe

2. Time among educators to deliver a cumulative economic education program beyond a stand-alone course

3. Credentials in economic education among educators

4. Accountability on the part of economic educators to commit to and hold themselves accountable for achieving measurable results

5. Cohesion of values, economic tools, and differing conclusions among famous economists leading to public cynicism about the value of economic education. (p. 79)

Which forms of instruction can impact the economic competence of middle level learners remains an open question. In looking for materials that can transform the economic conceptual development of middle level students, educators and scholars recommend discovery learning as a way to stimulate the natural curiosity of this age group and provide a pathway for development (e.g., Bransford et al., 1999; Ormrod & Jones, 2023). Discovery learning is a process through which students interact with their physical and/or social environment and derive information for themselves. Learning strategies include simulations and role-play exercises along with collaborative learning which place learners in artificially constructed, yet sufficiently realistic, context for learning to occur. Included are opportunities to learn by trial and error while receiving feedback and engaging in discussions. Through collaborative simulation and role-play activities, students engage in social cognitive learning theory (Bandura, 1985; Bonwell & Eison, 1991), where learning involves a continuous reciprocal interaction of cognitive, behavioral, and environmental factors.

Teachers widely use simulation and role-play activities in the middle school curriculum. Adolescence is the life stage that bridges childhood and adulthood. During this stage, the adolescent’s peer group becomes increasingly important as a source of information, experience, and support. Simulations and role-play are developmentally appropriate instructional methods for adolescents, as they help learners experience the consequences of their individual decisions, decisions of their peers, and results of group decisions. Simulated experiences help to model real-life decisions that young adolescents make as they push for autonomy and responsibility en route to adulthood marked by self-governance (Ezejiegwu, 2016; Ormrod & Jones, 2023). Empirical research on discovery learning pedagogy in the economics classroom shows that students who receive instruction with collaborative learning techniques perform higher on exams, as measured by test grades, than a control group using noncollaborative teaching (Maxwell et al., 2005; Yamarik, 2007).

The conceptual framework employed in this study was Piaget’s (1976) cognitive development theory. Piaget was concerned with children’s cognitive learning indicating that such development starts in a sequence of four separate stages, and each stage construct is based on the prior stage. He designated those stages as sensorimotor (0–2 years), preoperations (2–7 years), concrete operations (7–11 years), and formal operations (12–16 years). His theory focuses on how knowledge links with actions or operations, that is, with transformations. Piaget states that cognitive development is the reformation progress of the mind due to genetic, biological maturation, and surrounding practice.

In terms of developmental appropriateness for economic education concepts, Berti and Bombi (1981) found that children understand specific economic concepts such as salary at around 7–8 years of age. Between 10 and 12 years old, children shift their understanding of value and price, defined as the work and materials put into developing products. Schug and Birkey (1983) investigated the development of young children’s economic reasoning. They concluded that economic understanding coincides with Piaget’s development theory, where reasoning differs by age for most concepts, progressing from simple to abstract. Bonn and Webley (2000) agreed that economic understanding is developmental. In his more recent work, Webley (2012), who like Schug and Birkley (1983) and Berti and Bombi (1981) discussed children’s understanding of economics as Piagetian, noted universal stages that children segue through in order to achieve an adult understanding of economic concepts.

In this study, I investigated the impact of discovery learning using active learning materials on the development of economic thinking of middle-school students. The main research question was: can active learning materials help develop the economic thinking of middle-school students?

In this study, I employed a mixed-methods approach using pretest-posttest instruments consisting of nine questions, field notes, and content analysis. The university and the participating public school provided consent for conducting the study. Student participation in the study was voluntary without penalty for nonparticipation. In the following sections, I discuss the participants, setting, materials, instruments, and procedures.

Fifth- and sixth-grade Caucasian students attending a public school in the mid-Atlantic region of the United States participated in the study. The study began with 23 males and 18 females (ages 10–12). A total of 37 participants completed the final assessment. Student absence explained the difference in numbers. We, the researcher and research assistants, were guests in the classroom.

Materials used in the instructional unit included banking logs, deposit/withdrawal slips, tickets for fines, simulated cash, rent logs, deeds, and prizes. In addition, lesson plans designed to teach 27 different economic concepts were constructed by the principal researcher and led by two assistants, who facilitated the teaching and associated learning activities. Purchased materials amounted to approximately $100 for 41 participants ($2.43 per student).

We used four instruments to collect data: (a) a nine-question pretest and posttest, (b) student posters, (c) field notes of students’ behaviors that were completed by the principal researcher, and (d) banking transaction logs completed by some of the students who selected a specific classroom job (i.e., banker). The nine-question open-ended format pretest-posttest asked participants about salary and money, banking practices, the value of money, interest, scarcity, and supply and demand. Students completed posters that were used to determine their wants.

A 45-minute lesson ran once a week for four consecutive weeks with two groups of participants in fifth and sixth grades. With help from the classroom teacher, participants applied for classroom jobs, were hired, and informed of their job duties in exchange for their weekly salary (e.g., technology supervisor $550; banker $500; messenger $350). The principal investigator and two assistants constructed lesson plans designed to teach different economic concepts; we facilitated the teaching and led the associated activities (see Table 1). We selected microeconomics concepts as the focus—the study of how individuals and companies make decisions to allocate scarce resources for the unit.

This session began with the pretest, and participants made a poster, either writing or drawing what they wanted to own. The main objective of this initial session was for students to learn their jobs and perform the associated tasks. We conveyed that the unit’s objective was to save their salary to buy the deed to their desk, priced at $2,000. Once participants obtained the deed to their desks, they could use it to trade for what they wanted to own, which they had described on their posters. We told participants that the unit’s activities were not graded assignments. We also told them that their desks and chairs (and school building) were public goods, paid for by tax dollars. Lastly, each week they had to pay rent ($100) for the use of these public goods. In Table 1, we summarized the economic concepts taught in each session.

The classroom teacher was responsible for doling out bonus opportunities throughout the unit to students for earning high scores on tests and quizzes, completing an outside reading assignment, or showing an act of kindness. In addition, the classroom teacher doled out fines for off-task behavior. The purpose of including bonuses and fines in this simulation unit was to expose students to incentives that impact earnings/savings.

This session focused on the microeconomic concepts of banks, choice, consumers, currency, financial transactions (deposits and withdrawals), incentives, goods, money, opportunity cost, scarcity, trade, producers, and services. A sample activity asked each student to make a good using a container of Play-Doh. Next, we discussed the concepts of consumer and producer using prepared questions:

1. In what ways are you a consumer?

2. What types of goods do you buy?

3. What types of services do you buy?

4. Do you have choices when you buy goods and services?

5. Have you ever experienced scarcity— wanting an unavailable item?

A voluntary trade activity then ensued, which aimed to teach that trade is only successful when all parties believe that they benefit from the trade. We then asked participants about money: (a) Why do we need money? (b) What determines the price of goods or services? (c) What is currency? We did not use participant responses as data points in the study but used them more as a class review of what was taught during the session.

An example activity displayed a photograph of a tree with currency as its leaves. We asked participants to look at it and state what was wrong. Many fifth graders quickly remarked that money does not grow on trees, and our paper currency is not made from trees/paper. The sixth-grade group needed prompting, and a discussion ensued about the materials that comprise our currency (e.g., currency paper explicitly made for the Bureau of Engraving and Printing is composed of 75% cotton and 25% linen with the security thread and watermark built-in).

We reminded both participant groups of their obligation: a $100 rent payment to use their public goods. Another example activity was when participants engaged in a three-bean bag toss game, Chuck-a-Buck, to demonstrate the economic concept of incentive. The Council for Economic Education (2017) defines economic incentives as the additional rewards or penalties people receive from engaging in an activity. Understanding rewards and penalties could help people make the choices they need to make to achieve their goals. The cost to play was $500, and participants had a chance to win as much as $1,500. Another activity was associated with the economic concept of opportunity cost. We displayed paintings from the Smithsonian American Art Museum (e.g., Bolotowsky, 1934) to reinforce the economic concepts of goods, services, producers, and consumers. Participants in both grades formed groups and viewed the paintings, discussing and deciding which economic concept best fit the painting’s message. Finally, we asked them to explain their chosen economic concept.

We devoted the remaining time to logging transactions like paying rent and depositing salaries in the bank. We taught participants how to fill out a deposit slip and process it with the bankers, who completed the financial transactions for their group. Prepared questions engaged participants in a discussion about banks and the bank’s role in our economy:

1. Why do people deposit money in banks?

2. What do banks do?

3. How do banks make money?

4. Do you think you can “mark” your currency and go to visit that same currency in the bank?

5. When you withdraw your currency, will that same currency be returned to you?

We did not use participant responses as data points in the study but more as a class review of what was taught during the session.

In this session, we addressed the following microeconomic concepts: demand, profit, scarcity, shortage, supply, surplus, and price. It began with prepared questions and a discussion: (a) What is supply? (b) What is demand? (c) What is price? (d) How is the price of goods or services determined? (e) What is scarcity? We did not use participant responses as data points in the study but more as a class review of what was taught during the session.

We provided scenarios of the quantity of goods supplied compared to the quantity demanded so participants could visualize the terms in action. We discussed the price of an item as a clue to determine if goods or services were scarce. We also discussed the impact of celebrity endorsements on the price of a good or service, along with the relationship between supply, demand, and price involving gasoline. Next, participants played the online game Lemonade Stand where they assumed the role of a business owner in which the concept of profit was discussed. At the end of the game, the three most profitable Lemonade Stand owners received bonuses in the form of money. Using classroom-based laptops, participants worked in pairs to operate their lemonade stand for seven days (playing for about 10–15 min), learning about price, supply, demand, shortage, surplus, and profit. Through game play, participants considered factors that affected profit, such as the cost of doing business, the weather, local news reports, shortages, and surpluses. Next, the research assistants presented scenarios asking students if they agreed or disagreed (e.g., Thumbs Up/Thumbs Down) which reinforced the impact of price and quantity on supply and demand. The participants devoted the remaining time to financial transactions.

Participants worked in groups and played a scenario game, Decision Tree. They considered the opportunity cost of each situation presented to them. We conveyed the economic concept of incentive when participants decided if they wanted to participate in a drawing for prizes. Six items were available, and ticket prices were one for $50 or three for $100. Students could view the six items to decide if they wanted to participate. The items were mostly school related (e.g., notebooks, pens, pencils, Nerf balls, Play-Doh). Nine fifth graders participated (all male) and seven sixth graders (all male). Participants devoted the remaining time to financial transactions.

The last session began with a nine-question posttest. Next, participants completed financial transactions, withdrew money from the bank, and purchased the deed to their desk if eligible. Then, they celebrated their final trade—their desk for the item they wished for—ones written/drawn on their posters. Finally, participants purchased goods with their excess money at a store expressly set up for them, or they donated to charity.

In this section, we discuss the data analysis performed on the collected data. First, we analyzed the pretest/posttest results using a paired-samples t test. We selected a paired-samples t test because it is an inferential statistic used to determine if there is a significant difference between the means of two groups. Next, we completed a data screening process to ensure the collected data’s quality. This screening began with a frequency procedure establishing mean values for each data set, the standard deviation of each data group, and the number of data values of each group.

In Session 1, participants were given nine questions (“the pretest”—Time #1) to answer. Then, we taught the economic unit over five consecutive weeks. After 5 weeks, we asked participants to answer the same nine questions (“the posttest”—Time #2). Finally, each student’s pretest score was paired with their posttest score, resulting in 37 paired samples. We analyzed the samples for statistical significance between the two tests using predictive analytic software, SPSS for Windows, with a minimum alpha of 0.05.

• 21 fifth-grade participants (13 boys and eight girls)

• 16 sixth-grade participants (10 boys and six girls)

We reviewed the student responses to the pretest and posttest questions, coding each with a dichotomous categorical variable (“0” for an incorrect answer and “1” for a correct answer). Because this was an open-ended format assessment versus a selected response assessment, the research team discussed participants’ answers to achieve interrater reliability when there was disagreement. An open-ended assessment format was employed to gauge participants’ reasoning to questions asked versus a selected response assessment where participants could guess the answer.

In addition, a qualitative content analysis examined the content in the posters as an indicator of future wants. We determined that content analysis was well suited for analyzing and summarizing exploratory data (Babbie, 2007). We examined the posters, and separately the researcher and two assistants created a code of categories based on responses. We held a discussion among the three of us, and there was little disagreement about the final categories: clothing, transportation, shelter, and entertainment. If the participants had multiple wants, we only included the first one listed on the poster.

Results of the t test, content analysis, and observational field notes of student behaviors recorded by the researcher during the sessions established the findings depicted in the following section.

There was no statistically significant difference between the pretest and posttest responses in participants’ understanding of salary (question one), as both fifth and sixth graders knew that salary is an exchange for work. However, we expected participants to know this answer as Berti and Bombi (1981) found that children aged 7–8 years understand the concept of salary.

There was no significant difference between the pretest and posttest responses regarding the concept of money for either group (question two). Active learning strategies made no difference in the development of the concept of money. However, we hypothesized that participants would know this answer based on Berti and Bombi’s (1981) study.

The paired samples t test revealed statistical significance in sixth-grade participants’ understanding of the types of materials used in printing and minting money (question three). Active learning strategies made a difference in developing the concept of printing and minting money for sixth graders but not fifth graders.

Question four revealed no statistical significance between the pretest and posttest responses for either group of participants in understanding the value of goods. Active learning strategies made no difference in developing the concept of goods.

There was no statistically significant difference in understanding deposits (question five). Active learning strategies made no difference in developing the concept of banks. The most often found response as to why people keep their money in banks was for safekeeping. However, much like the work of Berti (1993), no student in the present study mentioned that one of the functions of banks was to help their customers resist the temptation to spend.

Responses to question six revealed no statistical significance in either group. Active learning strategies made no difference in developing the concept of interest. The responses suggested that participants had prior knowledge of interest at the Stage 2 level, according to Jahoda (1981), who determined a basic pattern to children’s understanding of bank profit. The stages range from no knowledge of interest; understanding interest on deposits; believing that deposit interest is higher than loan interest; believing that the interest is the same; and recognizing that interest is higher on loans and how banks make profits. In Jahoda’s study (1981), most 11-year-olds were either at Stage 1 (no knowledge) or Stage 2 (understanding interest on deposits).

Question seven determined how well participants understood the economic concept of scarcity. Results revealed statistical significance in sixth-grade participants’ understanding of scarcity. Active learning strategies made a difference in the development of the concept of scarcity for sixth graders but no difference for fifth graders. Further, this suggested under-development of the scarcity concept of the sixth-grade participants compared to other studies where students of the same age knew the concept (Webley, 1996; Webley & Lea, 1993) using the “playground economy” where games of marbles are played. Findings revealed that children (ages 8–12) understood that the value of the different kinds of marbles (e.g., galaxies, pixies, misties) was determined by their scarcity and not by their price.

The paired samples t test revealed statistical significance in fifth-grade participants’ understanding of the quantity demanded (question eight). Active learning strategies made a difference in developing the concept of demand effects for fifth graders but not sixth graders.

Statistical significance in fifth-grade participants’ understanding of quantity supplied (question nine) was revealed. Active learning strategies made a difference in developing the concept of supply effects for fifth graders but not sixth graders. Questions 8 and 9 follow the work of Thompson and Siegler (2000), who aimed to understand students’ reasoning about how supply and demand determine the quantity of items bought and sold. The findings were like Leiser and Halachmi’s (2006), who found that children in this age group understand supply and demand. However, they could better understand demand effects than supply effects.

The posters revealed a variety of wants, from the far-fetched (e.g., an underwater city) to the practical (e.g., puppies). Most wanted items tended to be materialistic, and most had celebrity endorsements (e.g., Yeezy sneakers endorsed by rapper, Kanye West, and a Maserati, endorsed by football player Plaxico Burres). Other items represented dreams (e.g., mansions, private jets), while most signified the achievable (e.g., vacations, football tickets, clothing). This revealed that students were aware of celebrity endorsements. This set the stage for additional teaching opportunities about scare resources as students tend to think that people who have money never experience scarcity. This is one of the most fundamental points in economics. Regardless of its government or institutions, the total of peoples’ wants typically exceeds what can be provided, so choices must be made, whether openly or implicitly (CEE, 2022).

The content analysis of the banking logs revealed accurate completion of deposits, withdrawals, and running total. Further analysis of the banker’s logs revealed that participants with this job role could fill in the banking logs accurately, recording correct deposits and withdrawals made by their assigned participants. This reveals a high level of student engagement in the simulation.

The principal researcher recorded field notes during each session. Notes revealed a high level of engagement with the activities presented, where all participants earned a bonus at one or more session, only 2% of participants incurred a fine, and 2% failed to pay rent. Ninety percent of participants had saved enough money to purchase the deed to their desks and chairs. However, the three participants who represented the remaining 10% had money donated to them by their peers, so they, too, were able to purchase their deeds.

Similar to content analysis results, participants were both aware of celebrity endorsements and understood their power, as observed when debriefing the Lemonade Stand game. For example, one team explained their winning strategy by following a news headline story that reported that lemonade helped professional basketball players improve their jump shot. Because of that news, they priced their lemonade high and quickly sold out.

Session four had only males participating in the drawing. The items were mostly school related (e.g., notebooks, pens, pencils, Nerf balls, Play-Doh). One recent study found that male adolescents engage more frequently in gambling (financial risk) behaviors (Razen et al., 2021) compared to female adolescents. This finding aligned with other studies insofar that females appear to be more financially risk averse than males (e.g., Charness & Gneezy, 2012; Eckel & Grossman, 2008; Sutter et al., 2013).

Incentives mattered to some participants. For example, participants who chose not to participate in the session 3 game, Chuck-a-Buck were happy with their choice, indicating a commitment to savings. Nevertheless, participants who chose to participate in the game and lost said the game was “not worth it.” Moreover, changes in incentives influenced human behavior in predictable ways. For example, if something became more costly—monetarily and nonmonetarily—people would be less likely to choose it (Gwartney et al., 2016).

The focus of this study was to determine the effectiveness of discovery learning and associated active learning materials used to teach economics concepts to fifth and sixth graders. To answer the main research question: can active learning materials help develop the economic thinking of middle-school students— we look to the results that revealed that participants’ understanding of key economic concepts improved using active learning materials. Specifically, fifth graders improved their understanding of certain microeconomic concepts (i.e., quantity demanded, and quantity supplied). At the same time, sixth graders developed a more robust understanding of currency and value associated with price and the microeconomic concept of scarcity.

A sixth grader stated that having a job that pays more is a faster way to reach their goals. The most notable remarks made when asked to state their thoughts about the learning activities were:

1. the best way to get ahead is to do their job;

2. make smarter choices with their money;

3. take advantage of opportunities to earn bonuses; and

4. avoid fines.

Based on these results, the middle level students clearly see that labor income is important and is, in fact, the largest source of personal income in our economy. Such an understating of student beliefs can help middle level educators determine and develop additional instructional goals. For example, a pathway at this point could ask students to investigate jobs/careers for their future; the typical salary each position pays along with the requirements and competencies. One force that makes inequality more pronounced in the United States is the lack of human capital (e.g., knowledge, skills, abilities) among lower income populations. Better education would promote acquisition of human capital and the higher income that goes with it.

We recommend that a larger population of younger students engage with the same or similar materials to determine if there is a better, lower grade level fit since most of the economic terms taught in this unit were previously understood by fifth and sixth-grade participants. In addition, educators should design middle level economics education programs with adolescent females in mind to combat the finding in the field notes and confirmed in other studies (e.g., Ackermann & Siegfried, 2019; Happ et al., 2021) that indicate that adolescent males are more risk tolerant than adolescent females. We determined that the Piagetian learning theory discussed and modeled in this study deals with cognition, so risk-tolerance behavior based on gender was a finding outside of the current study’s scope.

More than ever, the sheer magnitude of human knowledge renders its coverage by formal education impossible. Instead, the goal of education is better conceived as helping middle level learners develop the intellectual tools and learning strategies needed to acquire the knowledge that allows them to think productively about content. As espoused by Ormrod and Jones (2023), metacognitive awareness, which includes learners’ knowledge and beliefs about their own cognitive processes includes knowledge about ways they learn best. Exposing students to numerous instructional strategies such as discovery learning using simulations and active learning gets students closer to knowing which strategies are most effective for them. The more students know about effective learning strategies—the greater their metacognitive awareness—the higher their classroom achievement is likely to be (Perkins, 1995; Rahimi & Katal, 2012; Tuononen et al., 2022). Creating middle level curriculum that uses active learning strategies and simulation materials can help to develop a fundamental understanding of economic content, and practice with the content including how to frame and ask meaningful questions, which contributes to an understanding of learning principles that can assist middle level learners to become more self-directed as they transition to a higher educational level (e.g., middle to high school; high school to college).

Acknowledgment: I have no conflicts of interest to report.