Tuesday, 24 December 2013

Ideology and economic thought

by Jaime Bravo

Brenna made a response to my article - see here. She wrote some arguments that were supposed to refute my theories on austerity and public spending. But there are, yet, arguments to be said. She tried to build a model mixing up economics and politics; she even quoted paragraphs of the American Constitution. This is not of my concern in here. But still, I have something to say about what she wrote.

Thursday, 5 December 2013

In Response to Jaime

By Brenna Fisher 
Her author profile can be found below this article.

A few weeks ago, Jaime Bravo wrote an article refuting my stance on reducing the United States’ federal deficit. After reading his article and doing some more research of my own, I stand by my position of reducing the government debt. It is very clear that he is an intelligent young economist and has done ample research into the subjects on which he writes. I respect his opinion and his work; it would be foolish to try and claim otherwise. However, I cannot agree with, or condone, the examples or solutions he poses in response to my article.

First off, I would like to address some of his rebuttals to my points. Jaime seemed to generalize from my article that I believe all government spending is wrong and all debt should be eliminated. He states, “She assumes (by writing this article) that debt is a problem and that therefore, we should cut it.” However, never in my original article did I claim such a thing. Government spending is a crucial component to Gross Domestic Product and necessary to keep a country strong and expanding. Whether it is the federal government or the states individual responsibility to spend money on programs for education, transportation, and technological process is a long debated issue but, in the end, it should not be eliminated permanently, and a moderate amount is healthy. The government deficit should not be entirely eliminated either, but balanced with budget surpluses to create a more evenly equitable budget. Some government debt used to encourage GDP growth is good; 17 trillion dollars worth of debt, of which a majority is being spent on social welfare programs, is not. I have yet to read any concrete evidence of how an exorbitant amount of money spent on welfare programs profits the country in the long run.

Opportunity Cost in the College Decision

By Michaela Miller
Her author profile can be found below this article.

There's another one, an innocent-looking envelope sitting in my lap, just waiting to be opened. I've sorted through all the other mail, the advertisements, the catalogues, the bills (thankfully not mine), trying to forget its presence but to no avail. It taunts me with its computer-generated cursive printing and its happy, fall-colored exterior. "Dream" it says on the front! Encompassed in that simple word are the endless possibilities open to me if I a
ttend Vanderbilt University. The only problem? This is probably the tenth college brochure I've received in the past two weeks, all full of normative statements about the large amount of utility students get from attending the advertised school, all claiming my worth as human capital will be exponentially increased should I attend whichever college the brochure represents. I finally overcome my reluctance and open the packet, only to discover exactly what I knew I would find: yet another potential college further confusing my decision of where I should go.

Wednesday, 4 December 2013

How will online education affect demand for traditional colleges?

By Anna Mitchell 
Her author profile can be found below this article.

For decades, the image of an ivy-coated Gothic turret on a perfectly groomed campus has popped into people’s minds when they imagine an ideal education. Colleges are supposed to churn out legions of innovative and intelligent leaders, the people who will change the world with new technologies or policies. Their graduates should be equipped with unique ideas that they could only form thanks to their post-secondary educations. But increasingly, this ideal isn’t depicting reality. A change in the price of a substitute good, online education, has decreased. While online colleges such as the University of Phoenix have existed for years, only in the past two years have online college courses from top schools been offered for free. With this decrease in price of the substitute good, demand for expensive educations, especially from lesser-known schools, may start to decrease. In response, schools may be forced to lower their tuition or improve their product to compete.

Tuesday, 3 December 2013

Why Lloyd Shapley was Wrong

By Michaela Miller
Her author profile can be found below this article.

Lloyd Shapley (right) won the Nobel prize for economics in 2012 alongside Alvin Roth (left).
Image credits to The Guardian (UK).

Now heading into my eleventh grade year, I can finally begin to appreciate the amount of stress that accompanies students of this age. As if nine classes, the SATs, and a job weren´t enough, it is in this season that I will be forced to think about that dreadful thing they call college. Now don´t get me wrong, I´m excited for college. I want to meet people my age with the same interests and goals, I want to root for the team, and I want to figure out the rest of my life. I´m just not all that excited about the hours of stress involved with the admission process. Why do I have to worry about this now, when my time is a scarce good? If only the process was something a bit more like the 2012 Nobel prize winner Lloyd Shapley´s suggestion... right?

“Walmart is good for you!” Oh, really?

By Stephanie Canavan
Her author profile can be found below this article.

With the holidays approaching, one can hardly turn on the TV without being bombarded by commercials shouting that their store has the best deals and lowest prices. Perhaps one of the loudest culprits of these holiday season adds is Walmart. Long known for its low-price guarantees, Walmart is a front runner in boasting its benefits toward your microeconomic holiday family budgets. But from a macroeconomic perspective, Walmart can have less than positive repercussions for the economy as a whole. I recently read an economically faulty article, written by Tom Van Ripper, entitled “Walmart is good for you” which presented an alternative opinion, supported with scanty facts and jumpy assumptions.

Tom Van Ripper began his argument on a foundation of sand, basing virtually his entire debate on the misguided conclusion of a recent study which stated “between 1985 and 2003, personal income, overall employment and retail employment grew faster in counties with a Walmart than in those without one.” The lousy economist incorrectly placed assumptions that because of this finding, Walmart must be the sole beneficiary force causing these positive economic happenings. In fact, there could be a myriad of other factors that caused this economic growth, such as higher investments in education or monetary policies. Van Rippers article continues with more misused statistical proof by quoting a statement from the Federal Reserve “Nearly 90% of the U.S. population lives within 15 miles of a Walmart store, and two-thirds of all retailers are located within five miles of one, the Fed’s report says.” Simply because the Federal Reserve released this statement does not mean it can be used as evidence towards the economic benefits of Walmart. Conversely, this statement simply shows the vast spread of the Walmart enterprise and how greatly such a behemoth could affect the US economy.