Economics Commons^™

The End Of The Three Percent Rule: How Structural Changes In The U.S. Economy Have Impacted Economic Growth, Maxwell J. Urman

CMC Senior Theses

Using data from government sources (FRED, BEA, BLS), the thesis explores the underlying reasons for declining U.S. economic growth. A long standing trend of annual 3% growth no longer seems to hold true for the economy. The paper summarizes current theory as to why the growth has slowed and finds new explanations by analyzing the various major industries which make up GDP. The results show that sectoral shifts in employment from high paying industries to low paying industries help to explain a significant portion of the decline in national growth rates. The decline in growth is primarily driven by about …

An Analysis Of Sports Markets: Franchise Relocation, League Expansion, And Fan Bases, Evan Opperman

CMC Senior Theses

Through sports, cities can reach fans from all different walks of life to rally together and support a competitive cause. Each city’s fan base is distinct—with their individual personalities being reflective of the culture and environment of the home city. The intent of this paper is to study the effect of multiple on and off field factors as they relate to attendance across three major professional sports in city markets. This will determine which city markets have the strongest, or weakest, overall fan bases. Ultimately, this study will end with an educated recommendation for professional sports franchise relocation or a …

Degree Matters: The Impact Of A Leader’S Foreign Education On His Country’S Economic Development, Zhongyi Yu

CMC Senior Theses

I analyze the correlation between a nation leader’s foreign education experience and their nation’s GDP growth and economic freedom in African, Asian, and South American countries. There is a statistically significant correlation between a leader’s foreign education and the country’s GDP growth rate, especially in Africa. Data also shows that a leader’s foreign education is positively correlated with his country’s economic freedom. Despite the fact that the regressions can only demonstrate correlation as opposed to causation relationships among variables, further analysis of the results concludes that a leader’s education and the country’s development are reciprocal. The findings of this paper …

Determinants Of Organ Donor Registration Rates Among Young Americans, Syed Umar Farooq

CMC Senior Theses

In this paper I examine the factors that affect the likelihood an individual is a registered organ donor. Unlike many studies which focus on subpopulations in specific regions, I utilize national data to get a broader assessment of individuals from around the country across a number of racial and religious classifications. Using a probit model and controlling for a variety of parameters, I find that some racial and religious variables are negatively and significantly associated with organ donor registration rates, while education and being female are positively associated with organ donor registration rates. I conclude by discussing the implications of …

Are Oil Prices Important To U.S. Manufacturers?, Austin Perez Schoff

CMC Senior Theses

Very little has been written about the effect that oil prices have on manufacturing output in the United States. This paper aims to shed light about the effect of oil prices, oil imports, and GDP on U.S. manufacturing output through a four-variable vector autoregression and explain the timing of these shocks through impulse response functions. Empirical results find that oil prices are significant in determining manufacturing output, but manufacturing output is also significant in determining oil prices.

The Interconnection Of The Great Recession, Income Disparity, Segregated Metropolitan Districts, And Their Significance To All In The U.S., Marcellus Demer

CMC Senior Theses

In the United States, nobody can survive without depending on the income of oneself or of those that support them. Thus, economic opportunity and its skewed availability is pertinent to everyone. With income inequality in the United States measured in the early 2010s reaching some of the highest estimates among nations around the globe, people seek to investigate the forces behind this phenomenon and reverse it. This paper focuses on some of the many cycles and structures that exist to reinforce the challenges of achieving economic equality. Specifically, I extrapolate data to measure the correlations between the Great Recession and …

Institutional Development: Interpreting The Russian Case, Joshua W. Rooney

CMC Senior Theses

A fundamental question to both historians and development economists is why countries today are able to reach and maintain such starkly different economic outcomes. Popular explanations include geographic and climatological features, short-term policy decisions, and economic institutions. This paper looks at the importance of violence and social pressure in the transformation and conservation of political and economic institutions in Russia. It finds that several major historical legacies including serfdom, Mongol dominance, Orthodoxy, and authoritarianism significantly influence both the past a present institutional setting. Furthermore, such legacies have proven to be major obstructions to the emergence of economic liberalism.

Taking Good Works To The Next Level: Increasing Investment In And Support For Higher-Risk Innovation, Jessie Capper

CMC Senior Theses

This thesis explores the possible avenues available to corporations and capital-managing entities seeking to increase their commitment to good works. These organizations have the potential to fill the gap in societal needs by supporting and investing in good works, including environmental protection and highly-innovative energy technologies, beyond the traditional corporate social responsibility (CSR) norm. These means include charitable giving, working with disadvantaged communities, corporate assistance to environmental or other social non-governmental organizations, and more. This thesis discusses the advantages and limitations of various corporate structures (C Corporations, S Corporations, LLCs, B Corps, L³Cs, and benefit corporations) and capital-managing …

The Gender Gap In Immigrant Entrepreneurship: The Role Of Culture And Home Country Self-Employment, Amy Ingram

CMC Senior Theses

This paper investigates the effect of culture and home country self-employment rates on immigrant self-employment in the United States, post-migration. This study analyzes the effects for both men and women, focusing on the gender gap in self-employment. The empirical results show that home country effects have a small impact on self-employment, but most of this relationship is unexplained. Because the explanatory power of home country effects is so low, it is unlikely that culture significantly influences self-employment. I find that, contrary to my hypotheses, women from countries with high female self-employment rates are likely to see a larger decrease in …

Revenue Incentives And Referee Propensity To Make Foul Calls In The Nba Finals, Daniel Fallon-Cyr

CMC Senior Theses

In this study I examine foul calls by NBA referees alongside the difference in aggressiveness of twelve NBA basketball teams as they compete for the Championship Title. I aim to identify referee biases that increase the likelihood of the NBA Finals ending in a later game due to league revenue incentives. My data consists of 91 individual NBA Finals games played between the 2001 and 2016 NBA Finals. After controlling for changes in play as well as the difference in aggressiveness, I find that NBA referee’s foul calls are more dependent on a call on the opposing team in situations …

Is Silence The Answer?, Gator Adams

CMC Senior Theses

This study examines the relationship between company management guidance, and ex-ante crash risk over the duration of 2008(Jan 2006-Dec 2009) financial crisis using the implied volatility skew, which is based upon ex-ante volatility implied by the pricing model developed by Black-Scholes (1973). The study finds that over the duration of this crisis period, management guidance decreases with a rise in ex-ante crash risk. Further, the study provides evidence on the relationship of management guidance and earnings volatility, and how that is affected by a firm's industry product concentration based on the Herfindahl-Hirschman Index (HHI) score.

Australian Real Estate Stock Reactions To Firb Regulation Changes, Henry Wei

CMC Senior Theses

This study analyzes the share price reactions to real estate development and building/construction materials corporations in relation to FIRB rule changes. It appears companies as a whole were indifferent to the rule changes; however individual securities returns were wildly different. These findings suggest that the FIRB rule changes had a mixed effect on different corporations possibly based on their exposure to the Australian real estate market.

Salary Inequality In The Nba: Changing Returns To Skill Or Wider Skill Distributions?, Jonah F. Breslow

CMC Senior Theses

In this paper, I examine trends in salary inequality from the 1985-86 NBA season to the 2015-16 NBA season. Income and wealth inequality have been extremely important issues recently, which motivated me to analyze inequality in the NBA. I investigated if salary inequality trends in the NBA can be explained by either returns to skill or widening skill distributions. I used Pareto exponents to measure inequality levels and tested to see if the levels changed over the sample. Then, I estimated league-wide returns to skill. I found that returns to skill have not significantly changed, but variance in skill has …

The “Modi Effect”: Investigating The Effect Of Demonetization On Currency Demand And The Size Of The Underground Economy In India, Sanjana Sankaran

CMC Senior Theses

Demonetization is an economic tool used to reduce the size of an underground economy. Though studies on the effectiveness of demonetization have increased over the past 50 years, there is little literature on the ineffectiveness of demonetization and subsequent factors that could explain a lack of change, or an increase, in illegal activity. This paper examines past cases of demonetization to determine the effectiveness of demonetization, and investigates the incentive for foreign currency substitution as a mechanism for criminals to circumvent regulatory scrutiny. Major findings of this paper include a positive but statistically insignificant correlation between demonetization and growth in …

A Problematic Business Model: The Effect Of Private Prisons On Arrests, Claire Donnelly

CMC Senior Theses

Past work related to the private prison system has focused on direct comparisons between private and public facilities, including their respective quality, cost-effectiveness, and influence on recidivism. Using 2005 United States data compiled from a prison facility census, county census, and information on number of arrests by county, I examine the effect that the presence of private prisons has on the number of adult male arrests per county. Across four regression models, I initially find a significant effect of private prisons on arrests, but find that effect becomes insignificant once county and prison controls are accounted for. This suggests that …

A Deep Dive Into Technological Unemployment: A State-Level Analysis On The Employment Effect Of Technological Innovations, Yuqing "Jenny" Cang

CMC Senior Theses

Ever since the first Industrial Revolution, during which many textile artisans lost their jobs to weaving machines, the relationship between technological progress and unemployment has been explored and examined by researchers and policy makers. Existing empirical research, mostly at the microeconomic level, has presented ambiguous results. Procuring data on 51 U.S. states for a period of 19 years and a large number of controls, this paper studies the employment effect of technological innovations with a novel state-level macroeconomic analysis. Using commercially-supplied Research and Development expenditure as a proxy, this paper finds that although technological innovations have a non-significant effect on …

The Fear Factor: Determinants Of Entrepreneurial Fear Of Failure, Pema Donyo

CMC Senior Theses

This thesis aims to investigate determinants of fear of failure in entrepreneurial activity that could inhibit starting a business. The study uses cross-sectional, pooled OLS, and panel regressions. The dependent variable is fear of failure regarding entrepreneurship, measured with the Global Entrepreneurship Monitor (GEM) survey question of whether fear of failure would prevent the responder from starting a firm. The unit of analysis is at country level. I categorize determinants into demographic, property rights, and procedural variables. A population of higher working age ratio (measured as the population aged 15-64 divided by the population aged 65 and over) correlates with …

The Potential And Limits Of Extended Producer Responsibility: A Comparative Analysis Study, Jessica Bass

CMC Senior Theses

This thesis draws on the concept of product stewardship and its focus on incorporating all of the actors in a product’s lifecycle into steps to take responsibility for waste management. Extended Producer Responsibility (EPR) recognizes the producer’s distinct potential to consider and drive change in waste management. Producers often serve like mediators between the design and use phases of a product’s lifecycle. Through EPR policies, the producer takes on the costs of ensuring safe end-of-life waste disposal. In this way, EPR can be expected to help relieve the public of some of the costs of waste disposal, and to support …

The Relative Impact Of The Ged On Labor Market Outcomes For The Formerly Incarcerated, Sally Vandenberg

CMC Senior Theses

This paper shows that while incarceration is associated with economic losses, the economic benefits associated with a GED may be nearly twice as large for high school dropouts that have been incarcerated than for dropouts who have not been incarcerated. My results, though imprecisely estimated, suggest that this relationship may be one of correlation, rather than causality. I find that among the formerly incarcerated the GED is associated with other positive outcomes, particularly lower rates of drug use.

Sustainable Mining For Long Term Poverty Alleviation In The Democratic Republic Of The Congo, Ellen Perfect

CMC Senior Theses

This thesis explores the poverty alleviation and peace-spoiling power of the mineral extraction sector in the Democratic Republic of the Congo to arrive at a set of strategic goals for the country moving forward. Although subterranean minerals are often a source or perpetuator of violence, the potential to lift the country’s rural communities out of extreme poverty makes the mining industry an essential part of the nation’s development strategies. Lessons from Tanzania, Côte d’Ivoire, Guinea, Ethiopia, Zimbabwe, Nigeria, Ghana, Zambia, Uganda and Sierra Leone to arrive at best practices for increasing the multiplier effect of large-scale mining, formalization, beneficiation, capital …

Virtual Reality: The Game Changer For Residential Real Estate Staging Through Increased Presence, Alexander Julian Brenner

CMC Senior Theses

This study proposes a series of 3 experiments to explore how different types of staging, pictures versus virtual reality, impacts potential buyers’ likelihood of wanting to visit a home. Moreover, this study seeks to address how the type of market, hot versus cold, and type of home, luxury versus non-luxury, connects with staging and its impact on wanting to visit a home. In Experiment 1, participants will view 10 total homes, 5 randomly selected with staged pictures first followed by the remaining 5 with virtual reality, either within the hot or cold market. If VR increases presence, then people should …

Don’T Worry, College Doesn’T Make You Successful In The Nba, Cameron E. Van

CMC Senior Theses

This paper explores the value of attending college to Division I National Collegiate Athletic Association (NCAA) basketball players in terms of future success in the NBA. Future success is measured by both salary and minutes played per game. A dataset of 660 athletes from the 2006 through 2016 drafts was collected from Basketball-Reference. An empirical model is estimated using this data in order to identify the determinant factors in a player’s success in the NBA. It is found that college is not a determinant of success in the NBA.

Does Fundamental Analysis Lead To A Rudimentary Momentum Strategy For The Inexperienced Investor? Evidence From A Student Investment Fund, Nicholas J. Lillie

CMC Senior Theses

Using the Student Investment Fund at Claremont McKenna College as a proxy for inexperienced investors, I demonstrate that inexperienced investors using fundamental analysis produce momentum-like buying patterns. The results show that the Student Investment Fund is on average buying stocks that outperform Carhart’s four-factor asset pricing model in the year before purchase. As a result, the Student Investment Fund has, on average, underperformed the S&P500 by .48% per year since 1996. My thesis explores why the Student Investment Fund may have adopted momentum-like purchasing patterns and what steps can be taken to remedy it.

Deconstructing “Deviance” And “Disorder” As Systems Of Domination: Chicago Public Schools As A Case Study Of The Effects Of Zero Tolerance Discipline Policies On Educational Outcomes In Us Schools, Maya Kaul

Pomona Senior Theses

The rise of “zero tolerance” discipline practices in US primary and secondary schools has become increasingly well documented by the media and empirical studies. Despite the extensive scholarship that has emerged from these conversations, many of these analyses are limited in their scope and do not connect the phenomena of zero tolerance in schools to the diverse, shifting forces at play within American politics and policy today. As such, the goal of this work is to synthesize ideas about zero tolerance across disciplines by integrating historical thought, philosophical frameworks of punishment, shifting policy goals within the US education system, the …

Why Ireland: How Bank Failure Was Their Key To Success, Nia R. Gillenwater

Claremont-UC Undergraduate Research Conference on the European Union

Despite Ireland’s status as the first EU country to receive a bailout, Ireland appears to be bouncing back extremely well from the ongoing financial crisis in Europe and the EU. Looking at recent Irish economic statistics it begs the question whether the government’s complete guarantee of all Irish debts was the best response. Ireland’s financial crisis seemed quite similar to America’s: for both the root causes are freely lending for real estate and property. The responses however, were very different. While America let Lehman Brothers fail and only provided a partial guarantee to its banks, Ireland provided a complete guarantee …

Finland's Economic Freeze, Shivang Mehta

Claremont-UC Undergraduate Research Conference on the European Union

Abstract

The Eurozone sovereign debt crisis has been well documented and so has Germany’s booming manufacturing economy but these events are relatively easy to explain. Greece’s troubles can easily be traced to its social security structure and lack of land registry while Germany’s success is a result of labour reforms, an undervalued currency and an emphasis on small scale businesses which form the backbone of the economy. A relatively paradoxical case has been that of Finland; ranked second for global innovation by the World Economic Forum and with over $1.8 billion being invested by the government in the country’s tech …

How Global Rules And Markets Are Shaping India’S Rise On The International Stage, Aseema Sinha

CMC Faculty Publications and Research

Over the last quarter century, India has shifted from a hesitant economic power to a confident player on the international stage. In her new book, Aseema Sinha draws on extensive research to ask where this global activism has come from, and considers the international dimensions of domestic change. Here she discusses how her findings challenge standard narratives on globalisation and the supposedly homegrown character of India’s reform trajectory.

The Developmental Effect Of State Alcohol Prohibitions At The Turn Of The 20th Century, Mary F. Evans, Eric Helland, Jonathan Klick, Ashwin Patel

CMC Faculty Publications and Research

We examine the quasi-randomization of alcohol consumption created by state-level alcohol prohibition laws passed in the United States in the early part of the twentieth century. Using a large dataset of World War II enlistees, we exploit the differential timing of these laws to examine their effects on adult educational attainment, obesity, and height. We find statistically significant effects for education and obesity that do not appear to be the result of pre-existing trends. Our findings add to the growing body of economic studies that examine the long-run impacts of in utero and childhood environmental conditions.

Akhuwat: Potential For A Sustainable Islamic Interest Free Microfinance Model, Juliana S. Beall

Scripps Senior Theses

This study will examine if Akhuwat provides a sustainable Islamic interest-free Microfinance model for potential poverty alleviation. This question is particularly complicated for an organization that relies so heavily on subsidies. Theoretical debates of sustainability and the recognition of donations, cross-market comparisons, and data from audit reports will validate Akhuwat’s potential for long term sustainability. Analysis also highlights the discrepancies that plague this opaque industry.

The Price Is Right: Investigating Net Metering Policies For Rooftop Solar In California, Jesse Honig

Pitzer Senior Theses

As an increasing number of homeowners decide to take advantage of distributed renewable resources such as rooftop solar, we may need to rethink the current regulatory paradigm and governance structure of the electric market. This thesis examines the shortcomings of current net metering programs in California. While the current Net Metering 2.0 proceeding highlights a clash of solar advocates and electric utilities, it is in fact revealing an underlying structural flaw that has been present all along. In order to send the appropriate price signals to solar customers, both the structure by which utilities recover costs and the rate at …