Not Cutting It: Corporate Subsidies Abound as Amazon Looks for HQ2 Spot

Today is the deadline for cities to propose their bids to Amazon in hopes of hosting their new headquarters. The ever-growing corporation promises “up to 50,000 jobs paying an average of $100,000”, and cities all over the United States and Canada want this boost in their economy. All of the cities making a bid can be found here. But what price will these cities pay to get it? Corporate subsidies, or breaks on taxes and other concessions, is what city governments use to entice a company into setting up operations there. Is this big spending worth it for the long-term Continue reading

Time for a Change: Americans Support a Carbon Tax

Let’s start this article off by saying, while I can’t say that scientists have proved climate change is real (nobody can really prove anything, even economists and scientists), I think the evidence is convincing enough that even if only 97% of scientists believe in anthropogenic climate change, we should probably still do something about it. 81% of climate economics experts believe that a market solution is critical, given that climate change has been called “the greatest market failure the world has seen,” by Nicholas Stern, an economist and climate researcher. Essentially, there are three economic problems occurring with regard to climate Continue reading

Western Colonialism, a Pacific Island, and Property Rights

The Republic of Nauru, formerly known as Pleasant Island, is a remote, 8.1 square mile island nation that is located in the Micronesian archipelago. Approximately 200 miles East of Kiribati, the island was originally settled around 1000 BC by the Micronesian and Polynesian people. They remained isolated on the island for nearly 3000 years until in the late 1700’s a British whaling ship, captained by John Fearn, discovered the island and gave it its original name, Pleasant Island. It wouldn’t be until 1888 that the island would see its next visitors when Germany annexed the island nation, as part of Continue reading

Life on the Margin: How to Make Optimal Decisions and Maximize Utility

Anyone who has taken an introductory Economics course has probably heard that optimal decisions are made at the margin. This is a foundational concept in Economics, but it can be confusing for those who are unfamiliar with Economics jargon. What is the margin? How do you know if a decision is optimal? Here is an example to illustrate the concept: Consumer A has some free time and wants to figure out how to spend it. A new episode of a television show she likes has just become available to stream. It would take an hour of her time to watch Continue reading

Brandless Part 2: Tasteless Or Ostentatious?

This week’s post will be about my review of the food I ordered from Brandless, along with my revised thoughts on this quirky online company. For context, my previous post about Brandless can be found here. My classmates and fellow writers on this blog helped clarify for me why this website gives us such an odd feeling, and what it says about the consumption behaviors of millennials today. But first, my review. Last Wednesday, I made an order on Brandless’s website. They offer a $3 shipping cost on your first order, compared to the regular $9 shipping. (Once I placed Continue reading

Arrow’s Impossibility Theorem: Can We Hit a Societal Bullseye?

Many students have expressed discontent with our current voting system, especially as it relates to the ideas of “choosing between two bad options” or “wasting your vote” on a third candidate. Many articles, bills, and petitions have called for electoral reform, along with celebrities such as Lady Gaga. In this article I will go over the economic idea of a social choice rule, or mechanism which describes how we can move from individual preferences to group preferences, or social preferences. For a primer on the economic idea of preferences, see last week’s post, Accounting for Taste: Ice Cream Preferences. One of the best articles Continue reading

Demand Without a Brand: Online Grocery Store Eliminates “Brand-Tax”

You may have heard of Brandless, the e-commerce startup launched this year. The San Francisco-based company, founded by entrepreneurs Tina Sharkey and Ido Leffler, flaunts online groceries and essentials with an enticingly simple pricing model: everything is $3 or less. Why is it called Brandless? The inspiration for this online grocery store, Sharkey says, was the so-called “brand tax” (additional costs for shipping, warehouse space, etc.) on traditional consumer packaged goods (CPGs). In addition, Sharkey makes the claims that millennials don’t want to buy their parents’ brands and that there is an overwhelming variety of choices in grocery stores today. Continue reading

Accounting for Taste: Ice Cream Preferences

As a social scientist, I would just like to come right out and acknowledge my bias. Between chocolate, vanilla, and strawberry ice cream, chocolate is my favorite, followed by vanilla, then strawberry.This article is intended to explain a fundamental concept in microeconomics, consumer preferences, using a sweet example. To model consumer behavior, economists look at how consumers make comparisons between goods. Briefly, some notes on notation. If I said, “I like chocolate better than vanilla ice cream,” it would be written as Chocolate ≻ Vanilla. (Note, ≻ is not the same as >, which is used for ordering preferences) If I Continue reading

Intellectual Property Laws in the Pharmaceutical Industry: Facilitating Monopolies or Catalyzing Innovation

“Wherever the Art of Medicine is Loved, there is also a love of Humanity.” -Hippocrates Typical notions of healthcare and medicine are intrinsically linked to benevolence. After all, the modern Hippocratic Oath states that, “I will prevent disease whenever I can.” It seems strange then that the total nominal spending on medicine in the U.S. exceeds $450 billion annually while the global pharmaceutical market is predicted to reach an annual value of $1.12 trillion by 2022. This paradoxical relationship between medicine and profit-maximizing firms begs some interesting economic questions, specifically how the drive to maximize profits impact the consumer’s well-being. Continue reading

Tesla’s Battery Update: Price Differentiation Tactics Revealed

In early September, 2017 the car manufacturer Tesla released an update that would extend the battery life of some models of its cars for customers in the hurricane Irma evacuation zone. According to a report by NBC News, the update would give owners of certain Tesla models the ability to drive an additional 30 to 40 miles without needing to charge. The aim of the upgrade was to help people escape the effect of the hurricane during a period when electricity and time for charging would be difficult to come by. Initially, this upgrade appears to be a great benefit Continue reading