roanomics, vol 2, iss 2
TRANSCRIPT
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8/2/2019 Roanomics, Vol 2, Iss 2
1/12
office or
den. Unbe-
lievable!!
There is
even an
app that
will allow
me to swipe
your credit
card when you buy one of
my econ lessons. I imagine
in a few years, students will
have all of their textbooks
loaded on one of these. No
more reason to lug around
those heavy backpacks.
And you can update yourFacebook page, if one were
to have such a thing. Yep,
the old Colonel has finally
caught up to 2012. Well,
almost anyway.
Im going to tell you some-
thing youre not going to
believe-I am writing this
column using my new
iPad2 I received for Christ-
mas from my sweet wife.
Yes, I know, my idea of
technology is using colored
pens on a white board. And
that big black box in my
classroom thats used for
PowerPoint presentations I
use as a coaster for my cof-
fee cup. But, hey, maybe
you can teach an old dog
new tricks! After all, I re-
cently learned how to attachan attachment to an email (I
guess thats why its called
an attachment), thanks to
Dr. Kassens. And Dr. Patel
taught me how to use In-
quire to email my classes.
So right now I am using
this app called CloudOn,
which is part of another app
called Dropbox. Amazing!
Today I attended a two hour
workshop on all of the uses
of an iPad. My head is still
spinning with information
overload. This thing replac-
es everything! You dont
need a library, a typewriter,
a TV, a radio, an alarm
clock, or even a cell phone.
It tells you the weather, the
news, your appointments,
and your location. Its a
camera, a notebook, a cook-book, and a whiteboard.
Heck, it will even check
your vital statistics! So long
Dr. Amick! I can test my
pulse and blood pressure
from the convenience of my
From the Colonels Desk
Reaching outThis is our third release of
Roanomics and it continues
to grow in popularity. Sev-
eral alumni have sent
emails or posted on social
networking outlets that they
enjoy reading through the
newsletter.
We are thrilled that
Roanomics is catching on
in this way. Reconnecting
with alumni was one of the
purposes of the newsletter.
If there is something that
you would like to see in the
next issue, send an email to
Remember that you can
keep up to date on the Eco-
nomics Program between
issues of Roanomics by
following our blog, kas-
sensroanokeecon.blogspot.c
om, which is updated sever-
al times a month.
See you alumni weekend!
Roanoke College Economics Program
Winter and Spring 2012
Volume 2, Issue 2
Roanomics
Advising tips:
The Economics Pro-gram offers a major and
a minor
If you major in BUAD,there are only five addi-
tional courses left tocomplete the minor inECON (one of whichcan count as the BUAD
elective)
Several of the ECON200-level courses serveas electives in BUAD
concentrations
ECON 121 can substi-
tute for an INQ 260
Inside this issue:
News and notes 2
Student Editors
note3
Fall courses 3
Faculty updates 4
Presentations, Publi-
cations and Honors5
Fed Challenge 6
Feature: Advice for
2012 Graduates7
Economics Facultyin the RoanokeTimes
8
Travels with Dr. Bob 10
Garry Fleming,
Shannon Chair of
Economics
mailto:[email protected]:[email protected]://roanokeecon.blogspot.com/http://roanokeecon.blogspot.com/http://roanokeecon.blogspot.com/http://roanokeecon.blogspot.com/http://roanokeecon.blogspot.com/http://roanokeecon.blogspot.com/http://roanokeecon.blogspot.com/mailto:[email protected] -
8/2/2019 Roanomics, Vol 2, Iss 2
2/12
Dr. Darshak Patel and Con-
rad Classen have started an
Economics Club at Roanoke
College. If you are interested,
please fill out the interest form
http://
kassensroanokee-
con.blogspot.com/2012/01/
economics-club-at-roanoke-
college.html
Shingirai (Chris) Kwaramba
`12 has been accepted to both
UNC-C (Masters, Economics)
and Virginia Tech (MBA)
Sara Caudle `12 is presenting
her original research at theNa-
tional Conference for Under-
graduate Research(NCUR) at
Weber State University. Her
paper was accepted from over
3,500 submissions. She is the
second RC Economics Major
(Tyler Rinko `11) to do this
and the first female. Congrats
Sara!
Congratulations to the 2012ODE Inductees Nathan Cas-
tellano, Chanho Song, Ted
Ellis and Tiffany Ingram
Economics majorIanKervick-
Jimenez 13 was elected Presi-
dent of the Roanoke College
SGA in January. Read what he
has to say in a recent interview
posted on the Roanoke College
blog www.rcnewsblog.com
Dr. Alice Louise Kassens ran
2:59:07 to finish 29th at the
2011 Philadelphia Marathon in
November and defended her
title March 18, 2012 at the
Quintiles Marathon.
Nathan Castellano 12 and
Marko Krkeljas 12presented
their research in a student session
at the 2012 Virginia Association
of Economists Annual Meeting
in March
Dr. Alice Louise Kassens was
elected President of the Virginia
Association of Economists
Dr. Darshak Patel will be re-
joining the Roanoke College
Economics Faculty for the AY
2012-13
Wai Paing `12 and Nomin
Baasandavaa 12 earned Honorsin the Major for Economics in
December 2011
Please let us know what is new
with you at roanokee-
[email protected] fill out our
form at kassensroanokee-
con.blogspot.com
News and notes
Where are our alumni now?ership at the Roanoke Regional
Chamber of Commerce
Remember that Alumni Week-
end is April 13-15. Feel free to
stop by West Hall to say hello!
Fill out the alumni survey at
kassensroanokee-
con.blogspot.com
Have career advice or contactsfor our current Economics stu-
dents? Please send an email to
Chris Zachodzki 09 is in law
school at the University of South
Carolina. He also is a research
assistant for Dr. David Linnan, an
intern for the South Carolina
Court of Appeals, and National
Advisory Team Member for the
College to Community Pilot Pro-
gram at the American Cancer So-
ciety.
Andrew Streaman 09 is an ana-
lyst at JP Morgan Chase
SJ Brussard `09 is in Institutional
Sales at Rodman & Renshaw
Deborah Lindsay 02 is the Vice
President of Marketing and Lead-
Page 2 Roanomics
Chris Kwaramba
My overall education at Roa-
noke College, and particularly
my economics education, pre-
pared me for dealing with the
extremely varied career and
educational experiences I have
had throughout my life
-Roanoke College alumna `72
Give us your comments by fill-
ing out the alumni survey on our
blogand maybe they will be
included in the next issue of
Roanomics!
Ian Kervick-Jimenez
Nomin Baasandavaa
Marko Krkeljas
http://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.htmlhttp://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.htmlhttp://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.htmlhttp://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.htmlhttp://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.htmlhttp://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.htmlhttp://www.weber.edu/ncur2012/http://www.weber.edu/ncur2012/http://www.weber.edu/ncur2012/http://www.weber.edu/ncur2012/http://www.rcnewsblog.com/?p=4023http://www.rcnewsblog.com/?p=4023mailto:[email protected]:[email protected]:[email protected]://kassensroanokeecon.blogspot.com/http://kassensroanokeecon.blogspot.com/http://kassensroanokeecon.blogspot.com/http://kassensroanokeecon.blogspot.com/http://kassensroanokeecon.blogspot.com/http://kassensroanokeecon.blogspot.com/mailto:[email protected]:[email protected]://www.societylink.org/portal/server.pt/gateway/PTARGS_0_4192456_2256544_0_0_18/C2C%20About%20Program.pdfhttps://www.societylink.org/portal/server.pt/gateway/PTARGS_0_4192456_2256544_0_0_18/C2C%20About%20Program.pdfhttps://www.societylink.org/portal/server.pt/gateway/PTARGS_0_4192456_2256544_0_0_18/C2C%20About%20Program.pdfhttps://www.societylink.org/portal/server.pt/gateway/PTARGS_0_4192456_2256544_0_0_18/C2C%20About%20Program.pdfhttp://roanokeecon.blogspot.com/http://roanokeecon.blogspot.com/http://roanokeecon.blogspot.com/https://www.societylink.org/portal/server.pt/gateway/PTARGS_0_4192456_2256544_0_0_18/C2C%20About%20Program.pdfhttps://www.societylink.org/portal/server.pt/gateway/PTARGS_0_4192456_2256544_0_0_18/C2C%20About%20Program.pdfhttps://www.societylink.org/portal/server.pt/gateway/PTARGS_0_4192456_2256544_0_0_18/C2C%20About%20Program.pdfmailto:[email protected]://kassensroanokeecon.blogspot.com/http://kassensroanokeecon.blogspot.com/http://kassensroanokeecon.blogspot.com/http://kassensroanokeecon.blogspot.com/mailto:[email protected]:[email protected]://www.rcnewsblog.com/?p=4023http://www.weber.edu/ncur2012/http://www.weber.edu/ncur2012/http://www.weber.edu/ncur2012/http://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.htmlhttp://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.htmlhttp://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.htmlhttp://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.htmlhttp://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.html -
8/2/2019 Roanomics, Vol 2, Iss 2
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As graduation and the realworld approaches, I havespent copious amounts of
time polishing my resume tomake it perfect, hoping toland my dream career; how-ever, as of late, I havestopped worrying so muchabout making my resumeflawless and started becom-ing thankful for all of theopportunities I have received
while at Roanoke.
Over the past three weeks, Iwas one of four students toserve on the student panel forthe Scholars Program. As astudent panelist, we answerquestions regarding academ-ics, extracurricular activities,and student life for parentswhose children have beeninvited to participate in theScholars Program and arethinking about attending Roa-noke. I was asked numeroustimes this question: why did I
choose Roanoke?
After spending much timereflecting on this question, Ifound the answer that con-
firmed why I chose Roanoke.The opportunities I have re-ceived at Roanoke are unbe-lievable and endless. I pre-sented as part of a six mem-ber student team representingRoanoke in the National Col-lege Fed Challenge competi-tion at the Federal ReserveBank of Richmond in front ofa group of senior economists.At the end of March, I willfly out to Utah to present my
undergraduate research at theNational Conference on Un-dergraduate Research. Like-wise, a few of my peers arepresenting their econometricspapers at the Virginia Associ-ation of Economists AnnualMeeting. I have had the op-portunity to serve as the stu-dent editor ofRoanomics,tackle two Honors projects,and intern for the AthleticsDepartment and Salem Red
Sox. In addition, Dr. Kassens,Tyler Rinko, Justin Tuma,and I recently co-authored
and submitted a paper forpublication to the Perspec-tives on Undergraduate Re-search and Mentoring illus-trating how a mentor demon-stration model helps profes-sors and students conduct
research.
Any student can obtain theseopportunities. However, noneof these experiences werehanded to me but required agreat deal of hard work.Therefore, my advice to theyounger students, it is this: inorder to reap the fruits ofyour labor, you must workhard and take advantage ofevery opportunity that comesyour way. In the end, all ofthe hard work and sacrificesyou had to make will be
worth it!
Student Editors Note: Sara Caudle `12
Page 3Volume 2, Issue 1
Fall 2012 Courses (WebAdvisor has all official information)ECON 121 Principles of Micro-
economics
Patel
ECON 122 Principles of Mac-
roeconomics
Fleming, Kassens
ECON 232 Money and Banking
Fleming
ECON 242 Public Finance
Nik-Khah
ECON 252 Fed Challenge
Crook, Stauffer
ECON 267 Labor Economics
Kassens
ECON 321 Intermediate Theo-
ry: Microeconomics
Patel
ECON 448 Introduction to
Econometrics
Kassens
(Blogging in
Dr. Kassens
Principles
course)
helped me
to become
more aware
of how
economics
affects so
many
different
areas
[enabledme] to
understand
how what we
were learning
in class could
tie in to other
economic
events in our
country and
worldwide.
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8/2/2019 Roanomics, Vol 2, Iss 2
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This semester has been a busy
one! I have been on sabbatical
and have been working on a
variety of projects, in addition
to working with four undergrad-
uates on research projects.
First, I started a blog detailing
my journey searching for the
optimal balance between two of
my greatest passions: running
and research. Please take a few
minutes to visit the blog (http://
therunningecono-
mist.blogspot.com) and consid-
er following it on Twitter
@RnningEconomist
Second, I continue my research
project regarding the effects of
clinical depression on labor
market outcomes of young
adults. Recently I received a
second external grant to support
this research. This most recent
award is the Franklin Grant
from the American Philosophi-
cal Society. This organization
was founded in the 18th century
by Benjamin Franklin. The
grant will help fund my trips to
the Research Data Center at
CUNY-Baruch College to work
with highly secure data from the
National Center for Health Sta-
tistics. My next trip to work
with the data and serve as a
Visiting Scholar at Rutgers Uni-
versitys John J. Heldrich Cen-
ter is in April.
Third, I have several other re-
search projects underway, in-
cluding one that my research
assistant Kerry Murphy `13 is
helping me with. We are using
Google Insight for Search to
analyze the relationship between
health and the business cycle.
Finally, this is my first year as a
Senior Analyst with Roanoke
Colleges Institute for Policy and
Opinion Research. My job is to
calculate the Virginia Indexes of
Consumer Sentiment. This is an
exciting project in which we
release our estimates each No-
vember and February. Our first
two releases generated consider-
able media attention.
Faculty Update: Dr. Alice Louise Kassens
Faculty Update: Dr. Darshak Patela number of key foreign-owned
firms and its dependence on cop-
per sent Zambia into a downward
spiral. In the 1970s, oil prices
rose, copper prices slumped and
the country was stuck with a high
level of unemployment, high in-
flation, and debt. Zambias turna-
round began with the new govern-
ment in 1991 that started privatiz-
ing and implementing free market
principles. The country further
moved towards a positive direc-
tion last year when the opposition
leader Michael Sata won the na-
tional election, ousting the incum-
bent President Rupiah Banda.
President Banda did what many
African leaders are reluctant to
do. He accepted defeat and trans-
ferred the power to Sata in a
peaceful and civil manner. That,
in itself, is a cause for celebration
On April, 27, 1993, 18 players
and several coaches of the Zam-
bian national soccer team died in
an air disaster. This added to the
pain and suffering Zambia has
gone through, like many African
countries, in terms of their politi-
cal and social unrest and under-
development. It has become com-
mon to see a popular leader being
toppled by another leader through
a coup or a revolution promising
social change and eradication of
poverty. However, nothing
changes. The new leader sends
the nation through the same
downward spiral by increased
corruption and ill-managed poli-
cies. Its one of the longest trends
faced by many African countries.
These policies, enacted in 1968,
have mismanaged investor rela-
tions. The reforms to nationalize
Page 4 Roanomics
Dr. Alice LouiseKassens,
Associate Professorof Economics
Dr. DarshakPatel,
Visiting AssistantProfessor ofEconomics
for the African continent as a
whole. Zambia has seen an in-
crease in economic growth and the
inflation rate fell below 10% for
the first time in 30 years in 2009.
Sometimes a short-term pain is
needed for an overall long-term
gain. This gain can be realized
through a mixture of the right poli-
cies and the hard work of a unified
country. Even during hard times,
citizens must come together and
work hard to prosperjust as the
Zambian national soccer team did
19 years ago. The dedication and
hard work paid off for the soccer
team, as they lifted the African
Cup of Nations on February 12,
2012 after beating Ivory Coast in a
penalty kick shoot-out. The Zam-
bian people are also starting to
taste victory, as their hard work,
too, is beginning to pay dividends.
http://therunningeconomist.blogspot.com/http://therunningeconomist.blogspot.com/http://therunningeconomist.blogspot.com/http://therunningeconomist.blogspot.com/http://therunningeconomist.blogspot.com/http://therunningeconomist.blogspot.com/http://therunningeconomist.blogspot.com/ -
8/2/2019 Roanomics, Vol 2, Iss 2
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Dr. Alice Louise Kassens
Plenary Session, Consumer
Sentiment and Price Expecta-tions in Virginia, 2012 Vir-
ginia Association of Econo-
mists Annual Meeting, Vir-
ginia Beach, VA
The Management Institute
Session on Health Econom-
ics, March 2012
Dr. Darshak Patel
"An Exploratory Analysis of
the Relationship betweenStudent Earnings and
Postsecondary Retention"
paper with Chris Jepsen
(University of Kentucky),
Southern Economics Associ-
ation Annual Meeting, No-
vember 2011
my, Op-Ed,Roanoke Times,
3/4/2012
Dr. Alice Louise Kassens
Franklin GrantAmerican
Philosophical Society(March
April 2012-August 2012)
Elected PresidentVirginia
Association of Economists
Virginia Consumer Senti-
ment and Price Expectations
ReportFebruary
Joblessness is hard to
shake, Point/Counter Point
Sharham Amini
Bayesian Model Averaging
in R, 2011,Journal of Eco-
nomic and Social Measure-
ment, 36(4), 253-87.
Dr. Garry Fleming
The Supply Curve Paradox:
The Effects of Time on Prices
and Production in Microand
Macroeconomics,Interna-tional Journal of Humanities
and Social Science
(forthcoming)
Tariffs will harm the econo-
(Roanoke Times, 1/1/12)
Dr. Bob Stauffer
Protective tariffs would
start a trade war, Op-Ed,
Roanoke Times, 3/4/2012
Presentations
Publications, Awards and Honors
Page 5Volume 2, Issue 1
Fall 2011 Academic HonorsPresidents List
James Bradshaw
Deans List
Yahia Abu Hashem
Nomin Baasandavaa
Sara Caudle
Dustin DeMaria
Wai Paing
ODE
Nathan Castellano
Chanho Song
Ted Ellis
Tiffany Ingram
Honors in the Major
Nomin Baasandavaa
Wai Paing
APS has selected Dr. Kas-
sens research project for the
2012 Franklin Grant. APS
was the first learned society
in the United States.
Sharham Amini
James Bradshaw `13
Tifany Ingram `13
http://www.amphilsoc.org/http://www.amphilsoc.org/http://www.amphilsoc.org/http://www.vaecon.org/http://www.vaecon.org/http://www.vaecon.org/http://roanoke.edu/News_and_Events/Campus_News/Feb_2012_Consumer_Spending_Poll.htmhttp://roanoke.edu/News_and_Events/Campus_News/Feb_2012_Consumer_Spending_Poll.htmhttp://roanoke.edu/News_and_Events/Campus_News/Feb_2012_Consumer_Spending_Poll.htmhttp://www.vaecon.org/http://www.vaecon.org/http://www.amphilsoc.org/http://www.amphilsoc.org/ -
8/2/2019 Roanomics, Vol 2, Iss 2
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The Fed Challenge is an academiccompetition, regionally sponsored
by the Federal Reserve Bank ofRichmond, and is designed to ex-
pand the understanding of the Fed-eral Reserve System's unique rolein the economy and the importanceof monetary policy conducted bythe Federal Open Market Commit-tee. Encouraging a better under-standing of the nations central
bank, the forces influencing eco-nomic conditions in the UnitedStates and abroad, and the ways theeconomy affects consumers lives,
the competition is framed to assistin the development of students'research, group dynamics, presen-
tation, and critical thinking skills.
I just completed my fifth yearcoaching Roanoke Colleges FedChallenge team. Each year I am
blessed with bright students whoconduct significant economic re-search, project future actions of theFOMC, and write a prescription forcurrent economic ailments. Thisyears team showcased the talentsof Nomin Bassandavaa, Sara Cau-dle, Marko Krkeljas, Nathan Cas-
tellano, Dustin DeMaria, and Gra-ham Quadland. Which economicindicator best personifies the 2011team? The University of MichiganConsumer Sentiment Survey be-cause this team exuded confidence
beyond measure!
The University of Michigan Con-sumer Research Center conducts atelephone survey of about 500 con-sumers who are asked questionsabout personal finances, businessconditions and buying conditions.The survey measures changes inexpectations and is seen as a lead-ing indicator of future spending. Iam quite certain that the indexs
10% decline from competition day2010 to competition day 2011would have been radically alteredand improved if all six members ofthis years team been included in
the survey sample.
Our team competed against colleg-es and universities throughout theCommonwealth of Virginia, bydelivering an oral presentation to a
panel of Federal Reserve econo-mists who judge our content, team-
work, and ability to provide im- promptu responses to spontaneousquestions. Just as each teams com-
position and personality changeseach year, so has the economic envi-ronment. This years team dealtwith a stagnant U.S. economy as jobgrowth remains slow and Americanscontinue to cut back on spending. Intheir remarks to the judges, the 2011team suggested that the Federal Re-serve Bank raise interest rates, whiletaking off the table the possibility ofa third round of quantitative easing.Their collaborative delivery of theirresearch was precise, deliberate, andyes, confident. And this confidenceyielded positive results. The 2011
team tied the highest scoring team inRoanoke College Fed Challengehistory and was just two points shyof advancing to the championshipround.
A special thank you goes out to Roa-noke College Professor Emeritus,Dr. Robert Stauffer, who ensuredthat this years team was on the right
path at several key stages of thesemester.
Fed Challenge: Michelle Crook
Fed Challenge: Nathan Castellano `12Federal Reserve. The team and their
coach analyze economic indicators
(unemployment, consumer confi-
dence and exchange rates) to deter-
mine the current state and direction
of the economy. Next, the team
must design and defend its recom-
mendations for future monetary
policy. Any experienced economics
major can tell you that no other
class comes close to this kind of
hands on experience in economic
policy; not to mention the huge
gold star this course places on your
resume.
Economists analyze data and thenuse theory to interpret that data and
provide a policy prescription. Of
In economics classes we learn theo-
ries that help explain why the world
works the way it does; it is rare to
leave a class feeling you have
learned anything about the current
state of the economy. Participating
in the Federal Reserve Challenge
taught me how to gather and inter-
pret the economic data necessary to
make a well informed policy pre-
scription.
The Federal Reserve, or Fed,
Challenge is a national competition
for undergraduate economics ma-
jors held every fall semester. Facul-
ty choose a team to prepare and
present a monetary policy prescrip-
tion to members of the Richmond
Page 6 Roanomics
the courses that I am familiar with,Labor Economics and Health Eco-nomics are the only ones that incor-
porates any kind of real economicdata analysis. The rest of the curric-ulum is concerned with theory; al-most exclusively neoclassical theoryat that. Unfortunately, analyzingdata is only half of an economists
job. Knowing macroeconomic theo-ry is practically useless if you do not
know how to interpret current dataon jobless claims, inflationmeasures, interest rates, consumerspending, etc. If you are seriousabout using your degree in econom-ics after college then you must learnto analyze economic data. In myopinion, the Fed Challenge is the
best opportunity that the economicsdepartment offers to teach that skill.
Mrs. Michelle Crook
Nathan Castellano `12
-
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Page 7Volume 2, Issue 1
FEATUREADVICE FOR 2012 GRADUATES
A message was sent to
alumni and friends asking
for advice for the 2012
graduates. Here what they
had to say:
Make a budget that in-
cludes your "mandatory"expenses (student loan pay-
ments, rent, utilities, etc.)
and try to save at least 10-
20% of what's leftover after
you pay all the necessary
bills.
Spend less than you earn,
do something kind for
someone you don't know
every day, keep reading
and thinking about eco-nomics, stay in touch with
your alma mater.
Rent and have responsible
roommates.
Use all of your twenties
to get degrees. And then
stop.
The current job market is
extremely tough. Don't be
afraid to settle for some-
thing less in your first full-
time position. Always re-
member that your first job
is rarely going to be your
last one.
Don't be afraid to take
risks early in the career
and dont be too narrow
minded in terms of the
type of job or the type of
career you envision your-
self in.
Focus on building your
resume. Although starting
out it may not be your ide-
al job and salary. Focus
less on the initial salary
and more on how or if the
job will benefit you in the
long run, and put you a
step above other candi-dates. Make yourself mar-
ketable.
"Do not use your savings
for wants. Savings are
for emergencies. Wanting
a new car or TV is not an
emergency. You all under-
stand the Time Value of
Money so use it to your
advantage.
Make sure your spouse is
your best friend.
GOOD LUCK SENIORS!
Alum Scott Rosenblum
kindly passed on a useful
document addressing in-
vesting beliefs of youngadults. Email roanokee-
[email protected] a copy
of the full document.
Did you know that a $400
monthly investment at a
5% annual return will
Interesting financial information
amount to over $500,000
during a 40 year period?
Most college students be-
lieve it will only amount to~$200,000.
At a 10% annual return,
the same $400 monthly
investment grows to over
$2.5 million. Again, most
college students believe it
will only amount to
~$200,000. Imagining
rates of return can be diffi-
cult.
Younger investors (18-34)
report being more con-
servative than older inves-
tors (35-64). This might be
due to recent financial
volatility.
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected] -
8/2/2019 Roanomics, Vol 2, Iss 2
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Page 8 Roanomics
Dr. Alice Louise Kassens Point in the Roanoke Times
The U.S. labor market looks
bleak going into 2012, par-
ticularly for older Americans
and minorities. The totalunemployment rate for the
third quarter of 2011 was
9.1%, a reduction of 0.4
points from a year before,
but much above the optimal
unemployment rate of close
to 5.5%. For blacks, the un-
employment rate was 16.5%,
up modestly from 2010, and
is particularly high for
blacks ages 20 to 24 (27%).
Once blacks lose their job, it
takes an average of 47
weeks to find a new one,
compared to 41 weeks for
the typical American. The
average unemployment spell
for adults aged 55 to 64 is
more than a year compared
to 36 weeks for 25- to 34-
year-olds.
Long-term unemployment
has severe negative effects
on both the economy and the
individual. Expenditures for
unemployment insurance,
Medicaid and other welfare
subsidies rise with greater
unemployment, while tax
revenues fall, adding to our
deficit woes. Additionally,
the productivity of the un-employed individual is for-
ever lost, reducing national
output and income.
In addition to lost income,
there are substantial indirect
costs associated with unem-
ployment, including depres-
sion, self-esteem and re-
duced employability. The
longer an individual is out of
work, the more his or her
skills depreciate. Skill de-
preciation reduces chances
of employment, particularly
if competing against those
with a shorter unemploy-
ment spell. Depression and
loss of self-esteem can ac-
celerate skill depreciation,
compounding the social
costs of unemployment.
Going into 2012, the labor
force is brimming with indi-
viduals, particularly older
Americans and blacks, who
have been out of work for ayear. There is a fear that
these individuals, originally
unemployed because of the
downturn in the economy,
will become structurally
unemployed. Structural un-
employment is due to a mis-
match of skills. The skills
employers are seeking do
not match those of the job
seekers. This is a difficultpolicy issue to address, par-
ticularly when deficit spend-
ing would be required to
establish additional job-
training programs.
For older Americans, there
is an additional worry. A 55-
year-old experiencing an
unemployment spell of a
year or more will have little
time to work and save for
retirement. During the peri-
od of job loss, it is likely
that savings are depleted to
purchase the items typically
bought with labor income.
Employers will rationally
choose to invest in job train-
ing for younger workers for
whom they have a longer
period to recoup their train-
ing costs. Financing older
Americans' lost retirement
savings will be a considera-
ble policy issue in the future.
While signs of economic re-covery carry us into the New
Year, severe labor market
troubles continue to lurk and
dampen economic growth.
Originally in the Roanoke
Times as a two part piece on
1/1/2012 http://
blogs.roanoke.com/
roundtable/2012/01/
pointcounterpoint-the-
economy-in-2012/
Theaverage
unemploy
-ment
spell for
adults
aged 55
to 64 is
more than
a year
comparedto 36
weeks for
25 to 34-
year-
olds.
http://blogs.roanoke.com/roundtable/2012/01/pointcounterpoint-the-economy-in-2012/http://blogs.roanoke.com/roundtable/2012/01/pointcounterpoint-the-economy-in-2012/http://blogs.roanoke.com/roundtable/2012/01/pointcounterpoint-the-economy-in-2012/http://blogs.roanoke.com/roundtable/2012/01/pointcounterpoint-the-economy-in-2012/http://blogs.roanoke.com/roundtable/2012/01/pointcounterpoint-the-economy-in-2012/http://blogs.roanoke.com/roundtable/2012/01/pointcounterpoint-the-economy-in-2012/http://blogs.roanoke.com/roundtable/2012/01/pointcounterpoint-the-economy-in-2012/http://blogs.roanoke.com/roundtable/2012/01/pointcounterpoint-the-economy-in-2012/http://blogs.roanoke.com/roundtable/2012/01/pointcounterpoint-the-economy-in-2012/http://blogs.roanoke.com/roundtable/2012/01/pointcounterpoint-the-economy-in-2012/http://blogs.roanoke.com/roundtable/2012/01/pointcounterpoint-the-economy-in-2012/ -
8/2/2019 Roanomics, Vol 2, Iss 2
9/12
I agree whole-heartedly with
many of the arguments of-
fered by James Case ("Asolution to fixing the econo-
my," Feb. 22) regarding the
current problems facing the
U.S. economy and how to
best fix them.
Fiscal stimuli, either by in-
creasing government outlays
and/or reducing tax rates,
have proven to be expensive
failures.
If deficit spending promoted
economic expansion, would-
n't our economy be booming
right now after the Bush/
Obama stimulus packages?
Couple that with the current
monetary stance by the Fed,
with historically low interest
rates that have also offered
little aid except in helping
drive up oil prices to more
than $100 a barrel, and one
must begin to wonder if
there is anything the govern-
ment can do to extricate us
from our economic dol-
drums. Is protectionism the
answer?
In that regard, I must whole-
heartedly disagree with the
solution offered by Caseto increase import tariffs by
as much as 30 percent. As
usual, the protectionist argu-
ment is based on several
fallacies that, on the surface,
make it seem like a good
idea.
Fallacy No. 1: The higher
tariffs will leave everything
else unchanged. Not true ona couple of fronts. Reducing
our imports artificially will
cause the dollar to strength-
en, making our exports more
expensive. As export sales
decline, jobs will be lost in
these sectors, which are the
sectors in which we have
advantages with respect to
our trading partners. We
save jobs in inefficient sec-
tors and lose jobs in efficient
ones. There is no net gain in
jobs, and the ones we lose
are the ones we are best at.
Fallacy No. 2: Other coun-
tries won't retaliate. Not
true. They most likely will.
Result: Go back to the Great
Depression and revisit the
Smoot-Hawley Tariff and its
effect on global commerceand how it prolonged the
Depression. Rather than
expanding international
trade and promoting our
export sectors, we will with-
draw from the global eco-
nomic community, and our
welfare will decline.
Fallacy No. 3: Tariffs will
lead to expansion in govern-ment revenues, reducing the
deficit. Not trueat least,
not in the long run. Because
we will import less, a higher
tax on a smaller tax base does
not necessarily increase reve-
nues. In fact, it is conceivable
that tariff revenues may de-
cline as import purchases
abate, resulting in a largerbudget deficit.
Fallacy No. 4: The govern-
ment can target the tariffs to-
ward the correct goods and
countries that deserve the pun-
ishment. Again, not true. One
area in which the government
has shown over and over its
weakness has been in picking
winners and losers. Do we just
hit Chinese imports because
we think they are not playing
by the rules?
Economic principles tell us
that government attempts to
artificially stimulate the econ-
omy are fruitless in the long
run, including the use of tar-
iffs and other trade re-
strictions. If we truly want to
fix the economy, the govern-ment needs to focus on real
factors like education, infra-
structure and technology.
Initially printed in the Roa-
noke Times, 3/4/2012 http://
www.roanoke.com/editorials/
commentary/wb/305605
Dr. Garry Flemings Op-Ed in the Roanoke Times
Page 9 Roanomics
Economic
principles
tell us that
government
attempts to
artificially
stimulate the
economy are
fruitless in
the long run,
including the
use of tariffs
and other
trade
restrictions.
http://www.roanoke.com/editorials/commentary/wb/305605http://www.roanoke.com/editorials/commentary/wb/305605http://www.roanoke.com/editorials/commentary/wb/305605http://www.roanoke.com/editorials/commentary/wb/305605http://www.roanoke.com/editorials/commentary/wb/305605http://www.roanoke.com/editorials/commentary/wb/305605http://www.roanoke.com/editorials/commentary/wb/305605 -
8/2/2019 Roanomics, Vol 2, Iss 2
10/12
Page 10 Roanomics
Statement from the Economics Club
I am delighted to announcethat the SGA has approvedthe Economics Club of Roa-noke College. Since the an-nouncement in the JanuaryEconomics newsletter, theClub has 24 members, electedofficers, and has had a fewmeetings. Dr. Darshak Patelis serving as the Clubs Advi-
sor, and the officers are Con-rad Classen, President, TedEllis, Vice President, WilliamCorso, Treasurer, and CharlaHenley, Secretary. The reviv-al of the Club ends a 25 yearhiatus for an Economics Club
at Roanoke.
The Economics Club hopes toincrease student involvementwith extracurricular activitieson campus, increase studentknowledge of economics out-side of class, and providemembers the opportunity toapply economics to the realworld. An Economics majoror minor is not required andall students are welcome to
join the Economics Club.
As President and founder ofthe Economics Club, I wouldlike to encourage you to joinus and partake in discussionsof how you are affected by
the current economy, the eco-nomic implications on the jobmarket and how the currenteconomy might affect us bothnationally and internationallyin the future. We are plan-ning to have speakers, moviesand a fantasy stock tradingcompetition. I look forwardto seeing you at our nextmeeting.
Sincerely,
Conrad Classen
President, Economics Club ofRoanoke College
Conrad Classen 15
Ted Ellis 14
Talking Economics with the Economics Club
As anyone will tell you, Chi-
na has built its economy on
the abundance of cheap labor
it possesses. This last year,
the average Chinese worker
took home slightly less than
200 U. S. dollars every
month, just five percent of the
American average monthly
wage. Even so, the Chinese
worker is taking home seven-
teen percent more than last
year.
How does this affect us?
Like any other asset, the sup-
ply of labor, Chinas most
valuable resource, is not infi-
nite. As the number of 15-29
year old workers falls, pro-
ducers are encountering
shortages of labor, which
have led to higher wages for
the workers. This is obvious-
ly a good thing for the aver-
age Chinese citizen, who will
be able to more fully enjoy
the fruits of his or her labor.
Counter intuitively, this is
also a good thing for Ameri-
cans. Although economists
estimate that cheap Chinese
exports have added about
$1,000 additional purchasing
power to each American
household, through stiffening
competition and cheap inputs,
it is predicted that higher
wages in China will lead to
exported inflation. Further-
more, without the increase in
wages, there would be a fall-
ing supply in the world mar-
ket for labor. Just like as inthe world market for oil, fall-
ing supply would benefit no
one.
Furthermore, increased wages
in China will lead to a strong-
er exchange rate with the
U.S. which policymakers
have wanted for a good
while, as Chinas trade sur-
plus falls and consumer
spending increases. A hypo-
thetical twenty percent rise in
consumption in China could
lead to 25 billion dollars in
American exports and
250,000 more jobs on our
own soil. Theoretically,
greater import consumption
in China could lead to near
full employment on a global
scale. Producers may yearn
for the days of cheap Chinese
labor, but there will still be
plenty of unskilled humancapital available in other re-
gions of Asia, such as India.
You wont have to forego
your Nikes or iPhone just yet.
By Ted Ellis
Interested in
the
Economics
Club?
Fill out the
interest form:
FORM
26 students
already have!
http://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.htmlhttp://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.htmlhttp://kassensroanokeecon.blogspot.com/2012/01/economics-club-at-roanoke-college.html -
8/2/2019 Roanomics, Vol 2, Iss 2
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Page 11 Roanomics
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8/2/2019 Roanomics, Vol 2, Iss 2
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...Because we view economics as solidly within the liberal arts, we are
committed to examining the relationship between economics and other are-
as of knowledge. Students will therefore find it to be an excellent comple-
ment to many other majors, including, but not limited to public policy, soci-
ology, history, environmental policy, mathematics, biology, and business
administration, as well as concentrations such as gender studies and peace
and justice studies.
For information about the Economics Program contact Dr. Garry Fleming
For comments or suggestions about the newsletter email
Read our blog: kassensroanokeecon.blogspot.com
Faculty Editor: Dr. Alice Louise Kassens
Student Editor: Sara Caudle 12
221 College LaneSalem, VA 24153
Phone: 540-375-2426Fax: 540-375-2577
E-mail: [email protected]
Economics Program
paid for reserved seats).
Unfortunately, Allegiant 'sflights out of Roanoke only goto Florida destinations (thesame is true of Greensbo-ro). Departures are usual-ly limited to two days a week(we left on a Sunday and re-turned the following Satur-day). Their are no free snacksor drinks on board, includingwater. Despite these down-sides, it is still a great deal.Rates will go up in March andApril with spring break de-
mand.
The main reason Allegiant isable to offer low fares is thatthey rely on non-union labor.It is notable that AmericanAirlines finally declared bank-ruptcy in November 2011--roughly ten years after theother major airlines, allowingthem to break expensive union
We recently returned from anearly spring break trip to Flor-ida. By traveling in February,we took advantage of Allegi-ant Airlines super lowrates. The roundtrip airfarefor two from Roanoke to Or-lando/Sanford was $205(including one checked bag).The non-stop fight took undertwo hours--which is usuallythe amount of time you spendat U.S. Air's Charlotte hubwhen you fly out of Roa-noke. We flew into Orlando'ssmaller airport, avoiding a lotof congestion--except at therental car counter. We tookseveral actions to avoid vari-ous changes: I went to theRoanoke airport to purchasethe tickets, thereby avoidingan online booking fee of$40. We also chose open seat-ing wherein you board the
plane in the order that youcheck in (and after those who
contracts and return to profita-bility. Keep this in mind thiselection year as many will be
praising the bail-out of theauto industry while portrayingthe bankruptcy process as thedemise of an industry. Here'sthe real story: the auto bailoutwas for the unions with theirearly retirement options andgenerous retirement bene-fits. I'm afraid it is humannature to promise generousretirement benefits in the fu-ture with little thought as tohow they will be paid for.This is the root cause of thecoming entitlement crisis inthis country with Medicare,Obamacare and Social Securi-ty. As was famously said inthe Pogo comic strip: "wehave met the enemy and theyare us."
On a more cheerful note, I'mnow back in Roanoke: re-
Travels with Dr. Bob
Follow us on Twitter@roanokeecon
Tell us what is new with you
roanokeecon.blogspot.com
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laxed, refreshed and ready totake on the pressures andstress of retirement and I'dlike to thank you for yourcontinuing Social Security"contributions " (even thoughI'm entitled to them). Thosefunds are a valuable supple-ment to my travel budget, andI promise to spend them in a
responsible fashion.
Dr. Bob Stauffer
Professor Emeritus
mailto:[email protected]:[email protected]:[email protected]:[email protected]://kassensroanokeecon.blogspot.com/http://kassensroanokeecon.blogspot.com/http://roanokeecon.blogspot.com/http://roanokeecon.blogspot.com/http://roanokeecon.blogspot.com/http://kassensroanokeecon.blogspot.com/mailto:[email protected]:[email protected]