Author Archives: Lorraine Black

As a disclaimer, I am not against careers in finance. I plan on pursuing one myself. Where a student goes with their qualifications and talents is a greatly personal decision. I’m not a senior, but I know many students who are. The stress of graduating and moving on to the next stage in your life can be exciting, terrifying or both. Many students are already making employment decisions before they even walk across the stage and get their degree(s). As an economics major, I’m no stranger to the assumptions made by my family, peers and even myself that I’m going to pursue Continue reading Is Going into Finance the Best Use of Your Skills?→

You’ve probably heard about/experienced the many hardships of being a college* student (and the perks!). Many of the struggles students encounter while going through college can be boiled down to one thing: tuition. College is expensive, pretty much no matter where a student enrolls. As of 2013, about 70% of college students graduated with an average of $28,400 in debt. Why is tuition so high? When I still lived in my hometown of Sacramento, CA, UC Davis students were constantly protesting tuition hikes and class cuts. Many were essentially paying a ton of money to try and take classes they couldn’t Continue reading Why Is College So Expensive?→

In many economics classes, technology is seen as a positive: more advanced technologies being used in production can lower costs and increase efficiency. Firms that are on top of their industry’s respective tech tend to be more successful. People also love technology in their social lives: social media, communication and news are one and the same now, with every aspect of your life weaved seamlessly into one device. While technological advances are seen as positive in most social environments and economic markets, it might not be so great for the job market. According to Michael Osbourne of the Oxford Martin Programme on Technology and Continue reading Are Robots Going to Take our Jobs?→

Most stores have strict rules and regulations they follow when it comes to shoplifting. The purpose of loss prevention departments is to spot thieves and recover stolen items. When a person is caught or suspected of using the five-finger discount, many stores have the very limited right to make citizen’s arrests and/or search the individual (e.g. shopkeeper’s privilege). However, some stores are no longer arresting or searching suspected shoplifters, but instead giving people a choice: they can take a $320 class and walk out scot-free, or the store calls the cops. The Corrective Education Company (or CEC) is a Utah-based business founded Continue reading The Shoplifting Fee→

Most people remember Beanie Babies: the cute floppy animals stuffed with beans. There were hundreds of kinds at the height of their time: dogs, cats, bears, fish, squirrels, etc. They were a huge part of late 90’s culture, and many Americans were desperate to have them. American adults… not children. In 1998, Beanie Babies had sales of $1.4 billion. Stores that carried Beanie Babies were being mobbed by collectors and sold out in days. People were investing their childrens’ college funds into them, and dedicating their time to day trading stuffed animals. It was madness. Why were people pouring their life savings Continue reading When the Beanie Baby Bubble Burst→

In 1982, Nobel Prize winning psychologists Amos Tversky and Daniel Kahneman conducted a study of how framing affects decision-making. They created a scenario and asked two groups of participants to choose the program that was most optimal. This scenario was called the “Asian disease problem” and it yielded surprising results. Try it for yourself: “Imagine that the U.S. is preparing for the outbreak of an unusual Asian disease, which is expected to kill 600 people. Two alternative programs to combat the disease have been proposed. Assume the exact scientific estimate of the consequences of the programs are as follows”:   Continue reading The Science of Decision-Making: Framing→

Every day we use our brains to interact with other people, solve problems and make decisions. Every decision we make has a potential impact on our next decision. A certain decision, and the outcome that follows, could stick with you long after the decision was made and unconsciously determine your next. To make decision-making more efficient, your brain creates mental shortcuts to help you make the right decision faster. These mental shortcuts are called heuristics, and are a main theme of behavioral economics. Heuristics are deviations from rationality formed by previous experiences. Instead of relying on the information at hand Continue reading The Science of Decision-Making: Heuristics→

Japan is in its second recession in the past two years, as its economy has contracted for the second quarter in a row. GDP decreased 1.6% from July 2014 to September 2014, despite forecasts of an increase of 2.1%. In 2013, Japan printed out hundreds of billions of dollars in yen to buy government bonds. It was an attempt to balance the budget, and while it gave the appearance of economic growth, it lowered the value of the yen. Merchants sat on the wealth and didn’t distribute it to workers. Japanese incomes began to stagnate and/or decrease. Lower wages, compounded with increased Continue reading A Quick Overview of Japan’s Current Recession→