Sunday, April 9, 2017

Ethics: What role does ethics play in economic decision making and governance?

Last week during the SWEET meeting we were discussing the future of Economics at UAF. At some point during the discussion the role of ethics in economic decision making was mentioned which started a somewhat explosive tangent. This week, I would like to expand on the role of ethics in economic decision making and how sometimes ideology can lead policymakers astray. 
I think we all know that economics is not just a discipline used to boost the bottom line of businesses and corporations. Some in the SWEET discussion group who will go unnamed here (you know who you are) would argue that ethics is subjective and therefore should consulted based on the whim of the people making decisions. This of course means that key policy makers could just decide to completely disregard or at the very least reduce the ethical concerns and legitimate consequences of externalities to mere tertiary consideration. I would like to offer the position that this ideology of what I call ‘Free Market Fundamentalism’ is very dangerous for politicians and other government officials to have because it means that the government is corrupted to favor the interests of corporations and other big businesses over the people they are elected to represent. 

Here are a few articles that look at the ethics of past and present economic decisions rather than just the bottom line: 

Based off of that reading, consider the following questions: 

1. What role does ethics play in economics and governance if any

2. What is the role of government in terms of regulation and how does that relate to ethics? 

3. If we lived in an Anarchic society with no government, what kind of recourse could people expect? Would it really be as efficient or more efficient than our current legal system? 

4. To continue from question 3, what would recourse in this hypothetical society be predicated on? Wealth? Survival of the fittest (most heavily armed)? 

5. Is there any meaningful way to reform the government? Or are the incentives for corruption too strong to overcome for public officials? 

—Isaac Gage

Sunday, April 2, 2017

UAF Economics Program and SWEET

Hello all!

Sherri will not be able to attend this next couple of meetings, however, SWEET will still be in session. This week's discussion topic is..... the peril of our economics program at UAF. Below is an excerpt from the report I wrote a couple of weeks ago on Sherri's lecture.

Now, all subdivisions of the economics program, including minors, majors and organizations such as Students Who Enjoy Economic Thinking, are at risk for being cut for financial reasons. . .

. . . Enrollment in the economics major started its suspension in April. Wall criticized this decision, saying the board should consider the cost/benefit analysis of cutting the economics program before making a final decision around June.

The current decision-making process overlooks the benefits of keeping the program in the university, Wall said. The economics program is ranked 80 out of the 280 programs here at UAF. Despite being on the bottom of the School of Management curriculum, the program generates a copious amount of student credit hours for those in and out of the School of Management.

Cutting the economics program would cost more in lost opportunities than it would save in cash, according to Wall.

“The suspension of the program was cited for financial reasons… However, after just doing a brief cost-benefit analysis, the savings of eliminating the economics program would be very negligible,” Wall said. “It ignores things like return on investment, and where students go and how they are giving back and contributing to society. An economics degree is a very, very valuable degree.”

You can read the full article at

Other good articles to read and ponder (although a little outdated) include:


  1. What does economics mean to you?
  2. How has economics impacted your life?
  3. What value do you see in keeping economics at UAF?
  4. As a non-economics major, what value do you see in keeping SWEET?

I look forward to seeing you all on Wednesday!


Friday, March 10, 2017

Private Prisons

Corecivic Inc. ($1.74 billion in yearly revenue) and Geo Group ($1.61 billion revenue in 2011) are large companies that make money by building and operating prisons.  More and more prisons are not being operated by the states they are in, rather being run by private companies.  This has resulted in a host of effects even for people not normally associated with corrections and the legal system.


1.  Why is this switch to private prisons happening?  What economic forces might be causing the movement to private prisons?
2.  Should the state have a monopoly on prisons?
3.  Who, if anyone, stands to benefit the most from this switch?
4.  Who, if anyone, is harmed the most by this switch?
5.  In what manner, if at all, should the public benefit from incarcerated individuals?
6.  Is the movement towards private prisons a good change or a bad change?  Why?

Tuesday, March 7, 2017

Here We Go with Infrastructure Again

While economists have mixed views about the value of infrastructure spending, Donald Trump said the following in his recent address to a joint session of Congress:

To launch our national rebuilding, I will be asking the Congress to approve legislation that produces a $1 trillion investment in the infrastructure of the United States—financed through both public and private capital—creating millions of new jobs. This effort will be guided by two core principles: Buy American, and hire American. We’ve already seen this in action with Trump’s executive action on the Dakota pipeline. It stated that the pipes have to be American-made.

  • Do you agree with the statement that whenever government overrides the wishes of the market, it is not producing; it is destroying?
  • Are we really supposed to believe that Trump knows better how to transport pipe than the actual people who transport pipe?
  • What do you think of Pres. Trump's "Buy American & Hire American" agenda?
  • Should infrastructure construction be left to the private sector?
  • To what extent will government spending on infrastructure "crowd-out" the private sector? (Crowding out is a situation where personal consumption of goods and services and investments by business are reduced because of increases in government spending and deficit financing sucking up available financial resources and raising interest rates.)
To help prepare you for this week's discussion, here are some articles:

Wednesday, March 1, 2017

The Sweatshop Debate

Professor Ben Powell will be giving two talks on Monday, March 6. At 10:30 he'll be talking about sweatshops, and at 2:15 immigration. He is the author of "Out of Poverty: Sweatshops in the Global Economy (Cambridge Studies in Economics, Choice, and Society)."

Here's a link to United Students Against Sweatshops, a national student labor organization.

Here is a link to a short video featuring Ben Powell:

This link shows the conditions inside sweatshops in Bangladesh.

And finally, John Stossel:

1) As western consumers and businesses, are we valuing people as whole human beings or exploiting them in a quest for productivity, profits and low prices?

2) Should we boycott companies that use sweatshops on ethical/moral grounds?

3) Should we boycott companies that utilize sweatshops that use child labor since we know that they are working instead of obtaining an education that results positive externalities in their society?

4) Why do labor unions back anti-sweatshop campus organizations?

5) Why does United Students Against Sweatshops also advocate for a $15/hour minimum wage?

Sunday, February 19, 2017

The DOW has exceeded 20,000: Does this mean we are in for a period of economic expansion?

From this Forbes article:

"The Dow Jones Industrial Average hit 20,000. The aftermath was a barrage of media stories—some encouraging, others less optimistic. The positive stories prompted investors to buy more equities in expectation of more future gain; the cynics foretold the forthcoming correction with a warning: Get out of stocks. The one common theme all the articles share is that, yes, something is going to happen next. And this something will likely show gains and reverses, followed by more gains and more reverses."

1) Is the DOW an outdated and irrelevant formula?


2) Are we headed towards a period of economic expansion?

3) Should investors care? Should anyone?

Sunday, February 12, 2017

Is it possible to align incentives to achieve desired outcomes?

As you read these two articles in preparation for Wednesday's (February 13, 4:30 to 6:00 p.m.) discussion, ask yourself:

  • Is it possible to avoid switching effects and rewarding or punishing wrong behaviors. 
  • Given the fact that people respond to incentives in unforeseen ways and the many margins of choice, will our incentive schemes always go awry?
  • Do charitable efforts do any good? 
  • Should we not act on our good intentions?

Incentives Matter

Slavery, Snakes, and Switching: The Role of Incentives in Creating Unintended Consequences 

As we discussed at last week's meeting, we would like you to blog a substantive comment AFTER the meeting before Sunday, February 19, at 11:59 p.m.

Wednesday, February 8, 2017

Trump's New EPA Administration and the Economic Possibilities inside National Parks

I must begin with an apology for entering this topic at such a late date, and will discuss this in greater detail at the SWEET meeting regarding blog discussion.

On January 30 of this year, a H.J. Res. 46 was entered into the House by Rep. Paul Gosar [R] of Arizona. The joint resolution goes as follows:

Providing for congressional disapproval under chapter 8 of title 5, United States Code, of the final rule of the National Park Service relating to “General Provisions and Non-Federal Oil and Gas Rights”.
Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That Congress disapproves the rule submitted by the National Park Service relating to “General Provisions and Non-Federal Oil and Gas Rights” (81 Fed. Reg. 77972 (November 4, 2016)), and such policy shall have no force or effect.

Voting has yet to take place.

If this bill passes, it will weaken the protection that National Parks currently in place, and allow for an increase of mineral/oil extraction. As of this writing, Porcupine Mountains Wilderness State Park in Michigan has already experienced exploratory drilling for minerals by a Canadian company.

Questions to Consider:
1) Do the economic prospects outweigh the environmental impact on our National Parks?
2) Will we see this increase in Alaska under Trump's administration?
3) Is this how Alaska pulls itself out from under our growing state deficit?
4) Will this ultimately be in Alaska's best interest?

Food for thought:

Saturday, January 28, 2017

The effects of pipelines. Helpful or harmful?

Most of today's news is filled with information about protests against pipelines such as the Keystone XL pipeline of the Dakota access pipeline. Protesters claim that it is harmful to the environment and infringes on the historical significance the land has to certain groups. How much of this is true? What are the alternatives to pipelines? Can we stop this tide if progression? -Amount of oil transported by train.

Please look at the links above and any additional resources you can find and come charged to this Tuesdays meeting.

Saturday, January 21, 2017

An economic analysis of climate change

Climate change is something that will be affecting our future and that of our posterity.

"Economists have differing views of how to best deal with the problem of climate change, despite widespread scientific consensus on the reality of the trend. Though disagreements persist on whether to stop climate change, adapt to the climate or not focus on the climate at all, adaptation might become the only option if no other action is taken."

Here is a link to the article that I wrote about it:

Here are other sources which were linked in the article:

Some questions to consider:

1. How many resources should we be using to address climate change?
2. What about leaving Earth? Is that possible/ethical?
3. Will humans be able to devise a solution to this problem?
4. Is it possible for society to exist without creating a greenhouse gas problem in the process?
5. What are effective ways to deal with climate change?

Friday, December 2, 2016

The Economics of Marriage

Who you marry is one of the most important decisions you will make in your life.  While most products and legally-binding agreements have a set service life or contract time, it is exceedingly rare to find a circumstance where one puts money, products or services down "until death do us part."  If you are going to make a decision based on "forever", you had better have an understanding of what you are gaining and what you are giving up.  To explore this topic, I have included the following links.

Freakonomics Podcasts:
Why Marry? (part 1)
Why Marry? (part 2)

Additional Thought-Inducing Readings:
Hodgepodge of Marriage Phenomena
Marriage Increases Inequality
Marriage Benefits the Middle Class More

Some questions to think about:
1.  What benefits do you hope to gain from marriage?
2.  What are the consequences of getting married?
3.  What benefits do you hope to gain from not getting married?
4.  What are the consequences of not getting married?
5.  Do you think that men and women get the same things from a marriage?
6.  Is marriage really an equal partnership?
7.  Has marriage changed over the years?
8.  How does divorce affect your estimation of marriage?

Friday, November 25, 2016

Humans Need Not Apply

This video gives an explanation for how robots and AI may overtake nearly all jobs in the not-so-distant future, a premise which before fell under the process of creative destruction. As menial labor jobs are destroyed, jobs open up to to maintenance and building those robots.

However, Grey brings up the idea — what about when those robots can just build and maintain themselves?

Also here's another interesting article about the same idea.

Some questions I think might be good to think about are:

Is the analogy comparing humans losing their jobs to horses losing their jobs valid?

What can humans do in the future if the demand for humans is so low? Will human populations fall as there is less to do in the world?

Are there positive and negative externalities to humans not having jobs?

Would this lead to a Star Trek-esque society (where people don't have to work because scarcity is a thing of the past so people just do stuff in order to live a more fulfilled life)?