1) What are the major barriers to teaching as much simulation at the levels you would like in the way you would like? (resources? attitudes? students? time? other?) How have you overcome any barriers if you have?

I teach the agent based simulation approach as another tool available to students of economics and to get them thinking about top down vs. bottom up processes.  It is a very small component of a principles of economics course but after we cover the different types of market structures (competitive, monopolistic comp., oligopoly, monopoly) I have the students work with a Java applet of a Netlogo program that allows them to adjust different market parameters for consumer and producers and to see what market structure emerges.  Is the result something close to perfect competition or something close to monopoly.  At the principles level the largest barrier is the textbooks on the market.  An agent based or even systems dynamic approach is rare in texts.  Joseph Pluta has a text "The Market Mainstream and Evolutionary Views" which provides alternative approaches to the neo-classical framework so common in most texts.  Admittedly, much of the difficulty comes from having to convince myself that generative approaches to modeling are useful tools that in many cases can reproduce the mainstream models, in many cases provide insights not found in mainstream models at all, and of course are another set of tools useful for developing theories of how the economy works.  I hope that within 3 years we at least see a zero intelligence traders model to accompany supply and demand models in principles texts.  

2) What resources/exercises/materials/ideas have you found most useful in your teaching?

I have taught small classes where we had access to a computer lab and during the chapter on business cycles students could engage interactively in a simulation such as the beer game (based on a systems dynamics approach) to see how muddled just the supply side of the market model can become.  I have also had large classes where Netlogo java applets allow me to create a simulation, then have the students run experiments on the applet to see how different parameters affect market outcomes.  Part of this is giving them a sense of the neo-classical economic theory (more income increases demand type of stuff) and part of it is giving them an understanding of how theories are constructed and how the tools we use to model those theories affect the assumptions we must make (identical products, infinite firms, no barriers to entry, those are some big assumptions!)  and the how the tools we use to model those theories affect the generalizations or predictions we can make with our model.

3) What advice would you give to new teachers of simulation about what to do and to avoid?

Just do it.  whether simulation is a small component of a course or the course itself is dedicated to simulation.  Spend time showing how simulation is a unique tool for modeling social processes.  Show how simulation is consistent with theories based on top down maths.  Spend time showing how simulation can provide ways of deepening and creating more elaborate theories on topics that are assumed away in top down models.  Show that it is a generalized approach to modeling with much flexibility for theory building and useful for empirically testing those theories.  As far as things to avoid I can't think of anything.  I have never taught an entire course dedicated to simulation I have only incorporated simulation approaches into my economic theory courses.  Some day perhaps I will teach a course on computational economics and discover all the things to avoid when teaching computational economics. 
 

4) What do you think are the major challenges the simulation community must address in enhancing and broadening the teaching of simulation.

Tools like Vensim (systems dynamics simulation software) and Netlogo (agent based simulation software) need to be seen and accepted as tools as useful as that killer app. called The Spreadsheet (i.e.Excel).  Hopefully as the research communities across the disciplines find ways on furthering theory in their fields based on simulation, find ways of making simulations robust tools for empirical work, and convince all that this is not some approach meant to displace mainstream models or theories, rather it is a useful approach that will help with the development and empirical validating of theory in general.  The first formal game theory text appeared in the early 1940's.  Only over the last 5 years have these models started showing up in principles courses.  I suspect you would be hard pressed to find someone today who would say that game theory is an attack on mainstream economic theory, rather it is seen as a useful framework with its own unique set of subsidiary theories and applications, and its own special place in the textbooks.