Current PhD student Catalina Granda-Carvajal (advisor Prof. Zimmermann) has recently published an article in the International Economic Journal. The last issue of this journal features a selection of the papers presented at the conference ‘Shadow Economy, Tax Policy and the Labor Markets in an International Comparison: Options for Economic Policy.’ This conference was held in Germany at the University of Potsdam last April, where Granda-Carvajal participated with the paper entitled ‘The Unofficial Economy and the Business Cycle: A Test for Theories.’ In this paper, she attempts to establish how the features of the business cycle vary across countries with the size of the unofficial sector. Granda-Carvajal confirms that countries with a large shadow economy exhibit higher volatility in major macroeconomic variables such as output, consumption and investment. Also, she shows that unemployment tends to be more countercyclical, while employment and hours behave as more procyclical the smaller is the unofficial economy. She concludes that much more needs to be done in order to understand the implications of shadow activities on macroeconomic performance, as standard models of the shadow economy do not imply such behavior for aggregate variables.
Current students
Senior featured on UConn Today
Margaret McCarthy, a double Honors major in Economics and Political Science (plus a minor in Human Rights) has recently been featured on the university-wide blog, UConn Today. While on a Summer internship at the US Department of State, she was quickly promoted to fill on an interim basis the country desk for Nicaragua.
She is also a stellar citizen while on campus. In 2009, she received an Oaklawn Foundation Scholarship for academic excellence, honors involvement, and leadership; she is also a member of several honors societies, including Phi Beta Kappa. This year, she was a finalist for a Marshall Scholarship. She is UConn’s administrative director for the Model United Nations. She is also a member of the Global Leadership Commission, a small group of honors students that invites global leaders on campus to speak.
More at UConn Today.
New slate of PhD students going on the job market
Tao Chen: (Advisor: Tripathi)
My research on econometrics is both theoretical and applied. The theoretical part focuses mainly on microeconometrics and functional data analysis. The applied work is within the fields of labor and urban economics.
Paramita Dhar (Advisor: Ross)
My dissertation examines two different questions about housing and location choice. In the first essay, I apply a difference-in-difference model to capture the causal effect of school quality on house prices by looking at houses located on school district boundaries in Connecticut. The rest of the dissertation deals with detailed spatial analysis of the nature of housing discrimination in the context of multiple minority groups in Los-Angeles using Housing Discrimination Study (2000).
Leshui He (Advisor: Langlois)
My dissertation departs from the standard property rights theory of the firm of Grossman, Hart and Moore and develops the interaction between the ownership of the firm and the ownership of the alienable assets. By defining the ownership of the firm following Alchian and Demsetz (1972), I create a theoretical framework allowing for independent allocations of the two ownership rights. Then I move on and utilize the multi-tasking agent model under this framework to run a level horse race among four alternative organizational forms. The model sheds lights on conditions under which human-capital owned firms can be optimal, and offers tentative explanations to the fact that firms usually collectively own alienable assets.
Nicoleta Iliescu (Advisor: Matschke)
In my job market paper (“US Lobby Activity and Antidumping Outcomes”), I investigate the impact of lobbying on the antidumping practices in the US. Currently, antidumping is the most heavily used temporary tariff measure both worldwide and in the US. Thus, it becomes an appropriate avenue of studying how political pressure shapes the level of protection some domestic industries receive. The empirical results I derive in the paper reinforce the hypothesis that the political clout plays an important role in granting trade protection through antidumping duties.
Nick Jolly (Advisor: Couch)
My dissertation focuses on the consequences of job displacement. The first paper from my dissertation, which was published in Research on Aging, shows that displaced workers experience larger earnings losses if they are older at the time of job loss. The second paper examines how earnings losses vary over different phases of the business cycle; the final paper examines how this type of involuntary job loss influences the inter-temporal movement of workers throughout the earnings and income distributions.
Steve Kuchta (Advisor: Miceli)
My dissertation examines the role patent term restoration plays in incentivizing pharmaceutical development and clinical trials behavior. The unique position of pharmaceuticals, who must spend portions of their patent term achieving regulatory approval, forces the effective patent life to balance more interests relative to the standard patenting story. A law and economics approach is utilized to expose the competing dynamics and thereby to provide theoretical foundations for the 1984 Hatch-Waxman Act. The modeling also informs current policy discussion regarding adding exclusivity protection to patent protection in the emergent biopharmaceutical industry.
Xiaoming Li (Advisor: Ross)
My dissertation examines the dynamics in the housing and mortgage markets. Specifically I attempt to identify the “true state dependence” from the “spurious state dependence”. In the first essay, I specify a linear probability model to test the neighborhood information externalities in mortgage underwriting. In the second essay, I propose an analytically bias-corrected fixed effects estimator that is robust to the incidental parameters bias for panel fractional response models. In the third essay, I apply the proposed bias-corrected estimator to empirically examine the impact of local housing markets on neighborhood mortgage underwriting.
Shalini Mitra (Advisor: Zimmermann)
My dissertation examines the channels through which volatility of key variables like output, employment, investment and consumption is affected – both at the firm and the aggregate level and their implications. I specifically consider degree of financial development of a nation, research and development expenditure of firms, and the presence of an informal sector.
Zinnia Mukherjee (Advisor: Segerson)
My research is in applied microeconomics. My dissertation essays deal with the design and evaluation of conservation policies, with a specific focus on protection of endangered species. In particular, the three essays analyze (i) the effectiveness of voluntary approaches and the role of background regulatory threat in mitigating stochastic bycatch, (ii) the welfare effects of unilateral bycatch policies in an open economy, and, (iii) the economic impact of the TED regulation (a major U.S. bycatch regulation) on the U.S. shrimp industry. Post dissertation, my research projects include (i) studying the spatial and temporal effects of marine hypoxia on Long Island Sound harvest and fishers’ behavioral responses to the phenomenon, (ii) analyzing the effect of political ideology on state level income inequality for U.S. states, and, (iii) examining the role of U.S. state laws on sexual crime and crime location choice of repeat offenders.
Michael Stone (Advisor: Miceli)
I present a theory which extends the traditional economic model of punitive damages by incorporating litigation costs. Incorporating litigation costs into the model provides a possible justification for punitive damage caps. At the optimum, caps balance deterrence against the cost of litigation. Empirical testing of the model is performed via Cox proportional and parametric hazard analyses, using a panel dataset from 1981 to 2007. The empirical results reveal a positive relationship between judicial and legal expenditures (a proxy for legal costs) and cap enactment, and a negative relationship between state GSP (a proxy for damages) and cap enactment. Cap enactment is also influenced by political ideology.
Parag Waknis (Advisor: Zimmermann)
In my dissertation, I explore the nature of optimal monetary policy under a Leviathan monetary authority. Such a monetary authority is a reality wherever governments rely heavily on seigniorage. In a model based on Lagos and Wright (2005), I characterize a Markov perfect equilibrium as well as equilibrium under reputational concerns for such monetary authority. While, there are multiple equilibriums in general, under certain conditions we can narrow down the set of equilibriums to one and show that it is characterized by higher inflation. I then add one more Leviathan central bank to the model to see if adding a competitive element implies a lower rate of inflation in equilibrium. I plan to use the insights from these models to analyze sub-national spending in developing countries like India. Understanding the policies of such central banks or governments is critical given today’s interdependent global policy environment.
New class set to graduate
On Saturday May 8, 2010, a new class of students will walk in the commencement ceremonies and get well-deserved degrees. As there are no December ceremonies any more, the walking class in larger than usual. 212 students will be receiving the BA in Economics, of which 40 are double majors. Seven students will be graduating with Honors in Economics: Joseph Antelmi, Michael Bokoff, Taylor Brown, Charles Johnson, Bryan Murphy, Eric Roy, and William Watson. The Economics major is very popular on campus, in previous years it has been the third most sought after. Note also that among all Economics degree granting institutions in the United States, the University of Connecticut ranks 26th by the number of degrees conferred last year.
We also have a graduating class in our graduate programs. Are graduating with a MA: Jay Adams, Demet Cimen, Amy Druckenmiller, Elnara Eynullayeva, Elizabeth Kaletski, Xingkang Liu, Xiaoyin Shen, Rijesh Shrestha, Li Wang, Menxi Ying and He Zang. And with a PhD: Lei Chen, Onur Burak Celik, Marina-Selini Katsaiti, Monica Lopez-Anuarbe, Zinnia Mukherjee and Natalya Shelkova.
Phi Beta Kappa Welcomes New Initiates
Founded in 1776 at the College of William and Mary, Phi Beta Kappa is an undergraduate honors society that celebrates excellence in the liberal arts. Its long list of distinguished members—Ralph Waldo Emerson, Nathaniel Hawthorne, President Theodore Roosevelt, etc.—just got a little longer. UConn’s Epsilon Chapter of Phi Beta Kappa recently added 8 senior Economic majors to its list of members: Joseph Antelmi, Michael Samuel Bokoff, Tyler David Gold, John R. Harry, Yixian Lai, Margaret Lynn McCarthy, Eric Burton Roy, and Alex Keller Upton. The Department of Economics congratulates this group of outstanding students.
Shadow economies under the volcano ash cloud
PhD student Catalina Granda-Carvajal (advisor, prof. Zimmermann) has been invited to present last week in an international workshop in Germany, “Shadow Economy, Tax Policy and Labor Markets in International Comparison: Options for Economic Policy“. This workshop was held at the University of Potsdam, near Berlin, with the aim to demonstrate advances in the analysis of shadow economic activity and discuss how these can be used for better economic policies. Granda’s paper, entitled “The Unofficial Economy and the Business Cycle: A Test for Theories”, uses official data to establish a set of business cycle features and study how they vary across countries with the size of the unofficial sector, and compares these empirical regularities with the predictions of existing theories on macroeconomic fluctuations in economies featuring underground activities.
After having the chance to exchange ideas with young scholars and with some of the world experts in the field, Granda has been faced with the uncertainty imposed by the volcanic ash cloud in Iceland. Being stuck in Berlin has not been an easy situation; however, she reports “I have spent some time sightseeing, visiting museums and, overall, taking advantage of such a ‘forced tourism’. With plenty of history while trying to stand as a leader in arts and promoting Western values, now I understand why this city is one of the most exciting places in Europe. All in all, I cannot complain, but I cannot wait for the flight back to Storrs to share with my friends and colleagues how this experience has enriched my life and view of things.”
Undergraduate Mark Connolly chosen as University Scholar
For the second time in recent months, the Economics Department has had one of its students, Mark Connolly, chosen for the prestigious designation of University Scholar. Mark’s selection follows on the heels of the selection in August of Philip Gorecki, a double major in economics and molecular and cell biology. Administered by the Honors Program, the highly-selective University Scholars program is designed to provide “the most academically elite students at UConn” an opportunity to advance their UConn education through this special program. A key part of the program is in-depth and focused research on a project of the student’s choice. Mark was one of only 24 students recently selected as 2010 University Scholars.
Mark is pursuing dual degrees in Accounting and Economics, and is working toward his CPA degree. He is particularly interested in auditing and in environmental economics and has thus chosen to focus his project on environmental auditing. He will be studying the role that accounting firms can and do play in environmental auditing, and the potential for auditing to provide valuable information both to the audited firms and to the public. He is particularly interested in the use of audits as third-party certification. Mark will be interning this summer with PricewaterhouseCoopers to gain a greater understanding of the audit process. His faculty advisors on this project will be Professor Lawrence Gramling in the School of Business, and Professors Kathleen Segerson and Olivier Morand, both in Economics.
One advantage of the Scholars’ program is the flexibility it offers students in designing their plans of study. Mark has structured his plan of study and remaining coursework to give him the background necessary for his project. In the course of doing this, he will also be preparing himself for his next goal, graduate study in environmental economics. One day he hopes to be a research professor bridging the gap between industry and environmental protection.
Economics Major Wins Outreach Award
Joseph Antelmi, an Honors student majoring in Economics, is the 2009 student recipient of the Provost’s Award for Excellence in Public Engagement. Provost Peter Nicholls announced the winners of the awards at a reception on December 9.
A resident of Suffield, Joe is active in a wide variety of outreach and engagement. He is on the board of directors of the Hartford non-profit End Hunger CT!, and has been involved with numerous public-interest organizations both on and off campus. The son of Italian immigrants, Joe is especially interested in immigration issues, and worked as a research assistant for History Professor Mark Overmeyer-Velasquez in creating an Honors course on migrant workers in Connecticut.
Joe has received a number of other University awards, including the Spirer/Drucker Humanitarian Award and the Audrey Beck scholarship, the latter given by the Economics Department. He was also one 14 students chosen for the 2009 UConn Leadership Legacy Experience, an endowed program that identifies and mentors top student leaders on campus. (Another Economics major, Phil Gorecki, is also in the 2009 Legacy cohort, and junior major Rafael Perez-Segura has been chosen for the 2010 cohort.)
Joe is carrying a 3.9 grade-point average, and was a University nominee for the Rhodes, Marshall, Mitchell, and Truman scholarships. Next semester he will be studying abroad in Greece. And in what little spare time he has, he fronts a rock group called Exit 47.
New crop of PhD students heading to the labor market
The Economics Department is happy to announce that 11 of our graduate students are completing their Ph.D. this academic year and are currently on the job market. Their fields range across environmental, industrial organization, international trade, labor, law and economics, macroeconomics, sports economics and urban. The students are listed below in alphabetical order along with the name of their major advisor, a brief summary of their dissertation, and any web links. Going forward, updated information may be found at the department’s job market page.
Gulgun Bayaz (advisor: Couch)
I investigate the role of market forces and the institutional constraints in explaining the earnings inequality differentials in the United States and Germany, by focusing on educational wage differentials. I find that differential growth in relative skill supplies is largely responsible for the differences in returns to skill leaving a secondary role for wage-setting institutions in explaining the differentials during the 1980s and 1990s.
Onur Burak Celik (advisor: Knoblauch)
My work departs from the mainstream matching theory literature and analyzes via simulations the effect of correlation in the preference lists on the aggregate satisfaction of the participants in roommates problem. Results show that correlation is an important factor on the aggregate satisfaction of the individuals. A higher correlation level among the preference lists leads to less satisfied participants.
Lei Chen (advisor: Ray)
I apply both non-parametric Data Envelopment Analysis and parametric Stochastic Frontier Analysis methods to study the production technology and efficiency in the U.S. dental care industry. The empirical analysis is based on a practice level data set constructed from the American Dental Association 2005 survey on private dental practices in Colorado. It is the first study focused on the technical efficiency of dental care industry in the U.S. at practice level in the last 25 years.
Paramita Dhar (advisor: Ross)
My dissertation examines two different questions about housing and location choice. In the first essay, I apply a difference-in-difference model to capture the causal effect of school quality on house prices by looking at houses located on school district boundaries in Connecticut. The rest of the dissertation deals with detailed spatial analysis of the nature of housing discrimination in the context of multiple minority groups in Los-Angeles using Housing Discrimination Study (2000).
Juan-Pedro Garces (advisor: Randolph)
The first essay –to be published this Fall in the Journal of Knowledge Globalization- is an empirical study of the determinants of educational quality, focusing on the special case of Chile, my native country. The second paper is a cross-country study of the effects of population density on educational attainment (as a proxy for human capital) and, through it, on living standards. The dataset contains panel data for 209 countries. This paper will be presented at the ASSA meetings in Atlanta in January 2010. The third paper presents a theoretical model of the influence of institutional development -including the educational system- on economic growth.
Nicoleta Iliescu (advisor: Matschke)
In my job market paper (“Antidumping as Trade Protection: Evidence from the US Lobby Activity”), I investigate the impact of lobbying on the antidumping practices in the US. Currently, antidumping is the most heavily used temporary tariff measure both worldwide and in the US. Thus, it becomes an appropriate avenue of studying how political pressure shapes the level of protection some domestic industries receive. The empirical results I derive in the paper reinforce the hypothesis that the political clout plays an important role in granting trade protection through antidumping duties.
Nicholas Jolly (advisor: Couch)
My job market paper focuses on the effects job displacement has on intragenerational earnings and income mobility. The main results of the paper show that an involuntary job loss significantly increases the probability of a worker moving into the bottom half of the labor earnings distribution not only in the year of displacement, but also for several years after the event occurs. However, if the worker has access to earnings and income from a spouse and government transfer payments, the negative mobility effects of displacement are significantly mitigated.
Maroula Khraiche (advisor: Zimmermann)
In my dissertation, I qualitatively and quantitatively evaluate the channels that affect labor migration, both skilled and unskilled, examining the effects of immigration policies on both the sending and receiving economies specifically considering guest worker programs, the implication of trade for migration, and informal labor markets.
Zinnia Mukherjee (advisor: Segerson)
The theme that runs through my dissertation is the design and evaluation of conservation policies to protect endangered species. In particular, I look at the effectiveness of voluntary approaches and the role of background regulatory threat in mitigating stochastic sea turtle bycatch and the welfare effects of unilateral conservation policies in an open economy. In addition to my dissertation, my research includes analyzing behavioral responses of fishers to marine hypoxia, with specific focus on the Long Island Sound fisheries.
Michael Stone (advisor: Miceli)
I present a theory which incorporates litigation costs into the standard economic model of punitive damages showing that caps on punitive damages induce under deterrence, but also reduce litigation costs. At the optimum, caps on punitive damages are justified when the marginal benefit of deterrence equals the marginal litigation cost. Utilizing a rich panel dataset from 1981 to 2005, I uncover some empirical evidence that litigation costs cause legislators to enact caps. There is compelling empirical evidence that the conflicting lobbying efforts of the legal services and insurance industries are most responsible for the enactment of caps.
Brian Volz (advisor: Miceli)
My dissertation examines discrimination and productivity in the professional baseball market. The first chapter, which has recently been published in The Journal of Sports Economics, finds evidence that minority managers are more likely to return the following season than comparable white managers. The second chapter finds evidence that discrimination in hiring may contribute to this higher survival rate. The third chapter examines how efficiently MLB teams produce wins and attempts to identify team characteristics which lead to efficient production.
Philip Gorecki, University Scholar
Each year the Department of Economics attracts a large number of outstanding students with diverse talents and interests. Among the current crop is Philip Gorecki, one of a handful of UConn students selected each year as University Scholars. Students in the Scholars Program are encouraged to tailor a plan of study that meets their personal interests and career goals. Frequently the plans involve more than one field of study–Phil’s is an excellent example, and quite a unique one at that.
In addition to his B.A. in Economics, Gorecki will graduate with a B.S. in Molecular and Cell Biology. This might seem like just an odd mix of interests, but the two majors offer the ideal background and training for his University Scholars research project, titled “Microarray Biosignatures of Disease: Their Assessment and Economic Impact.”
Like his curriculum, Phil’s study has two major components. The first phase will examine the development of early diagnostic tools utilizing Grating Coupled Surface Plasmon Resonance Imaging (GCSPRI) to determine the molecular and cellular biosignatures associated with agricultural disease. [And you thought only economists used complex terms.]
After exploring these new methods for early detection of disease among farm animals, Phase 2 of the study will estimate the economic value of the new diagnostic tools, using models based on the costs of the 1997 outbreak of Foot and Mouth Disease in Taiwan and the 2001 outbreak in the United Kingdom.
We wish Phil all the best with his study, and until the profession launches a new journal in bioeconomics, we look forward to seeing Phil’s work in both the MCB journals and the economics journals.