Sound Economics – Page 83 – Everyday economics from the University of Puget Sound

The Importance of Virtual World Economics

Posted on March 26, 2014 by Collin Hoover — 1 Comment ↓

How much would you pay for a virtual spaceship? Ten dollars? One hundred dollars? One thousand dollars? Try $10,000. Yes, for a virtual spaceship. With online gaming on the rise, what can we expect to see from games like World of Warcraft, Eve, and Second Life? Well there are big spenders, like the hot shots that own Titans in the massive interstellar reality Eve, which go for $10,000. Then there are people who have quit their day jobs to pursue a full-time career in acquiring and selling virtual items. What you have is a free market consisting of potions, laser Continue reading The Importance of Virtual World Economics→

The Market Was Down

Posted on March 25, 2014 by Matthew Moreno — No Comments ↓

Newsmedia commonly personify “the market,” announcing “the market climbed today on news of a stellar jobs report” or “instability in Thailand sent shares tumbling.” Perhaps this simplification is a symptom of the unpredictability volatility of stock prices, a result of broad apathy towards the mechanisms behind the loose moniker “market,” or merely shorthand convenience for journalists. Whatever the cause, the market exists in the public imagination as a mysterious, moody beast. B.J. Novak’s short story “The Market was Down” takes this anthropomorphism to its logical extreme. He writes: “Why was the market down? No reason. Well, stupid stuff. Actually, to Continue reading The Market Was Down→

Obama Reaches out to Young America

Posted on March 24, 2014 by Jared Soares — No Comments ↓

President Barack Obama has been looking for ways to get young Americans to sign up for healthcare under the Affordable Care Act. Recently he appeared on Funny or Die to do a mock interview hosted by Zach Galifianakis (best known for the Hangover). It is interesting to see a President play a comedic role. The Economist follows up on the interview with a few stats to shed light on the trends in health care enrollment. The deadline to sign up for healthcare without a penalty is April 1st and Obama is hoping to get as many people enrolled as possible. Continue reading Obama Reaches out to Young America→

Econo-comic of the week!

Posted on March 14, 2014 by Andrew Monaco — No Comments ↓

No Thesis Corner this week as we head into spring break, so enjoy this one courtesy of Cyanide and Happiness:

Are Local Tax Incentives for Businesses Worth Their Cost?

Posted on March 13, 2014 by Tom Merritt — No Comments ↓

For my senior thesis, I examined how cities react to economic decline. An all too common reaction by local governments is to offer more and more tax rebates and monetary incentives to try to attract large businesses. These incentives can range from sales, corporate, and property tax reductions, to guaranteed loans, and in some cases straight up cash. In total, local governments in the US spend $80 billion a year on business incentives. An article in the New York Times from 2012 paints a good picture of the problem. Now you may say, “Well isn’t it worth it in some cases for Continue reading Are Local Tax Incentives for Businesses Worth Their Cost?→

The Ukrainian Economy: Stuck in the Middle

Posted on March 12, 2014 by Collin Hoover — 1 Comment ↓

On March 1st, the Ukrainian Parliament called on the U.N. security council for an emergency meeting regarding the military actions of Russian troops in Ukraine. President Obama has threatened to place trade sanctions on Russia if the militia are not removed and Putin insists that this force is a response to provocations from Ukraine. Secretary of State John Kerry has promised a billion dollar aid loan to the Ukrainian government. Details are pouring out daily as the event unfolds and all eyes are on Ukraine and Russia. (For those of you who may be confused, check out this link.) Ukraine may have Continue reading The Ukrainian Economy: Stuck in the Middle→

A Glimpse into the Federal Reserve

Posted on March 11, 2014 by Matthew Moreno — No Comments ↓

The Federal Reserve recently released a transcript of their Open Market Committee (FOMC) meeting in September 16, 2008. The FOMC oversees the Fed’s “Open Market Operations,” purchase and sale of bonds; the Fed controls our money supply through this mechanism. It makes sense for the operational arm of the Fed to convene bright and early—8:30am—that day. This meeting took place in the thick of the financial crisis. Chairman Bernanke opened the session: “Good morning, everybody. Sorry for the late beginning. The markets are continuing to experience very significant stresses this morning, and there are increasing concerns about the insurance company AIG.” The Continue reading A Glimpse into the Federal Reserve→

The Risk in Agriculture

Posted on March 10, 2014 by Jared Soares — 1 Comment ↓

The 2014 Farm Bill that was signed into law earlier this year. The Farm Bill puts out nearly $1 trillion ($956 billion) over the next ten years, but only 20% of that goes to farming. Food stamps make up a majority of the bill, but it is the restructuring of farm subsidies that changes agriculture in America. The Farm Bill has changed from Direct Payments to an insurance scheme. Direct payments was originally established in1995. Farmers originally received payments just for having the property to produce on. This was meant to help farmers during transitional periods between planting and harvesting. Continue reading The Risk in Agriculture→

Thesis Corner: Sport Event Sponsorships May Not Be Worth Their Price Tag

Posted on March 7, 2014 by Holly Ross — No Comments ↓

All marketers face the dilemma of how to promote their brand to consumers creatively and memorably. Today, there are so many platforms to advertise ranging from television, internet, print, radio, and out of home (billboards, bus skins, etc). But among competitors making equal or more noise, how how will advertisers get their brand to stand out? Sponsoring a sporting event (sports marketing) is a nontraditional out of home marketing tactic that many companies believe to have profitable commercial promise. But as several companies attempt to insert their brand in arenas everywhere, how much do we undercut the lucrativeness of these Continue reading Thesis Corner: Sport Event Sponsorships May Not Be Worth Their Price Tag→