Econometrics: A Difficult Tool

Econometrics an important tool for economists to explore relationships between different aspects in society and measure causality. I like to think it is more than a way to confuse new econ majors and scare off the less mathematical inclined ones. But by combining statistical and mathematical methods, econometrics can be used to answer economic questions such as the progress of African Americans. Russ Roberts and James Heckman discuss this topic as related to econometrics on Econtalk and how this method can be trouble for more than just undergraduates. Heckman sheds light on the African American progress measurement and brings up the issue Continue reading Econometrics: A Difficult Tool

2008 Financial Crisis Under the Magnifying Glass

It may be almost a decade after the 2008 financial crisis shook the US economy, but economists and financial managers are still trying to snuff out the causes of this pandemic. The idea of a “housing bubble” has been used to describe the confusion and ignorance around the risks of the housing market leading up to the collapse. This concept connects many different pieces within the US housing market, from borrowers to lenders to big players on Wall Street. But it is difficult for economists to pinpoint one key cause of this crisis. So the magnifying glass has been placed Continue reading 2008 Financial Crisis Under the Magnifying Glass

The Why Axis: Innovation is Key

Chapter 10 of the Why Axis discusses the reason behind many people’s willingness to give to nonprofits and how this changes the way these nonprofits run their companies. The chapter starts off by telling of a child who was the star of a 2008 Academy Award winning documentary entitled “Smile Pinki.” This child from India, Pinki Sonkar was born with a cleft lip and faced many hardships early in her life because the way people treated her. But one day she was introduced to a doctor employed by a nonprofit who agreed to preform surgery to rid of this problem. Continue reading The Why Axis: Innovation is Key

Argentina’s Tale of Debt Struggle

Argentina has been the center of global discussion for the past 14 years. No, it’s not because of its amazing soccer players or its spectacular waterfalls. The reason that Argentina has been the topic of debate is due to its decision to simply not pay back it’s debt of $100 billion. Argentina saw it could not provide the government services that their people needed, so they told the world they were going to sweep their debt under the rug. How do global entities and foreign lenders deal with a country that refuses to pay back their loans? Well, Argentina’s investors Continue reading Argentina’s Tale of Debt Struggle

How Much Luck Do You Have?

How does luck play into one’s success? When thinking about successful men and women, the fact that luck could have played a role in the road to success isn’t always brought up. This isn’t to say that successful people haven’t worked hard to get to where they are. But there are some people who possess hard-working qualities and superior knowledge, who do not catch a break. It possible that people “underestimate” the amount of luck that plays into their success and the success of people around them. If we take a look at the success of an athlete like, say Continue reading How Much Luck Do You Have?

Moral Hazard and Health care

Moral Hazard is a term that Economist are familiar with when discussing market failures, or the inefficient allocation of resources. The definition of moral hazard is when there is hidden action taken by one party that incurs costs of another party. But this is just the definition of the term, what does moral hazard truly mean in everyday life? One example that is brought up a lot is when an auto mobile owner becomes more of a reckless driver and justifies it by saying, “It’s fine, I have car insurance.” Obviously auto insurance doesn’t quite work this way, but moral Continue reading Moral Hazard and Health care

The Minimum Wage Movement

New developments in the debate of minimum wage increase have revealed themselves and this time it’s the whole state of California to become apart of this movement. I have discussed in one of my previous posts about the predicted advantages and disadvantages of hiking up the minimum wage. As I previously reported, San Francisco and Los Angeles were among the cities to be outlining plans to drastically increase the minimum wage over the next few years. San Francisco was one of the cities to pioneer the way for minimum wage increase as citizens voted in Proposition J in 2014 which Continue reading The Minimum Wage Movement

Middlemen: Connecting Consumers and Producers

Most of what people think about when the term “Middleman” is brought up, is somebody who doesn’t provide much value. Why hire a middleman when you could do the job yourself? Even today when the internet has lowered search and transaction costs, it seems as if the job of a middleman would soon disappear. But this notion may not be true. Middlemen provide a service of efficiency which does have value in itself, but some argue that this job will become obsolete as the internet is more widely available today. The cost of searching for an item has gone down Continue reading Middlemen: Connecting Consumers and Producers

Why Study Economics? Interview: Layth Sabbagh

A few weeks ago I interviewed sophomore and economics major, Layth Sabbagh and got his take on economics. He discussed many aspects of economics that he liked and thought were interesting. We also talked about what pushed him to pursue a degree in economics and how he intends to use this knowledge in the future. Layth grew up in Dubai and lived in Syria for a few years, where much of his family is from. When I asked him about why chose economics, he said that he “likes the social sciences” and that economics “feels less intrusive” than other social Continue reading Why Study Economics? Interview: Layth Sabbagh

Video Games: Just a Plastic Disk

For all those Xbox, PlayStation, Wii owners out there, have you ever thought about why your video games cost you so much these days? The average game costs about $60 when it is first released and can go to about twice that if it includes bonus material. But if you think about it, the actual game is just a plastic disk. It can’t be that difficult or costly to produce. But you guessed it… individual games for consoles such as Xbox or Playstation actually have huge budgets. In 2014 Activision, a popular video game developer, announced that one of their Continue reading Video Games: Just a Plastic Disk