Strategic Thinking Class: J-Term

Strategic Thinking Using Game Theory

Great leaders understand and use strategic thinking. Most learn it on the job. Some study it and then apply it. The basis of most strategic thinking among successful leaders is an application of game theory.

This Winter Session (J-Term) you have the opportunity to learn how to see the whole at a glance. Several games will be used as the springboard for you to begin the art of thinking strategically.

The course will be taught by Charles Swayne, recognized for his application of game theory. He is a frequent speaker at the World Series of Poker Academy Camps, teaches poker online with Daniel Negreanu, is the creator of the N-SPAT (The Negreanu-Swayne Poker Aptitude Test), is an honorary member of the Global Strategic Poker Thinking Society, and his new book, Swayne’s Advanced Degree in Hold’em, is the most comprehensive book on the market for the serious poker player. He is currently working on a new book, Heads Up Poker, with champion Paul Wasicka. Swayne has combined his education and lessons of mathematics, statistics, total quality management, industrial engineering, operations research, entrepreneurship, finance, economics, investments, marketing, leadership, strategy and ethics, to help you to become a more global thinker.

Where and When: University of Wisconsin – La Crosse
Winter Session (J-Term)
Time and Days: 9am-2:10pm (bring your lunch), Monday-Thursday
11-14 Jan and 19-22 Jan 2010
Credits: 3
Course Details: REC 375; Workshop in Recreation Management
University Information: If you are not a UW-L student, contact UW-L Admissions at 608.785.8939
More Course Information: Contact Charles Swayne at swayne.char@uwlax.edu or 608.397.2783

An interesting talk on India

This is quite an interesting talk on India. What makes it more interesting is that Shashi Tharoor is a dynamic speaker

Here is the link:

http://www.ted.com/talks/shashi_tharoor.html

Better Data

We need better data.

The shortcomings of the data-gathering system came through loud and clear here Friday and Saturday at a first-of-its-kind gathering of economists from academia and government determined to come up with a more accurate statistical picture.


The fundamental shortcoming is in the way imports are accounted for. A carburetor bought for $50 in China as a component of an American-made car, for example, more often than not shows up in the statistics as if it were the American-made version valued at, say, $100. The failure to distinguish adequately between what is made in America and what is made abroad falsely inflates the gross domestic product, which sums up all value added within the country.


American workers lose their jobs when carburetors they once made are imported instead. The federal data notices the decline in employment but fails to revalue the carburetors or even pinpoint that they are foreign-made. Because it seems as if $100 carburetors are being produced but fewer workers are needed to do so, productivity falsely rises — in the national statistics.


“We don’t have the data collection structure to capture what is happening in a real time way, or what is being traded and how it is affecting workers,” said Susan Houseman, a senior economist at the W.E. Upjohn Institute for Employment Research in Kalamazoo, Mich., who has done pioneering research in the field. “We have no idea how to measure the occupations being offshored or what is being inshored.”

Seminar: Michael Murray

There will be an economics department seminar this Friday, November 13, 4:30-5:30pm in room 230 Wimberly Hall. Michael Murray will be presenting a paper titled, "Modeling Keynes with Pasinetti: A Dynamic Schema for Full Employment."

Michael Murray is a former student and graduate of UWL's economics department. Michael went on to graduate school for Economics at the University of Missouri - Kansas City and is now an Assistant Professor of Economics at Central College in Pella, Iowa.

Increasingly Selective

UW-L is has increased selectivity over the years, often attributed to the rising quality of faculty. A much as I like the compliment it is probably not causal. I think this comports better with my views on why that has happened. From MarginalRevolution

Caroline Hoxby reports:

This paper shows that although the top ten percent of colleges are substantially more selective now than they were 5 decades ago, most colleges are not more selective. Moreover, at least 50 percent of colleges are substantially less selective now than they were then. This paper demonstrates that competition for space--the number of students who wish to attend college growing faster than the number of spaces available--does not explain changing selectivity. The explanation is, instead, that the elasticity of a student's preference for a college with respect to its proximity to his home has fallen substantially over time and there has been a corresponding increase in the elasticity of his preference for a college with respect to its resources and peers. In other words, students used to attend a local college regardless of their abilities and its characteristics. Now, their choices are driven far less by distance and far more by a college's resources and student body. It is the consequent re-sorting of students among colleges that has, at once, caused selectivity to rise in a small number of colleges while simultaneously causing it to fall in other colleges. I show that the integration of the market for college education has had profound implications on the peers whom college students experience, the resources invested in their education, the tuition they pay, and the subsidies they enjoy. An important finding is that, even though tuition has been rising rapidly at the most selective schools, the deal students get there has arguably improved greatly. The result is that the "stakes" associated with admission to these colleges are much higher now than in the past.

A summary of the paper. The ungated version is here.

Economica: Women and the Global Economy

Check out this online exhibit at the International Museum of Women.

CANCELLED: Seminar: Russ Kashian and Matt Kures

On Friday we will have a seminar entitled “Assessing Foreclosure Variations Across the Urban-Rural Continuum - A GIS-Based Approach”, presented by Russ Kashian, UW-Whitewater Fiscal and Economic Research Center and Matt Kures UW-Extension Center for Community and Economic Development. The presentation will be this Friday November 6th at 3:30pm in room 230 CWH. I will provide a link to their paper when they send it to me.

This has been cancelled due to H1N1.

Office Solutions: Econ Style

Check out this new podcast on behavioral economics. The first one discusses the bargaining versus the primadonna solution for who cleans out the coffee pot when the Administrative Assistant is laid off.

The Debt

I'm often asked about the "problem" our debt represents. Below is a largely good video explaining who holds the debt and the "problem" it presents. One VERY important caveat. While the author gets the idea correct that what matters is publicly outstanding debt, since inter-government debt is merely a wash, he does not accurately address this same issue when talking about bonds as financial assets. Remember that a US government bond is an asset to the holder, but a liability to the tax payer. We care about our net position as tax payers. Also, from an economic perspective, bond holders and tax payers are not the same people, so there are distributional consequences to changes in the level of the debt. But with that said this might help somewhat.

Useful Posts

Here are a few posts that BUS 230 students should find useful over the coming weeks.

Nancy Duarte on "Creating Waves" in presentations.

Seth Godin on making graphs that work.

Garr Reynolds on the art of the "Focal Point" and the art of "Less" in presentation design.

And two on the value of data visualization. Here and here.

Externalities

Wearing helmets while riding a motorcycle can have consequences for the organ donation market. This is an externaility only an economist can love.

Ostrom: First Woman to Win the Nobel Prize in Economics

Here are some links to blogs and other commentaries on Elinor Ostrom's Nobel Prize:

Econospeak

The American Academy of Political and Social Science

Greg Mankiw

Working in Groups

Some advice from the Harvard Business Publisher on working in groups. This is probably good reading for anyone in BUS 230.

The best approach is to go to the source — speak with your colleague directly. This conversation should take place in an informal, private setting and you should always follow good feedback rules. Don't accuse or blame your colleague. Use concrete examples to explain what you are seeing and its impact on you.

Richard Hackman, the Edgar Pierce Professor of Social and Organizational Psychology at Harvard Business School and author of Leading Teams: Setting the Stage for Great Performances says, "We tend to attribute what's going wrong to an individual and specifically to something dispositional about them." This is dangerous because you are then attacking a person — not their behavior. Most importantly, to establish a common ground with your colleague, discuss the issue in context of mutual goals. "You want to ask 'What can we do to achieve our goals?' not 'You screwed up again,'" Hackman says.

Multipliers

In ECO120 you learn about the multiplier. That concept has been used and misused. The Economist puts some of the recent debate about multipliers into context here.

The debate hinges on the scale of the “fiscal multiplier”. This measure, first formalised in 1931 by Richard Kahn, a student of John Maynard Keynes, captures how effectively tax cuts or increases in government spending stimulate output. A multiplier of one means that a $1 billion increase in government spending will increase a country’s GDP by $1 billion.

The size of the multiplier is bound to vary according to economic conditions. For an economy operating at full capacity, the fiscal multiplier should be zero. Since there are no spare resources, any increase in government demand would just replace spending elsewhere. But in a recession, when workers and factories lie idle, a fiscal boost can increase overall demand. And if the initial stimulus triggers a cascade of expenditure among consumers and businesses, the multiplier can be well above one.

The multiplier is also likely to vary according to the type of fiscal action. Government spending on building a bridge may have a bigger multiplier than a tax cut if consumers save a portion of their tax windfall. A tax cut targeted at poorer people may have a bigger impact on spending than one for the affluent, since poorer folk tend to spend a higher share of their income.

Crucially, the overall size of the fiscal multiplier also depends on how people react to higher government borrowing. If the government’s actions bolster confidence and revive animal spirits, the multiplier could rise as demand goes up and private investment is “crowded in”. But if interest rates climb in response to government borrowing then some private investment that would otherwise have occurred could get “crowded out”. And if consumers expect higher future taxes in order to finance new government borrowing, they could spend less today. All that would reduce the fiscal multiplier, potentially to below zero...

There is a lot more here.

Game Theory Explains Uneven Dating Scene

See! Economics can be fun!

Seminar: John Murray

Our first seminar speaker of the semester has been scheduled. John Murray (University of Toledo) will be here on Friday, October 9th to present “Information Asymmetries in Maternity Insurance Before Federally Mandated Coverage.” The seminar will be held in room 230 from 4:30-5:30. A copy of the paper is available from the link above. We invite our economics majors to attend.

For those who have asked about graduate school in Economics....

Twenty-Cent Paradigms: New Econ PhD Rankings

100 Blogs for Econ Students

via Marginal Revolution. The best 100 blogs for econ students.

Economics in the News Blogs

Murray's ECO 120: Global Macroeconomics students have an Economics in the News Blog. In each entry, they cite a newspaper story related to economics and give a brief discussion about it. There should be dozens of entries each week:

http://www.murraylax.org/eco120/studentblog/

I also have my own Economics in the News Blog that I rarely update:

http://www.murraylax.org/econblog/

Econ Club

You are invited to the first Econ Club meeting of the year. We’re still working to get official club status, but that doesn’t stop us from meeting. We’ll be discussing current economic events, meeting some new faculty, and starting on a plan for the year. Hope you can make it.

Meeting: Thursday, September 17th at 5:30pm in room 114 Wimberly Hall.

If you have questions, contact Josh Lieder at lieder.josh at students.uwlax.edu, or check out the facebook group here.

Nothing is new.

A recent report from the St. Louis Federal Reserve suggests that the current flood of bank failures result from only four problems:

1. An imbalance of risk versus return,
2. Failure to diversify,
3. Offering products and services that bank management doesn’t fully understand,
4. Poor management of risks.

They further suggest that none of these things are anything new. That is, every bank failure from recessions past and present can be explained by one or more of these four factors. As much as we might like to call the current situation "unprecedented" and blame our problems on new fancy financial assets, lack of regulation, bad monetary policy, or bad economic policy from your least favorite politician, maybe it is just a problem of us failing to learn from our past mistakes.

Here's the link:
http://www.stlouisfed.org/newsroom/displayNews.cfm?article=496

Salaries

Why should you be an econ major? Because you want to make lots of money, but you don't want to be an engineer. Data here.

Best Undergrad College Degrees By Salary

Methodology Annual pay for Bachelors graduates without higher degrees. Typical starting graduates have 2 years of experience; mid-career have 15 years. See full methodology for more.

Humor

The Fed struggles against a 'good old boys' persona

The NY Fed President resigned after announcement of his ownership and connections to Goldman Sachs who applied to become a bank holding company. I can understand the initial waiver of the conflict of interest, but I can't understand why he thought he could buy more shares.
Read the article here.

Where the Jobs Are (or Were)...

A geographical representation of job losses and gains over the past couple of years.
You can check it out here.

Mike on the News.

Check it out….here. Click the play button on the video.

Seminar: Strip Club Economics

Taggert J. Brooks (Economics) will present “In Da Club: An Econometric Analysis of Strip Club Patrons” Friday May 1st at 3:30 in CWH 230. The talk will cover the paper specifically and the adult entertainment industry more generally.

Abstract:

Experimental researchers find choice inconsistency among males after exposure to sexual cues. Men alter their rate of time preference or their willingness to accept unfair offers in the ultimatum game, after the mere viewing of pictures of attractive or “sexy” women (Wilson and Daly, 2004; Van Den Bergh and Dewitte, 2006). In this paper I try to identify the characteristics of individuals who expose themselves to similar treatments outside the lab. I do this by focusing on individuals who attend clubs that feature nude or semi-nude dancers.

Conservative estimates from the National Health and Social Life Survey (NHSLS) suggest 17 million Americans went to a club that featured nude or semi-nude dancers in 1991. I estimate a demographic logit model using the NHSLS which is the first and only national probability based sample which asks people if they have attended a strip club and their frequency of attendance. The results suggest the types of men who expose themselves to such venues are also more likely to alter their choices in the face of sexual cues.

Funny Video

I Love College

See the video here.

Economic Recovery Dashboard

Keep an eye on our recovery here.

Public-Private Investment Partnership is a little too private

An opinion piece in today's Wall Street Journal discusses how only large fund managers will be able to participate in the Treasury's new partnership. Instead of creating a liquid market for bad assets, the Treasury is limiting the buyers and backing them with government money.
See the article here.
We'll be discussing this at the Econ club meeting on Wednesday, April 1 at 5:30 in 114 CWH.

Some articles on the current crisis.

NY Time Op-Ed by Paul Krugman 3-30-2009

America the Tarnished

An article by Simon Johnson in The Atlantic May 2009 (This is a good one)

The Quiet Coup

NY Time Op-Ed by Joseph Stiglitz 4-01-2009

Obama’s Ersatz Capitalism

Go-getters

Some interesting advice for our juniors and seniors in the job hunt.
http://online.wsj.com/article/SB123845358462571299.html

Economics club next meeting

The next meeting of the Econ club will be Wednesday, April 1, 2009 at 5:30pm in 114 Wimberly Hall.
We will be discussing the public-private investment partnership and the Wall Street Journal's forum on the future of finance. You can find the articles and videos from this forum on the Wall Street Journal website. They came up with 20 principles that should be the basis for finance in the future. You can find them here.

Econ Club By-Laws

Josh Lieder and Andy Cowan have started work on a proposal for the Econ Club By-laws.
If you are interested in working on the bylaws, a small group is meeting at the cybercafe on Thursday, March 26 at 5:30pm.

You can find the proposed bylaws here.
http://www.uwlax.edu/faculty/birkeland/Econ-Club.htm

A Rare Interview with the Chairman

Ben Bernanke was interviewed on 60 minutes this week.
Part I

Watch CBS Videos Online

Part II

Watch CBS Videos Online

Frank: Lecture

It must have been the pizza....

Given the incentives of free pizza and stimulating discussion, approximately 40 students met as the newly-forming Econ club. We had more people than we expected and great discussions. If you missed it and would like to learn more about it, visit the facebook group: UW-L Economics Students or talk with Professors Birkeland, Brooks, or Knowles.

Economics Gets Sexy

NPR says Economics is getting sexier:

All Things Considered, March 1, 2009 · At Ohio's Oberlin College, registration in undergrad economics classes is up 25 percent this year, and the chair of the department says he's never seen anything like it. Host Robert Smith finds a similar surge in the classrooms of American University and across the country. So is undergraduate economics getting sexier? In a word: yes.

Speaker: Bob Frank

Textbook author Robert Frank will present a seminar entitled "Unsolicited Advice for the Obama Administration", it is scheduled for Monday, March 23rd tentatively at 7:30 pm. It is open to all.

Check out Bob's Crib

Credit Crisis

This is an okay visualization of the credit crisis.


The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo.

Seminar: Cara McDaniel

The Economics Department Seminar Series will kick off its spring session on Friday, March 6th at 3:30 pm in room 230 Wimberly Hall. Cara McDaniel (Kenyon College) will present “Hours worked in the OECD: Driving forces and propagation mechanisms.” The seminar is open to all interested parties. We hope to see you there.

Economist Panel Inteview about the Crisis

Why We Love

Helen Fisher tells us why we love.

Autism, Vaccination and Ethical Research

This appears to be another blow for those that think there is a causal link between the two. This is sure to be a classic example of alleged unethical behavior.

THE doctor who sparked the scare over the safety of the MMR vaccine for children changed and misreported results in his research, creating the appearance of a possible link with autism, a Sunday Times investigation has found.

Confidential medical documents and interviews with witnesses have established that Andrew Wakefield manipulated patients’ data, which triggered fears that the MMR triple vaccine to protect against measles, mumps and rubella was linked to the condition.

The research was published in February 1998 in an article in The Lancet medical journal. It claimed that the families of eight out of 12 children attending a routine clinic at the hospital had blamed MMR for their autism, and said that problems came on within days of the jab. The team also claimed to have discovered a new inflammatory bowel disease underlying the children’s conditions.

However, our investigation, confirmed by evidence presented to the General Medical Council (GMC), reveals that: In most of the 12 cases, the children’s ailments as described in The Lancet were different from their hospital and GP records. Although the research paper claimed that problems came on within days of the jab, in only one case did medical records suggest this was true, and in many of the cases medical concerns had been raised before the children were vaccinated. Hospital pathologists, looking for inflammatory bowel disease, reported in the majority of cases that the gut was normal. This was then reviewed and the Lancet paper showed them as abnormal.

Tough times, new behaviors

Dr. Brooks was interviewed on WXOW about changing behaviors during this downturn.

Tough times, new behaviors

Posted: Feb 9, 2009 07:35 PM

It's no secret that we're facing tough times right now, and it seems that consumers are becoming more realistic about the future of our economy.

Consumer Greg Ives says, "I would say we're trying to save more, we're trying to not overspend. We're watching more and more where our money goes."

While President Obama's economic stimulus bill moves forward, even the President knows it will take years not months to revive consumer confidence, and when we'll see relief is anyone's guess.

UW-L Economist T.J. Brooks says, "That's the million dollar question. I think this will be the longest, deepest recession. We're already 14 months into it. Usually the average for a post WWII recession is 18 months which would suggest we're going to be done in about six months and nobody really thinks that's the case."

For some, like Rachel Kleinertz the recession isn't an immediate concern.

Rachel says, "I'm still a senior in high school so it didn't really affect me much. I'm still making the same amount of money, not really doing anything different."

But, Rachel's future does concern her...especially the job outlook when she graduates.

Rachel says, "I just want to get through college."

The Ives have two college tuition's to think about it, and they're preparing for the future by doing what they can in the present.

Bonnie Ives says, "We are really watching what we spend. More coupons and watching for sales and things like that. Today we bought a Pack 'N Play for the baby, but we didn't buy the most expensive one, things like that."

While consumers watch what they spend, they're also saving what they have.

Brooks says, "It's a combination of finding their wealth has contracted from where it was, uncertainty about what the economy holds in terms of what job prospects has certainly increased dramatically."

Brooks predicts a potential economic turn around late this year, or early in 2010.

California's Trouble

An interview about California's crisis from the Wall Street Journal.

A Comparison of Job Loss Over Time

Check out this graph for a comparison of job loss in other post WWII recessions.

Is the Stimulus Plan "Macho"?

Check out this short piece in Slate by Jennifer Barret* that refers to several other articles questioning whether or not the stimulus plan could also achieve an ancillary goal: gender equality in the workplace.

Linda Hirshman [in her New York times editorial, "Where are the jobs for women?" asked of the 3.5 million jobs promised by the rescue package. Why not add more in female-friendly fields like child care, education, and social services, asked Barbara Bergmann, vice chair of the Economists' Policy Group for Women's Issues, in an open letter to President Obama that has garnered more than 600 signatures.

Yes. I signed the letter. I'm a sucker for such things. If we're taking the leap into economic engineering (analogous to social engineering), why not engineer this as well?



*She excitedly and mistakenly questions: "Is the stimulus package really better for men than for women? That's what many prominent feminists, and even some male economists, are saying." with a link on the "male economists" to an article by female economist, Randy Albelda... OOPS!

Craft Beer: Recession Proof?

Mike Haupert answers the question with an affirmative.

Pearl Street Brewery is getting ready for its 10th anniversary.

"Our business has grown about 30 to 40 percent in the last year," says Brewmaster Joe Katchever.

That's not something many businesses can say in this economy. But industries, like microbreweries, are booming. Economists say it's because a high-end beer is a small luxury people can justify.

"(People say) 'I can't afford the $40 bottle of whisky, but I'll go get myself a sort of "niche" beer," says UW-L Economics Professor Mike Haupert. "(They say) 'it's not the can of beer I'd get at a grocery store, but it's not going to set me back the same amount."

Which is good news for Pearl Street Brewery. They've expanded sales from the La Crosse area to all of western Wisconsin, something they credit to people thinking beer is an affordable indulgence.

"Our sales haven't really tapered off, or changed since this recession officially started, or people started talking about it at the end of the summer," Katchever says.

See the video and story here.

Tighten the ranks

In a Forbes article, William Easterly acknowledges that during a crisis, economists revert back to the basics (at least in the development field). See his article here.

Visualizing Store Openings

A dynamic map, plotting the openings of Target and another of Walmart openings. Both chains clearly have very different geographic strategies.

Why Study Economics?

President Obama's Stimulus Proposal

The President outlined his plan for a stimulus package in his weekly address. Click here for a summary of the proposed recovery plan.

Bringing home the bacon

Taggert just pointed me toward a great Freakonomics blog that tells us that 26 percent of wives earned more than their husbands in 2006.

Times are a-changin!