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November 20 2009
Why students protesting tuition hikes in California are well-intentioned, but misguided
Students were occupying buildings Friday on several campuses of the University of California system in protest of a 32 percent tuition hike.
...
University officials said the $505 million to be raised by the tuition increases is needed to prevent even deeper cuts than those already made because of California's persistent financial crisis.
Protesting students said the hike will hurt working and middle-class students who benefit from state-funded education.
While well-intentioned, the students are failing to recognize the simple economics of education. Students demand education--therefore there is a demand curve for education(click the diagram to the right) that is downward sloping: some are willing and able to pay more than others. Private educators are willing to supply education, but it is costly (Private Tuition). For a variety of reasons--affordable access to education, reduced crime, increased productivity--society, through state and federal tax revenues is willing to subsidize education thereby reducing the costs of education (Spublic). This downward shift in the supply of education decreases tuition (Public Tuition) and increases the number of people willing and able to get an education.
So what happens when the state is forced to reduce the subsidy, as California is currently doing? Starting from the fully subsidized situation (Spublic ), the reduced subsidy will shift the supply curve back to the left raising the market clearing price of education (Current Tuition + hike) and reducing the number of number of people receiving an education from Qbefore to Q+hike. Not only are less people educated, but those losing access to education are those with the lowest willingness to pay OR ability to pay. And this is where the protests come in. The increased tuition reduces education among those with the least ability to pay. Sounds protest worthy, right?
But, what happens if tuition isn't raised in the face of the reduced subsidy? On that case, the price of education would stay at the current Public Tuition level in the diagram, but the supply curve still shifted left (actually up) by the amount of the reduced subsidy. If tuition doesn't rise, the quantity of education supplied at the current tuition will be less than if tuition rises (Qnohike in the diagram).
Contrary to the tuition hike case, it's now a crap shoot as to which students lose out on education, but the end result in unambiguous: a successful protest for no tuition hikes (assuming funding for education is cut) will result in less total education than allowing tuition to rise.
Is that really what the protesters have in mind?
India to Spend $900 Million on Solar
Green Builders' Study Forecasts Job Growth
Study Says Air Cars are Inefficient
Doesn't this just create a different fishery?
From the Columbus Dispatch:
Federal officials say the despised Asian carp may have breached an electronic barrier designed to prevent it from invading the Great Lakes and jeopardizing their $7 billion sport fishery.
Officials with the Army Corps of Engineer say Friday that DNA of the giant carp have been found north of the barrier in the Chicago Sanitary and Ship Canal.
If correct, that would mean the carp might reach Lake Michigan if they get through a navigational lock. From there, they could spread throughout the Great Lakes and out-compete native species for food.
Asian carp escaped from Southern fish farms in the 1990s and have been migrating up the Mississippi and Illinois rivers. They can exceed 4 feet in length and 100 pounds.
Siemens Chief Discusses Green Initiatives
Is Food the Last Thing to Worry About?
I'm going to the SEA meetings!
As Tim previously announced, you'll be able to find me in San Antonio this weekend. Here is the link to my conference schedule. I'll also be attending this great looking session.
I'll be presenting our (Tim, Rob, Kurt and John) recreation demand models for marine fishing for the last time, hopefully. We have a website to support this project: http://econ.appstate.edu/marfin. Check it out for the full report, data, programs, presentations and (coming soon) a working paper.
A song for happy, hopeful days
Always use good news for a boost: “the sky was the limit”
It’s also a cautionary tale, on the consequences of basking in past glory. Head down, keep on pedalling hard. But, for the time being, let me enjoy!
Picture of the day
Hat tip: Rich Woodward
El Niño intensifies Latin American drought
India tells West to stop eating beef
Result!
From the snail-mail box:
Dear Mr. Ferreira
I am happy to inform you that the Examination Panel has recommended you be awarded the MSc in Applied Environmental Economics with Distinction.
I am so, so happy for this. And it’s Friday as well! So, in keeping with pure academic tradition,
Punchline: work hard, play hard.
How To Create a Free Energy Generator
A way that you can pay less for electric bills, so you want to know what it is? Most people will love this, but many will be extremely skeptical. Does it work? Many people have tried it with great results. Saving up to 50% on just a partial use of this free energy generator.
It’s a device that you can build yourself, and get free energy off the grid. It’s called a zero point magnetic generator, and with it you can get free energy. Using magnets with magnetic force it will produce perpetual motion, which in turn will create free energy for you to use. Running continually by itself, and will continually produce more energy then what it will use.
Imagine the benefits of such a machine, and then you can figure out why for years it has been kept from the general public. If you’re able to create your own free energy you won’t need to pay for it from all those big companies who make tons of money. This generator that you can make yourself will not use solar or even wind power.
Using very little space up in your home, so you will be able to place it without a big space being available. Power bills will be eliminated either by half or even the complete thing depending on how much you want to use the free energy generator. Doesn’t matter if it’s hot or cold out the generator does not have to be in an environmentally controlled area. Materials that you need to build your generator are inexpensive and easy to find anywhere in the world.
The cost of the material will not amount to much, and again it’s very simple to build. Many years have been spent testing this idea and perfecting it. Now it’s being shared with many people, hoping to save money on those electric bills.
Many have already tried this method out and many more are sure to give this free energy generator a try. Heck who won’t want to give up paying that electric bill for free energy! Extremely safe to use producing no hazardous gases or anything, even a child can walk right by this generator and not get hurt.
A very green idea to get energy into your home, eco-friendly equals help for the environment! The costs of materials to build this generator are indeed very inexpensive with a complete charge of 0. Not bad, and simply made up in a month of electric bills for most people out there. You won’t need to use it to completely power your home, if you are a bit tense of whether it will work or not, try it out for part of the procedure in your home.
Finally, if you want a new way to get energy for your home, and something that will cost you nothing. Well build your own free energy generator for a very small cost of 0. Save the money and use it for other things in your life that you could use. Use it for a nice family vacation, or something you’ve always wanted. Again it will help you save around 50% if you only use it for part of your home.
Magniwork power generator will teach you how to generate completely free electric power, meaning, create energy without needing any other source.
Bihar villagers now get green electricity
Where I won't be this weekend
John's headed to the Southern Economic Association meetings in San Antonio this weekend. Unfortunately I can't make it. At the risk of exposing her to John's typcial meeting antics, I'm sending one of my brilliant Ph.D. students, Carolina Castilla*, in my place. She'll be presenting some work we're doing on consumers' price search strategies. Here's the abstract for Consumer Willingness to Search in the Gasoline Retail Market...
Abstract:
Price search enables consumers to overcome information asymmetries, it can lead to a reduction in price dispersion and it can increase consumer surplus. But, search is costly and we know very little about how the cost of search enters the consumer’s search decision. In the case of the market for gasoline, the cost of search is a function of the amount of gasoline consumed and the time spent searching for the lowest price. In this paper we conduct an internet survey among a random sample of 480 drivers in the State of Ohio to answer two main questions: when do consumers search, and are consumers considering search costs as sunk. We use a choice experiment on willingness to search to answer these questions. Though, it can be argued that consumers incorporate some search as a sunk cost in their current optimization decision because they have incurred some of that cost in the past, we find that this is not the case. When faced with prices above their expectations, consumers incorporate both gasoline and time costs into their search decision, whereas when faced with prices below their expectations the driving factor on consumers’ willingness to search is the difference between posted and expected price.
*And yes, Carolina will be on the job market next year, so if you are in the market for a well-trained economist with a humble advisor, give her a call.
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Apex court rejects plea to ban idol immersion in water bodies
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