Technology is something that effects everything about the way market economics works. It has been one of the leading factors in the increase in many economic variables and measurements over the past 200 years. Some of the changes have been overwhelmingly positive but some have also been debatably bad for the people within our economy. It is also a place that has needed to be regulated and needs to be kept in mind when discussing policy options. With more and more jobs being replaced with machines we have to wonder what will happen to labor markets as the number of people living on Earth continues to increase and the number of professions that have always required man labor continue to be made obsolete by technology.

            An item that has been fantasized about technologically since the Model T was made is the self-automated car. It would be a technological advancement that would change everything about modern day society and it is within reach. Technological advancements have made serious pushes toward making the driverless car a reality. The thing that has been the biggest roadblock however has been the fact that our economy is not ready for it. Millions of people are employed as drivers and with people losing their jobs in other areas people have been switching to driving in order to make money through apps such as uber. With labor markets already saturated with people willing to work for cheap wage labor can our economy withstand the barrage that would take place if everyone who was currently employed as a driver became unemployed overnight. Hopefully in the future all undesirable jobs could be done by machines, which would thus end the saying that every economy needs a ditch digger, but is it realistic? We currently are neither economically nor technologically ready for the self-automated car despite its impending creation. One answer to this problem could be approached from the economic policy side. A policy could be implemented that would give some job security to professional drivers but also allow the recreational use of self-automated cars. This would give us more time to handle the more serious problems of how to get unemployment under control before we allow the self-automated car to take even more jobs away from actual people.

Stuart Huston

Working Out at Work

The benefits of working out are undeniable. People that workout tend to sleep better, eat healthier, have more energy throughout the day, and live longer. With the upward trend in obesity that America has experienced over the past several decades, exercise has become a hot topic for Americans. Today, over one in every three Americans are obese. People who are obese that would like to lose weight claim that they simply do not have time to workout or do not have the budget to afford healthier food options. The article, "Get a Life- or Get Fat" from the economist, finds that people who work longer hours tend to be more obese. Intuitively, this make sense, since people who work more would have less time to be active.

In order to offset this weight gain due to longer work hours, a number of options could be implemented. One option the economist wrote on a year prior to the publication of the aforementioned article was standing while at work. Constant inactivity is harmful to the body. It alters your metabolism and tightens your muscles. Simply moving while at work helps keep the heart rate up, helps keep the mind flowing, and loosens one's muscles. Another option would be to allow workers the option of one hour to exercise at some point during their work day. This will most likely result in workers having to stay longer at the office, but studies have suggested that after working out, people work more efficiently. Therefore, the longer hours from the workout could be slightly offset by increased productivity. Although a federal or state policy to force people to work out is not rational, private employers could encourage a more healthy lifestyle by encouraging one or both of these options. Not only will the person be healthier, but a company's bottom line might find itself better off as well. 

The (Actual) Prisoner’s Dilemma – Race or Crime Rate?

One may think quite logically that the harshness of penalties given to criminals would be proportionate with the crime rate in that state. According to research done by Rice University, if you believed this, you would be wrong. Surprisingly, the crime rate in a state is not the main determinant of whether that state would impose harsher penalties on crimes–instead, there is a more troubling variable to account for–the percentage of blacks residing in the state. I found this deeply unsettling; the fact that crime rate is superseded by the percentage of blacks for the most important determinant of the penalty given means that something more is happening behind the scenes when law enforcement decides to incriminate an individual. What exactly is the motivation for making one state have harsher penalties than another just because of race? The obvious answer to this question is racism: essentially, the whole legal process is prejudiced against African Americans. This is not just a question of why many more blacks are incriminated than whites or other ethnicities– this is a question of why the structure of the system purposefully imposes harsher penalties on states with larger black populations.

It seems that the current policy in place is due to the culture that has been prevalent in our society for an incredibly long time. Many posit that the belief of young black men being threatening to a population is the reason for the judicial system being biased in such a way. I have to agree– even though we have made long strides in combating racism, the deeper, subtler ways that racism permeates society are still there. The structure of the system is flawed in such a way to harshly penalize blacks for no net gain of any sort. Further imprisonment is costly both economically and socially, and it only makes sense to adjust the system to combat this. In terms of efficiency and equity, this policy decision is a no-brainer, but the question remains: how exactly do you address something that is so deeply ingrained? While I believe the cultural element of this can only change with time, the structure of the current systems in place can and should be changed. Penalties should be adjusted to either be harsher in other states with lesser black populations or less harsh in the states with the largest black populations. Further, more research should be done in order to discover more judicial systems in place that are either directly or indirectly discriminate against certain ethnicities.

– Ali Haq

Sources:

https://www.vocativ.com/usa/justice-usa/prison-statistics-race/

The New Jim Crow: Mass Incarceration in the Age of Colorblindness by Michelle Alexander

http://www.naacp.org/pages/criminal-justice-fact-sheet

                                                             

Regulating the Sharing Economy

Regulating the Sharing Economy
by Emma Catlett

Protecting consumers and  the hospitality industry are only two of New York State's motivations in regulating Airbnb in New York City, one of the largest companies in the sharing economy. New York Attorney General Eric Schneiderman claims 72% of the of the 35,000 rentals in New York City are illegally operated. It particularly accuses the large scale renters, or those operating more than a few dozen units, of illegally operating hotels without licenses. About 2,000 Airbnb units in New York City are rented for more than six months of the year, meaning, according to Mr Schneiderman, they are operating as hotels.

 New York's Airbnb climate is much more hostile than that in San Francisco, which has legalized the crowd sourced hostel movement. It is tasked with creating policy to regulate or illegalize the business. The hotel industry is concerned Airbnb is stealthily winning clients without submitting to the regulations to which the traditional hotel industry must submit. New York City rentals in the Lower East Side, Soho, Chelsea, Chinatown, and Hell's Kitchen comprise 40% of Airbnb renters' revenue in New York City, although Airbnb emphasizes that only 18% of its units are in traditional tourist areas (areas with high tourist traffic and hotel demand). Airbnb argues that its members (those renting out their own units) are able to provide a more personalized and authentic stay in the City, benefitting tourism and giving individuals the chance to break into the hoteling industry.

Those concerned with the housing stock in New York City criticize Airbnb's large scale renters for driving up the prices of the real estate in the area. The competitive housing market does not have room for housing stock to decline (and transfer to the hoteling industry). Clearly, there are a number of interests at stake in regulating this business. Unfortunately, regulation is difficult when renters are acting almost entirely independent of the company. Such is the sharing economy.


Sources:
"Airbnb Listings Mostly Illegal, New York State Contends" by David Streitfield
http://www.nytimes.com/2014/10/16/business/airbnb-listings-mostly-illegal-state-contends.html?_r=0

Returning to the Stem Cell debate - Robert Mitchell

Ask any pro-lifer and they will tell you that stem-cell research is a moral harm. But what about economic harms? At the turn of the century, federal funding restrictions devastated the human embryonic stem cell research field, resulting in a metaphorical ocean-sized gap between US scientific advances in hESC fields and non-US fields (DeRouen). As a result, US research has often relied on specific old lines of research, "many of which were made with outdated culture methods" (DeRouen). The ultimate impact is a lag effect in US competitive research models from two primary forms. First, the lasting fear of new bans or restrictions and the current restrictions on funding prevent adequate research into new fields of study, such as epigenetic research. Second, this uneasiness has resulted in scientists fleeing the field, either physically--as many scientists move overseas to complete their research (Medina)--or mentally--by shifting fields of study out of the hESC field (DeRouen). The result is a stagnation effect in the US based hESC research field. 

As countries around the globe such as China and the United Kingdom ramp up stem cell research, economists and policymakers alike must return to the question of stem cell research restrictions and the continued benefits thereof. The current restriction regime--which does not explicitly ban the use of stem cells but rather prevents funding and other benefits from federal grants based on NIH restrictions--has had many unintended consequences for the United States in the last decade as shown above. These brain drain like effects result in a failure of US biotech leadership (Cadden). As young new scientists move abroad, so do many companies, in order to maintain competitiveness with other international biotech companies (Medina). These firms view the benefits of finding new therapies and tech innovations as necessary for long-term survival. Because biotech is an increasingly global industry, not only does that mean companies must compete with one another, but there is a growing unwillingness to locate in a country that does not defend hESC research (Medina). The net result of stem cell funding for biotech companies is "lowers costs and higher ROI" (Cadden). Ultimately, we must decide whether or not morals can trump technological advances in medical treatment and the US industrial base. 

Bibliography

Cadden, Laura. "New Administration could mean profits for US stem cell companies", http://www.todaysfinancialnews.com/us-stocks-and-markets/new-administration-could-mean-profits-for-us-stem-cell-companies-5269.html, 11/5/2008

DeRouen, Mindy. http://link.springer.com/article/10.1007/s12015-012-9391-6/fulltext.html, 2012

Medina, Joanne. “Is Stem Cell Research a One-Way Ticket to the Island of Dr. Moreau? Singapore and the United States' Differing Paths” 21 Pac. McGeorge Global Bus. & Dev. L.J. 125. 2008

Public Health Policy: Containing Ebola and Preventing Future Outbreaks

As of late we have heard much about the Ebola outbreak, especially since it has entered the United States and the first transmitted case here occurred only a few days ago. The interesting aspect about public health policy is that it encompasses the economic and social aspects on a relatively equal level making it difficult to arrive to a clearly feasible solution. Dealing with the Ebola situation is certainly difficult to tackle, especially since this instance of it is much different than prior outbreaks. This leads to two main questions: How can we effectively deal with the Ebola outbreak and what can we do for future public health policy to quickly prevent something like this?

The Ebola outbreak has seen about 9000 confirmed, probable, and suspected cases so far and WHO fears that 10,000 more cases will be seen by early December if it continues to spread at the current rate. One patient infects on average 1.5-2.2 other patients; if that number can be brought to below 1 the situation will greatly subside. In order to do this, cases need to be isolated and prevented early on. In order to stop this there have been some measures taken like airport screenings for potential Ebola patients. One measure that has been suggested is quarantine of West African nations. This is both unethical and unreasonable. People would simply find ways to flee to other areas in Africa and to stop that, you would need a lot of resources. Instead, I believe foreign aid and increasing public health funding are more viable solutions. It costs a lot to treat and isolate Ebola patients--hospital beds, staff, etc. Also, education of the public, teaching them proper burial techniques and hygiene can go a long way in reducing the rate of infection. It may seem out of our scope to be helping other nations in addition to our own,  but when the root of the cause is stemming from other areas, solving the issue in other nations will collectively help the issue at home as well. We have to recognize this as a global issue. If we increase foreign aid and funding for public health then workers can be deployed to poor nations that lack infrastructure and resources to contain Ebola and future epidemics. This also helps organizations like the CDC and NIH recognize threats before they even occur--allowing preemptive measures. The main question then is where to cut funding to add to public health spending, but that is another debate.

-Neal Patel

Sources:

http://www.economist.com/news/leaders/21625781-win-it-requires-much-larger-effort-west-africa-outside-world-has-so-far

http://www.economist.com/news/international/21625813-ebola-epidemic-west-africa-poses-catastrophic-threat-region-and-could-yet

http://www.nytimes.com/2014/10/14/us/politics/debate-over-ebola-turns-to-specific-policy-requests.html?_r=0

Prostitution and Drugs Bring Italy Out of Recession

Recent news has stated that Italy is no longer in recession, as a result of a change in the way data calculations are made in the EU to illegal economic activities such as drug trafficking, prostitution, and alcohol and tobacco smuggling. Previously, the state of Italy’s economy was bleak following Prime Minister Matteo Renzi’s rise to power. Shortly after assuming the position, the Prime Minister led the country into a downward spiral. The EU has decided to include prostitution, drug trafficking, and other illegal forms of exchange in Italy in their calculations due to the fact that some European countries have legalized or decriminalized these activities, and thus to fairly compare the countries’ GDPs, all must include them. The black market activities has helped to raise the country’s GDP from a 0.1% decline for the first quarter to a flat reading according to the EU reading, which has helped Italy avoid a third recession in six years. This higher means that Italy will be entitled to less subsidies, it also has moved the country’s debt and deficits closer to the EU’s targeted levels. Additionally, by including black market activities in the country’s GDP, Italy’s debt to GDP ratio will be reduced from its current level of 132%, which is double the EU level. The finance ministry expects the country to have GDP showing growth by the year 2015. The new data confirmed a 0.2% decline in the second quarter, but GDP needs to contract in two consecutive quarters to be in recession.

Meth, Intervention, and Black Market---Juan Vasquez

It has been estimated that in the United States the costs of all addictive drug enforcement are almost $40 billion per year. Methamphetamine is the second most used illegal drug in the United States, behind marijuana. Abusing drugs like these does not only have significant costs to the individual, but there are public health costs that include child maltreatment, foster care, environmental damage, and hospitalization from overindulgence. The DEA’s mission, besides lessening the direct damages of drug abuse, is reducing these said externalities.  Unlike many other abused drugs, meth is manufactured with precursor ingredients available to many without restrictions.  By restricting the availability of these precursor ingredients, the quantity of meth will decrease and price will increase, thus limiting the use for many abusers of this drug initially. However, this form of intervention will open up the possibilities for black markets.

The most active ingredients in the production of methamphetamine are either ephedrine or pseudoephedrine. To combat the production of meth, in 1988 congress passed the Chemical Diversion and Trafficking Act, which was a policy that gave the DEA authority to the wholesale distribution of these precursors. There was one major loophole in this policy however: all tablet forms of ephedrine and pseudoephedrine were exempt.  Due to this specific lack of detail in policy, congress enacted the Comprehensive Methamphetamine Control Act of 1996, which required registration of all forms of precursors used to synthesize methamphetamine. In the short run this policy proved extremely effective as prices of the drug increased dramatically, but in the long run, after the temporary disruptions to meth producers have died down, it is uncertain whether these precursor interventions are effective.      

Government interventions against drugs are initially very effective; however, in attempt to eliminate externalities, intervention creates the black market. This can be seen as a negative externality as well because the black market provides these precursors that the government is trying to get rid of and continues to harm society. Due to this inevitable response to government interventions against drugs, it is hard to gauge whether they are really worth the expenditure. With that said, as long as there is any sort of positive feedback from interventions than there is a valid argument to have them.

- Juan Vasquez

Synthetic Marijuana - Zach Dubrof

            In light of our recent class discussion surrounding drug policy, I thought it would be interesting to discuss an article I read recently about synthetic marijuana. Synthetic marijuana is a term used for a variety of different chemicals – all legal – that mimic the effects of THC, the active ingredient in marijuana. The rise of synthetic THC is a cause for serious concern, especially among young people. Between 2010 and 2011, the number of emergency room visits related to synthetic marijuana nearly tripled. While these substances are said to work in terms of producing an effect similar to that of real marijuana, they are composed of a mix of very potent and usually toxic chemicals. Moreover, with the ease and legality of obtaining “fake weed,” people are going to continue trying it – exposing themselves to the nasty chemicals within and risking a trip to the ER, or worse.

            This discussion topic clearly leads us to the question regarding the legality of marijuana. I won’t delve too deeply into this conversation, but I think it is very clear that the current prohibition of marijuana is pushing people to try a much more dangerous substance. While there are negative health effects involved with smoking marijuana (the extent of which are still debated), it is undeniable that the drug has been very heavily researched. Synthetic marijuana, on the other hand, is an unregulated, experimental compound with unknown and unpredictable side effects. There is simply no way of knowing what you’re putting in your body when you use it. In 2013, it was reported that 8% of 12^th graders had tried synthetic marijuana in the last year. While this number may not seem large, there are a couple of important things to consider. First, all it takes us one bad reaction to the toxic chemicals in these compounds to have very serious consequences. Second, this number is expected to grow. Without asserting an opinion on the legality of marijuana, I think policymakers and economists need to take a much closer look at current drug laws and assess their true costs.

- Zach Dubrof