June 29Markets React to Greek Bank Closures
European stocks and bonds, as well as the euro, fell as Greece shut banks and implemented capital controls.
June 29Only Unfunded Government Spending Can Save Us
Nearly eight full years have passed since the beginning of the Great Recession in the United States, and yet the national – and global – economic recovery continues to grind along lethargically. Growth has picked up domestically, especially relative to America’s international counterparts, but wage growth continues to be languorous and the US still faces significant structural challenges in trade and production. But the reason for the tepid recovery is no mystery. Economists such as Larry Summers, Paul Krugman, and the International Monetary Fund have pinpointed the problem: secular stagnation. What is secular stagnation, and why is increased government spending the only way to solve it? Read on for Wonk Tank’s explanation.
June 25Wharton study finds disaster aid displaces property insurance
Federal disaster aid granted to communities hit by natural catastrophes causes demand for property insurance to fall by six times as much, according to anew issue briefingfrom the Wharton Risk Management and Decision Processes Center, based on aworking paperco-authored by PPI Faculty Affiliate Erwann Michel-Kerjan.
June 25Why Poorly Performing Funds Remain in 401(k) Plans
Research by the Pension Research Council at the University of Pennsylvania’s Wharton School, directed by PPI Faculty Affiliate Olivia Mitchell, found that there is significant favoritism toward affiliated funds in 401(k) plans. The study found that poorly performing funds that were affiliated with the plan’s service provider were unlikely to be removed from the 401(k) plan.
June 18The Rights of Nature and of Companies: Ecuador’s battle with Chevron to restore the polluted rainforest and its inhabitants
Is oil thicker than water? The Chevron-Ecuador conflict spans several decades, continents, and court cases. At first glance it seems to follow the familiar narrative of a small country exploited by a big foreign company, but neither party adheres to stay within these lines (or those of the law), and with legal, political, social, environmental, and corporate forces all at play, the issue has long-term ramifications for constitutional and legal precedents.
Meet a Student
I was very impressed by PPI’s founding vision to create a nonpartisan collective of University faculty for informing lawmakers’ decision-making.
Alex Gray’s first Penn family weekend, in the fall of his freshman year, stands out for what didn’t happen. “My parents and I had long planned to use the opportunity to tour historical sites around Philadelphia,” he recalls. Family weekend that year, however, coincided with the 2013 government shutdown that suspended operations of the National Park Service—not to mention most other government offices. While Alex previously had been aware of—and like so many others, frustrated by—the dysfunctions of the federal government, the shutdown really brought the full extent of partisan gridlock home to him, and made him want to better understand this often murky world of policymaking.
Studying policy wasn’t exactly at the forefront of Alex’s mind when he chose to come to Penn. Alex, who hails from Lexington, Kentucky, came for the unique academic opportunity to pursue the dual-degree Huntsman Program in International Studies and Business, with Mandarin Chinese as his target language. But through Penn Wharton PPI, he found a forum for putting public policy study onto his plate. As Alex put it, “I was very impressed by PPI’s founding vision to create a nonpartisan collective of University faculty for informing lawmakers’ decision-making,” and when PPI created a student association to further involve students in pursuing and expanding that mission, he hopped aboard.
Alex joined the PPI student association’s policy committee, which took responsibility for writing a research report on the social and economic aspects of comprehensive immigration reform. “Not only did this opportunity help sharpen my research skills, but it also broadened my perspective on an issue that touches millions of people who are living and working in the United States,” Alex says. “My favorite part of this process, however, was the culminating event in which we hosted Douglas Rivlin, a staffer to Representative Luis Gutierrez of Illinois [former Chairman of the Immigration Task Force of the Congressional Hispanic Caucus], where we heard how immigration reform policy has been debated in recent sessions of Congress.” The policy committee’s success in generating its immigration report inspired Penn Wharton PPI to launch Wonk Tank, our student-organized and student-run group that draws together students from across the University to issue research-based blog reports on a wide range of presently-debated policy topics. Currently, Alex works with PPI staff to write the Daily Update—a comprehensive snapshot of the day’s most salient policy and economic news for release to the University community.
This summer, Alex is bringing together his interests in international affairs, Chinese studies, business, and public policy through an internship at the American Enterprise Institute in Washington, DC. There, he’s working with AEI resident scholar Derek Scissors to conduct financial research on the Asian macro-economy. “Specifically,” explains Alex, “I interpret contracts between Chinese and international firms to update AEI’s China Global Investment Tracker, which is the only direct measure for Chinese foreign investment that is produced by a private organization in the western world.” In doing so, Alex is one of 95 Penn students this summer receiving internship support from Penn Wharton PPI.
While Alex acknowledges that he is still uncertain about making a career for himself in DC, he is quick to add that the exposure to public policy he has gained through Penn Wharton PPI will certainly influence his future endeavors. By interning in DC, “I hope to enter the finance industry and specialize in macro-strategy investing. In order to do so effectively, I feel it is very important to have a concrete understanding of how public policy impacts financial markets. Thus, I hope to grasp the inner workings of policy making and hone my research skills as an analyst at AEI for translation into the business world next summer and beyond.”