Professor Kai Zhao to be published in Review of Economic Studies

Posted on March 4, 2025 by McConnel, Mark

Professor Kai Zhao’s paper, “How Important Is Health Inequality for Lifetime Earnings Inequality?” (with Roozbeh Hosseini and Karen Kopecky), has been accepted for publication in the Review of Economic Studies, one of the top five academic journals in Economics.

In this paper, Professor Zhao and his coauthors examine an often-overlooked driver of economic inequality: health disparities. They show that health inequality is not just a reflection of broader economic disparities but a key driver of them.

Abstract:

Using a dynamic panel approach, we provide empirical evidence that negative health shocks significantly reduce earnings. The effect is primarily driven by the participation margin and is concentrated among the less educated and those in poor health. Next, we develop a life cycle model of labor supply featuring risky and heterogeneous frailty profiles that affect individuals’ productivity, likelihood of access to social insurance, disutility from work, mortality, and medical expenses. Individuals can either work or not work and apply for social security disability insurance (SSDI/SSI). Eliminating health inequality in our model reduces the variance of log lifetime (accumulated) earnings by 28 percent at age 55. About 60 percent of this effect is due to the impact of poor health on the probability of obtaining SSDI/SSI benefits. Despite this, we show that eliminating the SSDI/SSI program reduces ex ante welfare.

Storrs and Stamford Fed Challenge Teams at the Open House in Washington, DC

Posted on February 17, 2025 by McConnel, Mark

Storrs Fed Challenge Team at the Open House in Washington, DC — UConn Storrs 2024 Team: from left to right: back row: Professor Derek Johnson (faculty adviser), Spencer Thompson, Viren Chainani, Lilla Korniss, Claire Dobbins, Katrina Melnik, Professor Owen Svalestad (faculty adviser). Front row: Nameeda Elmi, William Infante, Evelyn Zhou and Rai Kumar

The Economics Department students participate in the College Fed Challenge national competition every year. The Storrs team competes in the Boston district of the Federal Reserve System, and the Stamford team competes in New York. In 2024, the Storrs team was a National Finalist, which is an exceptional achievement. In February 2025, both teams travelled to the Board of Governors of the Federal Reserve System in Washington, DC, for an Open House for all participants.

Stamford Fed Challenge Team at the Open House in Washington, DC — UConn Stamford 2024 Team: from left to right: back row: Matthew Dalzell, Thomas Surette, Angelina Solodka, Professor Smirnova (faculty adviser), Paul Juszczyk, Liz Maia, Madina Mamedli, Brenda Leon, Mallory Albrecht, front row: Cole Sembrot and Micthell Velasco.

In addition to summarizing results from the 2024 competition, the agenda of the Open House focused on showcasing various segments of the Fed’s functions and sharing career opportunities available at the Board for graduates with bachelor’s degrees. Participants heard from Brian Bonis, Assistant Secretary of the FOMC, Matt Eichner, Director of the Division of Reserve Bank Operations and Payment Systems, and a panel of former Fed Challenge participants, who are now employed as Research Assistants (RAs) at the Board.

The students of both teams were excited to participate in the Open House and are appreciative of the Economics Department as well as other entities that provided funding for this trip. The sponsors are the Business School, CLAS Dean’s Office, UConn Center for Career Readiness and Life Skills, and Stamford campus administration. Thank you!

Stamford Students Meet with UConn Alum in Washington, DC

Posted on February 11, 2025 by McConnel, Mark

During the trip to the Open House at the Federal Reserve Board, UConn-Stamford 2024 Team of the College Fed Challenge competition had an opportunity to meet with UConn alum, Misbah Seyal. Mr. Seyal is a real estate professional with a substantive career including various positions at Moody’s, Wells Fargo, Bank of America, and other financial services firms.

Natalia Smirnova, faculty, (left) and Misbah Seyal, UConn alum (BA’97, MBA’04), at dinner with students on February 6, 2025, in Washington, DC.

During the meeting with students, Misbah talked about career opportunities after graduation from UConn. He emphasized the importance of developing skills that could be transferred to the workplace and of being adaptable to labor market conditions as they change.

Students were interested in learning about the real estate sector as well as about the financial sector. They were curious about navigating the competitive market environment and about balancing career expectations and family. Misbah shared his wisdom and encouraged students to pursue their passions and dreams.

The students, as well as Dr. Smirnova, faculty adviser to the College Fed Challenge team, are grateful to Mr. Seyal for his time with us. We are also appreciative of Ms. Siobhan Lidington, Director of Development, School of Business, University of Connecticut Foundation, for her efforts to make this meeting possible.

Professor Miceli Publishes Harm and Responsibility

Posted on January 14, 2025January 14, 2025 by McConnel, Mark

Professor Thomas Miceli has published Harm and Responsibility: The Economic Factors Controlling the Extent of Civil and Criminal Liability

From the publisher:

Risk is an ever-present feature of life in a complex world, and it is important for societies to manage it in a just and efficient manner. One way to reduce risk is to assign responsibility for the associated harm. In this book, economist Thomas J. Miceli examines harm and responsibility from an economic perspective.

The book focuses on how responsibility affects people’s incentives to refrain from causing unnecessary harm to achieve what economists call optimal deterrence. Secondarily, it is concerned with the quest for justice. Defining this is part of the journey. Does it mean compensating victims for unavoidable losses? Does it involve punishing wrongdoers in proportion to the harm they have caused? Is there a clear answer? The book addresses these questions and more, explaining how, in some cases, these objectives will align with deterrence and in others they will not. The book discusses the ways that the law, tempered by religious and social norms, strikes a balance between these goals.

The principal areas of law that assign legal responsibility are tort law (for accidental harms) and criminal law (for intentional harms). There exist vibrant economic theories of both, and this volume draws on this literature. One theme that emerges is the role of causation in determining responsibility. Attributing responsibility for a given harm to the party that caused it seems both morally just (because it embodies personal responsibility), and economically desirable (because it achieves deterrence in the most direct manner). And yet the law departs from this prescription in any number of ways, both by limiting the responsibility of some who caused harm and by expanding responsibility to some who did not. The book offers readers coherent economic explanations for these departures from a purely causal basis for legal responsibility.

Author Thomas J. Miceli clarifies causation as reciprocal in nature and therefore not a uniquely defined concept. This means that when an action by A causes harm to B, the question is not how to restrain A but rather: whether A has the legal right to take the action in question or whether B has the right to prevent it. There will be a harm either way; the relevant question is which party should bear it. This insight ultimately leads to the fundamental problem of defining harm. In most conflicts this can be straightforward—as when A punches B—but in others it is more challenging. For example, when does free speech become hate speech? Where is the line drawn?

The book concludes by drawing out the implications of this fundamental ambiguity over the meaning of harm, what that means for the law, and what economic theory has to say about it.

https://link.springer.com/book/10.1007/978-3-031-74831-8

Public Economics Students Propose Policy Solutions for Connecticut Waste Management Problem

Posted on November 22, 2024 by McConnel, Mark

During the Fall 2024, the students in the ECON 3431- “Public Economics” course at the Stamford campus worked with the industry professional to research, analyze, and propose policy solutions to the imminent State of Connecticut problem of Solid Waste Management.

The applied nature of the course allowed students to experience every aspect of public policy development from problem identification, ideation, research of the literature, data gathering, analysis, and policy recommendation formulation.

In addition to Professor Smirnova, who is the instructor of this course, the students worked under the mentorship of Mr. Brian Bartram (CLAS’ 94), who has been the manager of the Salisbury/Sharon (CT) Transfer Station in Connecticut since 2007. At that time Salisbury & Sharon were seeking design ideas to be used in the construction of a new transfer station. Since then, Brian has been active in the Northeast Resource Recovery Association, CT Department of Energy & Environmental Protection’s Solid Waste Advisory Committee, and CT Product Stewardship Council. In 2012 he was appointed by Gov. Malloy to be a member of the Modernizing Recycling Working Group. Brian completed the UConn Master Composter Program in 2015.

Students were assigned to groups to imitate the economic think-tank work environment. Each group selected their topic through the process of ideation based on Brian’s presentation about the acute waste management problem in Connecticut. The following research questions were formulated and answered during the semester:

Cost Benefit Analysis of Installing a Methane Capture System at the Manchester, Connecticut Landfill.
Government Policies Promoting Recycling and Landfill Use Reduction.
Where Did Your Old TV Go?
What is the Most Cost-Effective Waste Conversion Technology for Connecticut Municipalities?
How does Connecticut Dispose of Waste Tires?

At the completion of the course, student teams presented their findings to the class with Mr. Bartram visiting the class virtually, asking questions, and commenting on issues. Brian reflected that he “really enjoyed how different student teams were looking at the issue from different angles. Solid waste is a national, regional, state, and local issue. All different views and situations need to be considered and assessed.”

Through this exercise, students learned to collaborate with and present and defend their findings to the industry expert. Collaborative experiences such as this, between UConn students and the State of Connecticut professionals, are invaluable in preparing our students for careers in industries and the public sector. By integrating the workplace analytical approaches into the curriculum of applied courses, we are teaching students career competencies that are demanded of them upon graduation.

ECE Economics Workshop 2024

Posted on October 28, 2024October 29, 2024 by McConnel, Mark

ECE Economics workshop participants in Storrs on October 23, 2024

The Early College Experience – Economics program is the largest at UConn. In the Economics program, we have 34 partner high schools with 66 certified economics instructors. Last academic year, 1,102 students were enrolled in 68 economics courses, with a total enrollment of 1,607 students. Our program is making a meaningful impact on Connecticut students introducing them to economic concepts and way of thinking as well as preparing them for college attendance.

Every year, Dr. Smirnova, who is ECE Economics coordinator, conducts the professional development workshop for participating teachers. The workshop is aimed at providing comparability of instruction and at sharing pedagogical innovations.

This year, 23 teachers from partner schools attended the workshop on October 23. The room was buzzing with commotion as guest speakers engaged the audience with hands-on activities.

Our guest speakers were Ariel Slonim, Curriculum Designer at Marginal Revolution University (MRU) and Mary Clare Peate, Senior Economic Education Specialist at Federal Reserve Bank of St. Louis.

The micro- and macroeconomics concepts were showcased in interactive ways, that would encourage high school students to engage in the classroom. Here are the topics:

Learning about Economic Decision Making with Pretzels
Cowbells and M&Ms: Creative Classroom Exercises for Teaching Externalities and Public Goods
The Inflation Rate is Falling, but Prices are Not!
Fact vs. Fiction: Interactive Tools to Teach the Truth About Fiscal Policy

This year, the teachers also heard from their peer, Ms. Lynn Taillon from Cheshire High School. Ms. Taillon shared her “Valentine’s Day” and “Model Decorations for Christmas” activities. Such sharing stimulated the discussion of other ideas and stories of attending teachers.

Participants went away with a lot of pedagogical materials that could be used immediately in their classrooms. All materials are stored on HuskyCT in the ECE Economics organization section.

Fall 2024 GA Training Workshop: Faculty Insights

Posted on October 23, 2024 by McConnel, Mark

Last Thursday, October 17, 2024, the Department of Economics held its regular semester GA Training Workshop, aimed at preparing new Graduate Assistants for their teaching responsibilities. Three faculty members—Professors Talia Bar, Professor Kai Zhao, and Professor Tianxu Chen—shared valuable advice drawn from their teaching experience.

Professor Bar emphasized the importance of adapting to students’ varying levels of mathematical proficiency, using active learning strategies to keep students engaged, and proactively addressing potential classroom challenges.

Professor Zhao reflected on his early teaching experiences, offering advice on understanding student backgrounds, using relatable examples, and ensuring clear communication to avoid confusion.

Professor Chen concluded the session by focusing on classroom management, encouraging a positive learning environment, and balancing teaching duties with academic responsibilities. Her practical tips provided GAs with useful strategies for success.

This workshop remains a cornerstone of the department’s efforts to support GAs, offering them essential tools and insights to excel in both teaching and their academic progress each semester.

UConn Storrs Fed Challenge Team Advances to National Finals

Posted on October 21, 2024 by McConnel, Mark

Congratulations to the UConn Storrs Fed Challenge team!

Over the past few days, the undergraduate students on the Fed Challenge team competed in the Boston Federal Reserve (Boston Regional) Fed Challenge competition, and they excelled – first advancing to the Boston Regional Finals, and then advancing to the National Finals.

As a result, in November the team members will be presenting their economic forecasts and monetary policy recommendations to the Federal Reserve in Washington, DC. This is an exceptional achievement.

A brief recap of the Boston event… On Friday, October 18th, the team competed with 23 other universities and colleges in the New England Boston Federal Reserve district. For the first round, the 24 teams (universities and colleges) were divided into six groups of four, with the winner of each group moving on to the Boston Regional Finals.

The UConn team won in its group, and earned its spot in the Regional Finals, joining the other five other Regional Finalists (Yale, Harvard, Wellesley, Babson and Dartmouth) to compete in a final round on Sunday. The final round would decide which three of the six Regional Finalists would move on to the National Finals.

UConn competed against the schools in the Regional Finals, presenting analyses of current macroeconomic conditions and monetary policy recommendations and fielding questions from Boston Federal Reserve economists. The UConn team was outstanding, and by the end of the day had made it to the National Finals along with two other teams.

The three New England Universities to move on are Yale, Harvard and UConn.

Congratulations to our student team members for all of their hard work and accomplishments!

The students are:

Viren Chainani (presenter)
Spencer Thompson (presenter)
Claire Dobbins (presenter)
Rai Kumar (presenter)
Katrina Melnik (presenter)
Nameeda Elmi
William Infante
Lilla Korniss
Evelyn Zhou
John Mclean

The faculty advisors are Derek Johnson and Owen Svalestad.

Professor Kathleen Segerson Published in Science

Posted on October 15, 2024January 24, 2025 by McConnel, Mark

Professor Segerson, a Board of Trustees Distinguished Professor of Economics at the University of Connecticut, has made significant contributions to the field of environmental economics. Her research focuses on the incentive effects of environmental policy instruments, particularly on legal rules and principles applied to environmental problems.

Dr. Segerson recently served as the lead author in an article published in the journal Science, where she and her colleagues highlight the hidden costs of green subsidies. They warn that while these subsidies can promote sustainability, they may also lead to increased consumption and market distortions. The authors advocate for clear end dates and cautious application to avoid long-term reliance and negative spillover effects.

As described in UConn Today:

Green Subsidies May Have Hidden Costs, Experts Warn

Some subsidies that appear to encourage sustainability are not so simple

Government subsidies for business practices and processes should be approached with caution, even when they seem to be environmentally friendly, writes a group of scientists and economists in this week’s Policy Forum in the journal Science.

They argue that subsidies can alter market pressures, leading to unintended consequences that not only perpetuate harmful subsidies over time but also diminish the overall effectiveness of those intended to promote environmental sustainability.

Therefore, when they must be used, subsidies should have clear end-dates, advise the authors.

“We’ve got this odd juxtaposition of trying to get rid subsidies in some sectors, and then ramping up subsidies in others,” says lead author Kathleen Segerson, Board of Trustees Distinguished Professor of Economics at the University of Connecticut. “The question that interested me was: is this a good thing or a bad thing?”

The full article is online at

https://today.uconn.edu/2024/10/green-subsidies-may-have-hidden-costs-experts-warn/

Professor Langlois Delivers the Eli Heckscher Lecture in Stockholm

Posted on October 4, 2024 by McConnel, Mark

Professor Langlois delivered the Eli Heckscher Memorial Lecture at the Stockholm School of Economics on September 26, 2024, talking on the theme of the American corporation in the twentieth century.

The Heckscher lecture has been given annually since 2003 by a list of distinguished economists, including two Nobel Laureates. It is named in honor of Eli Heckscher (1879-1952), known to most economists for the Heckscher-Ohlin theorem in international trade, who was the founder of economic history in Sweden.