Economics Commons^™

The Counter-Cyclicality Of Earnings Management: Evidence Through 2024, William J. Hall

CMC Senior Theses

This thesis examines the relationship between macroeconomic conditions and earnings management, extending the analysis of Hillegeist and Lin (2019) using updated data through 2024. Based on 16,635 firm-quarter observations, my study affirms the results found in prior literature and confirms that there is a negative association between the change in GDP and the direction of firms’ earnings management behavior, indicating that earnings management is counter-cyclical. My study also finds that firms manage earnings asymmetrically based on the current macroeconomic state, with firms managing earnings more in economic downturns and less in expansions. My findings suggest that despite major macroeconomic and …

Optimizing Bitcoin Allocation: Predictability Of Bitcoin Portfolio Weights Through Macroeconomic Variables, Kirby Baynes

CMC Senior Theses

This thesis examines whether Bitcoin is a beneficial asset in a diversified, mean-variance optimized portfolio and whether its portfolio weights can be reliably predicted using macroeconomic variables. Using data from December 2013 to February 2025, the analysis applies rolling-window portfolio optimization and OLS regressions with Newey-West standard errors to test the relationship between Bitcoin allocations and a set of macroeconomic indicators. Results show that Bitcoin receives non-zero weights across portfolios and that its optimal allocation is sensitive to variables such as changes in the Credit Spread and Yield Curve. These variables were statistically significant in several models and produced meaningful …

Clutch Or Comfortable? How Franchise Tags Influence Qb Performance In The Nfl, Justin Edwards

CMC Senior Theses

Abstract

The National Football League (NFL) has a type of contract known as the Franchise Tag. The Franchise Tag is a one-year contractual extension often used when a player and a team cannot come to terms regarding the details of a contract extension. Usually, the player expects to be paid more than the organization can afford that year due to restrictions imposed by the salary cap. Because of this, Franchise-Tagged players tend to have a greater incentive to perform well in hopes of being signed into a long-term contract. My findings show that the incentive of future earnings and job …

Germany’S Climate Foreign Policy Strategy And Making The High Politics Of Climate Ambition, Thomas M. Goldstein

Claremont-UC Undergraduate Research Conference on the European Union

Germany’s Climate Foreign Policy Strategy, released in December 2023, is the first of its kind anywhere. The document elevates a set of climate objectives to the highest level of Germany’s foreign policy. This paper examines Germany as a case study of how a consistently ambitious climate actor may shift its policy preferences over time. Party policy shifts are traced within government documents, campaign manifestos, and coalition contracts to consider the viability of three potential explanations: the demands of a “green” political constituency, a structural reaction to reduce energy dependencies, and feedback effects from international institutions. Upon investigation, the Strategy displays …

Llms Can’T Be Trusted For Financial Advice, Gary N. Smith

Pomona Economics

ChatGPT and other large language models (LLMs) do not understand the text they input and output. When three prominent LLMs were tested with 11 financial-decision prompts, the LLM responses were seemingly authoritative but riddled with arithmetic and critical-thinking mistakes. Financial planners are unlikely to be replaced by LLMs anytime soon.

Mpt And Capm Mismeasure Risk, Gary N. Smith

Pomona Economics

Mean-variance analysis and the capital asset pricing model provide many useful insights for investors who want to measure and manage risk. However, their focus on short-term returns is of limited use and potentially misleading for investors with long horizons. A value investing approach suggests that risk might be better measured by long-run uncertainty about asset income than by short-run uncertainty about asset prices.

It May Be A Mistake To Delay Social Security Benefits, Gary N. Smith, Margaret H. Smith

Pomona Economics

Financial planners generally recommend delaying the start of Social Security retirement benefits until age 70. However, two-thirds of recipients begin collecting benefits before full retirement age. We argue that starting benefits before age 70, or even before full retirement age, and investing these benefits sensibly may well be a smart financial decision.

Ode Models Of Wealth Concentration And Taxation, Bruce Boghosian, Christoph Borgers

CODEE Journal

We refer to an individual holding a non-negligible fraction of the country’s total wealth as an oligarch. We explain how a model due to Boghosian et al. can be used to explore the effects of taxation on the emergence of oligarchs. The model suggests that oligarchs will emerge when wealth taxation is below a certain threshold, not when it is above the threshold. The underlying mechanism is a transcritical bifurcation. The model also suggests that taxation of income and capital gains alone cannot prevent the emergence of oligarchs. We suggest several opportunities for students to explore modifications of the model.

Essays On Regional Economic Integration, Economic Growth, And Economic Development In West Africa, Nyema Guannu

CGU Theses & Dissertations

Since the end of colonial rule by major European powers, the throughline of economic integration between African countries has been one of resolve and urgency toward closer regional economic cooperation. There is close to complete unanimity, at least in principle, among African leaders and governments - as evidenced by their signatory to and ratification of the treaties establishing The Economic Community of West African States (ECOWAS), The Mano River Union (MRU), and The West African Economic and Monetary Union (UEMOA) – to meet the goal of regional economic integration. The originating treaties of these regional economic integration blocs were optimistic …

The Relationship Changes Between Asian Countries And Advanced Economies Before And After 2008, Jingyu Wang

CGU Theses & Dissertations

This dissertation is aimed to discuss the relationship change between east and southeast Asian countries and advanced economies, especially focus on the export and import changes before and after 2008. This study uses both econometrics model (fixed effect, first difference effect, difference-in-difference model) and social network models to analyze the impact of the 2008 financial crisis on these Asian countries and advanced economies. The results show that after 2008 the impact of exports with advanced economies on GDP per capita growth has changed from negative to positive, while the impact of imports with advanced economies on GDP per capita growth …

Corporate Decision-Making: Three Essays In Applied Finance, Mohamed Ahmed Abd El Rahman Ahmed Khashbah

CGU Theses & Dissertations

Corporate Decision-Making: Three Essays in Applied Finance.By Mohamed Ahmed Abd El Rahman Ahmed Khashbah Claremont Graduate University: 2024 This dissertation consists of three distinct chapters, each focusing on a different topic. Chapter 1 of this dissertation investigates the relative effectiveness of earnings and cash flows as predictors in corporate decision-making processes within the U.S. financial market. Drawing on two decades of comprehensive financial data from Compustat, encompassing the years 2000 to 2019 and involving 18,595 firm-year observations across 980 diverse companies, this study employs a robust methodological framework. Advanced statistical techniques, including regression and correlation analyses, alongside firm-specific time-series and …

Seemingly Unrelated Research In Economics, Michael Krouse

CGU Theses & Dissertations

In my first chapter, my co-authors and I1 estimate the effect of current affective states on reported satisfaction with life. The satisfaction with life scale is a well-established measure of thriving and its use for both research and behavioral interventions requires understanding how external factors influence participants’ evaluations of their lives. We tested whether influencing participants’ affective states using videos would change their reported satisfaction with life in a representative sample of US adults (N=788). Those for whom the video improved affect reported 5.9% lower satisfaction with life compared to nonresponders (p=.008). This result was driven by young adults, women, …

Decentralize, Depoliticize, Democratize: An Empirical Political Economy Analysis Of Global Cryptocurrency Adoption, Jennifer L. Verdier

CGU Theses & Dissertations

This dissertation examines the global adoption of cryptocurrency, challenging the broad narrative that it would fundamentally revolutionize finance through decentralization, depoliticization, and democratization. Despite not fully delivering on these transformative promises, cryptocurrencies have continued to gain traction. This dissertation delves into the political economy aspects that fuel this sustained adoption. Through quantitative examination of data from the International Monetary Fund, Statista, World Uncertainty Index, and the World Bank, this study investigates the complex interplay of factors influencing cryptocurrency adoption. The study employs multivariate models with TFE, assessing not only economic variables but also the critical roles of trust in traditional …

Macro-Financial Linkages And Perspectives In Economic Development, Nasser Khalil

CGU Theses & Dissertations

This paper is a composition of three essays on topics dealing with financial market derivatives, macroeconomic policies using microdata, and the link between macroeconomics and international finance. All three chapters are a cohesive discussion on financial markets, investment analysis of financial derivatives, and economic impacts during COVID-19. We examine capital and resource allocation in a variety of cases across all three chapters: international capital flows on the largest domestically listed firms, investments in option contracts with low likelihoods of being exercised, and the role of domestic policy in distributing social welfare benefits during periods of economic downturns in India. The …

An Analysis Of The Association Between Foreign Investors Holdings And The Local Currency Sovereign Debt Yields, Yudistira Surjadi Slamet

CGU Theses & Dissertations

This study examines the association between foreign investors holdings of local currency sovereign debt on the corresponding debt yields. It includes a multi-country study encompassing 12 emerging markets and 17 advanced economies, as well as a single-country study focusing on Indonesia. By analyzing the association of foreign holdings on the corresponding 5- and 10-year debt yields on a combined data set of advanced economies and emerging markets, the multi-country study employing a quarterly data set from March 2011 to December 2019 accomplishes an analysis that was absent from previous literatures. Although previous literatures have found a negative association when using …

Do Globalization And China’S Wto Accession Affect Social Spending In Its Eleven Neighboring Countries? An Empirical Study Of The China Shock, Jian Qing Xu

CGU Theses & Dissertations

This dissertation investigates whether globalization and China’s WTO accession in 2001 have any impact on government expenditure to social security transfers and human capital of its eleven neighboring countries--Bangladesh, India, Indonesia, Japan, Korea, Malaysia, Nepal, Pakistan, the Philippines, Singapore, and Thailand. These countries have enjoyed economic growth from intra-regional trade and foreign direct investment (FDI). Due to Chinese liberalization of trade and FDI-led growth policies, China became the favorite destination for foreign investors because of the large population providing enormous potential markets for consumption of goods and services as well as having a huge pool of low-wage workers for lower …

Decoding Job Market Trends: Chatgpt’S Influence On Soft And Hard Skill Demands, Larkin Barnard-Bahn

Scripps Senior Theses

As the abilities of Artificial Intelligence (AI) grow, automation anxiety (the fear of being replaced by technology) has plagued the workforce—especially after the launch of the advanced Generative AI tool ChatGPT. To avoid structural unemployment, workers may need to invest in developing skills not easily replaced by AI. Some scholars argue that AI is less able to replicate soft skills than hard skills, but the literature lacks studies that indicate a causal effect across industries and occupations. This paper investigates how the public release of ChatGPT has influenced the demand for soft skills relative to hard skills in the U.S. …

Essays On Crime And Law, Anuar Assamidanov

CGU Theses & Dissertations

This dissertation examines the interplay between law, policy, and decision-making within criminal justice and employment.

The first chapter investigates the interplay between predictive algorithms and human discretion in parole decision-making. It examines how deviations from algorithmic recommendations affect recidivism rates, revealing that increased supervision levels—when tailored by professional judgment—significantly lower recidivism. These findings underscore the importance of strategic oversight in enhancing the effectiveness of parole supervision.

The second chapter examines gender discrimination in hiring, using data from the blind auditions of the TV show The Voice. It highlights a significant own-gender bias, with coaches showing a clear preference for …

Effects Of The Homegrown Player Rule In The English Premier League: A Comprehensive Analysis Of Squad Composition, Market Values, And Wages, Jiho "Brian" Jun

Pitzer Senior Theses

This paper uses theoretical frameworks from economics and sports management to investigate the transformative effects of the Homegrown Player Rule on English Premier League squad dynamics, market valuations, and wage structures. The study examines the evolution of homegrown player distribution across clubs from the rule’s implementation in 2010 to the most recent season in 2023. My analysis of market values and wages finds no evidence that the rule leads to possible market value and wage rate disparities between homegrown and non-homegrown players. Subsequent research shows evidence of a decrease in the real wage rate of homegrown players over time, contrasting …

More Than A Feeling: Exploring The Drivers Of Music Catalog Values, Emily Nutting

CMC Senior Theses

This paper examines which characteristics of songs affect transaction price in the sale of artist’s music catalogs. My analysis tests many variables, including the number of years between the song’s release its catalog’s sale (age); the natural log of the number of Spotify streams the song has (popularity); the genre of the song; themes in the song, such as dating, violence, romance, obscenity, sadness, and feelings; and elements of the song like danceability, energy, loudness, instrumentalness (the prevalence of instrumentals relative to vocals in a song), and acousticness (the measure of sound made using instruments as opposed to electronic means). …

Empirical Linkage Between Economic Growth And Political Instability And The Effects Of Inequalities In Africa, Francis Joseph Assenga

CGU Theses & Dissertations

The examination of the relationship between political instability and economic growth is critical in today's global economy, especially in African nations facing multifaceted challenges. Over recent decades, this connection has been a key area of focus for economic scholars, driving significant empirical research. Previous studies, which examined the dynamics of this relationship consistently underscore the profound interconnectedness of economic growth and political stability in the sense that, political instability hampers economic growth, while economic downturns can trigger political unrest and government collapse.

Our study empirically investigates the linkage between economic growth, political instability, and inequality in Africa, analyzing data from …

Mobile Food Displacement And Formalization: A Case Study Of Portland’S Block 216, Marcello Ursic

Pomona Senior Theses

Portland has been on the cutting edge of American mobile food for over fifteen years, becoming a critical darling in the popular and academic press for its role in trailblazing progressive mobile food policy buttressed by broad-based civic engagement. In recent years, Portland’s mobile food landscape has begun shifting as downtown development has picked up post-recession, displacing some of the oldest and most prominent city center food cart pods with others likely to follow. Meanwhile, a new breed of formalized, purpose-built food cart pods has gained ascendancy. Called “food courtyards,” their armored, insulated, and bourgeois character is distinct from traditional …

Improving American Men's Quality Of Life By Economically Empowering American Women, Margot Rosenblatt

Scripps Senior Theses

In this paper, I explore the relationship between women’s economic empowerment and men’s quality of life in the United States. I created an index of women’s economic empowerment based on county-level data on labor force participation rates, rates of pay, teen birth rates, and families in which a woman is the primary income earner. I then created an index of men’s quality of life based on financial, physical, and mental health indicators. Adjusting for income, dominant industry type, age, population density, race variables, and environmental factors, I found a statistically significant positive correlation between women’s economic empowerment and men’s quality …

Justice As Fairness Or As Inclusion: Putting Rawls In Conversation With The Bans On Transgender Athletes, Nicole Player

Pomona Senior Theses

The last decade has seen a flurry of anti-transgender bills introduced and passed in the United States, and the topic that has likely been the most hotly debated regards the dozens of state bans on transgender athletes. While most discussions of these bans go straight to a debate about physiology, this thesis centers instead on a question of justice. In the debate of whether to allow a transgender girl to compete in girls’ sports, is it more “just” to prioritize fairness in women’s sport, as these bans do, or is it more just to prioritize inclusion? This thesis, in finding …

How Do Pay Transparency Laws Impact The Gender Pay Gap In The United States?, Kendall Chapko

CMC Senior Theses

After much progress during the late 1900s, the gender pay gap has hardly closed in the last two decades. As policy makers look for new solutions, many governing bodies have turned to pay transparency laws, which make employee salaries transparent to employees. There have been several international studies on this topic, and almost all found that these laws are very effective in decreasing the pay gap. This research is extremely important, as it suggests that these policies push us further towards equality, and makes gender based discrimination less common in the workplace. In my study, I conduct a difference in …

The Effects Of Spending-Focused Fiscal Policy On Italian Output And Stock Market Performance, Filippo Salvatico

CMC Senior Theses

This paper studies the effects of Italy’s expenditure-focused fiscal policy on (1) economic output, measured with real GDP growth, and (2) stock market performance, measured with FTSE MIB period returns, using ordinary least squares and generalized autoregressive conditional heteroskedasticity models. To the first end, a quarterly (time series) data base of fiscal indicators—Budget Balance, Government Debt, and Government Expenditure—as well as other macroeconomic series is constructed to test their effects on output. To the second end, a monthly (time series) data base of the same indicators, as well as period returns for seven other benchmark stock exchanges across Europe, is …

The Efficacy Of Insider Trading Regulation: An Analysis Of The 1942 Introduction Of Sec Rule 10b-5, Kamila Melikova, Eric Hughson

CMC Senior Theses

Existing research has thoroughly examined the impact of insider trading regulations, finding mixed results regarding the effectiveness of new law introductions. Although this topic has received considerable attention, there is still a notable lack of research on the first regulation of insider trading: the 1942 introduction of Section 10(b), an amendment to the Securities Exchange Act of 1934. This paper uses a newly compiled dataset of earnings announcements from large public companies between 1937 and 1946, combined with event study methodology, to investigate the effectiveness of the very first ban on insider trading. Through the application of t-tests and regression …

Analyzing The Effects Of 2018 Bank Reclassifications On Individual Balance Sheet Compositions, Hiyab Abraha

CMC Senior Theses

The March 2023 collapse of Silicon Valley Bank (SVB) marked the second largest bank failure in United States history and the largest bank failure since the 2008 Global Financial Crisis (GFC). This paper analyzes the mechanisms underlying SVB’s downfall and explores the specific systemic vulnerabilities that March 2023 revealed. To study the impact of systemic risk reclassification on individual bank balance sheets, I construct a quarterly panel dataset of the largest US chartered banks and track their regulatory classification and financial reports from 2009 to 2023. The 2018 Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA) changed the Federal …

Do Inclusionary Zoning Ordinances Restrict Housing Supply: An Instrumental Variable Approach Using Evidence From California, Liam James

CMC Senior Theses

Do inclusionary zoning (IZ) ordinances restrict the supply of housing, putting undue upward pressure on prices? Using an improved version of the California Coalition of Rural Housing database, we use OLS and 2SLS methods to estimate the effect of IZ policies on supply. In demonstrating the endogeneity of OLS, we address this concern through the use of differences in two-party voter registration as an instrument for the presence of an inclusionary zoning ordinance. We find no evidence consistent with a clear restrictive effect of these policies.

Happy Teams: Utilizing Remote Data Entry Work To Understand The Relationship Between Team Gender Composition, Team Performance, And Worker Satisfaction, Laura Zimmer

CMC Senior Theses

The following study contributes to existing scholarship surrounding the relationship between gender and teamwork. My experiment aims to build on how gender impacts team members' success, emotions, and overall experience by randomly pairing individuals in two-person remote teams, to complete data entry tasks together. Teams work together remotely to complete tasks rating Chicago roads. Pre and post-teamwork surveys were completed by individuals surrounding their emotions and experience working with their partner. My results demonstrate that single-gender female teams report the highest increases in happiness while working in teams. Individuals were found to rate partners of their same gender more highly …