Thesis Corner: Tesha Shalon

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A few days ago I had a talk with graduating senior and former Sound Economics writer, Tesha Shalon about her thesis on the impact of low cost carriers (LCCs) in the domestic airline market. In her thesis, she compares the profit and revenue of these airline companies to legacy carriers, who prospered during the airline regulatory era before the late 1970s. Tesha examines the effect of these LCCs on the profit and revenue of legacy carriers, while analyzing the extent to which LCCs’ profit compares to that of legacy carriers. Since deregulation in 1978, airline carriers have been forced to Continue reading Thesis Corner: Tesha Shalon→

Chinese Law May Show Trend Towards Tighter Regulation of Microtransactions

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As I touched on in a previous article, the market for digital items in video games is complex, lucrative, and rapidly changing. One particularly notable change has just come into effect. Last year, a Chinese law was introduced that would require video game publishers to release the item drop rates from in-game “loot boxes”, and as of May 1st this law is now in play. The “loot box”-based model of microtransactions has gained tremendous popularity among video game developers in the last handful of years, with games like DOTA 2, League of Legends, Overwatch, and others making extensive use of Continue reading Chinese Law May Show Trend Towards Tighter Regulation of Microtransactions→

Thesis Corner: Annie Vela

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Alex Shaw (AS): Annie, first, what was your thesis about? Annie Vela (AV):  My thesis was about US government changing allocation of funding from public prisons to public education. AS: How did you arrive at this topic? AV: When Kate (Stirling) asked us to start thinking of a topic over the summer, I started thinking about which of my economics classes I really enjoyed my Urban Economics class with Bruce Mann, which I loved. I’m very interested in how economic policy tangibly affects actual people. So I thought about topics that focused on people, and education is super important to Continue reading Thesis Corner: Annie Vela→

Thesis Corner: Predicting College Attendance

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So three weeks ago, I spoke with Ian Hughes about his thesis, titled: Identifying Socioeconomic Indicators of College Attendance with Classification Trees Much of Ian’s research centered around intergenerational income mobility and barriers to it. Some of the research showed that “low-income students are subject to less college preparation and lower test scores because of their financial situations”, which contributes to more difficulty in using education as a route out of poverty.  Much of the literature surrounding wealth, race, and parental education in connection with children’s college attendance is well established, so Ian included some other characteristics that have not Continue reading Thesis Corner: Predicting College Attendance→

Where is the Craft Beer Market Headed?

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The craft beer market has been heavily influenced by a change in preference for these less recognized beers. There has been a significant increase in demand for craft beer in general in the past five ten years. Independent and small beer producers accounted for 24.5 million barrels two years ago.  This production was a 13 percent rise in volume and led to a 16 percent increase in retail dollar value. Then in 2016, the sales of craft beer increased by 6.2% and saw a 10% dollar sales growth. After examining these statistics, it is evident that this market has seen Continue reading Where is the Craft Beer Market Headed?→

Private vs. Public Investments for Infrastructure: The Constant Battle

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Recently, I discussed why a private investment in building the Seattle arena made sense for the major parties involved (especially the citizens). I have been involved in many heated discussions about why public investments in arenas/stadiums are very frustrating but won’t get to deep into that right now. The main conclusion is that either the city that has the team will cough up the money or the owner will relocate to a different city since the city officials are willing to pay the cost of having the team. The owners will always have the power to have public investment unless there is Continue reading Private vs. Public Investments for Infrastructure: The Constant Battle→

Should We Be Taxing Robots?

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Here’s a question that no one even thought to consider until now- should we be taxing robots? *Before I go much further, I want to make it clear that although the topic of a robotic workforce is a hot topic, I won’t be arguing the morals of the idea but rather the logistics assuming the transition is inevitable. Bill Gates stirred up quite a frenzy when he stated in an interview that robots who take human jobs should pay taxes. If robots begin taking human jobs, the government will begin to lose the tax generated revenue needed to fund their Continue reading Should We Be Taxing Robots?→

Why Should Class Attendance be Optional?

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In economics, a common topic of discussion is opportunity cost, or the value of your next best option given up when you choose something. It is often used to highlight how people make decisions when faced with limited resources, especially scarcity of time and money. One common example is a college education. When most people look at the cost of college, they look at the sticker price on the college’s website, which includes room and board, tuition, and a few other odds and ends. Let’s say that ends up being $30,000, with $20,000 for tuition, $9,000 for room and board, and $1,000 Continue reading Why Should Class Attendance be Optional?→

Expensive Juicers and Two-Part Pricing: A Cautionary Tale

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Over the last decade or so, more and more goods and services seem to be adopting a two-part pricing strategy as a way to maximize their profits. Two-part pricing (also sometimes known as a two-part tariff) is a strategy used by firms with market power in which the price of a good or service is composed of a lump-sum fee, as well as a per unit cost. The benefit of this technique is that firms are able to capture more of the consumer surplus (the monetary gain that consumers get when they are able to purchase a product for less than Continue reading Expensive Juicers and Two-Part Pricing: A Cautionary Tale→

USAFacts: An Injection of Facts

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Have you ever wondered where the US tax revenue exactly comes from and where it goes? To most US citizens the thought of traversing a mountain of US government financial data could seem like a nightmare. But this nightmare is no more, thanks to our friendly neighborhood (former) Microsoft CEO, Steve Ballmer. With the help of economists, writers, researchers from the academic communities, Ballmer was able to compile government financial data into a user-friendly format. USAFacts is this “portrait” of the US tax system. USAFacts is described by Ballmer a “nonpartisan, data-driven” website that provides reports on the US population Continue reading USAFacts: An Injection of Facts→