Economics Commons^™

Fun, Games & Economics: An Appraisal Of Game Theory In Economics, Jamus Jerome Lim

University Avenue Undergraduate Journal of Economics

Game theory has had a profound influence on many fields of the social sciences since its rise to prominence more than fifty years ago. This paper provides an overview of the main concepts in game theory and studies four main areas of its application in economic problems – oligopolistic competition, externalities & public goods, market equilibrium and general equilibrium. The conclusion is that game theory has found a natural place in economics and will continue to contribute to it for many years to come.

Free Agents, Fire Sales, And Fungoes: An Econometric Examination Of Team Success In Major League Baseball, Corey R. Maynard

University Avenue Undergraduate Journal of Economics

This paper explores what good organizational strategies baseball teams use to put themselves into the group of those that win more often than they lose, and conversely, what poor strategies cause teams to fall into the group of those who lose more than they win.

The Exchange Rate Mechanism And The Ruble Devaluation Of 1998, Philip Porter

University Avenue Undergraduate Journal of Economics

I will first examine what I see as the common sense fundamentals of the exchange rate mechanism, noting as I go, the relationship with the current Russian crisis. In my examination, I will take the simplest approach, assuming free trade, unrestricted capital movements and negligible transaction costs. Concluding, I will delve into the quagmire of the Russian situation.

Gender Differences In The Causes Of Non-Completion Rates Among Oregon Apprentices: A Case Study Of The Metro Electrical Jtpc, Portland, Oregon, Kerstin Rock

University Avenue Undergraduate Journal of Economics

This paper will address the question of why women drop out of apprenticeship programs at a higher frequency than men. I will examine if there are in fact substantial differences in human capital and social characteristics between female and male apprentices and whether the influence of these characteristics on the probability of finishing depends on the sex of the apprentice. I hypothesize that the reasons apprentices quit prematurely will differ significantly between sexes, especially in reference to educational background, experience, and family situation.

An Analysis Of The Determinants Of Financial Derivative Use By Commercial Banks, Katie Hundman '98

Honors Projects

Section One will provide background infonnation defining financial derivatives and discussing their increasing popularity among commercial banks. A summary of recent regulatory developments surrounding capital requirements and derivative use will also be presented. Section Two will describe previous research that has been done on derivative use in the financial services industry. A theoretical model will be developed in Section Three, and an empirical model will be presented in Section Four. And the results and future implications of the study will be presented in Section Five and Six, respectively.

The Impact Of Youth Characteristics And Experiences On Transitions Out Of Poverty, Michael Seeborg, Mark Israel

Scholarly Publications

Although the causes of intergenerational transitions from poverty have attracted the attention of economists and sociologists in recent years, there have been few attempts to integrate ideas from both disciplines. Using a sample of young adults who were impoverished as youth, this study explores the effects of a number of background characteristics such as early welfare dependency, substance abuse, teen parenthood and parent's educational attainment on the family income levels of young adults. It finds that many of these background variables have significant indirect influences on family income through intervening variables, especially the respondent's own educational attainment, welfare dependency, and …

Crowding Out And Government Spending, Marie Carrasco

University Avenue Undergraduate Journal of Economics

The purpose of this paper is to provide a better understanding of the relationship between budget deficits and private investment and to contribute to the discussion of whether or not such a relationship exists. We test the robustness of Cebula's (1985) model by extending the time period, by testing the model using a proxy for one of the variables, and by de-trending the variables.

A Test Of Additional Effort Expenditure In The "Walk Year" For Major League Baseball Players, Benjamin D. Grad

University Avenue Undergraduate Journal of Economics

Whether they "overperform" or underperform, it is clear that there is incentive for players to do well in their walk year. This same incentive is not present for players either already tied up in long-term contracts or those without enough major league service time to qualify for free-agent status. This paper seeks to test whether the assertion that players perform better and expend more effort in their "walk year" is empirically observable.

Editor's Note: Figures are missing from this article. We apologize for the inconvenience.

Japanese U.S. Auto Transplant Production: An Analysis Of The Roles Of Vers And The Exchange Rate, Michael Cornstubble

University Avenue Undergraduate Journal of Economics

Since their introduction in 1982, Japanese auto transplants in the U.S. have skyrocketed in production, now producing many more cars than are imported. This study incorporates new refinements and revisions to attempt to identify the main factors that are responsible for the introduction of Japanese auto transplants and their massive growth in production over the last 14 years. The author develops two hypotheses for theoretical analysis of the factors contributing to production decisions. The first is that the voluntary export restraints (VERs) imposed on the Japanese from 1981-1985 are responsible for bringing the transplants to the U.S. and for creating …

Firm Size And R&D; Testing The Schumpeterian Hypothesis, Melissa Goodwin

University Avenue Undergraduate Journal of Economics

This paper aims solely to look at the question of R&D, research and development, expenditure. More specifically, this paper asks the question, "What is the relationship between the size of the firm and R&D? And do larger firms spend more on R&D relative to their size than smaller firms?" The answers to these questions have important implications concerning a firm's incentives for growth and innovation. These answers will also put us a step closer to understanding the functions performed by firms as Coase suggests.

The Minimum Wage In America Will Current Legislation Really Help The Working Poor?, Douglas A. Noe

University Avenue Undergraduate Journal of Economics

This same incentive is not present for players either already tied up in long-term contracts or those without enough major league service time to qualify for free-agent status. Were Finley's plan adopted, this incentive would be present for all players in all seasons, instead of just the few hoping for lucrative contracts at the end of the year. While the competitive balance (and aggregate statistics) may not be effected, if work effort is indeed endogenous, overall effort (and "hustle") would likely be increased, and a finer product would be put on the field, potentially increasing attendance and thus revenues. Thus, …

Winning The Marathon: A Reconsideration Of The Development Effects Of Neo-Classical Trade Practices, Peter Weylie, Jean-Pierre Guevremont

University Avenue Undergraduate Journal of Economics

This paper focuses on the trading policies of developed nations, specifically import quotas, and their positive and negative effects on developing countries. We hope to show that the case is not as polar as was once believed and instead focus on how the current literature suggests that the real effects of free-trade are shrouded in nuance and circumstance. Our starting point will be an analysis of the fashionable neo-liberal trade theory and its impact on development, making special reference to the Multi-Fibre Agreement (MFA). We will then turn our attention to the shortcomings of the neo-liberal approach, and provide a …

Are Economies Moving In The Direction Of Smaller Firms?, Hong Kian Boon Kelvin

University Avenue Undergraduate Journal of Economics

This paper assesses the present situation of the SME sector in Singapore, and appraise its role in the future. SMEs are a distinct economic entity that often thrive in small niches. SMEs may be defined in various ways, in terms of the country's stage of development and policy objectives. While the SMEs can play many strategic roles in our transition to the innovation driven stage of development, recent trends over the decade have shown that they still have a long way to go.

Editor's Note: Some figures are missing from this article. We apologize for the inconvenience.

Japanese U.S. Auto Transplant Production: An Analysis Of The Roles Of Vers And The Exchange Rate, Michael R. Cornstubble '97

Honors Projects

Since their introduction in 1982, Japanese auto transplants in the U.S. have skyrocketed in production, now producing many more cars than are imported. This study incorporates new refinements and revisions to attempt to identify the main factors that are responsiblefor the introduction of Japanese auto transplants and their massive growth in production over the last 14 years. The author develops two hypotheses from theoretical analysis ofthe factors contributing to production decisions. The first is that the voluntary export restraints (VERs) imposed on the Japanese from 1981-1985 are responsible for bringing the transplants to the U.S. andfor creating major growth in …

The Economic Rationale Of A Multi-State Lotto, Brett Roush '97

Honors Projects

First, lotteries offer an opportunity to study how consumers react to straightforward risky situations. Other forms of risk-taking--investing in the stock market, for example--or even many forms of gambling--handicapping horses, for example--do not offer the simplistic situation posed by lotteries. These instruments involve nothing more than a small payment followed by a purely random determination of winner and losers. The potential winnings, moreover, can range from the nugatory (a free ticket) to the awe-inspiring (in July of 1993 the Powerball jackpot reached $110 million). Besides gaining insights into consumer behavior in risky situations, lottery research is important for public policy …

Wealth Through Christ?, Matthew P. Mikulcik

Honors Projects

As a Christian, should a belief in God have an impact on economic well-being? Does it? One could argue that Christians have certain values and beliefs that might have a significant impact on economic well-being. One could also argue that other non-Christian people possess similar values and beliefs that have nothing to do with a belief in the Christian God, but that might also have a significant impact on well-being. One could argue that the values and beliefs associated with being Christian should have a positive effect on well-being; however, one could also argue that the values and beliefs should …

Predicting The Divorce Decisions Of Young Women Using The National Longitudinal Survey Of Youth, Angela A. Smith '96

Honors Projects

Over recent decades, we have witnessed drastic changes in American family structure. Previous studies, such as those performed by Gary Becker (1991) and Manser and Brown (1980) have applied economic models to divorce and other family structure decisions. Building on the utility maximization analysis of Manser and Brown, as adapted by John Ermisch (1993), this study uses a logit regression analysis to predict divorce decisions for an all female sample of respondents, ages 28 to 36. Data are extracted from the National Longitudinal Survey of Youth for this analysis. Economic theory predicts that the probability of divorce is directly related …

Automobile Leasing Versus Installment Loan Credit: A Comparative Analysis, Susan E. Brown '96

Honors Projects

The Shortino family has done what many other consumers are doing--Ieasing an automobile. As a result, leasing is becoming an increasingly popular method of automobile financing. But why is leasing advantageous for the Shortino family? Johanna Shortino stated that the principle advantage of leasing was the savings on the down payment. While this may be true, there are also other factors to consider. For example, consider the contrast in the Shortinos' vehicles: an "aging" Datsun versus a new Cadillac. This shift is a significant trade upward among automobile classes and suggests another advantage to leasing: leasing can make expensive cars …

Exchange Rate Variability And Its Effect On Trade: A Case Study Of The Cfa Free Trade Zone, Gwendolyn M. Alexander '96

Honors Projects

Since the fall of the Bretton Woods agreement and the rise of a floating exchange rate regime, there has been a marked increase in the volatility of exchange rates. The movement of exchange rates relative to other currencies, or exchange rate variability is seen as a risk by importers and exporters. The uncertainty surrounding exchange rate movements affects importers and exporters who must determine domestic prices of traded goods without knowing how the exchange rate will move between the time an order is placed and the time payment is due. Theory supports that as exchange rate variability increases, ceteris paribus, …

Cultural Wage Differentials Among United States Immigrants, William J. Takahashi '96

Honors Projects

One ofthe most debated political and social issues in contemporary America is that of immigration. As a nation ofimmigrants and descendants ofimmigrants, the United States is grappling with the conflict over whether or not continued immigration will prove to be beneficial or detrimental to the economy and society. Immigration is an issue as old as the United States itself, yet it seems as though this generation of leaders is more determined than ever to make lasting changes in the policy concerning immigration. Some argue that a consistent inflow ofdiverse and talented human beings will advance the nation's economy as it …

An Empirical Analysis Of Dutch Disease: Developing And Developed Countries, David Rudd '96

Honors Projects

Dutch Disease occurs when a country discovers a substantial natural resource deposit and begins a large-scale exportation of it. As a result, the country's currency appreciates, thereby reducing the competitiveness of the country's traditional export sector. Therefore, this tradable goods sector should contract, leading to structural changes and unemployment in the economy. Neary and Van Wijnbergen (1986) develop the theoretical underpinnings by identifying the two components of Dutch Disease: the spending effect and the resource-movement effect. Using these theoretical components, the paper attempts to account for the decline in the Netherlands' manufacturing sector and Nigeria's and Indonesia's agriculture sectors. The …

Teen Mothers And Their Educational Attainment: Some Evidence From The National Longitudinal Survey Of Youth, Michael Seeborg, Risa Kumazawa

Scholarly Publications

This study uses the National Longitudinal Survey of Youth to estimate the effects of teenage motherhood on the educational attainment of young women. The results of an OLS regression with interaction terms demonstrate that the effects of teenage motherhood on education depends on the socio-economic background of the mother. Estimations show that young women from economically advantaged backgrounds sacrifice more than one year of education as a result of teenage motherhood while those from disadvantaged backgrounds sacrifice little, if any, education. Statistically significant interactions are found between teenage motherhood and several background characteristics. (J13, J24)

The Stock Market As A Leading Indicator: An Application Of Granger Causality, Brad Comincioli

University Avenue Undergraduate Journal of Economics

The purpose of this paper, then, is to evaluate stock prices as a leading indicator of economic activity. Time-series analysis and the notion of "Granger causality" are used in this project to estimate relationships between stock prices and the economy, and to see if they are consistent with theory. In this paper, we will explore the following questions. First, does the stock market lead the real economy, in the sense that variation in its past values explains some of the variation in the real economy? Second, does the stock market "Granger-cause" the real economy, in which case past values of …

An Economic Analysis Of The Death Penalty, Martin Kasten

University Avenue Undergraduate Journal of Economics

From an economic perspective, society should only use capital punishment if the marginal benefits outweigh the marginal costs. In the course of analyzing the economic efficiency of capital punishment, and before providing any recommendations, both the benefits and costs of the death penalty must be evaluated. Since the death penalty has been implemented for centuries, many people believe its benefits outweigh its costs. The evaluation of benefits in Part II will be compared to the costs assessed in Part III to determine if this long held assertion is correct.

Cultural Wage Differentials Among United States Immigrants, Bill Takahashi

University Avenue Undergraduate Journal of Economics

This project will attempt to take a modern snapshot of the ongoing process of immigration and cultural diversification, examine the problem of immigrant adaptation into the American way of life and explore which groups, if any, have an advantage when it comes to integrating into American society. More specifically this paper will address the question: What is the role of cultural factors in determining the standard of living of immigrants.

Editor's Note: Figures are missing from this article. We apologize for the inconvenience.

Environmental Injustice: Evidence And Economic Implications, Heidi Y. Willers

University Avenue Undergraduate Journal of Economics

Some economic analyses find evidence of environmental injustice--minorities and/or low-income persons are exposed to environmental dangers (locally undesirable land uses, or LULUs) more than their non-minority or more affluent counterparts. Such inefficient allocations result from a violation of perfect property rights. This paper does not determine efficient levels of various environmental dangers, but rather examines and compares several studies in an effort to find a consensus among researchers. No consensus emerges, as differences in research techniques prevent consistent results from being found. Future research must have well-defined methodologies before it can be effectively used by policy makers.

Cumulative Voting And Single Member Districts In Industrial Organization, Joshua Yount '95

Honors Projects

In 1993 Bill Clinton nominated Lani Guinier to head the civil rights division of the Department of Justice. Soon after, Guinier's nomination became embroiled in controversy when the media and conservative legislators began to examine her writings on electoral remedies to Voting Rights Act violations. Almost immediately, Lani Guinier became known as the "quota queen" and her writings were derided as undemocratic and racially preferential. Still smarting from "nanny-gate," President Clinton quickly moved to avoid further attacks and withdrew Guinier's nomination. Foremost among the charges raised against Guinier was that her advocation of cumulative voting as an alternative to districting …

The Effects Of High School Mathematics And Science Classes On Wages, Kara Joy Rocheleau '95

Honors Projects

The popular press is filled with claims that the world is becoming a more technological place, and that mathematical and scientific knowledge is becoming a necessity. Carol Wynn, chairwoman of a chamber of commerce education group, projects by the year 2000 almost all new jobs will be technical in nature (Louka 1993, p. 1). According to Barbara Behrendt (1993, p. 1), education is also moving in that direction; many people feel pursuing more math or science oriented classes will payoff financially.

The Stock Market As A Leading Economic Indicator: An Application Of Granger Causality, Brad Comincioli '95

Honors Projects

The stock market has traditionally been viewed as an indicator or "predictor" of the economy. Many believe that large decreases in stock prices are reflective of a future recession, whereas large increases in stock prices suggest future economic growth.

The Effect Of Nations' Economic Linkages On The Co-Movement Of Their Stock Markets, Niveditha Hasthak '95

Honors Projects

The flow of international investments has been rapidly increasing in recent years. One of the foremost reasons for international investing is that it provides diversification which can be explained in sinple terms as selecting securities that do not move together. The main benefit of diversification is that it reduces risk (Markowitz 1952). The amount of diversification provided by investing in international equity markets is dependent on the extent of co-movement of equity markets across the globe.