Letter from the editor

Latest Cover

Dear Reader,

The publication of the second volume of Equilibrium not only establishes the journal as a yearly publication, but also provides an appropriate occasion to discuss how the journal fits into the economics department and the University of Wisconsin-Madison as a whole.

On the most local level, Equilibrium is an opportunity for economics undergraduates to develop and showcase their skills. All types of economics majors, from future bankers to policy wonks to budding researchers, contribute to the journal and learn from the experience. Taking a step back, the journal provides undergraduates in all disciplines the opportunity to learn about economics…

 

School’s out for…three weeks?

Most children in America have it pretty good in the summer: they get to swim in lakes, bike around aimlessly, run a lemonade stand, or play on their Nintendo DS.  While doing these activities, most are even more excited about what they don’t have to do: go to school.  The nine months on, three months off calendar is deeply ingrained in American culture, but much like the manual lawn mower or the GameBoy Color, it is a relic of an earlier, agrarian age in which children needed the summer months off to help on their family’s fields. Our population has…

 

Lones Smith: A theorist among men

Lones Smith, a prominent microeconomic theorist and recent addition to the UW faculty, becomes animated when discussing how models of disease transmission used by epidemiologists fail to take human decision making into account.

“An epidemiologist would say that if the prevalence (the fraction of people with a disease) doubles, the incidence (number of new cases) should double as well. That’s false; [the incidence] only goes up by about 70%. Human incentives are playing a role and not being accounted for: the more the disease is out there, the more careful you’re going to be. Economic incentives matter everywhere.”

He’s describing…

 

Work now, play later? How a new definition of work could change the way economists view the labor market

The gender wage gap garners significant attention, both as an economic indicator of equality in the workplace and as a sparkplug for the gender equality movement more generally. Earlier this year, the White House Council on Women and Girls reported that women still make just 75 cents for every dollar a man earns. This statistic is calculated by comparing average earnings of full-time (at least 35 hours a week) year-round workers in the same occupation. As part of his senior thesis, “Incorporating household production into measurements of intertemporal elasticity of substitution of labor supply,” recent UW graduate Desmond Chan analyzes…

 

A study in punishment: What’s the most effective way to prevent drunk driving?

In a horrific car crash on June 25th, 2011, 27-year-old Jesse Herman hit and killed a 23-yearold female, injuring four others in the process. After the accident, he was found to have 0.27 percent blood alcohol content (BAC), over three times the legal limit. This was not his first offense; he had been convicted of drunken driving before, along with bail jumping and battery.

This brief story is one of many that advocacy groups and investigative journalists have used to call Wisconsin’s relatively lax policies on drunken driving into question. Wisconsin is one of the few states that will not…

 

A question of time: Stability in teacher evaluations

In 2009, Benjamin Guggenheim, director of An Inconvenient Truth, was driving his children to school when he was forced to take account of a glaring inequality. His success in film had enabled him to provide world-class education for his children, yet he drove past public schools in deplorable condition on the way to his children’s elite private school. He knew that many of the students in the dilapidated buildings he passed would not graduate high school, and out of those that did, few would make it to college.

When Waiting for Superman—Guggenheim’s documentary on the languishing underbelly of America’s education…

 

A different kind of competition: Can charter schools improve the performance of public schools?

The debate on school reform has raged back and forth for decades, with each new wave offering a different mantra for change. Some pushed choice, others the value of tests and various objective measures of performance, still others smaller classes, more rigorous teacher certification processes, and myriad other alterations. One assumption, though, has remained relatively constant: that private schools exert competitive pressure on public schools to improve teaching quality and student outcomes . This assumption seems reasonable, especially if families are given a choice of schools. A family with their child’s best interests at heart, so the thinking goes, will…

 

Poor Economics : A new perspective on development

Within the past decade, a consolidation of approaches within global poverty research has occurred. The result: two prevailing camps caught in a polemical dispute.  On one side stand those unified behind Columbia professor Jeffrey Sachs, while those standing opposed rally behind NYU professor William Easterly. Sachs is the author of the best-selling book The End of Poverty and advocates “top-down” aid programs centered on reaching the United Nations Millennium Goals and dissolving what he calls “poverty traps”. Conversely, Easterly, author of The Elusive Quest for Growth and The White Man’s Burden, expounds a “bottom-up” growth philosophy that is smaller, more…

 

Welcome to Equilibrium

Fall 2010 staff

Dear reader,

Because everyone loves a podium, we decided to take up a page of our limited space to explain ourselves. We write this hoping that you will devote a small portion of your day to the following pages. In the event such a scenario proves realistic, you may be curious about what we hoped to give you in producing Equilibrium.

As we began writing, designing, and seeking out faculty members, we struggled to answer a fundamental question: how can a publication for undergraduates contribute to a field whose conclusions frequently contradict each other? Even with this university’s resources at…

 

The superstar effect

The superstar effect

Sidney Crosby, captain of the Pittsburgh Penguins and considered one of the best centers in the National Hockey League, is no stranger to all-star treatment. When the Penguins officially opened the CONSOL Energy Center, the team’s $321 million dollar new complex, Crosby, along with Penguins owner Mario Lemieux, was the first person to skate on its virgin ice. Crosby is also handsomely compensated, earning roughly $9 million dollars a year. But his story is comparatively rare—Ryan Getzlaf, one of Crosby’s most talented contemporaries, makes $4 million dollars less playing the same position for the Anaheim Ducks. Median wages in the…