Trump Delivers on Campaign Promise

Trump has yet to take office and he’s already delivered on one of his campaign promises. Tuesday evening president elect Trump struck a deal with Carrier Corporation to keep 1,000 jobs previously scheduled to be outsourced to Mexico in the United States. Back in February Carrier announced they would close their Indianapolis plant and send 2,000 jobs to Mexico. This announcement was much maligned by Trump and Bernie Sanders whose campaigns were in part built on anti-outsourcing platforms. Both candidates believe that a key to maintaining a strong US economy is to keep jobs, particularly manufacturing jobs which have been Continue reading Trump Delivers on Campaign Promise

Breaking Down Election Statistics

Since the surprising Presidential Election results became official a myriad of theories have come to light trying to explain how or why Donald Trump was victorious. They range from believes that Hillary Clinton never really had a chance to win because a third straight Democratic term was historically unlikely to suggestions that white coastal elites shamed Midwesterners so much (through social media particularly) that it turned them against Democrats – in Congressional and Senate elections as well as the Presidential one. Other theories include 1. America is racist (Obama winning twice, not once, but twice!! makes this one far-fetched in Continue reading Breaking Down Election Statistics

Silent Majorities Aren’t Silent Forever

Yes, this is an Economics blog. But even an econ enthusiast like myself can recognize when to put economics in the backseat for a moment in the face of something much more important. And what can I say, the surprising election seems to be a bit more important. To seemingly all (though in reality only most) pollsters and experts this election was headed in one direction – a clear cut victory for Hillary Clinton. As late as Tuesday morning Nate Silver of Five Thirty Eight gave Clinton a 71.4% chance to win the election. He also gave Clinton an 83.5% Continue reading Silent Majorities Aren’t Silent Forever

Efficiency in Class Registration

We are just about a week away from registration for Spring Term 2017. More than just being an easy topic to bring up to assuage an awkward conversation with that person you aren’t great friends with but somehow find yourself running into often, registration is cool because it gives most students a sense of excitement. I like to think there are two main reasons for this: 1) Most people like to plan, especially when the planning is almost entirely up to them. Registration gives us powerful autonomy, with a few clicks of a mouse we can essentially more or less Continue reading Efficiency in Class Registration

Oregon’s Measure 97

We don’t only vote for Presidents. While we spend much of our time fretting over who the next President will be, we often neglect important local elections and legislative bills. This isn’t necessarily a problem but it is ironic that voters spend more time paying attention to headline grabbing presidential candidate debates and TV appearances than local bills that if passed, are likely to have more impact on their lives than the next President. In Washington this year, the potential bill getting most attention is Initiative 732 which would be the first statewide bill in the United States to place Continue reading Oregon’s Measure 97

And the 2016 Nobel Prize in Economics goes to…

While most of us were sleeping this morning the Royal Swedish Academy of Sciences announced that Oliver Hart and Bengt Holmstrom were awarded the 2016 Nobel Prize in Economic Sciences “for their contributions to contract theory.” Hart, an English-born economics professor at Harvard, and Holmstrom, a Finnish-born economics and management professor at MIT, received the award for improving the design of contracts. Hart and Holmstrom are two giants in contract theory. Though the first formal treatment of contract theory was given by Kenneth Arrow in the 60’s, the pairs’ work, which began in the 1970’s, helped establish contract theory as Continue reading And the 2016 Nobel Prize in Economics goes to…

Could Private Universities Face an Adverse Selection Problem?

George Akerlof’s ultra-famous paper “The Market for Lemons: Quality Uncertainty and the Market Mechanism” introduced adverse selection as a consequence of information asymmetry. Akerlof noticed that in markets where sellers have more information than buyers, the average value of the good tends to go down, even for those of high quality, which causes sellers of high quality goods to exit the market eventually leading to a market collapse. Buyers are weary that unscrupulous sellers may be looking to rip them off so they avoid buying higher quality goods, “peaches,” and instead only buy ones of lower quality “lemons.” Since they Continue reading Could Private Universities Face an Adverse Selection Problem?

Advertisers and Social Media: The Endless Struggle

Facebook is under considerable scrutiny from angry companies that use its platform to advertise to its users. What has them upset is Facebook’s two-year long deliberate embellishment of the reported length their users spend watching ads. By not counting video views of less than three seconds, Facebook’s metric overestimated how long users watched ads on the site. This allowed Facebook to charge firms more to advertise on its platform than it otherwise could have en route to generating $5.2 billion in ad revenue in the first quarter of 2016. Companies are understandably upset because the length viewers watch ads on Continue reading Advertisers and Social Media: The Endless Struggle

A Lesson in the Marginal Value of Time

It’s nice to see that someone understands the value of time, or should I say, the marginal value of time. A recent article on Bleacher Report described Urban Meyer’s return to coaching football after health issues due to excessive work forced him to leave Florida, where his teams went 65-15 and won two nationals championships, after the 2010 season. Meyer is now the head coach at Ohio State, where he is reportedly in good health and happier than ever. According to Meyer the secret to his health and happiness is a balanced life. He’s replaced eighteen hour work days for Continue reading A Lesson in the Marginal Value of Time

What Increasing the Federal Funds Rate Means for the Stock Market

Since the Great Recession rocked the U.S. and world economy in 2007, the federal funds rate in the U.S. has been at or near zero, falling from its pre-recession level of 5.25%. The hallmark of post-recession years has been the Fed’s strict adherence to low interest rates for fear that raising them could send the United States back into a recession. But now, this period may finally be coming to an end. For the first time in nine years interest rates may be set to climb as Janet Yellen announced at the Fed’s annual Jackson Hole meeting two weeks ago Continue reading What Increasing the Federal Funds Rate Means for the Stock Market