Lawrence Economics Blog

Creative Instruction

Are You Ready for Some Econ?!?

It’s come to my attention that many of you have not registered for Spring term.   You can’t be serious!

Here’s what’s in store:

  1. Professor Galambos: Econ 100: INTRODUCTORY MICROECONOMICS (Q) 12:30-02:20 TR
  2. Professor Karagyozova Econ 120: INTRODUCTION TO MACROECONOMICS (Q) 11:10-12:20 MWF BRIG 223 09:50-11:00
  3. Professor Galambos Econ 180: ENTREPRENEURSHIP IN THE ARTS & SOCIETY (S) 09:00-10:50 TR
  4. Professor Gerard Econ 240: POLITICAL ECONOMY of REGULATION (W) 03:10-04:20 MWF
  5. Professor Gerard Econ 280: ENVIRONMENTAL ECONOMICS 09:50-11:00 MWF
  6. Professor Finkler Econ 320: MACROECONOMIC THEORY (Q) 09:50-11:00 MW and  08:30-09:40 T
  7. Professor Finkler Econ 425: ENTREPRENEURSHP & FINANCIAL MARKETS 12:30-02:20 TR
  8. Professor Karagyozova Econ 460: INTERNATIONAL ECONOMICS (G,Q) 01:50-03:00 MWF

Count ’em, two courses on entrepreneurship, a new 400-level chance to take International, and my new writing-intensive course on the political economy of regulation.   If you are itching to take that one, signal your interest by getting on the waiting list.

The schedule for next year is up on Viking as well.  Start planning ahead if you need to fill those econ boxes.

Economics TBA — today at 4 p.m.

After a scintillating weekend up north, we are back for the home stretch of the second term.  And what better way to finish a Monday than TeaBA with the economics faculty and students?

Today will be the Oliver Zornow Tea, for his spectacular finish in the this weekend’s game theory tournament.  Today’s cookies are courtesy of Mr. Zornow.

We will also hear a presentation from a group in The Economics of the Firm (Econ 450), examining the role of the football coach in the division III schools.  Can we measure his performance in terms of wins and losses?  Or is it a multi-attribute principal agent model?

Should be a corker.  See you there.

Zornow wins Lawrence Economics evolutionary game tournament

Many of us just returned from Björklunden, where we spent the weekend talking about game theory, outsourcing at Lawrence and elsewhere, and the economies of Monterrey, Bangalore, Seattle, and Johannesburg. And we enjoyed late (?) winter in Door county, as well as Georgi’s guitar playing and Sunghun’s piano music.

We also held the first Lawrence Economics evolutionary game tournament. This competition follows in the tradition started by Robert Axelrod, who organized a computer tournament in the 1970’s to see what kind of behavior will be most successful in an evolutionary game. Participants entered strategies (described as algorithms), and each such entry became an agent in Axelrod’s world. These agents met randomly and played the prisoners’ dilemma game. Our competition also featured random encounters and the prisoners’ dilemma game.

Though many were betting on strategies such as “sneaky” and “defector,” in the end Oliver Zornow’s “foolfor7” took the $25 prize, to be awarded at Monday’s Econ TeaBA. “Foolfor7” started alone but reproduced faster than any other strategy, and avoided being exploited with its trademark “fool me 7 times, shame on you, fool me 8 times, shame on me” approach to life in a squareful of pixels. We used the fun, convenient and easy to learn Netlogo software to run the simulation. If you’d like to play with the parameters and check out how the various strategies would fare in different populations, download the free netlogo software and open this Netlogo file (download the zip file and double click on it to unpack it).

Free and fun agent based model simulator

Pareto Improvements, Film at 11

Tom Hazlett continues to beat the drum to auction off the spectrum.   What does that mean?

Professor Hazlett estimates that selling off this spectrum could raise at least $100 billion for the government and, more important, create roughly $1 trillion worth of value to users of the resulting services. Those services would include ultrahigh-speed wireless Internet access (including access for schools, of course) much improved cellphone coverage and fewer ugly cell towers. And they would include other new things we can’t imagine any more than we could have imagined an iPhone just 10 years ago.


What’s the downside?

Off to Björklunden

The faculty and students are headed to the great whitish north for its (first annual) departmental retreat, featuring presentations from Economics of the Firm (my personal favorite),  Game Theory, and Urban Economics courses.     It’s not too late to sign up.

Speaking for the economics of the firm course, there will be presentations on:

*** why Lawrence outsources its food service (can’t we do this ourselves?)

*** why Lawrence has its own campus security (why not use a professional security company?)

*** why Lawrence has its own vehicles for student use (why not use Enterprise?  They pick you up!)

*** why universities have endowments, and how reliant Lawrence is on its endowment (I’m not sure, and I don’t know… looks to be a good one)

    If you can’t make it this weekend, we hope to see you Monday for tea!

    “the secret, multibillion-dollar systems that U.S. intelligence agencies use to monitor the communications, transactions, and associations of people in this country and around the world”

    Slate.com has an extended dialog with Shane Harris, the author of The Watchers: The Rise of America’s Surveillance State.   Here’s the prelude:

    The Watchers is really a book about [Admiral John] Poindexter, the visionary Ph.D., former national security adviser, disgraced Iran-Contra conspirator, and father of one of the most far-reaching and reviled surveillance initiatives of the post-9/11 era, Total Information Awareness. The Bush administration gagged Poindexter when TIA ignited a firestorm in Congress in 2003, and after being removed from his position at the Defense Advanced Research Projects Agency (the Pentagon’s R & D shop, known as DARPA), the admiral appeared to recede from the national stage. But he gave you unprecedented access—14 long interviews about his philosophy and career—and in your book, he emerges not as the caricature civil libertarians have come to know and loathe but as a nuanced, surprisingly sympathetic character.

    I’d imagine this is an interesting piece for folks interested in organizations or regulatory policy generally.   I look forward to reading this one.

    Checking Your Financial Plumbing

    At the recent Lawrence Scholars in Business banking summit, alumnus Rob Bearman suggested that a young person interested in a career in banking would do well to learn all s/he could about the recent financial crisis.   He suggested Andrew Sorkin’s Too Big to Fail as a good start.   Another place for a more academic flavor is the recent Journal of Economic Perspectives Symposium on Financial Plumbing.

    The list looks like a good place to start an independent study project.  I can’t speak for the quality of the articles, except to say that the JEP authors are generally recognized area experts, and the pieces tend to be very readable and heavily documented.

    Enjoy!


    Innovation & the World Economy

    That’s the title of Robert Litan’s speech from the Foreign Policy Research Institute, and it is a crisp and interesting read.  Here’s a taste:

    Entrepreneurs are vital to the economy not only because of the innovations they bring to the market, but also for the jobs they create. The Kauffman Foundation sponsored a study recently to look at the source of job growth in the United States since 1980. The conclusion is remarkable, or at least I believe it to be. Since 1980 until the recession, all net new jobs—net meaning gross jobs minus layoffs — have been created by firms under five years old. Think about that. That means all existing firms as of 1980 have not increased their employment since that year. In fact, if anything, the firms that existed in 1980, as a group, have lost employees. Using these data, we have made a rough estimate that at least 1/3 percent of our employment and a somewhat smaller fraction of our GDP since 1980 is due to young new firms that have since grown. These are amazing facts.

    The piece contains some nice blurbs about the difference between state-guided capitalism, managerial capitalism, and entrepreneurial capitalism.   These concepts seem to follow the Schumpeterian notion of innovation, which is why it’s important to understand Schumpeter (!)

    The Nature of the (Urban) Farm

    From our pals over in Environmental Studies:

    Does meeting with fellow students and faculty to talk about running a farm in the ghettos of Oakland, dumpster diving to feed pigs, and corralling runaway turkeys in downtown Oakland sound like fun?

    During the Spring term  Green Roots and the Environmental Studies program will be sponsoring a for credit campus read program.  The book is Farm City: The Education of an Urban Farmer, by Novella Carpenter.  Her work covers topics including sustainable agriculture, urban communities, and healthful eating.  As a special treat, the author will be in the Fox Cities in mid-April, just before Earth Day!

    Contact Andrew Knudsen knudsena@lawrence.edu or Jason Brozek jason.brozek@lawrence.edu for more information.

    The New Palgrave Encylopedia of Economics, Redux

    While dredging through Steven Landsburg’s excellent, yet interminable, chapter on perfect competition, we took a brief break to contemplate the Austrian critique paused to think about some of the Austrian critiques of the competitive model.   To wit:

    The trouble with the concept from the Austrian point of view… is that it describes an equilibrium situation but says nothing about the competitive process which led to that equilibrium. Indeed, it robs the firm of all business activities which might reasonably be associated with the verb ‘to compete’ (Hayek, 1948). Thus, firms in the perfectly competitive model do not raise or lower prices, differentiate their products, advertise, try to change their cost structures relative to their competitors, or do any of the other things done by business firms in a dynamic economic system. This was precisely the reason why Schumpeter insisted on the irrelevance of the concept of perfect competition to an understanding of the capitalist process.

    That passage, of course, is from The New Palgrave Dictionary of Economics, which is one of the fabulous economics resources offered through The Mudd.

    Having trouble with the Principal-Agent Model? Wondering about empirical work on the make-or-buy decision?  Need a quick primer on health economics or the ins-and-outs of the logit model?   This might be a good starting place.

    The Cartoon Introduction to Economics

    Well, the future of pedagogy has arrived in the form of The Cartoon Introduction to Economics. If you’ve ever wondered what economics would be like if someone with a sense of humor was teaching you, this might be the book for you. I have a copy if you are interested in coming by and taking a look at it.

    Professor Bauman will be on campus April 26 to promote his book and maybe to help us to understand economics a little better.

    Here’s a bit of his stand-up act. I find it laugh-out-loud funny in parts, but worry that he’s right about the Snickers bar.

    The Gales of Creative Destruction…

    Well, the good news is that the new site architecture is in place and it looks pretty fabulous  — thank you toschumpeter Jay Dansand and the gang for transporting the site.

    The bad news is that some of our pithy posts from last week have been vaporized.

    Overall, I judge the change to be Kaldor-Hicks efficient but not Pareto improving.   And, again, if you find this sort of joke amusing, you might consider subscribing to the RSS feed.

    On the right there, just because we can, that’s Joseph Schumpeter.

    Free Market Environmentalism

    If you are interested in how economists make extensive use of markets to address environmental questions, you might be interested in attending the one week symposium in June put on by PERC (Policy and Environmental Research Center.) Furthermore, PERC provides funding to cover the costs of the program and a portion of the travel expenses to Montana. Last year, Tam Dao attended and really enjoyed it.

    http://www.perc.org/enviroprog/students/fme/basics.php

    Koch Summer Internship Opportunity

    2010 Summer Internship Opportunity

    Are you interested in a paid internship that will give you the opportunity to gain valuable work experience in Washington, D.C.? Applications are now being accepted for the Koch Internship Program.

    The Koch Internship Program is a paid opportunity for young professionals with an interest in free-market ideas to gain the tools to be more effective advocates for liberty. The program seeks to engage interns through substantive roles within think tanks, policy institutes, and grassroots organizations. In addition to the professional experience, interns also are challenged through weekly seminar-style management training. Internship roles include: policy research & analysis, marketing & communications, grassroots education, and donor relations. Summer interns earn $13.00 an hour.

    Interns who participate in KIP should expect to:

    * Deepen their understanding of free-market ideas;

    * Develop professional skills;

    * Explore opportunities to advance liberty throughout their careers;

    * Build a network of like-minded colleagues, through interactions with speakers, staff, and other interns;

    * Be challenged through the semester!

    The application deadline for the Koch Internship Program is March 1, 2010. For complete program information please visit our website www.cgkfoundation.com.

    Careers in Advertising, Marketing and Branding

    Marketing America’s first carbon neutral beer; Creating a winning Superbowl ad; Apple: Shattering expectations, exploding orthodoxies, making nice; Branding the tallest building in the world; Creating a highly profitable, award-winning, new restaurant which helps to change the way people eat … for the better. Does any of this sound interesting to you? See some great, multimedia presentations on these topics from Lawrentians who are at the top of the marketing world, and find out more about careers in marketing, advertising, and branding. Whatever your background, you may find marketing interesting and profitable, but these careers fit especially well for students from Arts, Music, Psychology, Anthropology, English, Economics, and social science generally.

    Join us Sunday, February 21st at 3:00pm. Sign up in the Career Center or by email at careercenter@lawrence.edu. If you’d like to join the group for dinner in Andrew Commons afterwards, sign up for that, too–we’ll pay for dinner! Here’s a poster for the event!

    EconOlympics, Cont.

    There’s another piece up at Slate.com about economics of the Olympics. This time, it’s Colorado College’s Daniel Johnson continuing research project — simple econometric specifications to predict medal counts. The explanatory variables are the number of country medals as a function of population (+), per capita income (+), climate (colder is better), political variables (openness not necessarily a good thing), and the host-nation advantage.

    The upshot? Canada 27, the US 26, and Bangladesh 0. The predictions are also broken down by gold, silver, and bronze.

    Here’s the Slate piece.

    Economics Tea with Corry Azzi, Today at 4 p.m.

    Rumor has it that Professor Azzi will be stopping by for tea and conversation.

    More than likely, “subtle” is one of the last adjectives that springs to mind when a description of economics professor and alumnus Corry Azzi is needed. In a world fashionably attired in grays, Azzi, ’65, prefers going through life dressed to the nines in blacks and whites.

    ….

    A willing combatant on the academic battlefield, he revels in the good fight. He doesn’t suffer fools easily and spouts sentences that sound like a talk radio host audition: “We’ve put such a value on open-mindedness that we think the uneducated and the ignorant are sophisticated.”

    Peek beyond the bluster, however, and you will find an award-winning teacher, loyal friend, and most importantly, a nurturing mentor.

    Who knew?

    We will also be discussing the Bjorklunden weekend, the winter Olympics, and whether 4 p.m. is too late for “morning thunder.”

    See you there!

    Internets Down in Briggs, Monday 9 a.m.

    The internet is down and so for those of us who spend time engaged in cyberspace, there has been a flight to [generally lower] quality. No word on it’s expected return except the always reassuring, “they’re working on it.”

    If you need an economist, you might be forced to go to Briggs 2nd and bang on a door. I’ll see my 300 class at 9:50.

    We will see you for tea at 4 p.m., somewhere on Briggs 2nd. Start at the Fish Bowl and then work from there.

    UPDATE: Never mind.