Economics Commons^™

The Role Of Conflict In Sub-Saharan Africa, Samy Lemos

CMC Senior Theses

Sub-Saharan Africa is the provider of many critical natural resources. With such resources, one would expect these countries to have thriving economies. Why is the opposite case true? To answer such a question, this paper examines a few critical causes that may justify the current economic situation these African countries are experiencing. Specifically, the paper observes the economic impact of civil war and terrorist conflict in sub-Saharan Africa from 1971 to 2016. To explore the changes in GDP per capita for all these years, this thesis sheds light on three independent variables: year of conflict, education level, and foreign direct …

Analysis Of The Economic Impact Of Constructing A Nba Arena On The Host City, Grant Gilchrist

CMC Senior Theses

Using economic data collected from 24 different Metropolitan Statistical Areas in the US, this thesis investigates the impact of constructing a new National Basketball Association (NBA) arena on the host city’s economy. When a simplistic model is implemented, which does not control for other economic factors or individual subject heterogeneity, significantly positive economic impacts of arena construction are observed. However, when a more appropriate model specification is implemented that controls for economic activity and individual heterogeneity, these effects are no longer statistically significant. This comparative analysis ultimately highlights the importance of appropriate model specification and supports the conclusion that new …

Why Not Mexico? Policy Recommendations For A Globally-Oriented Economic Strategy, Víctor Manuel Hernández-Rodríguez

CMC Senior Theses

Mexico, one of the world’s largest economies and an increasingly relevant actor in international affairs, is at a crucial point in defining its future policy course. Given the uncertainty surrounding the global economy, as well as the political situation in Mexico, it is important to have a clear vision for policy going forward. This thesis offers a foundation for a national economic strategy with a long-term vision, upon which future administrations can build as appropriate to maximize on the country’s economic potential. The task is undertaken through a three-part approach. First, a thorough and analytical overview of the country’s economic …

Evaluating The Effects Of Nutritional Intake During Adolescence On Educational Attainment And Labor Market Earnings As An Adult, Mikaela Connell

CMC Senior Theses

In this thesis, I analyze whether nutritional intake at the time of adolescence can impact academic attainment and earnings later on in life. Millions of children in the United States are living in food insecure households and do not have access to an adequate nutritious diet. Since adolescence is a time period of intense growth and development, it is essential to meet nutritional needs at this time. Using data from the Longitudinal Study of Adolescent to Adult Health (Add Health), I measure the nutrition of a nationally representative sample of youth in the United States through their daily food intake, …

The Cultural Legacy Of Communism In Entrepreneurship: Entrepreneurial Perceptions And Activity In Central And Eastern Europe, Amy Wu

CMC Senior Theses

Using data from the Global Entrepreneurship Monitor, this paper examines differences in entrepreneurial perceptions (fear of failure, opportunity perception, self-efficacy, public opinion) between CEE and non-CEE countries, before and after the 2008 recession, as well as the effects of these perceptions on entrepreneurial motivation and overall levels of activity. The results suggest that CEE countries have systematically more pessimistic outlooks in terms of fear of failure and opportunity perception, but no difference from non-CEE countries in self-efficacy and public opinion. Additionally, most of the difference in fear of failure and opportunity perception, along with an increase in necessity-motivated entrepreneurship, comes …

The Effects Of Recreational Marijuana Legislation On The Opioid Epidemic In Washington State, Steven Dickerson

CMC Senior Theses

This paper analyzes the impact of the 2012 legalization of recreational marijuana in Washington State on opioid abuse. Using synthetic control methodology, this paper finds that the legislation prevented 638 overdose deaths and lead to over 3,600 individuals seeking treatment for opioid abuse disorders. Due to the large health, social, and economic impacts of the opioid epidemic, further research should be conducted into ways to reduce the number of opioid prescriptions, the number of opioid overdoses, and opioid abuse generally.

Is Avocado Toast The Reason I'M Still Living With My Parents?, Brendan Macdonald

CMC Senior Theses

Is avocado toast the reason that I am still living with my parents? In other words, does the consumption of avocado toast, or more specifically eating out in general, have any impact on one’s ability to be a homeowner. In May of 2017, an Australian real estate developer by the name of Tim Gurner was asked to provide advice to young people who could not afford to purchase a home. He responded by saying, “when I was trying to buy my first home, I wasn’t buying smashed avocado for $19 and four coffees at $4 each,” (Victor, 2017). While the …

Model Specification For Bank Failure: A Retrospective Look At Banks In Missouri During The Great Depression, Peter Welch

CMC Senior Theses

This paper examines banks in Missouri during the Great Depression in order to find the correct model specification for bank failure during economic downturns. The data set controls for a bank’s balance sheet, correspondent network, charters and memberships, county characteristics, and market share, and includes both Federal Reserve member and non-member banks. Using a probit model, it is concluded that the contractionary monetary policy employed by the St. Louis Federal Reserve did not help bank survival, as being a member of the Federal Reserve had no significant effect on a bank’s probability of survival. Additionally, while an increased network led …

The Effects Of The Correspondent Banking Network On The Real Economy, Jack Brown

CMC Senior Theses

There is a longstanding academic debate regarding the role of financial networks. There is a tradeoff between improving the flow of funds and acting as a channel for contagion. This paper investigates the impact of banking networks on the real economy during the Great Depression. Building permit values are used as a proxy for real economic activity as implemented in previous research. A simple linear regression model estimated by ordinary least squares is used such that locational networks are differentiated from networks links to money centers and non-money centers. The results demonstrate that financial networks have both positive and negative …

The Political Economy Of Participation In The Euro: A Case Study Of Italy And Germany, Thomas Schalke

CMC Senior Theses

This thesis analyses the political economy of the decision of Italy and Germany to participate in the euro. The emphasis is on understanding the economic rationales employed in each country in support of euro membership.

For Italy, the central argument is that Italy outsourced monetary policy management to the ECB in order to delimit deficient domestic policy making and import German monetary credibility. This transferred the costs of monetary orthodoxy to Europe, and the thesis briefly examines places where we might observe those costs.

For Germany, the argument is that, out of respect for the national humiliation and shame of …

Are Volatility Expectations In Different Countries Interdependent? A Data-Driven Solution To Structural Var Identification For Implied Equity Volatility Indices, Timothy H. De Silva

CMC Senior Theses

Over the past couple of decades, the number of volatility indices has increased rapidly. These indices seek to represent the market’s expectation of realized volatility over the coming month, based on the prices of options traded on each underlying equity index. Although the dynamics of realized volatility spillover have been studied extensively, very few studies exists that examine the spillover between these volatility indices. By using DAG-based structural vector autoregression, this paper provides evidence that implied volatility spillover differs from realized volatility spillover. Through solving the well-known VAR identification problem for these indices, this paper finds that Asia, more specifically …

Determining Factors Of Risk Tolerance: Evidence From Fantasy Football Snake Drafts, Nicholas Obrand

CMC Senior Theses

This paper utilizes fantasy football snake drafts to analyze risk tolerance of individuals who are trying to maximize their present and future utility, but are faced with unknown factors and only have limited resources. Fantasy football provides a unique perspective on risk tolerance, different than the commonly researched fields of auctions, financial portfolios, and lotteries. I examine mock draft data from Fantasy Football Calculator as well as rankings data from Fantasy Pros to gauge the amount of risk associated with each draft pick. I find that the more perceived uncertainty that is connected to an individual selection, the more likely …

College As Capability Enhancement, Cristina Lee

CMC Senior Theses

In this thesis I wanted to apply the Sen’s framework in Development as Freedom to college campuses. In my experience at Claremont McKenna College, I have seen how some students are able to take advantage of the resources better than others. Given that we were all accepted by the same admissions office, I always questioned why did some students know how to take advantage of the system. In order to explore this, I first discuss Sen’s capability approach. Then, I show how the capability approach is more comprehensive than social networking theory and William Deresiewicz’s account on elite colleges. Finally, …

Getting Girls In Stem & The Dangers Of Forgetting That Science Is Art - Someone Made It Up, Heidi Therese Dangelmaier, Camilla Hermann

The Transdisciplinary STEAM+ Journal

Encouraging girls to participate in STEM is a hot topic that has captured the concern of the world’s academic, business and scientific communities. The intention is noble, however the strategies being deployed are reinforcing the very bias society seeks to eliminate. If we wish to advance our evolutionary journey as a species, a shift from “feeling sorry for disadvantaged girls” to “fearing STEM without girls’ reformation” is imperative. This piece discusses the rise to an initiative to redesign culture: Girlapproved.

Trade Union Trade-Offs: Unions, Voters, And The Rise Of Right-Wing Populism, Kim Gabbitas

Claremont-UC Undergraduate Research Conference on the European Union

Trade union membership in European Union member states has been in decline for decades, which has many concerned about the future of workers’ rights. While existing work examines the reasons for this decline, my research shifts the focus from union density to the functions unions serve and how these functions affect and are affected by changing electoral behavior. I examine the rise of right-wing populist movements in Europe and how these movements and the challenges today’s labor unions face can be traced to the same underlying forces. I argue that, as the relevance of trade unions declines for blue-collar workers, …

A Second Child? No, Thank You! The Impact Of Chinese Family Planning Policies On Fertility Decisions, Yinghan Qi

Scripps Senior Theses

In 1979, the Chinese government introduced the One-child Policy for the purpose of controlling population growth. Thirty years later, the fertility rate in China has declined to a very low level and one-child families have become the norm. At the same time, the consequences of low fertility rates have emerged. In 2015, the government announced a new policy that encouraged couples to have two children in order to raise the total fertility rate. In this paper, I analyze the economic and legal implications of the Chinese family planning policies. By examining to what extent fertility decisions are affected by government …

Are Donald Trump And Hillary Clinton Controlling The Stock Market? An Analysis Of The 2016 Presidential Election's Impact On Stock Market Volatility, Julia Tambone

Scripps Senior Theses

Hillary Clinton and Donald Trump ran highly controversial campaigns in the 2016 Presidential Election, which then leaves us with the question of what impact is this having on the current economy? Prior analysis of political influence on the stock market tells us that isolating political impact on the stock market is nearly impossible. However, there are clearly defined 4-year cycles in stock prices that seem to correspond with election years. In this paper, I create my own index of stocks in the four major U.S. industries and measure both day-to-day and intraday volatility in stock prices across three comparable time …

The Real Estate And Stock Market During The Great Depression: Construction Permit Growth As A Leading Economic Indicator For Stock Returns, Will Cresap

CMC Senior Theses

The 1929 stock market crash on Black Thursday, followed by the subsequent four-year period of extreme economic downturn, signifies an extremely profound piece of U.S. history. During this time, global economic productivity – measured by GDP – decreased while the U.S. unemployment rate increased staggeringly. Leveraging construction permits as a forward-looking measure of economic activity, I empirically evaluate the effect of construction permits – specifically, the lagged growth rate of monthly construction permits – and lagged monthly stock returns on monthly Standard & Poor's 500 (S&P 500) stock returns. Lagged construction permit returns and lagged stock returns provide early indications …

The Political Impact Of Rising Trade Exposure: Evidence From 2000 - 2016 U.S. Presidential Elections, Xiaoyang Qian

CMC Senior Theses

In this paper we analyze the impact of global imports on regional labor markets, and how such impact translates to changes in voting patterns in the U.S. Presidential elections from 2000 to 2016. We find that imports from different U.S. trading partners influence voting patterns in different ways. In particular, we observe an anti-incumbent effect caused by import competition from OECD countries. Such an effect cannot be observed for imports from low-income countries. There is also evidence that suggests high exposure to import competition tends to drive voters toward the Democratic candidate, who typically proposes better social welfare programs and …

Nudging Towards Social Change: The Application Of Psychology And Behavioral Economics In Promoting Responsible Consumption, Larissa Chern

CMC Senior Theses

With workplace disasters in developing countries increasingly in the news, a major question is how to encourage consumers to use corporate social responsibility as a criterion in purchasing. Distinct from environmental concerns, social responsibility is defined here with respect to the humanitarian aspects of corporate practice, including fair wages and working conditions, equitable treatment of the disadvantaged, and restriction of child labor. Although the idea of socially responsible consumption (SRC) was first identified over forty years ago, most recent research on changing consumption habits focuses specifically on environmentally responsible consumption (ERC). Combining the psychological concept of social norms with economic …

Testing For Nationality Discrimination In Major League Soccer, Matthew Swift

CMC Senior Theses

Using data from the 2014-2016 Major League Soccer (MLS) seasons, this paper finds evidence for nationality discrimination in the MLS. In particular, foreign players receive a wage premium of 15.97 percent, ceteris paribus. Foreign players also receive an additional bump in their salary based on performance. Finally, using an Oaxaca (1973) decomposition, I find that 22-26% of the differences in wages between foreign and domestic players is largely due to discrimination.

Quantifying The Trenches: Machine Learning Applied To Nfl Offensive Lineman Valuation, Sean Pyne

CMC Senior Theses

There are 32 teams in the National Football League all competing to be the best by creating the strongest roster possible. The problem of evaluating talent has created extreme competition between teams in the form of a rookie draft and a fiercely competitive veteran free agent market. The difficulty with player evaluation is due to the noise associated with measuring a particular player’s value. The intent of this paper is to create an algorithm for identifying the inefficiencies in pricing in these player markets. In particular, this paper focuses on the veteran free agent market for offensive linemen in the …

How Mobile Phones Can Spark An Entrepreneurial Revolution, Alison Choe

Scripps Senior Theses

In the last decade, there has been an exponential rise in mobile phones in both developed and developed countries. In light of that, this paper investigates whether the expansion of such mobile networks leads to increased entrepreneurial activity. By conducting panel regressions, I find the degree to which various stages of entrepreneurial activity is affected by increased mobile phone subscription rates. I use data from 80 countries from 2007 to 2015 and parse out the different effects between developing and developed countries, and between males and females. I find that larger mobile networks encourage entrepreneurship, particularly in the early stages, …

Meat Consumption And Health Outcomes: The Economic Risk Factors Of Non-Communicable Disease, Alley Bellack

Scripps Senior Theses

Noncommunicable diseases (NCDs) are the most prominent cause of adult mortality, killing 38 million people each year and on the rise^[1]. Cancer, heart disease, diabetes and chronic respiratory diseases are responsible for 82% of NCD-related illness and death. These four diseases, along with mental illness, are estimated to cost the developing world $21 trillion over the next two decades.^[2]

Given the substantial health and economic detriments of NCDs, policy makers, government officials, and enterprises around the globe have begun to focus efforts on better understanding and preventing the proliferation of these diseases. Lifestyle factors, including increased inactivity, …

Does Increased Access To The Arts In High Schools In The Los Angeles Unified School District Affect Graduation Rates?, Elizabeth K. Gile

Scripps Senior Theses

Determining whether the arts are beneficial to a student’s education is a widely, and hotly debated topic every year in the United States, with many studies published each year demonstrating the impact that the arts have on various educational outcomes, from increased test scores to higher graduation rates. This paper examines previous research on the efficacy of incentives and how students’ participation in extracurricular activities, from sports to the arts, could impact graduation rates. It also develops a model for analyzing the present value of a high school education to a student using a discounted present value analysis and conducts …

Robert Parker’S Wine Advocate And The Consequential Pricing Of Provençal Wines, Gweneth Marter

Scripps Senior Theses

Robert Parker is an esteemed, somewhat controversial wine-critic. Since 1978, Parker has assigned every wine he tastes a score between 50 and 100. He uses this method to communicate to both consumers and producers his opinion of the quality, taste, and aging potential of the wine. Between the years 2005 and 2015, Robert Parker graded 115 wines from the French region of Provence. The goal of this thesis is to determine whether and to what extent Robert Parker’s grades affect the price of wine. Through descriptive statistics and regression analysis of Robert Parker’s grade and year of production on the …

Why Did China Do This? An Analysis On China's New Gasoline "Price Floor" Policy, Youhan Ding

Scripps Senior Theses

Why did China choose certain policy over others that would achieve similar impact? Because China has a significant presence in the modern international community, it is difficult yet critical to understand the policy implications of the Chinese government under its unique political and socioeconomic context. This thesis shows the impact of a specific “price floor” policy China chose to employ in its oil and gasoline market, and identifies the factors concerning the Chinese regime that it took into consideration in the decision making process, through analysing data and official statements released by the government. After different parties affected by this …

Compensating Against Turnover: Managers' Talent Retention Decisions In Major League Baseball Under A Budget Constraint, Emma Knoesen

Scripps Senior Theses

From 1997 to 1999 and 2003 to the present, Major League Baseball has had a luxury tax on high payroll teams. This paper analyzes the impact of the tax as a budget constraint on teams’ ability to reward and retain high performing players. In contrast to other papers, we use wins above replacement (WAR), a popular sabermetrics statistic, to measure performance. Using this metric, we quantify the number of top performers, how this performance is rewarded with salary, and how salary impacts players’ mobility decisions. We conclude that when using WAR, the distribution of performance is not heavy tailed and …

How "Costly" Is Healthcare For The Elderly?, Ruchika Majumdar

Scripps Senior Theses

This study focuses on the possible ways to improve healthcare services around the world, which increase the life expectancy for aging people. Utilizing a cost-effective analysis, the relationship between various healthcare expenditures and conditional life expectancy for people aged 60 and above was examined. A linear regression model was used to analyze data from 122 WHO (World Health Organization) countries obtained from the year 2000. The model included additional health-adjusted life years (HALE) at age 60 as the dependent variable and healthcare cost indicators as the independent variables. Regression results revealed that cost of healthcare was overall significant in contributing …

What Goes Up Must Come Down: The Relationship Between The Housing Market Boom And The Subsequent Economic Downturn: Evidence From The Msa Level, Bruce Dale Service

CMC Senior Theses

Using MSA level data, the paper shows, that geographic areas which experienced the largest housing bubble generally suffered a more serious subsequent economic downturn. More specifically, the paper establishes that MSAs with larger declines in housing permits had larger increases in unemployment. There also appears to be strong evidence of a correlation between the magnitude of a housing boom and the timing of the decline in housing permits. MSAs which experienced larger real housing inflation offered early indications of the subsequent Great Recession.