Supreme Court permits Trump to deny asylum to Central Americans; Trump delays tariff hike on Chinese goods by two weeks; House approves two bills to block offshore drilling; US weekly jobless claims drop to five-month low; U.S. consumer prices rise a slight 0.1% in August.
As economists debate the possibility of another recession, it is critical for policymakers to have a full understanding of the dynamics that were at play in the last one. In this brief, the authors offer a new perspective on the behavior of banks during the financial crisis of 2007-08 and the limited success of unconventional monetary policies in stimulating bank credit to the private sector during the subsequent economic recovery.
The rise of peer to peer fundraising on digital platforms has many questioning whether technology will usher in a new era for accessible capital formation. Traditionally, investment in early stage ventures is restricted to ‘accredited investors:’ those of sufficient net worth and income levels. Nonetheless, both Regulation Crowdfunding and ‘Initial Coin Offerings’ (ICOs) allow unaccredited investors to ‘get in on the action’, participating in early stage funding in return for equity.
When you visit your physician with an ailment, you hope your doctor prescribes medicines that are, to their absolute best knowledge, the right ones for you to get better. When you purchase a vehicle at the used car dealership, you would like to expect that your dealer discloses pertinent information about the car’s condition, especially any hidden issues that may exist. And when you go to your broker-dealer with your hard-earned money, seeking sufficient returns that will allow you to plan for retirement, a child’s education, or a rainy day, you might want to hear that your broker is working for you and has your best interests in mind.
International Political Economist, Robert Gilpin, claimed that in a global economy, states use economic forces to further their national interests. Recently, this very concern has magnified with the proliferation of sovereign wealth funds (SWFs) and foreign direct investments (FDIs). SWFs are government-controlled assets that grow when states experience excess liquidity from budgetary surpluses. SWFs are useful investment tools, often used for development, savings, and as stabilization funds to protect against economic volatility. In contrast, FDIs are investments made by individual firms that usually exert direct control over operations. Ultimately, both FDIs and SWFs raise similar questions regarding the potential influence of foreign capital in local markets.
What does a drop in construction spending mean for economists? Professor Susan Wachter claims that it could be a harbinger of a slowing economy.
Is a US economic recession imminent? Professor Jeremy Siegel says, no, but a slowdown is perhaps in the horizon. “I don’t see [a recession coming up]. I also think that the Fed has enough silver bullets” he says.
In the months leading up to my summer in D.C., I dreamed of walking along the National Mall, the Washington Monument and Lincoln Memorial glistening grandly in the backdrop as hundreds of tourists strolled casually about. What I did not picture, however, were the electric scooters that have taken over the city. From their incessant buzzing to their seemingly ubiquitous presence, these scooters have become a fixture of the city landscape.
Medication costs have long been a significant component of healthcare bills in the United States. According to the Centers for Disease Control and Prevention, national spending on prescription drugs exceeded $328 billion in 2016, representing nearly 10% of all national health expenditures. However, the unique marketplace for prescription medication in the U.S. has stirred much debate on how to best regulate such a complicated industry.
In 2014, when Volkswagen’s TDI diesel cars began showing discrepancies in emission readings between lab tests and real-world tests, there were many questions about the underlying cause. Investigations revealed that Volkswagen installed emissions software, known as “defeat devices,” on more than a half-million diesel cars in the U.S. These devices were able to differentiate between test mode and real-world driving. In test mode, the cars were fully compliant with the Environmental Protection Agency’s emissions laws, but the actual emissions while driving were almost 40 times higher than the federal limit.
In a discussion on the Fed’s recent push to be more transparent, Professor Peter Conti-Brown comments on how the federal bank did not always operate this way.
Accounting Professor comments on the risks imposed by a government proposal to provide audit waivers to certain companies; “There should be no question that this will unambiguously lead to weaker internal controls, greater restatements and greater destruction of shareholder wealth.”
In a discussion on Presidential Candidate Andrew Yang’s basic universal income idea, the authors cite Professor Ioana’s research on the Alaska Permanent Fund, the closest active comparison to Yang’s policy.
Secretary of State Michael Pompeo represented the United States at the Arctic Council Meeting in May 2019 and drew international attention as he both refused to sign an agreement between the Arctic states and reprimanded Canada for its claims to an Arctic seaway. He claimed that “Russia is not the only nation making illegitimate claims” and that “the US has a long-contested feud with Canada over sovereign claims through the Northwest Passage.”
The United States’ current relationship with African countries is rapidly changing. Previously, the US touted the strongest commitment to Africa, being the largest contributor of foreign developmental aid compared to other countries. However, this strong relationship is being threatened as other countries realize a shifting commitment from the United States.
In 2015, the United Nations Member States committed to 17 Sustainable Development Goals (SDGs) as a blueprint for peace and prosperity for people and the planet. While progress has been made, achieving any of the SDGs will require development finance institutions, governments, multilaterals, and foundations to develop and deploy innovative financing tools to make existing funds as impactful as possible. Foreign aid has stagnated and begun to fall over the last few years, prompting investors to increasingly innovate to drive development. According to the OECD, external foreign investment to developing countries dropped by 30% between 2016-2017, after a 12% decrease in overall finance from 2013-2016.
In a discussion on the ramifications of legal challenges to the ACA, Professor Mark Pauly comments, “I will be heartsick if it’s declared unconstitutional. My view is that you should be required to have health insurance just like you’re required to wear clothes in cold weather.”
Wharton’s Brian Feinstein discusses his research on how judicial foreclosure can help states fill the policy gap left by the federal government’s pullback from regulatory enforcement of mortgage-lending.
Professor Herbert Hovenkamp anticipates that the Capitol’s big tech hearing will focus on issues of anticompetitive behavior/acquisitions and exclusionary contracts.
In a discussion on Puerto Rico’s bankruptcy plan, Professor David Skeel comments how its success could encourage similar state bankruptcy plans while its failure would have the opposite effect.
White House projects $1 trillion deficit for 2019; Mnuchin raises alarm over cryptocurrencies; White House moves to further restrict asylum; U.S. retail sales post big gains in June; U.S. industrial production flat through June.
“Safe third country” agreement blocked in Guatemala; Republicans without plan to raise debt ceiling; Republicans ready to “repeal without a replace” Obamacare; Threats push Congress to act on infrastructure cybersecurity; Economists find unemployment rate a weak metric in current business cycle.
Professor Barbara Kahn comments on the effective costumer service model practiced by local Philadelphia institution Fante’s as it battles to resist ecommerce hegemony.
Professor Matthew Grennan joins in a conversation regarding President Trump’s recent executive order to increase transparency in the hospital prices. Grennan addresses whether or not the move will ultimately raise prices for consumers.
Policymakers concerned about stimulating small business and entrepreneurial growth need to better understand the dynamics of crowdfunding as a vehicle for that growth. The conventional wisdom is that raising cash through crowdfunding always benefits entrepreneurs. But that is not the complete picture. In reality, there are ways in which entrepreneurs, as well as VCs looking for new investments, may actually be left worse off after a successful crowdfunding campaign. This issue brief examines the potential pitfalls of a successful campaign. These include a moral hazard problem that comes into play when entrepreneurs explore both crowdfunding and venture capital investment, which can lead to a breakdown in negotiations between entrepreneurs and VCs, leaving the VC without a potentially lucrative project and the entrepreneur without the VC’s essential financial support, expertise, and guidance. While the brief focuses on reward-based crowdfunding platforms, the pitfalls described herein likely apply as well to peer-to-peer lending, real estate, and equity-crowdfunding platforms too.
FBI, ICE utilizing DMV records for facial recognition; This week lawmakers are returning to Capitol Hill amidst lingering tensions from negotiations in June over a $4.6 billion bill to fund humanitarian aid for migrants on the southern border; The Justice Department is shifting responsibility to a new team of lawyers for matters related to adding a citizenship question to the 2020 census; Economists have been expecting to see more of an economic boost from higher government spending authorized in 2018, but that bump has not materialized.
Professor Cary Coglianese comments on the recent political contestation around the census question. Though there is a legal avenue by which the question could end up on the census, Coglianese is skeptical.
Professor Peter Cappelli comments on how current trends that outsource hiring actual result in greater inefficiency. There are simpler practices such as internal evaluations that can better identify the best talent.
In light of the Federal Reserve’s stress test exemption of 17 smaller banks, Professor Peter Conti-Brown decodes the regulator’s behavior and highlights the cost to do otherwise.
Professor Howard Kunreuther discusses why federal bodies need to insure against terrorist attacks and highlights the ambiguous but potentially catastrophic economic implications of a failure to do so.
In light of the public fascination around health care in the upcoming presidential election, Professor Ashley Swanson discusses the merits of a Preferred Pharmacy approach rather than the “health care for all” framework.
Recent demographic changes—the sharp increase in single-person households, especially among single individuals over the age of 65, as well as racial disparities in homeownership and the increasing cost burden of home rentals—are underscoring the need for a new vision with respect to U.S. housing policy. This Issue Brief lays out several policy prescriptions for improving housing affordability and fairness, both for renters and owners: modifying the federal Housing Choice Voucher program as well as local and state land-use regulations; investing in the maintenance of existing affordable housing stock; making good on HUD’s Affirmatively Furthering Fair Housing requirements so as to reduce fair housing barriers; and promoting financing programs for retrofitting existing low-income housing, to increase energy efficiency and reduce overall costs. While each of these recommendations would be beneficial in and of themselves, what the U.S. ultimately needs is a broader and more complete national strategy for housing policy.
While policymakers have talked a lot recently about finding a comprehensive fix for escalating health care costs, such as Medicare-for-all, many economists have been exploring the possibility that the answer for excessive health care spending may rest instead in series of smaller adjustments. One such small fix is preferred pharmacy networks. This is a relatively new tool whereby health insurers aim to steer consumers to lower cost “preferred” pharmacies, where insurers are able to negotiate lower drug prices. The research concludes that preferred pharmacy contracting results in a roughly 1 percent decrease in Medicare Part D drug costs among plans utilizing this tool—a fact that should be encouraging to policymakers concerned about reigning in costs, especially in light of other research demonstrating that health care consumers do not shop around for lower priced care. If this practice of “steering” consumers toward lower cost drugs were applied to the entire pharmaceutical industry, the savings could be much greater.
Richard Cordray was the first Director of the Consumer Financial Protection Bureau, which was formed in the wake of the 2008 recession as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. In his five years leading the CFPB, Cordray was tasked with making sure consumers were no longer harmed by the actions of banks, lenders, and other financial institutions. In 2017, Cordray returned to his home state of Ohio where he had previously served as State Treasurer and Attorney General, to run for governor. Mr. Cordray was the Wharton PPI 2019 Public Policy Visiting Fellow and joined Dan Loney in the Knowledge@Wharton studio for an in-person interview.
According to research by Penn GSE Professor Laura Perna, data shows that inequalities continue to persist in higher education that uniquely disadvantage students of the lowest income brackets. However, the Perna argues that this presents a unique oppertunity for federal and state lawmakers to design new policies that help support low-income, first generation, and differently abled students.
For three days in May, Wharton Legal Studies and Business Ethics Department Professor David Zaring took a group of students to Washington, DC for the Wharton Industry Exploration Program’s short-term field course on the Public Policy Sector. While in DC, students were able to attend sessions at various public policy institutions, to learn about how they conduct policy research, and how the research fits into the federal policymaking process.
In 2018, Chinese firms secured more than $30.9 billion in venture capital funding, surpassing for the first time that received by their U.S. counterparts in the same year, by $3.7 billion. The technology-led revolution that China has undergone has spurred major innovations in the sphere of mobile payments, Financial Technology (FinTech), and transport. Nine of the world’s one-hundred largest technology companies, home-grown giants such as Tencent, Alibaba, and Baidu, have thrived on the global stage. Simultaneously, venture capital funds are beginning to search for opportunities that exist beyond the mature and competitive markets in North America and Europe, markets in which there exist many established incumbents and a lack of new entrants. China, with its 700 million internet users (more than twice the population of the United States) and strong tax and loan incentives from the central government, is looking to be a more attractive destination for venture capital firms. In addition, the “Made in China 2025” plan looks to increase investment even further in the Chinese technology sector. However, despite the upside, foreign investors are reluctant due to navigating a digital, economic, cultural, and political climate entirely different from the one they are familiar with.
If your friend owes you money for putting the dinner tab on his card, all it takes is a few clicks in the Venmo app and within minutes the money is in your account. It is one of the easiest ways to transfer money between people. Yet the backbone of Venmo and the entire American financial system—the main payment processing system the United States—still runs on the same schedule as when it was launched in 1974. This is the reason why when you get a paycheck on a Friday, the funds are not available until the following Monday or Tuesday. In October, the Federal Reserve put out a notice seeking comments on how the central bank could “support faster payments in the United States.” While this upgrade is still in its early stages, the Federal Reserve needs to make a massive change in how payments are processed in the United States. The Fed should correct some of the system’s regressive components and make the system quicker and more consumer-friendly.
President Trump’s new trade rules face challenges; A finalized deal is expected to result from U.S.-China trade negotiations; Americans’ approval rating on the Affordable Care Act (ACA) remains split; U.S. consumer spending shows biggest gain since 2009.
On March 25, Wharton PPI joined the Penn College Republicans in co-hosting a talk by Sean Spicer, former White House Press Secretary for President Donald Trump. Mr. Spicer shared his story of discovering a passion for politics and becoming fascinated with the “winner takes all” aspect of the U.S. election process. During his undergraduate studies at Connecticut College, he volunteered at the Connecticut State House and in local campaigns. This led him to work as a field representative on the 1994 election campaign in the Connecticut 2nddistrict, which the incumbent won by just a handful of votes. It was this defeat that taught Spicer the importance of “running through the tape” and past the finish line of any political race. If the Republican organizers in 1994 had continued to campaign until the very last vote was cast, Spicer believed there was a good chance they could have swayed enough voters to win.
The landmark Supreme Court ruling in Illinois Brick Co. v. Illinois (IB), which bars “indirect purchasers” from bringing antitrust suits against upstream product manufacturers, has greatly reduced the legal costs associated with antitrust enforcement. The ruling also might have another, lesser-known result: it has the potential to enable firms upstream in the supply chain to engage in collusion through the use of a particular contract structure—the wholesale price plus fixed fee structure (WPFF). The key component of the WPFF structure is a slotting fee, by which manufacturers agree to pay a fixed fee to retailers, compensating them for stocking fewer, higher cost items than they would under perfect competition. The fee acts as a disincentive for retailers to level antitrust suits against manufacturers. And consumers, whose welfare is reduced by the collusion, are forbidden from bringing antitrust action by the IB ruling. The research suggests that the incentive to collude is greater when demand uncertainty for a product is higher, the number of retailers in the market is higher, and the number of manufacturers is lower. Public enforcers of antitrust law can use this knowledge to focus their monitoring efforts on firms embedded in the type of supply chain structures described here while using WPFF contracts.
Turkey has been plagued by political and economic instability for the past several years as President Recep Tayyip Erdogan has strived to maximize his power and strengthen his country’s economy. Turkey’s economic growth in recent years has been fueled by the accumulation of corporate and financial foreign-currency debt, which are outstanding loans in Dollars and Euros that Turkey and Turkish companies now owe to outside investors. These debts now account for 70 percent of its economy. The current account deficit in the country is at an all-time high, meaning that the amount of goods and services the country imports exceeds the amount it exports.  Due to the strengthening of the dollar, Turkey is now experiencing difficulties in repaying its loans and is thus in danger of default. It is in the interests of the global community to prevent a Turkish default, which could spread to other countries.
Throughout its history, the U.S. Federal Reserve has engaged in international diplomacy, outside the bounds of (and sometimes in conflict with) the priorities of the White House and U.S. State Department. In directing monetary policy, the Fed’s primary concern is to benefit the U.S. economy. In the process, the Fed at times acts in concert with foreign central banks, as was the case in setting new bank regulations after the 2008 financial crisis. At other times, the Fed acts in ways that other countries view as detrimental to their economic interests. Either way, the Fed operates with little public accountability, and can wind up complicating the work of U.S. diplomats. This brief addresses the questions of whether and how greater oversight of the Fed’s international activities should be pursued. The brief recommends not an overhaul of the Fed’s structure or the elimination of its role in international affairs, but instead calls for greater disclosure of its international activities. The authors suggest that the Fed should provide testimony to Congress twice per year on its foreign policies, just as it does for monetary and regulatory policy. This kind of disclosure permits broader discussion of the Fed’s activities without eliminating the benefits of its institutional independence for monetary policy.
Penn Law Professor Cary Coglianese offers his perspective regarding the lack of regulatory work in the Federal Register, which was greatly impacted by the most recent government shutdown. He argues “The people who produce the analysis and provide the legal justification for these rules, they’re not there to process the public comments, think through and work with the Office of Management and Budget.” In this case, Coglianese suggests that it is important to separate the opinions of policymakers and those of the public.
This competition, open to all undergraduate and graduate students across the University of Pennsylvania, is intended to foster discussion and collaborative research on key public policy issues. One team will win the grand prize of $5,000. Two teams will earn honorable mention awards of $2,000 each.
At a press conference in 2016, President Obama remarked, “The United States and ASEAN [the Association of Southeast Asian Nations] have forged a strategic partnership guided by key principles, including that ASEAN will remain central to peace, prosperity and progress in the Asia Pacific.” However, the U.S.-ASEAN partnership faces several emergent challenges, including disruptions in trade policy, adjustments in major economies, US withdrawal from the Trans-Pacific Partnership (TPP), Chinese territorial expansion, and a lack of organizational unity and infrastructure. This article will provide a history of the U.S. relationship with the ASEAN, an overview of the various problems faced by the partnership, and recommended policy responses to ensure continuing United States and Southeast Asian economic development and prosperity.
Funding for early-stage biomedical innovation has been declining at the same time that medical breakthroughs seem to be occurring at ever increasing rates. One explanation for this counterintuitive trend is that increasing scientific knowledge can actually lead to greater economic risk for investors in the life sciences. While the impact of the Human Genome project, high-throughput screening, and genetic biomarkers has been tremendously positive for clinicians and their patients, it has also increased the cost and complexity of the drug development process, causing investors to shift their assets to more attractive investment opportunities. In this talk, Prof. Lo describes how financial engineering—portfolio theory, securitization, credit default swaps, and other tools of modern finance—can be used to reduce the risk and increase the attractiveness of biomedical innovation so as to bring new therapies to patients faster.
Cary Coglianese is the Edward B. Shils Professor of Law and Professor of Political Science at the University of Pennsylvania, where he currently serves as the director of the Penn Program on Regulation and has served as the law school’s Deputy Dean for Academic Affairs. He specializes in the study of regulation and regulatory processes, with an emphasis on the empirical evaluation of alternative regulatory strategies and the role of public participation, negotiation, and business-government relations in policy making.
A co-chair of the American Bar Association’s administrative law section committee on e-government and past co-chair of its committee on rulemaking, he has led a National Science Foundation initiative on e-rulemaking, served on the ABA’s task force on improvingRegulations.Gov, and chaired a task force on transparency and public participation in the regulatory process that offered a blueprint to the Obama Administration on open government. He has served as a consultant to the Administrative Conference of the United States, Environment Canada, the U.S. Department of Transportation, and the U.S. Environmental Protection Agency.
Based on a thesis presented in a PPI article entitled Addressing Personal-Income-Tax Manipulation with Tools from Psychology, Professor Alex Ree-Jones discusses how governments should utilize the behavioral tendencies of tax payers to minimize losses and maximize rewards in order to create the most generative tax revenue systems.
Proponents of robust mortgage finance regulation would do well to look to the states, and specifically to the regulatory effects of state-mandated judicial foreclosure. Judicial foreclosure, which is authorized in almost half of U.S. states, requires that lenders seeking to foreclose on a mortgage file an action in state court. This not only provides borrowers with a forum for holding lenders accountable for their behavior and obligations, but puts the onus on the lender to show that the requirements for foreclosure have been met. It also aids borrowers by delaying the foreclosure process and allowing them to remain in their homes for longer periods while in default. In this brief, Professor Brian Feinstein empirically examines the effects of judicial foreclosure on lender behavior and mortgage costs for consumers. The findings indicate that judicial foreclosure alters lender behavior in ways that are beneficial to borrowers, and that mirror regulatory goals. Lenders exhibit greater caution in loan-approval decisions and offer fewer subprime loans. These results are amplified for lower-income borrowers. Importantly, the costs imposed on lenders by judicial foreclosure do not appear to get passed on to borrowers in the form of higher rates.
Resilience. It’s the new buzzword going around the U.S. electricity sector, and it’s defined by an electrical grid’s ability to recover from major disturbances (read: cyberattacks and natural disasters). President Trump and Secretary of Energy Rick Perry have accordingly introduced plans to support struggling coal and nuclear plants because of their ability to store backup fuel on-site.
Vox.com cites Wharton Public Policy Initiative’s election technology industry analysis “The Business of Voting, Market Structure and Innovation in the Election Technology Industry,” in article about the vulnerabilities of the election infrastructure. Rather than criticize election officials, Vox.com suggests the public should look harder at the lack of incentives created for election companies to properly manage voting. “The revenue footprint of the entire US elections industry is less than $350 million — smaller, for instance, than a single construction company in Dallas, Texas.”
Initial Coin Offerings (ICOs) are attracting a great deal of interest—in 2017 alone, an estimated 370 ICOs raised around $6.2 billion—but they are not well understood. ICO transactions are based on “smart contracts”: automated rules, designed by programmers, to govern the functionality of the digital cryptoassets sold in ICOs. In theory, transactions based on smart contracts do not require human oversight, as the computer code embedded in the contracts is supposed to ensure proper governance. But an analysis of the 50 ICOs that raised the most capital in 2017 reveals a troubling trend: for many ICOs, the software code does not deliver what the ICO promises in its investor disclosure documents. ICO code often fails to ensure key investor protections, and sometimes provides founders with significant, undisclosed authority to alter investor rights. Currently, there is no ICO regulatory regime comparable to what the SEC and state securities regulators provide for IPOs. Policymakers would do well to develop a regulatory environment that can help the ICO market mature, particularly in the accurate encoding of smart contracts. But they first will need to understand who is on the buy side of ICO transactions—and whether they warrant protection.
Peter Conti-Brown studies central banking, financial regulation, and public finance, with a particular focus on the law, history, politics, and economics of central banking at the Federal Reserve. He is author of the book The Power and Independence of the Federal Reserve , forthcoming from Princeton University Press. His articles have appeared in the Yale Journal on Regulation and the Stanford, UCLA, and Washington University Law Reviews, among other journals. He is also the editor, with David Skeel, of the book When States Go Broke: Origins, Context, and Solutions for the American States in Fiscal Crisis , published by Cambridge University Press, and editor, with Rosa Lastra, of the Research Handbook on Central Banking, under contract with Edward Elgar Publishing. He has been quoted in print and online articles published by The Atlantic, The Economist, The New York Times, and Reuters, and has appeared on C-SPAN and National Public Radio. He has testified before the US Senate Banking Committee on reforming the Federal Reserve.
Modern antitrust policy follows the consumer welfare principle (CWP), the proposition that antitrust policy should encourage markets to produce high output consistent with sustainable competition, and low prices. The market dominance of giant firms such as Amazon, however, is opening the door to a reevaluation of this antitrust standard, particularly from a new antitrust “movement” that has economic goals, such as protecting small businesses and controlling runaway profits, that can be at odds with promoting low prices. Penn Law and Wharton Professor Herbert Hovencamp evaluates the merits of three antitrust frameworks within the context of the law and economic history. While he acknowledges that business can cause harm to the lives of Americans in ways that extend beyond inflating prices—i.e., creating barriers to market entry, stifling innovation, controlling information, or limiting wages—he argues that the CWP remains best positioned to respond to antitrust problems, although it would benefit from technical improvements.
In a discussion on blockchain, Faculty Affiliate Kevin Werbach debunks central assumptions of the technology and provides a series of examples of how its application in untraditional spaces such as supply chain operations can be revolutionary.
In a discussion on factors that led to Portugal’s economic recovery, Faculty Affiliate Joao Gomes expands the conversation to include what further must be done. In particular, Gomes focuses on productivity as a necessary precondition for future growth.
To the extent that immigration reform is discussed in terms of economics, the debate tends to focus exclusively on labor issues—specifically, how immigrants affect jobs and wages for native citizens. But to understand the economic effects of immigration, and thus develop sounder policies, policymakers need to consider how immigration affects all three core components of economic growth: not just labor, but capital and innovation too. In this brief, Professor Hernandez discusses new research showing that immigration produces gains for the U.S. economy with respect to capital and innovation. Immigrants help to attract investment from foreign firms and significantly increase bilateral trade flows between the U.S. and their home countries. Immigrants also account for roughly a quarter of all U.S. entrepreneurs. They not only generate novel businesses and inventions, but also introduce novel ideas that U.S. natives develop further to create new products and companies of their own. Just as importantly, labor, capital, and innovation are all interrelated. Failing to understand the multiplicative relationship between these three elements can result in botched economic policy.
The House of Representatives passed a compromise $717 billion defense spending package which instituted new provisions to crack down on national security vulnerabilities; The Senate passed legislation evening which would eliminate tariffs on imported raw materials that were not available domestically; The US government announced high second quarter GDP growth numbers at an annualized rate of 4.1%.
Despite the vulnerability of America’s aging infrastructure to costly disruptions from man-made and natural disasters, infrastructure insurance under-utilized. On average, only 30% of catastrophic losses in the past 10 years have been covered by insurance. Most infrastructure project managers have relied instead on taxpayer-funded federal aid when disaster strikes. But it doesn’t need to be this way. In this brief, Gina Tonn, Jeffrey Czajkowski, and Howard Kunreuther use technical reports and input from infrastructure managers to outline steps that policymakers can take to help maximize the use of infrastructure insurance for providing financial protection, encouraging investment in loss mitigation measures, and limiting the current reliance on taxpayer dollars.
For the fifth consecutive year, Wharton PPI is pleased to fund a cohort of Penn students who are serving as public policy interns in DC. The 63 interns, who received funding through a competitive application process, represent undergraduate and graduate programs across six different Penn Schools — Wharton, Arts and Sciences, Law, Education, Engineering, and Medicine.
Advocates of cryptocurrencies such as Bitcoin believe that having currency competition will help achieve the economic objective of price stability. This Issue Brief summarizes research that explores whether competition among privately issued fiat currencies can actually produce price stability. The research finds that in most cases, a system of private monies does not deliver price stability. And even when it does, it always is subject to self-fulfilling inflationary episodes, and it supplies a suboptimal amount of money. Although there is no economic reason to curb the use of cryptocurrencies at the moment, it is important to review key regulatory issues that policymakers need to consider now, before the use of cryptocurrencies becomes even more widespread.
In light of the disputed actions of President Trump at the recent G7 summit, Faculty Affiliate Mauro Guillen discusses the pitfalls of protectionism and challenges popular critiques of free trade.
Faculty Affiliate Kevin Werbach provides insight on the current trajectory of the net neutrality. Professor Werbach claims that “nothing will change the next day, companies are not going to take any major action to change their policies until its [the controversial repeal of Obama-era net neutrality protections] resolved.”
Recently on Knowledge@Wharton show on SiriusXM channel 111, faculty affiliates Howard Kunreuther and Michael Useem discuss the contents of their new book Mastering Catastrophic Risk: How Companies Are Coping with Disruption . By reexamining the field of risk management, once an afterthought for many companies, the authors provides ways for business leaders think more deeply about worst-case scenarios in corporate settings.
In a discussion on the implications of the Corporate Tax Cut, Faculty Affiliate Jennifer Blouin notes how, because companies do not yet know the final regulations to be implemented by the Treasury Department, they find themselves “playing a game without knowing the specific rules.”
Faculty Affiliates Kevin Werbach and Pinar Yildirim comment on the implications of the FCC’s repeal of Net Neutrality. First Professor Werbach points out that “there is this misunderstanding that net neutrality is kind of this catch-all provision that prevents broadband companies from doing bad things. It’s not.” Professor Yildirim goes on to challenge the notion that net neutrality ever really posed as a financial burden to ISPs.
The House Appropriations Committee approved a $23.4 billion financial services spending bill that includes a boost to IRS funding; Stock markets continue to rise despite President Trump’s contentious performance at the Group of Seven summit; New applications for U.S. unemployment benefits unexpectedly fell last week; U.S. retail sales increased more than expected in May; Prices for U.S. imports increased 0.6 percent for the second consecutive month in May.
The House Committee voted to advance the Pentagon’s annual spending bill; Speaker Ryan announced House Republicans will vote next week on two bills aimed at addressing the fate of DACA recipient; Fed increases rates as expected; Inflation rose at the fastest rate in six years.
House approves a measure to recover $15 billion in previously appropriated government funding; US Justice Department claims the parts of the Obamacare mandate is unconstitutional; The Atlanta Fed is forecasting a double in the GDP annualized 2017 growth rate.
Faculty Affiliate Amol Navathe reflects on new research on the future of “bundled payments” and its implications on policy and the cost of care. Through a Medicare mandated program, hospitals were forced to offer knee and hip surgeries as a bundled package whereby the entire procedure and recovery period are thought of as a holistic product. The results indicated a 5% in overall savings for the entire procedure, presenting a promising future for this model of health care administration.
Faculty Affiliate Peter Conti-Brown examines and critiques a legislative solution that proposes banking for the poor through the postal system. Within this proposal, the United States Postal Service would not only oversee the mailing of letters and packages, but also traditional banking services as well. Professor Conti-Brown identified three thought provoking critiques that raise the question, are bankers—private and governmental alike—the best people to provide support for the poor?
Faculty Affiliate Mauro Guillen contextualizes a discussion on the potential ramifications of an economic collapse in the Italian peninsula. Experts fear a negative feedback loop where financial stress multiplies because the government is already so indebted that borrowing more money to fund shaky banks means yet more risk for investors, and that reduces the value of existing bonds, which in turn further reduces the value of the banks’ government bond holdings
In a discussion on the lack of gender diversity in many company boardrooms, Faculty Affiliate Katherine Milkman’s study on tokenism was cited for its claim that “if organizations see gender diversity as a goal but tend to consider that goal satisfied once they match or just surpass the gender diversity levels of peers, then attaining true gender diversity may be jeopardized.”
In light of political turmoil in Italy, Professor Siegel advises listeners to monitor other types of movement and changes such as those of increasing interest rates. Consistent with his message since early December, Professor Siegel points to macro visions of the trajectory of the 2018 fiscal year.
Autonomous Vehicle (AV) technology promises to dramatically reduce deaths and economic losses from crashes caused by human error, increase mobility for those with disabilities, and revolutionize the auto industry. Yet legislation to facilitate oversight of the development and deployment of AVs is stalling in Congress. Professor John Paul MacDuffie offers a primer on AV technology policy, and discusses strategies for addressing safety and other public concerns while still facilitating AV innovation in the private sector.
The first class of Public Policy Research Scholars (PPRS) began their journey through this rigorous honors program in 2016. Now, just two years later, seven students are graduating from Penn with a solid understanding of economic and political analysis of public policy; knowledge of the policymaking process; and the application of theoretical and quantitative tools to practical, real-life policy questions. The PPRS cohort for the Class of 2018 includes students from all four of Penn’s undergraduate schools.
The Wharton Industry Exploration Program, a half-credit course organized by Wharton PPI and led by Professor David Zaring, brought a group of 25 students to Washington, DC for three days of experiential learning about public policy research.
On an episode of Energy Policy Now at the Kleinman Center for Energy Policy, Faculty affiliate Cary Coglianese comments on the possible ethical violations that could have led to the Pruitt controversy following the administrator’s lack of professional integrity. When asked whether or not he believed if Pruitt could survive these allegations, Professor Coglianese provided an allegory to a similar situation during the Reagan administration where the Administrator of the EPA at this time was forced to resign following a suit of misconduct.
During the spring semester, Wharton PPI ran its 5th annual Public Policy Case Competition, focusing on the opioid crisis. The competition challenged students to work in teams of 3-4 people in addressing the following prompt: Develop a specific government policy or program (at the local, state, or federal level) that would prevent (as opposed to treat) opioid use disorder. This policy can focus on the supply side (i.e., the pharmaceutical industry, medical professionals, insurance companies, or other purveyors/distributors), or on the demand side (i.e., potential licit and illicit opioid consumers), and can address business or government policy. Beyond describing the policy or program itself, students had to project its economic and social impact, including assessing the costs of implementation and providing a funding model.
Through an examination of Vice Chairman Randal Quarle’s re-nomination, Faculty Affiliate Peter Conti-Brown reflects on the need for a restoration of “political accountability and independence to the Federal Reserve.” He claims that the partisan influence over the functionality of the Fed as well as the actions of the President and Senate all serve as competing narratives that obstruct the organization’s ability to successfully fill vacancies.
On April 24th, 2018, the Penn Wharton Public Policy Initiative hosted a talk with E. Glen Weyl, Principal Researcher at Microsoft Research, New England, about his recently published book, Radical Markets: Uprooting Capitalism and Democracy for a Just Society. His lecture was then followed by a discussion moderated by Herbert Hovenkamp, the James G. Dinan University Professor at Penn Law and the Wharton School and Ioana Marinescu, an Assistant Professor at Penn’s School of Social Policy and Practice as well as a long-time friend and colleague of Weyl’s.
PPRS is an interdisciplinary certificate program intended for rising sophomores with a background in Economics, who want to explore the economic impact of U.S. public policies. Application Deadline is June 1st!
Faculty Affiliate Ann Harrison reflects on the impact of President Trump’s efforts to bring the auto industry back to the US and its effects on industrial Mexican cities such as El Bajio. She ultimately claims that undoing the North American Free Trade Agreement alone wouldn’t be enough to trigger an automotive exodus from these cities.
Faculty Affiliate, Professor Gyourko was recently cited for his research on the impact of the growing price divide between low-cost areas where housing is plentiful and cheap, and desirable areas where housing is scarce and expensive in coastal areas such as California.
Mauro Guillen, director of the Lauder Institute at the University of Pennsylvania’s Wharton School, said Germany can be a good model for Korea to emulate to find a solution to its employment woes. In particular, he called for Korea to focus more on improving a training system for youths rather than artificially creating jobs in the public sector.
Professor Werbach of the Wharton school reflects on how a comprehensive culture of legal and ethical thinking is an integral part of any company’s development. He notes how although the mantra of “move fast and break things” found in the Silicon Valley is often in conflict with this growth, its an inevitable step that all long standing companies eventually must take.
Faculty Affiliate Michael Knoll reflects on South Dakota v. Wayfair and the competing legal narratives on both sides He states how, “The fundamental issue is the impact of state and local sales taxes on the competition between online sellers and traditional brick-and-mortar retailers.”
On April 13, Professor Tom Baker from Penn Law organized a workshop on “Robo Advisors at the Regulatory Crossroads,” with co-sponsorship from Penn’s Center for Technology, Innovation and Competition; Penn Wharton Public Policy Initiative, Georgetown University’s Institute for International Economic Law, and the Warren Center for Network and Data Sciences.
In a thought piece on the intersection between behavioral economics and policy making, faculty advisor Katherine Milkman was cited as one of the scholars who’s work is expanding the literature on the power of evidence-based policy.
On April 9th, the Penn Wharton Public Policy Initiative hosted an interactive conversation on the state of the US economy and the direction of federal economic policy. This panel featured three top financial journalists: Binyamin Appelbaum, Washington correspondent for the New York Times; Jeanna Smialek, economic reporter for Bloomberg News; and Ryan Tracy, reporter for the Wall Street Journal. Peter Conti-Brown, Assistant Professor of Legal Studies & Business Ethics at Wharton, moderated.
Labor market concentration can worsen after a merger takes place, and this heightened concentration can negatively affect wages. The focus of antitrust analysis, however, has been on the prices of consumer products, not the wages of laborers. New research indicates that, on average, labor markets are highly concentrated, and that higher concentration is associated with significantly lower posted wages for new jobs. This brief uses existing economic tools to develop a model for evaluating labor market concentration and its effects, to determine if a merger will run the risk of anticompetitively suppressing wages, employment, and output. Regulators can use this model to apply antitrust principles to labor markets, as a basis for antitrust enforcement.
As countries around the world grapple with the gender pay gap, some places in America have come up with a new way to tackle the problem.
Their solution? Bar employers from asking job applicants what they currently earn, so new salary offers are not based on the previous figure.
Faculty Affiliate Peter Cappelli says he thinks the legislation could have other unintended consequences.
For example, if job candidates don’t volunteer salaries during the discussions, firms are likely to assume their pay is lower than it is.
Cappelli says this effect is likely to be especially pronounced for women and other groups that are statistically likely to have lower pay.
“The phrase for this is statistical discrimination,” he says. “Now we’ve got this quirky situation where it’s actually likely to make things worse.”
Walgreens is reportedly in talks to acquire Valley Forge’s AmerisourceBergen. Walgreens already owns 26 percent of Amerisource and may move to take over the rest of the company.
“When firms do not know what to do about the future they tend to circle the wagons by merging,” Faculty Affiliate Mark V. Pauly, Wharton health care management expert, told Philadelphia magazine. “It does not help that much based on evidence, but you have to do something.”
To Pauly, Walgreens’ potential deal with AmerisourceBergen wouldn’t be daring at all, just purely defensive. “This seems like a fairly safe thing for Walgreens to do after buying and closing all those stores from Rite Aid,” he said.
At this year’s World Economic Forum held in Davos, Switzerland, in late January, a financial crisis was one of the key topics among economists and bankers. Although chances are still slim, they said the global economy and financial markets have become more vulnerable as a result of prolonged loose monetary policies. They are particularly concerned financial authorities are unprepared to deal with the next crisis
Faculty Affiliate Mauro Guillen commented on the recent economic changes: “it seems investors are reading the good news on the U.S. and global economies as if they were negative. Stronger growth, declining unemployment and rising wages could be the harbingers of inflation, which in turn might prompt central banks to accelerate interest rate increase, and thus bring the era of low rates to an abrupt end.”
Although cannabis-related businesses have thrived in the localities that have legalized marijuana as a consumer product, the industry has suffered from crippling uncertainty, in the form of limited access to the banking system. The cannabis industry thus has been forced to operate in a cash-intensive “gray market,” which is a problem. An entire industry conducting all of its business in cash cannot be fairly taxed or regulated and, historically, has been associated with lawlessness—everything from security concerns, transportation and currency problems, money laundering, and cash hoarding. This brief reviews and analyzes the issues that surround marijuana banking and offers several policy options for addressing the tension between federal enforcement and state sovereignty as it relates to marijuana banking.
The term “intern” is one that has drawn a lot of discussion over the last several years. It is generally associated with someone in college who works during a specific period of time with a company as a way to gain experience. But, over time, companies have started offering “internships” to people just out of college. A few years ago, a court case decided that if someone was doing the work of a regular employee, they couldn’t be called an “intern,” and they had to be paid. Now, the Labor Department has relaxed those rules a bit and, therefore, has allowed the unpaid internship to return. To discuss this change, Knowledge@Wharton Business Radio’s Host Dan Loney interviewed Michael Schmidt, a labor and employment attorney with the firm of Cozen O’Connor, and Ioana Marinescu, an Assistant Professor of Economics, Faculty Affiliate of the Penn Wharton Public Policy Initiative and a Faculty Research Fellow at the National Bureau of Economic Research.
Justice department threatens to subpoena sanctuary cities in funding battle; Jobless claims under projected figures.
One of the key features of the Dodd-Frank Act is that it imposes specific and costly regulatory requirements on banks that cross the threshold of having more than $10 billion in total assets. Anecdotal accounts have suggested that this threshold has led to increased consolidation in the banking industry. This brief provides new statistical evidence of that phenomenon. Banks that approach the $10 billion threshold are significantly more likely to engage in an acquisition, pay more for that acquisition, and acquire bigger target banks than similar banking institutions did prior to Dodd-Frank. To the extent that policymakers are concerned with further consolidation in the banking industry, these findings should be of interest as they continue to evaluate current regulations and develop new ones, which might include the use of bright line asset thresholds.
Also, U.S. core consumer prices record largest increase in 11 months in December; U.S. holiday retail sales strongest since Great Recession, up 5.5%.
Although taxing carbon is an idea that enjoys significant support among policymakers and business leaders, new research indicates that carbon taxation can actually cause energy investments to gravitate away from the cleanest energy technologies. This counterintuitive finding reflects two key characteristics of energy markets: the worldwide increase in renewable energy sources whose output is intermittent and variable; and greater market liberalization, which has made the spot pricing of electricity more volatile. The intermittency of renewable energy sources requires backup generation, typically from generators using fossil fuels. The dynamics of market liberalization amplify this negative effect of intermittency. Policymakers need to take steps to reduce intermittency by supporting storage technologies or setting monetary incentives to increase renewable generation capacity investment.
Over the span of recent decades, the federal legalization of marijuana has been a popular topic of discussion within the political arena. One aspect less frequently introduced is the financial impact legalization has within the banking sector. At the moment, most cannabis companies are unable to take out federal loans or establish any form of credit, since marijuana is federally illegal and therefore federally regulated banks are unable to work directly with marijuana businesses. A few states have legalized the use and distribution, of cannabis, both recreationally and medicinally, but this legal standing is insufficient for distributors to access services provided by national banks. All of this has led to volatility within the marijuana business structure and a business model built in violation of banking standards.
Penn Wharton PPI recently welcomed Jason Post, Director of Public Affairs at Uber Technologies, Inc. to campus for a talk on how modern technology is transforming urban mobility. Post oversees transportation policy and works with elected and appointed officials as well as third-party groups to achieve Uber’s mission to make transportation reliable and efficient. Before his time at Uber, Jason worked in journalism, government and consulting, including service in the Administration of New York City Mayor Michael R. Bloomberg. He also produced the political news program Inside City Hall on the cable news channel NY1. He is a 2001 graduate of Penn’s College of Arts and Sciences and serves as volunteer wish granter for the Make-a-Wish Foundation.
In order to better understand the tax manipulation decision-making process—both legal uses of tax deductions and illegal tax evasion—this brief looks at the impact of gain/loss framing. Analysis of tax data confirms that tax decisions are influenced by “loss aversion.” For instance, taxpayers are more likely to pursue tax reduction activities when they make a loss smaller, as compared to when they make a gain larger. The brief looks at tools that policymakers have at their disposal for both deterring tax evasion and making existing tax incentives maximally effective. The brief discusses instances when such gain/loss framing interventions might be deployed, and provides estimates around the size of the revenue responses they may generate. The author estimates that if tax filers who face losses experienced the lower motivation to manipulate shown by those facing gains, annual tax revenue would increase by $1.4 billion. Even attempts at marginal interventions, though smaller in predicted effects, might be financially worthwhile.
A wave of corporate inversions by U.S. firms over the past two decades has generated substantial debate in academic, business, and policy circles. The core of the debate hinges on a couple of key economic questions: Do U.S. tax laws disadvantage U.S.-domiciled companies relative to their foreign competitors? And, if so, do inversions improve the competitiveness of U.S. multinational firms both abroad and at home? This brief summarizes both old and new research that views these questions through the lens of corporations’ global effective tax rates (ETRs), and finds that the stronger case seems to be that U.S.-domiciled corporations are often tax-disadvantaged and that they can improve their competitive position by inverting. Additional evidence also suggests that U.S. MNCs can increase their after-tax cash flow by inverting.
American healthcare has been a recent focus in both politics and the media, with much fanfare around the future of health reform. Woven into these discussions are questions about the rise in national health expenditures – if spending growth is significantly faster than economic growth, it may pose risks for consumers and for the nation as a whole. Here, an overview is provided of some principal drivers of growth in national healthcare expenditures, along with their impacts and policy proposals aimed at management.
As the United States continues to play its role as a leader of the global community, there is one area in which the nation falls far behind its progressive counterparts: paid sick and family leave. Paid sick and family leave is the idea that working men and women should have the ability to earn paid time away from work to care for a new child, ill family member, or themselves, while protecting against discrimination or retaliation for needing or taking leave.
What is gender responsive budgeting? Gender responsive budgeting (GRB), or gender budgeting, refers to the strategy of assessing and/or preparing fiscal budgets through a gendered lens.
Financial “robo advice”—an automated service that ranks or matches consumers to financial products—has gained significant attention in the investment industry and on the Hill, but there has not yet been a consensus on how to regulate these new services. Robo advisors often are on par with and can exceed the standards of human advisors, but they don’t fit into the category of fiduciary, and therefore won’t be held to the same regulatory standard that human advisors are. Nonetheless, they are subject to systemic risks and the potential for abuses that can hurt consumers. Professors Tom Baker and Benedict Dellaert offer a regulatory trajectory to follow as the technology of robo advisors continues to develop and expand.
In this period of increased globalization, the international economy is as relevant as the domestic. So when British citizens voted to seriously disrupt their domestic economy by leaving the European Union, Americans watched with curiosity, wondering what international consequences this break was to spur.
Since the North Atlantic Treaty Organization (NATO) was an institution founded as a counter to Soviet aggression and designed to prevent another world war, its members should invest substantial amounts of GDP into defense. Throughout the 2016 presidential election, then-candidate Donald Trump claimed the other 27 countries in NATO were not paying their fair share of the defense expenses for the international peacekeeping organization.
Uber – the application-based, ride-hailing service with a multi-billion dollar company valuation—is known for its convenience, popularity and financial success. But behind its growing net revenue of over $600 million lurks complaints and formal lawsuits regarding the misclassification of its drivers as “independent contractors” rather than employees that could impact its future financial position and ethical reputation.
Over 41 million Americans now owe more than $1.2 trillion in outstanding federal student loan debt. Policymakers are considering a number of amendments related to federal student aid programs in the context of the Higher Education Act reauthorization. In addition to providing a snapshot of key data related to student loan debt that all policymakers should consider, this brief discusses recommendations for facilitating repayment and curbing defaults on student loans, including: protecting students from low-performing institutions; encouraging use of forbearance and deferment mechanisms; and strengthening income-driven repayment options.
Since 1978, the National Flood Insurance Program (NFIP) has enlisted private insurers, with their market presence, to sell and service policies under the auspices of the Federal Emergency Management Agency.
In the interest of bringing high-speed broadband access to communities underserved by current Internet service providers, many U.S. cities have initiated municipal broadband projects. Such efforts have received favorable attention from those eager to help close the digital divide. This brief presents a first look at a new, comprehensive empirical analysis of 20 U.S. municipal fiber builds for which financial data is available. The findings show that half of the projects in this study are cash-flow negative, and based on their performance from 2010-2014, 90 percent are unable to generate sufficient cash to recover their project costs within the 30-40 year life expectancy of a municipal fiber build. City leaders considering such projects, as well as state and federal officials interested in supporting them, need to understand the documented costs and risks before encouraging new municipal fiber programs to form.
Consumer protection regulation targets services like payday lenders under the presumption that these services can be predatory and associated with high costs. Yet an increasing number of Americans are utilizing such alternative financial services and joining the ranks of the “unbanked” and “underbanked.” Altering this status quo and promoting greater middle-class stability will require that policymakers foster innovation in the development of high-quality, transparent, and consumer-oriented financial services within the mainstream banking system.
A panel of leading research scholars tackled the challenge of Understanding Student Debt: Moving Toward Evidence-Based Policy Solutions, during a panel discussion co-sponsored by Senators Tim Scott (R-SC) and Bob Casey (D-PA) on April 20.
The Penn Wharton Public Policy Initiative and the OSET Institute announce the release of a new study that provides a comprehensive business analysis of the structure and outlook of the voting machine industry. Given the questions of election integrity that arose during the 2016 election cycle, the study provides some insights into what is needed to innovate the industry which can help improve the security, accuracy, and reliability of the nation’s election machinery.
Using simulations based on a new economic model, this brief empirically examines the pivotal mechanisms of the Affordable Care Act, such as the individual mandate, employer mandate, and premium subsidies, to inform the debate over repealing and replacing the Affordable Care Act. The research suggests that the ACA, if left intact, in the long run significantly reduces the uninsured rate. The simulations also suggest that the employer mandate is not a crucial pillar for the success of the ACA. The analysis indicates it is the premium subsidy, rather than the employer mandate or the individual mandate, that is crucial for the success of the ACA, in terms of expanded coverage. The brief concludes with a look at the key elements of the main legislative proposals Congressional Republicans have offered to replace the ACA, including the American Health Care Act.
This brief examines the tension between the Republican ideological commitment to curbing executive power and the opportunity Republicans now have for Trump to dominate the direction of financial regulatory reform. The discussion will focus on three key policy outcomes that Republicans have sought during the last six years: reforming the Federal Reserve, overhauling the Consumer Financial Protection Bureau, and changing the way in which the nation’s largest financial institutions are designated and regulated.
The next stage in the evolution of the digital economy involves the creation of what can be called the “Internet of the World”—an expanding web of transactions, anticipated today by on-demand platforms such as Uber and Airbnb, that eventually will occur across trillions of networked devices and penetrate every sphere of human activity. This brief looks at the many legal questions raised by these novel services, in particular, at the regulatory classification of on-demand services, as well as the application of antitrust provisions, the imposition of taxes and fees, and the assignment of liability to these new platforms.
Economists and political observers agree state governments defaulting on their debt obligations is a growing concern. How best to aid struggling states, however, is a point of contention. This Issue Brief makes a case against ex post restructuring measures, specifically bankruptcy modeled on Chapter 9 of the U.S. Bankruptcy Code, and in favor of ex ante debt mitigation action. In particular, it introduced tax-credit borrowing (TCB) as a potential commitment device for states that would allow for the creation of super-priority, risk-free debt.
On November 15th, Penn Wharton PPI welcomed Sebastian Mallaby for a discussion of his recently-released book, The Man Who Knew: The Life and Times of Alan Greenspan. Faculty Affiliate Peter Conti-Brown, Assistant Professor of Legal Studies and Business Ethics at Wharton, moderated the conversation.
This brief looks at the costs of implementing the EPA’s Clean Power Plan. Specifically, it examines whether implementing the CPP on a state-by-state basis—that is, with each state meeting its own individual target for emissions reduction by 2030, rather than establishing regional targets—is economically efficient. The economic analysis uses data from electricity-generating firms participating in the Pennsylvania-New Jersey-Maryland (PJM) Interconnection to examine the relative economic efficiency of regional versus state-by-state implementation of the CPP. The research indicates that state-by-state implementation would yield the lowest electricity prices in 2030.
On October 25th, the Penn Wharton Public Policy Initiative welcomed David Rothschild to discuss his research and the science of polling as it relates to the 2016 Presidential Election.
Consumers tend to purchase too little insurance or purchase it too late. Consequently, taxpayers wind up bearing substantial burdens for paying reconstruction costs from extreme events. The 2005 and 2012 hurricane seasons alone cost taxpayers nearly $150 billion. There is much that can be done to better facilitate the role that insurance can play in addressing losses from extreme events, both natural and man-made.
On September 22nd, the Wharton PPI welcomed Sam Vinograd (C’05) for an interactive session reflecting on this month’s meeting of the United Nations General Assembly. Prior to joining the private sector, where she leads policy discussions with public and private stakeholders on clean energy and clean tech projects, Ms. Vinograd held various senior roles within the National Security Council at the White House during the Obama administration.
On September 6th, the Penn Wharton PPI, Penn AEI Executive Council, Penn Government and Politics Association, College Republicans, and the Penn Federalist Society welcomed Arthur C. Brooks, bestselling author, social scientist, and the president of the American Enterprise Institute for a discussion about what we can do as individuals to break through the gridlock of political polarization.
For the third year in a row, Penn Wharton PPI is pleased to offer funding to a large cohort of Penn students who are serving as public policy interns in DC. The students, chosen through a competitive application process, represent both undergraduate and graduate programs in seven different Penn Schools – Wharton, Arts and Sciences, Social Policy and Practice, Gradate School of Education, Nursing, Law, Engineering and Applied Science.
In the wake of the stalled Johnson-Crapo bill, the overarching goal of housing finance reform continues to be the efficient provision of long-term fixed-rate mortgages to credit-worthy borrowers in all markets throughout the business cycle. This Issue Brief analyzes three newly-proposed plans for reforming the U.S. housing finance system: (1) a proposal from Jim Parrot et al. to merge Fannie Mae and Freddie Mac into a new government corporation; (2) Andrew Davidson’s proposal for mutual ownership of the GSEs by mortgage originators; and (3) an opposing plan from Mark Calabria, arguing against securitization altogether and for a return to the regime of originate-and-hold.
While the public debate on immigration reform has been divisive, the tools of economics provide clear lessons for a way forward. The single most important lesson that economics holds for immigration policymakers is that immigration restrictions are costly, because they interfere with the free movement of labor. Most economists believe that the gains to global GDP from greater labor mobility are very large. Beyond the estimated gains to the world economy, the consensus among economists is that, as a whole, U.S. natives gain from immigration in the labor market. While immigration may have an adverse effect on some native wages and employment—particularly for the least skilled workers—the empirical evidence indicates these effects, if existent, are small.
This Issue Brief summarizes events surrounding the current debt crisis in Puerto Rico and presents a two-step plan for restructuring Puerto Rico’s debt and encouraging more effective governance. This plan draws extensively on the previous experiences of debt crises in municipalities on the U.S. mainland. Step one entails the creation of a financial control board (FCB) for Puerto Rico, monitored by the U.S. federal government but involving significant Puerto Rican representation. Step two would be for Congress either to craft a restructuring framework applicable to all of America’s territories, or to extend the existing bankruptcy laws in Chapter 9 of the Bankruptcy Code (with modifications) to Puerto Rico and its municipalities.
On March 3rd, Penn Wharton Public Policy Initiative collaborated with the Kleinman Center for Energy Policy to host Marvin Odum, President of Shell Oil Company, for a lively discussion about the energy industry in today’s world and the push towards renewable resources for tomorrow. Odum discussed the challenges of finding solutions to our energy problem in the face of a growing population, the energy transition in place now, and what all stakeholders can do to ensure feasible solutions for energy moving forward.
Are FDA premarket trials on new drugs and medical devices excessive and do they inhibit consumer access to new and much-needed technologies? Or may they actually be insufficient and expose consumers to too much risk? To address this question, the new research described here compares the regulatory approaches of the U.S. and the European Union for second and third generation coronary stents. The research supports the FDA’s argument that reductions in their standards for device approval would reduce consumer welfare. Nevertheless, the research also suggests that in some circumstances, FDA reform proposals advocating for more relaxed premarket requirements but enhanced post-market surveillance would yield considerable welfare gains.
Looking for funding for your summer internship? Penn Wharton Public Policy Initiative (PPI) offers funding, on a competitive basis, to students who accept an offer for a public policy summer internship at a government entity or non-profit policy research organization in Washington, DC, that otherwise would be unpaid or come only with modest compensation. All undergraduate and graduate students enrolled in any of Penn’s schools are eligible to apply for funding from Penn Wharton PPI.
This brief offers a 5-year retrospective on Dodd-Frank, pointing out aspects of the legislation that would benefit from correction or amendment. Dodd-Frank has yielded several key surprises—in particular, the problematic extent to which the Federal Reserve has become the primary regulator of the financial industry. The author offers several recommendations including: clarification of the rules by which strategically important financial institutions (SIFIs) are identified; overhauling the incentives offered to banks; instituting bankruptcy reforms that would discourage government bailouts; and easing regulatory burdens on smaller banks that are disproportionately burdened by the SIFI designation process.
This Brief focuses on ways in which private firms are adopting tools that mirror public law instruments—such as internal carbon fees (similar to a public carbon tax) and private cap-and-trade schemes (like public emissions trading schemes)—to reduce greenhouse gas emissions and address climate change. These private case studies suggest that significant progress in reducing emissions can come from embedding emissions reduction programs into core business strategy. Moreover, these case studies indicate that climate change, as a global issue, requires public regulators to recognize the potential contributions of global multinational firms.
With the Social Security Disability Insurance (SSDI) trust fund on the verge of depletion, Congress must enact structural reforms to the SSDI program that address and counter the rapid growth in SSDI enrollments in recent years. This brief details a work incentive program for SSDI beneficiaries, called the Generalized Benefit Offset (GBO), which would help get SSDI recipients back into the labor force, enhancing their own economic welfare while increasing economic output on a societal level.
Perceptions of how illegal immigration affects native residents have shaped policies, but these policies are likely ineffective both in general and in their specific focuses, like in lowering crime and improving native employment. Policymakers should consider objectively the effects of past policies such as IRCA and 287(g), before instituting new, non-data driven mandates and legislation in response to public demand.
Since the beginning of the global economic crisis, investors have flocked to bond funds, and especially corporate bond funds, viewing them as the “safest” vehicles for their capital. However, bond funds are subject to fragilities originating from the first-mover advantage problem: when investors cash out, the cost of compensating them amplifies the funds’ price decline, making it costlier for other investors to remain. Moreover, three other conditions—general market illiquidity, lower fund liquidity, and the prevalence of retail investors—accentuate the financial fragility of corporate bond funds. Academic research shows that when corporate bond fund managers have to trade illiquid corporate bonds after investors redeem shares en masse, the subsequent demand shock in the secondary bond market results predictably in significant negative effects to the real economy. This brief looks at the fragility of corporate bond funds and offers policy options to combat these conditions and mitigate their wider effects.
The 113th Congress extended the research and development (R&D) tax credit through the end of 2014 by passing the Tax Increase Prevention Act (H.R. 5771), which President Obama signed into law on December 19, 2014. That the fate of this credit in 2015 remains unknown is not surprising. This brief explores the history, logistics, and policy implications of the temporary R&D tax credit, and offers recommendations for additional research that would help determine the merit of making the credit permanent. Using new, restricted-access IRS data and an instrumental variables strategy, the brief offers an unbiased estimation of the effectiveness of the R&D tax credit, showing that corporate research intensity—the ratio of R&D spending to sales—is indeed highly sensitive to the tax subsidy rate. When it gets cheaper for firms to spend on qualified R&D, they actually do spend more, as policymakers hope.
Over the next five years, the effects of the ACA on employer-sponsored insurance will be modest. In the longer run, there is greater potential for disruption, depending on how firms respond to the subsidies available on the exchanges for low-wage workers. In all, only about 15% of the workforce likely will be affected. The impacts of the ACA on firms will vary widely based on three main factors: 1) the size of the firm, 2) the average compensation within the firm, and 3) the degree to which wages within the firm are homogenous or heterogeneous. Keeping in mind that employees pay for all their health insurance, group insurance is not intrinsically superior to private exchanges, and cost trumps choice for consumers, firms will choose the option that maximizes benefits to their workers, takes advantage of the best available subsidies while avoiding tax penalties, and results in the lowest administrative costs. Making all low-wage workers eligible for the same subsidies, whether they acquire coverage on the exchanges or in group plans, would be reasonable and involve less distortions.
Momentum seemed to be escalating in early 2014 for the passage of a comprehensive reform package of the housing finance system in the U.S., but that was not to be, as neither political party fully supported its passage, derailing the progress made over the previous few years.
While consensus around the primary features of reform has grown, new research that questions these assumptions needs to be addressed and the inertia keeping the country mired in the current, uncertain system needs to be overcome. In this brief, we will discuss the progress made thus far en route to reform, analyze the disparate elements of the leading proposals, and incorporate new findings that will shape the additional research that must be done before policymakers can agree on the best path forward.
Soon after the launch of HealthCare.gov , the exchange websites that formed the vanguard of the Affordable Care Act quickly became notorious for numerous bugs, crashes, and painfully slow loading times. Over a year later, the portals have reached a sufficient level of stability and core functionality on the back end. But what about the front end?
When the state and federal health insurance exchanges were introduced in 2013, much attention was paid to the logistics of their launch. Nearly a year later, policymakers should now be looking at a different question: how can we collect and use data from the exchanges to understand how consumers think about insurance choice, so as to make the exchanges function better?
With regard to equity crowdfunding, too many policymakers and regulators are focusing their attention on the “funding” piece of crowdfunding, overlooking the fact that the true revolutionary power of crowdfunding lies instead in the crowd.
The Terrorism Risk Insurance Act (TRIA) is set to expire at the end of 2014 and is currently under debate in Congress. Renewing TRIA may limit the amount of disaster relief the federal government would contribute after a terrorist attack, but the different options under which TRIA might be renewed carry implications for how losses from any attack would be spread between commercial policyholders, insurers, and taxpayers.
In order for the U.S. to remain competitive in the 21st-century economy, more individuals are going to need to earn workforce credentials and college degrees. At the same time, however, state governments have been facing financial challenges wrought by chronic structural budget deficits and rising Medicaid expenses, translating into reduced support for higher education. Instead, families now are hard-pressed to shoulder more of the burden of paying for higher education. The current system for financing higher education is broken and needs to be fixed.
The Affordable Care Act calls for significant cuts in reimbursements to insurers providing Medicare Advantage (MA) coverage, which has been the most popular alternative to traditional fee-for-service Medicare. Opponents of these cuts argue that they carry serious negative repercussions for seniors, and have lobbied successfully to force their postponement. But research coming out of the Wharton School suggests that cuts to MA reimbursements actually are unlikely to harm consumer welfare.
Credit card minimum payments can act as an “anchor” that causes consumers to pay less of their debt than they otherwise would, leading to higher balances and interest costs, lower credit card scores, increased bankruptcy risks, and in the aggregate, suboptimally high levels of debt in the macro-economy. Policy “nudges,” which aim to increase the monthly amount that individuals pay on their credit card debt, have had mixed results.
It’s a tough time to be a renter. According to data from the U.S. Census, half of all renters, and 83 percent of renters with incomes under $20,000, paid more than 30 percent of their incomes in rent in 2011. One commonly-proposed policy solution to declining rent affordability is the construction and preservation of low-income housing. But this will only ameliorate the situation temporarily.
Detroit filing for bankruptcy had significant implications for people beyond the residents of the city. There were consequences for pension beneficiaries and bondholders that call into question the laws that protect pension and bond creditors during municipality financial distress.
Although the military’s operations are largely exempt from environmental laws and regulations when those laws conflict with its national security mission, the military has important incentives to reduce its reliance on fossil fuels and combat climate change. If nurtured properly, the military’s extensive undertaking to improve its sustainable energy use and reduce demand for fossil-fuel-derived energy has the potential to become one important tool in the environmental regulatory toolkit.
The success of the new health insurance exchanges will depend greatly on the quality of the enrollment decisions that consumers make. Choosing the wrong insurance product can translate into billions of dollars in wasteful spending at the national level. Faculty at the University of Pennsylvania have contributed to several studies outlining important ways that the exchanges can be made to work better for consumers—and for the larger economy.
The United States has entered a new era of catastrophes, of which floods have been the most devastating. Through its 2012 reform (Biggert-Waters Act), the 45-year old federally-run National Flood Insurance Program has an opportunity to highlight the role that risk-based premiums can play in encouraging individuals to undertake loss reduction measures. But the implementation of this reform is now being challenged due to concerns that residents cannot afford risk-based premiums. The authors of this brief propose that this can be overcome by successfully combining risk-based pricing, required insurance, means-tested insurance vouchers, and mitigation loans, so that individuals reduce their flood risk and are financially protected against future disaster losses, thus reducing the need for taxpayer money for disaster relief in the future.
The Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA) significantly changed tax policy by cutting long-term capital gains tax rates and taxing dividend income at the same rates as long-term capital gains. Following the reduction in the tax disadvantage of dividends, investors gravitated toward dividend-paying investments—especially high-income investors who previously had faced the highest tax rates on dividends.
The behavior of investors before and after the passage of JGTRRA suggests that they divide into “clienteles” based on dividend payouts when the tax disadvantage of dividends varies across investors. Policymakers therefore need to build a proper appreciation of investor behavior, particularly among affluent households, into their thinking about any tax reform proposal affecting capital income. If dividend clientele effects are ignored, estimates of the revenue that can generated by changes in capital tax rates will be off-base.
Currently, the rules of fuel taxation in the U.S., like the U.S. tax code more generally, is complex and riddled with inconsistencies. The tax rate applied to carbon-based fuels varies widely depending on the type of fuel, purpose of consumption, and identity of the user. These inconsistencies only invite tax evasion and result in fuel tax revenues that fall short of even covering the costs associated with fuel consumption.
The Dodd-Frank Act requires that the Federal Reserve conduct an annual stress test on large bank holding companies (BHCs) to ensure they have sufficient capital to withstand losses from adverse economic conditions. Eighteen BHCs were subjected to a stress test this year.
The “shale revolution,” spurred by the development of hydraulic fracturing, brings some of the best news to U.S. manufacturing employment in recent years, and gives the U.S. the potential to become a major energy exporter. And the potential of “fracking” to produce negative health and environmental effects is a grave concern.
The Dodd-Frank Act does not provide sufficient protection against another major financial crisis. A better regulatory system would promote financial stability by correcting the key market failures that lead to excessive risk taking by Strategically Important Financial Institutions (SIFIs). Regulatory policies centered on contingent capital would offer a clearer and purer market signal when a SIFI is performing poorly and trigger steps to mitigate the financial risks.
Increasingly, and particularly in response to the recent economic downturn, policy makers have pointed to regulation as a “job killer” and have called for regulatory reform to promote job creation and economic recovery. The empirical research, although limited, reveals a more complex relationship between regulation and jobs, and fails to support the notion that regulation is either a major job killer or a significant job creator. U.S. policy makers should not expect that the nation’s economic woes can be solved by reforming the regulatory process.
As U.S. legislators struggle to balance the fiscal budget, tax reform and business income tax, often emerges at the forefront of the discussion. Not all business income is taxed the same, creating great challenges in the design of new tax policy. The implications arising from the different ways in which corporate and non-corporate entities are taxed needs to be understood in order to anticipate how changes in tax policy could affect businesses and their tax obligations.
With trade talks on the horizon, China drops tariffs on some U.S. goods; Drug prices on election agenda for both Republicans and Democrats ahead of 2020; Trump pushing for California homeless crackdown; California approves bill that requires app-based companies to treat their workers as employees; Median U.S. household income remains static in 2018.
Senate Democrats aim to force one more vote against border emergency; San Francisco-based federal judge reinstates national asylum ban block; Attorneys General launch Google probe; U.S. tech industry urges Congress to pass North American trade pact; U.S. job openings decline for second month in a row.
Financial sector teed up for a busy fall on Capitol Hill; A brief breakdown of Big Tech antitrust issues; Marijuana advocates divided in Congress; Trump’s trade war is weighing on manufacturer spending plans; The richer you are, the longer you live.
U.S. and China schedule trade talks for October; Market eyeing Fed rate cut this month; Special interest groups push back on ‘surprise’ medical costs bill; Pentagon announces cuts to fund border wall; ADP: Private sector employment increased by 195,000 jobs in August; Jobless claims up slightly week-over-week; U.S. productivity climbs 2.3% in second quarter.
Google, Facebook facing state run antitrust probes; Treasury share plan to set Fannie, Freddie free; Federal agencies moving to block California’s vehicle emissions rules; U.S. employers add 130,000 jobs in August.
Trump administration moves ahead with $3.6 billion transfer of funds from military to border wall; Key House Democrat says North American Trade Pact approval unlikely in 2019; Trump administration rolling back lightbulb requirements; U.S. trade deficit narrows less than expected to $54 billion.
In face of tariffs, U.S. and China struggle to set trade meeting; Trump administration reconsiders ending protections for migrants who receive medical care; In tight labor market, Americans with disabilities chase dream jobs; ISM manufacturing index falls below 50% in August reading; Construction spending barely rises in July.
Oil and gas industry split over methane rule rollback; Trump promises ‘giant package’ for ethanol makers; Dems accuse Trump administration of blocking detention facility tours; Trump administration planning expansion of overtime pay; U.S. consumer spending rose sharply in July.
Trump administration set to roll back rules on methane emissions; U.S. may issue 50- or 100-year bonds, Mnuchin says; American businesses growing frustrated with trade war; U.S. military and federal workers’ children born abroad may not receive automatic citizenship; U.S. second-quarter GDP growth revised to 2.0%; Jobless claims rise slightly.
Latest U.S.-China concerns lie deep under the sea; Trump administration to divert FEMA funds to border; Trump seeks to reduce Alaska logging restrictions; U.S. president pushes for border wall by election day; Former Fed President writes rebuke of Trump but Fed pushes back.
Brexit won’t guarantee an easy U.S.-U.K. trade deal; DEA announces plans to increase marijuana growing licenses for research; New rule to allow companies to set own energy efficiency standards; White House brings asylum crackdown to Supreme Court; Home-price growth slows in June; Consumer confidence relatively unchanged in August.
In 2018, President Trump issued two executive orders calling for tighter tariff enforcement and a review of US trade deficits. These orders led to a suite of US tariffs on approximately $50 billion worth of Chinese goods. Throughout the year that followed, China instituted retaliatory tariffs of its own kind in rapid succession. To date, the US has imposed tariffs totaling $250 billion on Chinese imports ranging from steel and aluminum to washing machines and solar panels. Conversely, China has imposed tariffs totaling $110 billion on the US. This ‘trade war’ has drastically changed trade patterns around the world and has inspired protests from many industries in both the US and China. As the war has been in effect for over a year, it is crucial to take stock and evaluate the tariff policies’ economic effectiveness for American consumers.
White House walks back Trump comments; French wine saved from tariffs for now as U.S. and France reach agreement; G-7 countries commit $20M to help fight Amazon rainforest wildfires; G-7 summit ends without any major breakthroughs; Central Banks can’t protect from ongoing political shocks.
Wharton’s Daniel Taylor discusses his research on why proposed SEC changes on small firm audits could lead to more accounting scandals.
China announces tariff hike on $75 billion of U.S. products; Conservatives come out against tax cuts, for tariff rollback; Trump drops plan to cut foreign aid after internal pushback; EU drafts plan to take on U.S. tech firms; Fed chair says trade uncertainty new challenge for officials.
ACA footprint grows under health insurers expansion; Budget deficits could limit U.S recession response effectiveness; New immigration policy to allow indefinite detention; New initiative to research mental illness and gun violence; U.S. jobless claims fall in sign of labor market strength; Leading index signals moderate growth ahead.
Administration weighing options to avoid recession; FDIC approves Volcker rule changes; Farmers frustrated over ethanol exemptions; Existing home sales climb 2.5% in July; CBO raises 10-Year forecasts for budget deficits by $809 billion; FOMC releases minutes from July meeting.
State Attorneys General open antitrust investigation of big tech companies; U.S. renews Huawei waiver for 90 days; HUD proposes changes to fair housing rules; California and Trump press on in emissions standards battle; White House considering payroll tax cut; Investors hopeful for more rate cuts.
Professor Allison Hoffman breaks down the misrepresented idea of “choice” behind several Democratic Presidential Nominees’ support for alternative healthcare options to Medicare for all. She shows the structural barriers that make it so that even with a choice, often patrons make poor health insurance decisions.
Professor Mark Pauly provides a clear analysis of the Trump administration’s current efforts to both reduce US drug prices and promote R&D by setting its eyes on the European system.
Trump ties Hong Kong protests with China trade talks; Pelosi cautions Mnuchin against cutting foreign aid; Trump and team attempt to downplay recession fears; NABE survey reveals economists’ recession expectations; Survey shows surge in support for free trade.
Professor Joseph Harrington discuss T-Mobile and Sprint’s move to convince regulators that a merger is well advised. The companies proposes a fast track to 5G rollout and the creation of a new carrier: Dish. Though creative, Harrington has his doubts
Professor Mauro Guillen comments on the implications of the rising tensions between the US and China on the export dependent Korean economy. He urges the Korean Government to be cognizant of the ripple effect that will likely be felt from the currency war, onto the global economy, and then onto Korea.
Professor Cornelia Colijn discusses the important role of cities in the fight against climate change. She address why they are at the forefront of this effort and why cities favor adaptation solutions rather than mitigatory ones.
Professor Corinne Low and Judd B. Kessler discuss their research into hiring bias and their findings. Even in companies that purportedly champion diversity, there were indicators of implicit bias that favor some applicants over others.
U.S. President required to be told he cannot buy foreign sovereign land; Labor Department proposes religion exemption for hiring and firing; Implementing International Price Index for drugs is a top priority; Trump merit-based immigration policy will lead to sicker children; U.S. homebuilding fell for a third straight month in July; Trade worries send consumer sentiment lower than expected.
Trump seems to link Hong Kong protests to trade talks with China; DHS wants to shift money to immigration enforcement; Government moves toward easing drive-time rules for truckers; Jobless claims hit 6-week high of 220,000; U.S. retail sales beat estimates to show strong consumer spending; U.S. industrial production slips in July.
Trump walks back tariff threat; 22 states sue EPA to block Trump’s coal-friendly power plant rule; FHA loosens crisis-era rules for first time condo buyers; Iowa farmers still backing Trump amidst trade war; U.S. import and export prices rise in July; Key yield curve inverts.
Trump to deny green cards to immigrants receiving public benefits; U.S. significantly weakens endangered species act; U.S. budget deficit already exceeds last year’s total figure; Legal battles continue over reduced fuel efficiency penalties; African Americans and minorities underserved by U.S. banks; Trump’s jobs efforts not delivering results; U.S. consumer prices up in July.
Biometric information is data involving any physical or behavioral human characteristic; common examples include fingerprints, retina scans, and facial patterns. In recent years, the use of this information has become increasingly commonplace. In 2018, 62% of companies reportedly already used biometric information for verification and access purposes. Higher security is thought to incentivize this switch from passwords and IDs to biometric authentication.
These days, it seems like every other reported major tech advancement is in some way related to artificial intelligence (AI). Indeed, AI is a big deal, and it’s on the verge of revolutionizing everything from how we drive to how we raise our children. One industry bound to feel AI’s impact is the financial services sector.
EPA eyes changes to Clean Water Act; Trump renews pressures on Fed; Graham promises repeal of ACA if Republicans win big in 2020; U.S. Producer price index rose 0.2% in July; U.S. China Trade battle stifles global oil demand.
Trump considering executive action over alleged anti-conservative tech bias; China sets yuan’s midpoint at weakest level since 2008; Medicare to cover high-priced cancer treatment; UN climate change report calls for changes to human diet and land use; Initial jobless claims fall by another 8,000.
U.S. tariffs on pace to generate $100 billion this year; Foreign aid funds put on hold for review; China halts all U.S. agriculture purchases; Congress working towards data privacy legislation; FOMC members says trade policy is becoming a challenge.
U.S. labels China a currency manipulator; Federal Reserve announces real-time payments system FedNow; “How Much Nature Should America Keep?”; Trump pick throws FERC into turmoil; JOLTS adds to upbeat signs in labor market.
DOJ and FTC clashing over big tech antitrust agenda; Advisors can’t walk Trump back from tariffs; Congress facing September scramble to fund the government; Top research departure at USDA highlights worrying trend; U.S. services sectors decelerated in July.
Professor Gilles Duranton comments on the startup Opendoor pioneering Real Estate “iBuying.” Though he has doubts about its reach and impact, he ultimately thinks the model will work.
Drawing allusions to the Knights Templar, Professor Kevin Werbach discusses how Facebook’s new cryptocurrency platform, Libra, is not unlike this medieval institution that sought to provide infrastructure for international financial exchange.
Professor Herbet Hovenkamp comments on how the Qualcomm dispute may further complicate the competing investigations into antitrust led by the FTC and the DOJ.
Trump says he’s raising more tariffs on China; EPA proposes relaxing air pollution standards; FTC examining Facebook’s acquisitions as part of antitrust probe; New data shows extent to which Trump counties received subsidies; U.S. economy adding jobs; wage growth still tepid; Trade numbers show deficit barely unchanged.
Trump preparing executive order to allow drug imports from Canada; Congress restarts self-driving car legislation; U.S.-China trade talks end with no deal; plans to continue in September; Alaska and environmental groups file lawsuit for information on Arctic refuge lease sale; Weekly jobless claims edge up; U.S. factory activity lost momentum in July.
Trump administration wants to index capital gains to inflation; Child separations at border continue despite order to stop; 500,000 kids could lose free school lunch under Trump administration proposal; Senate panel acknowledges climate change in passing $287 billion transportation bill; Fed cuts rate by a quarter point; ADP: Private sector employment increased by 156,000 jobs in July.
Trump administration proposes hospital price transparency rule; AG restricts asylum claims based on family relations; Senators unveil federal highway spending plan; Consumer spending slows slightly in June; Inflation well below Fed target in June; U.S home prices rose at a slower pace in May.
It was a sunny day in Houston when President John F. Kennedy stood before a crowd of 40,000 at Rice University. On September 12, 1962–over a year after he stood in front of Congress and proposed that America ought to put a man on the Moon–President Kennedy declared that America chooses to pursue its loftiest goals precisely due to their difficulty. That day, the President of the United States also highlighted the importance of American leadership in space: for making this new frontier “a sea of peace” that allows the exploration and progress of all people.
First large-scale offshore wind project faces headwinds from fishing industry; Labor department announces small business retirement-plan rule; U.S. joins international community demanding decryption power; U.S.-China trade talks resume this week; Inflation concerns driving expected Fed rate cut.
With tech companies gaining increasingly large amounts of power in our economy, the threat of monopolization has reawakened. As such, the Federal Trade Commission (FTC) and the Department of Justice’s (DOJ) Antitrust Division have both ramped up their efforts to respond in kind. However, today’s monopolies are unlike those of the past, and regulators will need to use antitrust law in novel ways to react appropriately.
House and Senate introduce competing carbon tax bills; House passes two-year budget deal to lift spending and debt ceiling; Farmers’ patience running out over trade war; Trump can’t get a win on asylum laws; GDP slows to 2.1% in second quarter but beats expectations.
Trump wants U.S. drug prices in line with Europe’s; States permitted to import Canadian prescription drugs under new plan; Federal judge blocks President Trump’s new asylum restrictions; Four automakers strike deal with California on vehicle emissions; Initial jobless claims fall for third time in four weeks.
DOJ announces broad antitrust review of Big Tech; USDA to pay $15 minimum per acre to farmers impacted by China trade war; U.S., China trade talks scheduled to resume in Shanghai; Senate introduces bipartisan legislation to bolster the Freedom of Information Act; New home sales rise in June; prior three months revised down.
White House and Congress reach deal on spending and debt ceiling; New Trump administration rule to remove 3 million people from food stamps; Congress targets Chinese rail cars over security concerns; Trump administration moves to speed up deportations; House Democrats to unveil drug pricing bill in September; U.S. existing home sales fell 1.7% in June.
Sherria Duncan is a second-generation General Motors’ employee and a mother. She has been employed at GM’s Lordstown, Ohio plant since she was a teenager, working alongside her mother and providing for her younger daughter, Olivia. She is soon to be unemployed. In March of 2019, General Motors announced an end to production and the movement of the plant overseas. Preventative efforts by the United Auto Workers have been of no avail, and workers like Sherria are terrified because they don’t have “[a] safety net.”
Chinese investment falls as trade tensions rise; House Republicans ask Trump to reject new spending levels; Markets preparing for dovish monetary policy convergence; National Activity Index shows some improvement.
EPA hands chemical industry a victory at the expense of children’s health; To Trump’s ire, budget deal poised to extend deficit; House passes $15 minimum wage bill; Market guessing how much Fed cuts rates this month.
It has been 46 years since the Supreme Court ruled that access to safe and legal abortion is a constitutional right, but that was only the beginning of the conversation. In the past few months, the appointment of more conservative judges has led to a reenergized effort to pass abortion restrictions and possibly overturn Roe v. Wade. So far, the debate has been emotional and heated, but it has rarely examined the economic impact of restricting abortions.
White House and Pelosi make some progress on budget deal; Battle over Huawei brings trade negotiations to a standstill; New policy lowers chronic illness costs; U.S. weekly jobless claims rise.
Tesla speeding self-driving cars to market, but are they ready?; House voting to repeal the ACA’s “Cadillac tax”; Lighthizer trying to move Democrats on USMCA; Politicians disagree on how to deal with tech industry; Housing starts down 0.9% in June.
Based on recent numbers, the US student debt has ballooned to over $1.6 trillion, or nearly 8 percent of national income.
Plan to eliminate surprise medical bills faces headwinds as Senators disagree; Justice Department tries to substitute census team but judge says “no”; Obamacare future murky after court of appeals hearing; Job opens cool for second consecutive month.
President Trump orders investigation into France’s planned “digital tax.”; White House drops proposal to eliminate drug rebates; White House reportedly prepping for nationwide immigration raids; Mnuchin to assist U.S. companies with Huawei licenses; U.S. jobless claims drop to 3-month low during holiday week; U.S. consumer prices up in June.
Judge rules against drug price disclosures; U.S. and China seek to renew trade talks; Constitutionality of Obamacare headed to appeals court; 24 governors call on Trump to halt clean car rollbacks; Job opens cool for second consecutive month.
Is it effective for local governments to use tax payer money to support private businesses? Professor Holger Sieg says probably not, unless they create large-enough spillovers or positive externalities for the local economy.
Research led by Mark Neuman, a scholar at Penn Medicine and a LDI Senior Fellow, was cited at a U.S. House Ways and Means Committee hearing regarding the re-authorization of funding for the Patient-Centered Outcomes Research Institute (PCORI).
U.S. presents defense in Huawei suit; Turmoil as Trump administration pursues citizenship question; GOP senators call on administration to revise budget proposal; Hiring data proves strength in labor market.
In 2018, the United States spent roughly $3.65 trillion on healthcare services, a 4.4% increase from 2017. With the increasing growth rate of national health expenditures in 2017 combined with costs per capita at over $10,700, health care spending has contributed to almost 18% of the national GDP. Predictions that maintain these trends estimate that by 2027, health care spending will approach $6 trillion and account for 19.4% of the GDP.
Trump keeps fight alive over citizenship question; Virginia could become 38th state to ratify Equal Rights Amendment; New rule weakens home-care unions; Private payrolls up in June but below expectations; U.S. weekly jobless claims fall more than expected; U.S. trade deficit jumps 8.4% in May.
U.S. proposes more tariffs pending Airbus verdict; Trump receiving pushback on Huawei reversal; On Monday, President Trump signed the Taxpayer First Act, a bipartisan IRS reform bill; Drug prices rise despite efforts from Trump; U.S. stocks dropped on Tuesday as optimism on a trade deal between the U.S. and China dissipated..
US and China agree to resume trade talks; Lyft/Uber debate in California has labor movement split; President of the Federal Reserve Bank of Richmond said that trade tensions could weaken business sentiment and decrease in investment; Manufacturing gauge hits 2 ½ year low; Construction spending fell unexpectedly.
Trump still calling for 2020 census citizen question; Dems yield to Trump on border aid package; Will the G20 be a watershed moment in U.S.-China trade war?; U.S. consumer spending rises in May; Inflation trending upwards; not yet at Fed target.
China lays out conditions for trade agreement; Attorneys file suit against Trump Administration over border care of minors; Canada and California partner on auto pollution standards; Jobless claims hit 7-week high; U.S. GDP first-quarter growth unrevised at 3.1%.
House passes emergency border aid bill; Senate tackles increasing drug prices; Stopping Bad Robocalls Act advances; U.S. goods-trade deficit widens in May; Durable-goods orders drop in May.
On Monday, President Trump signed an executive order that fulfills his promise to tackle high health care costs; The Labor Department has announced a possible new apprenticeship program; President Trump’s trade wars have the rural economy on verge of collapse; National debt and deficit growing slower than predicted; Consumer confidence fell after rising for straight three months; New single-family home sales in the U.S. fell for the second month in the row in May.
The Trump administration pushes deregulation through less enforcement; US could require all next-generation 5G cellular equipment intentioned for use in the US to be created outside China; Legal fight on the horizon over pollution rule; Trump administration buries government studies on climate change; Oil retreated as uncertainties in Iran arise.
In an article discussing the current status of job-listing conventions, Professor Peter Cappelli insightful writes to how monolithic expectations of a one-dimensional employee may be a deterrent to attracting greater talent.
As tensions between Trump and the Federal Reserve rise due to disagreement over economic policies and interest rates, Professor Peter Conti-Brown is cited for his take on whether or not the President can demote the Bank’s chair. In court, the answer would ultimately depend on the jurisprudence of its judges.
Trump administration defends fuel efficiency requirement freeze; Congress introduces bill to block robocalls; Study reveals cost to protect U.S. against rising sea levels; U.S. existing home sales rise in May;Global industrial production slowing
In an article discussing the seemingly lopsided merger between United-Technologies and Raytheon, Professor Emilie Feldman shares how there are questions regarding the viability, necessity, and potential losses to a merger between two companies of considerable size.
In light of the recent boom in the house flipping industry, Professor Susan M Wachter comments on how older cities with high job growth like Philadelphia are ideal for such strategies.
In light of Walmart’s announcement to provide direct delivery services into its customer’s homes, Professor Gad Allon breaks down the pros and cons of such operations. Walmart says to serve integrity they will implement camera and monitoring technology, but Allon is skeptical.
Testifying before The Senate Banking, Housing and Urban Affairs Committee, Professor Howard Kunreuther provided a report in anticipation of the 2020 renewal of the Terrorism Risk Insurance Act.
Progress budget deal slows; Deportations to deter migrant families; Trump Administration backtracks; will not close Job Corps training centers; House Committee on Small Business holds hearing on cannabis; U.S. jobless claims fall more than expected.
EPA keeps coal plants alive; Senators agree on $4.5 billion for emergency border funds; FAA doling out drone delivery approvals; Trump says ICE will deport “millions” of illegal immigrants; Fed keeps rates steady in June meeting.
After meeting with local farmers during a recent visit to Iowa, President Trump is considering policy changes in regards to ethanol fuel; The EPA announced that it will waive the ban on sulfoxaflor for the use on cotton and sorghum crops in 11 states; A group of hundreds of business and trade representatives warned Trump that further tariffs on China could harm the US domestic economy; Today the Federal Reserve will convene to discuss their economic outlook and strategy; US housing starts fell in May by 0.9%, which was unexpected.
Wharton’s John Paul MacDuffie and Eric Orts discuss why automakers are pushing for uniform fuel efficiency and emissions standards in the U.S. These businesses have urged Trump to reengage discussions with California to prevent lengthy instability and litigation.
Republicans and Democrats in the Senate are coming together to pass federal regulations on self-driving cars; G-20 summit may represent a forum to patch up US-China relations; Traditional retailers fear that trade tensions and tariffs could be disastrous for their business; Global trade tensions have intensified, causing markets to send conflicting signals to investors; The National Association of Home Builders/Wells Fargo Housing Market Index (NAHB HMI) fell from 68 to 64 from May to June.
Professor Lorin Hitt’s PPI research into the voter technology market was cited in an article discussing the vulnerabilities and concerns that these businesses pose to American democracy. The article highlights the near monopoly holds that these organizations hold int the tightening marketplace and the barriers this places on transparency and oversight.
In an article cautioning laypeople from investing in currency mutuals or exchange-traded funds, Professor Chris Geczy provides a qualified remark on how momentum trades and carry trades may be the only exception.
In the face of increasing disaster-related property damage, fewer people are still purchasing the necessary insurance policies. As such, Prof. Carolyn Kousky has advocated for policies that make it harder to drop the expenses in the first place.
In an article discussing the potential for technology driven health care systems, Professor David A. Asch identifies and deconstructs some of the social and cultural barriers that drive resistance against this type of adoption.
Economics and policy makers consider how much longer Washington can tolerate its growing deficit; White House expands health insurance options for small businesses; Left and centrist Democrats split on $15 minimum wage; US retail sales rose in May; U.S. industrial production rebounds in May.
Border funding revived in Congress; McConnell pressuring White House on budget deal; Puerto Rico restructures pension liabilities; U.S. weekly jobless claims edge higher; Import prices down in May.
Federal Housing Finance Agency director begins push for housing finance reform; Financial markets regulator takes a stand against climate change; Treasury ends SALT deduction workarounds; House opens tech antitrust inquiry for news industry; Consumer prices rise slightly on decline of gas prices; U.S. budget deficit up from last year
The US Energy Department will prohibit its researchers from joining Chinese recruitment programs and will require all personnel to disclose connections to foreign government recruitment programs; The Mexican government prevented further tariff increases by the TrumpAdministration by agreeing to harsher immigration measures targeting Central American migrants; This Monday, President Trump shifted his focus back to the trade war with China, after gaining significant concessions from the Mexican government by threatening tariffs; The New York Fed reported this Monday that consumer inflation expectations fell to the lowest level since late 2017; US producer prices have increased for a second month in May, according to a Labor Department report.
One of the central promises of the Trump administration has been the rollback of regulations on financial institutions that had been put into place after the Great Recession; The Trump administration announced that it secured significant commitments on immigration from the Mexican government, in response to the President’s threat of imposing a 5% tariff across the board on all goods from Mexico; The US government is looking to make it easier for licensed professionals to work across state lines; The number of workers hired by US businesses reached a record high in April.
In a discussion on Philadelphia’s recent cash-less policy ban, Professor Cary Coglianese said, “Concerns about equitable treatment — namely, ensuring access to services to all individuals, regardless of their economic status or access to banking services — should presumably apply even more strongly to the public’s interaction with their government.”
Amidst the recent buzz around breaking up large tech companies, Professor Herbert Hovenkamp comments on how suits may not be brought by regulators unless they know they can win.
Progress in U.S.-Mexico border talks; 17 major automakers push back on Trump plans to roll back fuel efficiency standards; Bloomberg pledges $500 million in fight against coal; FCC allows phone carriers to block robocalls; Wage gains slowed in May; FOMC to consider rate cut in June meeting.
Trump threatens tariffs on an additional $300 billion of Chinese goods; Arrests rise on the southern border while negotiations continue; SEC adopts new rules aimed at Wall Street brokers; Weekly jobless claims unchanged pointing to strength in labor market; U.S. trade deficit falls 2.1% in April; Labor Department reports U.S. productivity up 3.4% in the first quarter.
U.S. to get tougher on immigrant families; Trump moving forward with tariffs on Mexico; House Ways and Means Committee to hold hearing on “Medicare for All.”; Job creation reaches 9-year low in May; World Bank lowers 2019 global growth forecast to 2.6% from 2.9%.
US government agencies are preparing to investigate the largest technology companies for antitrust activity; President Trump announced a possible trade deal with the UK during his visit to Britain; Congress is facing a number of fiscal deadlines as they come back into session on Monday; Trump defeats House on border wall lawsuit; The Institute for Supply Management’s manufacturing index fell by 0.7% since last month, from 52.8% to 52.1%; US construction spending was flat in April, signaling that the housing market is not expanding
In their Special Report on Global Warming of 1.5ºC, released in October of 2018, the Intergovernmental Panel on Climate Change (IPCC) warns that time is running out to avoid a global climate disaster. Specifically, to avoid a net temperature increase of 2ºC, we have until the year 2030 to reach net zero global carbon emissions. In 2017, President Trump announced that the US would pull out of the Paris Agreement, and since then, there has been no national policy in place to address climate change.
In an article discussing the disparity of access and use to credit cards between white consumers and black adults, the authors cite Professor Lisa Servon’s argument against recent Congressional bills focused on regulating interest rates, which she reasons actually hurt the individuals it was designed to protect.
US government is struggling to regulate large US tech companies; China and Mexico, two largest sources of US imports, have shown that they are willing to negotiate with the US over trade issues; Congress is facing a number of fiscal deadlines as they come back into session on Monday; The Institute for Supply Management’s manufacturing index fell by 0.7% since last month, from 52.8% to 52.1%; US construction spending was flat in April, signaling that the housing market is not expanding.
Trump hits Mexico with a 5% tariff on all goods; Trump permits the year-round sale of ethanol; Interior Department to move forward with the sale of Alaska oil leases; China strikes back at U.S. Huawei ban with “unreliable entity list.”; U.S. consumer spending up 0.3% in April.
In an interview with Professor Rachel Werner, she magnanimously speaks to experience of being the first female and physician-economist to be appointed as Director of the Leonard Davis Institute of Health Economics. She hopes to leverage her dual academic background to greater facilitate interdisciplinary approaches to current health care issues.
College students Michael Krone, Jenna Liu, Natasha Menon, and Kevin Myers won the 6th annual PPI public policy case competition. The focus this year was on automation—specifically, ameliorating the effects of job displacement caused by advancements in technology. Their project, “New Horizons,” is a proposal to help shift administrative workers in Pennsylvania into jobs that are low risk for automation and fit their skills and aptitudes, and to encourage them to gain further career development, using the PA CareerLink website. The four of them were excited to get involved in a case competition but were nervous that they did not know much about the topic. To start, they looked at research on automation and spoke to experts they had met through course work and internships. As they went along, they were then able to gain feedback from people with different perspectives on the subject, which helped them continually refine their thinking.
Trade tensions challenge Fed position; Trump official helps passage of Ohio House energy bill; Pelosi taking her time on new NAFTA deal; U.S. GDP growth revised lower to 3.1% in Q1 2019; Labor market still strong as jobless claims rise slightly.
U.S. Treasury declines to label China a currency manipulator; Trump’s tax law does little for wages; House Republican delays emergency aid package; Global bond yields falling.
Trump’s infrastructure plan remains at an impasse; Trump administration is expected to oppose legislation targeting harmful chemicals entering water supply; Major index finds that average home prices in major metropolitan areas in the US have increased 3.7%; Consumer confidence has hit a 6-month high.
Professor Ezekiel J. Emanuel discusses the burgeoning application and use of AI technology in health care but urges that a refocusing on the behavioral hazards of modern life is necessary for tangible improvements in net American health.
As robots continue to replace physical jobs, Wharton Professor Kartik Hosanager comments on how computers developed to understand languages may represent an early encroachment on more creative industries such as medicine and the law
Wharton Professor Barbara Kahn provides a multifaceted breakdown of Amazon’s current financial success. She highlights elements such as its multi-sector ubiquity, apparent transparency, and discreet focus on data operations.
Executive order on healthcare price transparency; Progress stalled in drug pricing talks; Cabinet secretaries told to seek repayment from migrants’ sponsors for use of services; U.S. proposes penalties on countries it accuses of manipulating currencies; Durable goods orders slump in April.
Trump can’t work with Democrats “under these circumstances”; Disaster deal talks stall; Political crackdown on Agriculture Department economists; Trump Administration announcing farm sector bailout; U.S. jobless claims fall more than expected; U.S. new home sales drops from near 11-1/2-year high in April.
Wharton Professor Peter Cappelli comments on PTO exchanges, or a new system where employees can trade in the monetary value of their vacation days in exchange for compensation to pay off student debts. Cappelli notes how strategies such as this one are creative solutions to deal with an ever tightening labor market.
Trump wants to focus on Trade Pact before infrastructure deal; Efforts to create a Do Not Track registry reinvigorated with new “Do Not Track” bill from Senator Josh Hawley (R-MO); The EPA plans to reform the cost-benefit calculations of air pollution on human life; No budget deal was reached between Congressional leaders and the Trump administration on Tuesday; The FOMC released minutes from its April/May meeting.
Wharton Professor Minyuan Zhao comments on the ensuing “trade war” and argues that the core issue is one of domestic politics. Zhao reasons that the underlying motivating mechanisms driving the conflict is one centered around Trump’s re-election interests amongst other things.
Wharton Professor Kevin Werbach joins other scholars in a discussion on 5G technology and whether or not it will fulfill its purported promises. Considerations such as its implications on productivity, innovation, and rural reach all make a review of the new wireless technology a rich and fascinating subject.
Read about Penn Law Professor Tom Baker’s research on the challenges of regulating the automated advice industry. Amongst these difficulties, Baker cites conflict of interests, poorly tailored laws and more.
Since last year, the U.S. government has sharply curtailed the ability of American semiconductor companies to hire Chinese nationals for advanced engineering positions; Unless a budget caps deal is reached, the US military spending will face sharp cuts; More than 75 representatives from some of the largest companies in the US will address Congress tomorrow to call for a new climate tax; Sales of existing homes in the US have declined over the past two months.
Penn Med Professor Christina Roberto’s research found that in Philadelphia and Baltimore “Taxing sugar-sweetened beverages is one of the most effective policy strategies to reduce the purchase of these unhealthy drinks. It is a public health no-brainer and a policy win-win.”
A bill that would prohibit unauthorized tracking of users’ activity online proposed today; The Environmental Protection Agency is adopting a new method for accounting future health risks of air pollution; The Securities and Exchange Commission struggle to collect fines for securities law violations; Business spending in the US has slowed.
The second class of Public Policy Research Scholars (PPRS) began their journey through this rigorous honors program in 2017. Now, just two years later, ten students are graduating from Penn with a solid understanding of economic and political analysis of public policy; knowledge of the policymaking process; and the application of theoretical and quantitative tools to practical, real-life policy questions. Learn more about the cohort by clicking into each student’s PPRS profile.
Trump readies new immigration overhaul; Executive order aimed at protecting U.S. networks from Chinese tech; U.S. jobless claims fall more than expected; Housing starts rise 6% in April
Labor board issues key Uber ruling; Lawmakers scrutinize Chinese visa program on IP concerns; House votes to extend National Flood Insurance Program; Retail sales decline in April
White House explores new farmer bailout plan as U.S.-China trade war heats up; Trade Dispute Between U.S. and China Deepens as Beijing Retaliates; Payday Lenders Mobilize in Support of Rule’s Repeal, Consumer Group Says; U.S. import prices rise; underlying imported inflation weak.
Trump’s Trade War Escalation Will Exact Economic Pain, Adviser Says; States fight Trump rollback of Obama light bulb rules; China Hits Back With Tariffs on $60 Billion in U.S. Goods; U.S. Stocks Fall on Renewed Trade Anxiety.
Professor Peter Conti-Brown is a cited in an discussion on the recent complications experienced by the Trump administration to staff the Federal Reserve. Brown comments “Republicans still wish to see the Fed as a place where serious work is done by credible Republicans.”
Professor Ioana Marinescu’s research into monopsony influence in the US was cited in an article discussing the growing market power of America’s biggest firms and the potential explanations for this phenomenon.
Trump defends tariffs; House Dems begin insurance blitz; Consumer prices rose, but inflation remains tame.
Professor Gilles Duranton comments on the future of ride-hailing apps and the inevitability of increased rates in order to make companies such as Uber and Lyft more sustainable, viable, and profitable.
Tennessee becomes first state to convert Medicaid programs to a block grant; Federal regulators feel pressure to hold Facebook accountable; China backtracks on US trade deal; Mortgage applications up as real estate market quickens.
Trade fight escalates; U.S. pressures Arctic Council on mention of climate change; Job openings jump 7.49 million; Job surge points to tightening job market.
In a paper published by Wharton Professor Gilles Duranton, he discusses his findings that suggest how congestion pricing may not relieve India’s urban mobility issue. His research found that other complications such as poor road conditions and city design infringe on the mobility of cars – irregardless of the amount of traffic.
Top safety alums joining the driverless car industry; Trade talks set to continue with China despite Trump’s tariff threat; Trump administration grants seasonal worker expansion; Stock markets drop as Trump hurls tariff threats toward China.
Wharton Professor David Zaring discusses the implications of the $1 billion dollar fine levied on Wells Fargo and whether or not it is a sufficient value to function as a deterrent for future malpractices in big banks
Trump aims to protect health workers’ religious belief, Facebook agrees to greater oversight; Trump rids of offshore drilling rules enacted after BP oil spill; U.S. trade gap expands to $71.4 billion.
For nearly eight years, civil war has been raging in Syria. Pro-democracy forces, Islamist groups, including the Islamic State of Iraq and Syria (ISIS), and Kurdish separatists form separate factions in the struggle against Bashar al-Assad’s regime. The United States military has also played an active role in the conflict, both engaging in firefights with and conducting air strikes against enemy targets. However, on December 19th 2018, President Donald Trump claimed victory over ISIS and announced that a withdrawal of American ground troops was imminent.
Trump administration files brief calling for the end of the Affordable Care Act; CBO publishes new report on Medicare for All; Lawmakers feel pressure to fix loophole in 2017 tax law; Jobless claims unchanged from last week.
Medicare for All first became a fixture in the national political conversation in 2016, when Senator Bernie Sanders (D-VT) presented his plan for universal medical insurance during his Democratic presidential campaign. Since then, the idea has only gained traction in the political sphere, with several Democratic frontrunners for the 2020 presidential election announcing their support for Sanders’ plan.
President Trump’s new trade rules face challenges; A finalized deal is expected to result from U.S.-China trade negotiations; Americans’ approval rating on the Affordable Care Act (ACA) remains split; U.S. consumer spending shows biggest gain since 2009.
Wharton PPI welcomed the former Director of the Consumer Financial Protection Bureau, Richard Cordray, as our Visiting Fellow for Spring 2019. He also was a Distinguished Policy Fellow at Penn Law this semester.
Labor Department decides that workers at gig company are contractors; President Trump moves to toughen the path to asylum; Congressional Democrats call for expansive infrastructure package; FDA struggles to keep up with booming cannabis market; Home-price growth slows to lowest level since 2012.
Offshore oil and gas plan sidelined; Data shows that Mexico is now the U.S.’s largest trade partner; Judge gives U.S. six months to identify separated migrant children; GDP grew by 3.2% in the first quarter of 2019.
White House plays hardball on Congressional subpoenas; Trump immigration plan increases skilled work visas; Lawmakers reach bipartisan agreement on tech company regulation; Jobless claims at 19-month high.
House asks Federal judge to prevent the President from using DoD funds on border wall; Federal Reserve loosens bank investor restrictions; Facebook hires Patriot Act author.
U.S. ends waivers for countries to import Iranian oil; Fight over census question will be heard in the Supreme Court; Trump administration’s proposed hiring requirement faces scrutiny; Existing U.S. home sales fall.
Debate escalating over the effects of Trump’s NAFTA deal; U.S. launches four-state, $350 million study on ways to combat opioid deaths; Housing starts fall to a near 2-year low.
Treasury Department announces new Opportunity Zone regulations; Trump administration Housing Department to limit housing aid for undocumented immigrants; Jobless claims continue to fall; Retail sales post big gains.
President Trump vetoes bipartisan Yemen measure; Trump administration to deny bail to asylum seekers; Businesses advocate against census citizenship question; US trade deficit falls in February.
Wharton’s John Paul MacDuffie and David Zaring join the Knowledge@Wharton broadcast to discuss Volkswagen’s ongoing emissions cheating scandal. Both MacDuffie and Zaring indicate that the cause of the ongoing situation is company greed.
In light of the US Treasury Department’s announcement sanctioning corporate lump sum pension pay outs for employees, Wharton Professor Olivia Mitchell discusses the benefits it serves for companies and the potential risks it posses for employees.
Wharton Professor Peter Conti-Brown provides a historical conversation aimed at answering how laws and the court system have informed the polarizing question of “how much should credit cost?”(especially for those that are the most socially and financially disadvantaged in society)
Trump administration stresses urgency of mortgage finance overhaul; Federal court dismisses Trump administration’s repeal of an Obama-era fossil fuel rule; U.S. manufacturing output is unchanged.
The tension between China, the United States, and other smaller countries around the South China Sea is one frequently covered by the news as the potential for conflict there holds a constant presence. Reports note that the most recent developments in the South China Sea involve increased military tensions as China, the United States, and various other countries such as Taiwan, Vietnam, China, the Philippines, Malaysia, and Brunei vie for authority in the region.
White House considers President Trump’s sanctuary cities proposal; First Tax Day under President Trump’s law; Affordable Care Act (ACA) is popular despite President Trump’s opposition; Former Federal Reserve officials worry about the institution’s political independence.
Could algorithms collude on prices? Wharton Professor Joseph Harrington argues that it is difficult to determine based on the limited technical knowledge of algorithms. He also suggests that “algorithms will need to be tested in more advanced and complex environments” to see their impacts on pricing.
Bipartisan lawmakers hold hearing on insulin prices; President Trump signs order targeting states’ ability to slow energy projects; Mnuchin announces US and China agree on trade enforcement mechanism; Producer price increases by highest increment in 5 months; Jobless claims at lowest level since 1969.
Kartik Hosanagar discusses Senator Elizabeth Warren’s plan to regulate giant tech companies. Warren proposes that companies will not be able to use their platforms to market their products and services. Hosanagar proposes that to regulate big tech companies, one must address consumer protection and “platform-oriented organizations”.
Senate Republicans move to reduce legal immigration; Majority Leader McConnell refuses to take up net neutrality bill; Left-moderate Democratic divide delays budget vote; Consumer Prices up in March.
Wharton Professor David Hsu analyzes Lyft becoming a publicly traded company. Unlike Uber, Hsu argues that Lyft did not make the same operational mistakes and “…positioned themselves as the anti-Uber.”
Trump administration moves to impose tariffs on $11 billion of EU goods; Judge blocks Trump administration policy of returning asylum seekers to Mexico; U.S. military plans for climate change; Job openings fell by the most since 2015.
Wharton Professor Mark V. Pauly joins the Knowledge@Wharton broadcast to discuss Bernie Sanders’s proposed “Medicare for All” plan. He argues that there is not enough evidence to suggest that a national health insurance program would work in the United States. Furthermore, Pauly implies that Senator Sanders’s proposed “Medicare for All” plan is dependent upon providing cost-effective care.
Senior Trump adviser pushes to bring in more immigration hardliners; Nielsen departure could hurt the Trump administration’s efforts on cybersecurity; President Trump struggles to curb unauthorized immigration; Government spending fight clouds growth outlook.
Wharton Professor Olivia Mitchell is cited in a conversation about public knowledge and fears on the alleged defaulting of corporate commitments to employee pension plans.
House passes measure to end US support for Saudi coalition in Yemen; House advances net neutrality bill; US-China trade talks wind to a close; Weekly jobless claims at 49-year low.
Professor Lisa Servon provides an insightful meditation on the human issues that stand behind a recent push for Philadelphia to ban cashless stores. She juxtaposes her own financial stability with her customers from RiteCheck to show how a reliance on cash is a symptom of a larger system of economic disenfranchisement faced by many Americans.
Senators question CFPB on student borrowing; U.S. adds 196,000 in March; Trump proposes tariffs over border dispute.
Ways and Means sends bipartisan IRS reform bill to the House floor; Senate Democrat Wyden proposes tax on unrealized capital gains; Kushner authors plan to increase legal immigration; Private sector hiring drops as manufacturing sheds jobs.
Penn Law Professor Cary Coglianese explains Trump’s claim of curtailing the number of business regulations than any other president. Coglianese argues that Trump’s claim can be beneficial for both himself and Democrats.
Senate introduces legislation to overhaul retirement; Federal disaster relief funds stalled by Senate; President Trump delays healthcare vote until after 2020; Congress concerned about Trump’s role in upcoming budget deadlines; Durable-goods orders fall.
Wharton Professor Herbert Hovenkamp discusses Elizabeth Warren’s proposal, which intends to break up Big Tech firms. Hovenkamp argues that Warren’s proposal fails to distinguish between “..who is being harmed and who is benefiting. Furthermore, he suggests that her plan may “…raise consumer prices and consumer variety”.
China closes loophole in Fentanyl rules; White House threatens to close U.S.-Mexico border; Federal judge rules against President Trump in Arctic drilling case; Retail sales unexpectedly fall; Construction spending rises to a nine-month high.
Wharton Professor Joao Gomes joins the Knowledge@Wharton broadcast to discuss the United States’s national debt and offers some potential solutions to combat the issue. A potential idea he suggests is decreasing services provided by the government. One question he poses is”Is it more likely that we will strike some balance where we have to compromise and say these promises [on Social Security and Medicare] are just way too generous?”
John Paul MacDuffie and David Zaring join the Knowledge@Wharton broadcast to discuss Volkswagen’s “Dieselgate”, where the auto manufacturer had altered the environmental dependence in over 500,000 automobiles. Both MacDuffie and Zaring imply that greed is what lead Volkswagen to deceive consumers and investors.
Itay Goldstein discusses where in the financial technology space is the most opportunity located. He argues that not only is fintech going to overhaul the traditional finance industry, but that there are also tons of activities occurring outside of the traditional finance sector. Therefore, he suggests it is crucial to critically analyze new technologies and their impacts on global society.
This is Part 2 of a two article series on healthcare reform in India. Part 1 explored the unique factors that drive healthcare policies in India. This piece analyzes India’s flagship healthcare reform, Ayushman Bharat, which is also known as “Modicare.”
In June 2018, Pakistanâ€™s current-account deficit swelled to $19 billion. Pakistanâ€™s foreign exchange reserves are at a drastic four-year low, and the central bank has devalued the rupee by almost a third in the past year.  Pakistan has a history of financial instability and a weak central government. As this article will demonstrate, many of these same domestic factors are at play in the current Pakistani financial crisis. This time, however, the extent of Pakistanâ€™s problems is exacerbated by a significant debt to China. A project known as the China-Pakistan Economic Corridor is a central piece in Chinaâ€™s ambitious international development efforts, known collectively as the Belt and Road Initiative. As the US-China conflict intensifies, it is essential to understand the threat of Chinese dominance in Pakistan and what the US can do to combat it.
Senate Democrats attempt to defund Republican ACA lawsuit; House Finance Committee to vote on marijuana banking bill; US steel and aluminum tariffs stall North American trade conversation; January US trade deficit falls over expectations.
This is Part 1 of a two article series on healthcare reform in India. This article explores the unique factors that drive healthcare reform in India. Part 2 analyzes India’s flagship healthcare reform, Ayushman Bharat, which is also known as “Modicare.”
Trump administration broadens efforts against the Affordable Care Act (ACA); House votes on overriding President Trump’s veto; House Democrats call for the U.S. to remain in Paris climate accord; Housing starts drop almost 9 percent; Consumer confidence falls in March.
Wharton Professor Kartik Hosanagar analyzes the potential risks of algorithms that are being used for artificial intelligence. He advocates for “an algorithmic bill of right”, which argues for personal liberties and responsibilities of using algorithms. Without “an algorithmic bill of right”, Hosanagar implies that the use of algorithms will have negative consequences on how one lives.
Susan M. Wachter offers her perspective regarding the drastic rise of home prices in North American urban centers. Although home prices will eventually settle down, she indicates that their spike in relation to income remains a growing concern for the Millennial generation
GOP budget proposal diverges from President Trump’s; Trump administration proposes cuts that would require drug television advertisements to highlight costs; Department of Energy announces $3.7 billion loan guarantee for nuclear energy; Stock market data could suggest worsening global economy.
Wharton Professor Mark V. Pauly offers his perspective of accountable care organizations, which are controlled by the Stark Law. The legislation prevents physicians from referring patients to places where they have an economic incentive. Pauly argues that people should have a choice if they decide on choosing an ACO.
Free speech order could stifle expression, critics say; Drug company protections slowing NAFTA rewrite; U.S. home sales hit highest level in 11 months.
According to a new study conducted by Penn Medicine researchers, Medicare patients that receive home care have higher rates of hospital admission than those who receive care in a nursing home. Professor Rachel M. Werner discusses the tradeoffs between home care and nursing facilities. She argues”…While home health care may cost less, it doesn’t have the same intensity of care as a skilled nursing facility, which may be sending many of them back into the hospital.”
President Trump is expected to issue an executive order that ties federal grants to free speech at Universities; Trump announces that irregardless of trade negotiations, tariffs will remain; Federal Judge places an injunction on drilling Wyoming; Jobless claims fall more than expected.
Trump administration considers extensive foreign auto tariffs; Trump administration pulls back on family detention policy; Trump officials seek to remake Medicaid; Federal Reserve dramatically downgrades rate path.
Trump administration plans to overhaul flood insurance; White House promotes labor-force participation; Federal Trade Commission (FTC) asked to probe Facebook’s market dominance; Trump proposes limiting student borrowing; U.S. factory orders rise by 0.1 percent.
GOP lawmakers move to restrict the president’s emergency power; Investors await rules on opportunity zones; Antitrust actions against big tech gain popularity; Housing market index (HMI) remains unchanged.
In this Op-ed article, Wharton Professor Mark V. Pauly discusses his perspective of U.S. Senator Kamala Harris’s “Medicare for All” proposal. He argues that it could lead to complications with medical visits and that “benefits…and their policies vary across states”. Furthermore, he implies that one must be realistic in their expectation of healthcare delivery.
One of the issues that the Democrats are looking to use in the upcoming 2020 election are “antitrust laws”. Wharton and Penn Law Professor Herbert Hovenkamp offers a historical perspective to “antitrust laws”. He argues that it “hasn’t been such an intense focus of a presidential campaign since the 1912 election with Woodrow Wilson, William Taft, and Theodore Roosevelt”.
Lawmakers consider policy changes following college-admission scandal; Democrats introduce bill protecting scientific research from political interference; JOLTS shows big gains in job openings; U.S. consumer sentiment rose in March.
Bipartisan Senators introduce a bill that would boost SEC’s ability to recover funds for fraud victims; Trump is anticipated to issue vetos for issues on both trade and border resolution as GOP senators find themselves at odds with the President; House Energy and Commerce Committee members remain divided on drug pricing reform; Jobless claims higher than expected
Wharton Professor Minyuan Zhao offers her perspective about why China and the United States have not come to a trade agreement. She argues that one avenue that is worth consideration is “both [countries having] a mutual interest in protecting IP rights. Apart from protecting IP rights, she suggests that “U.S.-China negotiations are not just about trade, but also have longer-term implications on the “development models” China adopts”.
Wharton Professor Kevin Werbach discusses the Trump campaign’s proposal for a wholesale 5G network. Part of the proposal is that “No company could use exclusive control over spectrum to block competition”. Although against the Trump administration, Werbach argues that “…Democrats should welcome [the Republican’s] open access vision.”
White House proposes a $4.7 trillion budget for fiscal 2020; Auto import tariffs face opposition; President Trump’s involvement in AT&T-Time Warner merger is questioned; CPI rose for first time in four months.
White House drafts proposal to use social media to identify abuse of disability insurance; Trump requests $8.6 billion for border wall in 2020 budget; Central banks change course to prevent recession; Retail sales up in January.
Wharton Professor Ashley Swanson joins the Knowledge@Wharton podcast to discuss government efforts to curb rising prices for prescription drugs. She argues that there are negative impacts to leaving drug prices to the markets, such as charging monopolistic prices. To amend the problem, Swanson also indicates that the government must enact stronger policies. One solution that she recommends is re-analyzing the “cross-subsidization” model of pharmaceutical companies.
Trump administration weighs revealing hidden medical rates; Trump administration proposes mandatory overtime pay; Unemployment rate lower than perceived; U.S. housing starts bounced back in January.
The Federal Reserve announces that it looks to loosen regulations on Wall Street; Lawmakers try and build bipartisan support for the restructured trade deal with Canada and Mexico with a replacement NAFTA bill; Philadelphia becomes the first major city to ban cashless stores; Jobless claims fall last week; U.S. productivity rose 1.9% in the fourth quarter.
In a meeting with Congress, Homeland Security Chief urges lawmakers to recognize the “humanitarian catastrophe” at the southern border; Future US and EU trade talks remain a contentious issue; Trade deficit at a record high under the Trump administration; Metrics indicate that private-sector hiring slowed in February
National emergency block to pass Congress; Lawmakers debate space for state rules in federal privacy law; U.S. insurers seek ‘backstop’ renewal for terrorism risk; New home sales hit seven month high
In light of the economic and political turmoil facing Venezuela, Wharton Professor Philip M. Nichols provides a three point non-violent alternative to help the country begin its recovery: Establishing equity, Restimulating vital markets, Erecting legal institutions for asset claims.
Senator Rand Paul announces that he will be voting for a resolution that block’s President Trump’s national emergency; US and China approach a final trade deal; The Trump administration looks into ways to reduce the federal cost of dialysis care; Construction spending unexpectedly declines in December.
Regarding the use of artificial intelligence to address the gap in cybersecurity skills, Wharton professor Pinar Yildirim argues that “automation can negatively impact team dynamics and actually lead to less efficiency.”
Original source here: http://knowledge.wharton.upenn.edu/article/automation-make-teams-less-efficient-less-cooperative/
Appearing on the Knowledge@Wharton podcast, Arthur van Benthem discusses, “Flawed Analyses of U.S. Auto Fuel Economy Standards ,” a new study he co-authored, which challenges the argument made by the current administration that the costs of the fuel efficiency targets made by the Obama administration outweigh the benefits. Additionally, van Benthem discusses the more relaxed fuel efficiency rates imposed by the Trump administration. He suggests that with higher efficiency standards, “[t]here are environmental benefits. Not just greenhouse gases, but also air pollution. By relaxing the standards, we’re throwing away all those benefits.”
In September, 2015, “Dieselgate” captured the world’s attention when the Environmental Protection Agency (EPA) discovered that Volkswagen cheated on American emissions testing. In the United States, the German car giant sold vehicles with a software in diesel engines that detected testing conditions and lowered vehicle performance to artificially improve testing results. Consequently, these vehicles emitted pollutants up to 40 times higher than the legal standards established by the Clean Air Act. The scandal fueled the continuing debate on environmental regulatory policy and raised questions about what regulators can do to reign in the behavior of firms. In light of this, we reflect that in recent years, the burgeoning field of behavioral economics has equipped regulators with additional tools for improving environmental behavior of firms by changing consumer demands.
On October 3rd, 2018, US Ambassador to NATO Kay Bailey Hutchinson set off a diplomatic storm after her comments on Russian violations of the Intermediate Nuclear Forces Treaty (INF). During a press conference, Hutchinson warned Russia that continued violations would force the US to consider all options, including the possibility of an American strike to “take out a (Russian) missile” capable of hitting any NATO countries. Russian diplomats strongly condemned Hutchinson’s warning, forcing the ambassador to clarify her commitment to diplomatic solutions later that day. But within just three weeks, to the surprise of many in the international community, President Trump announced the United States’ intention to leave the treaty altogether. Ultimately, the surprise decision to leave the treaty unilaterally was a result of Russia’s ongoing aggression despite damaging international sanctions and the changing geopolitical realities in Asia.
Wharton Professor Kevin Werbach implies that regulation is not the main concern with blockchain systems. Instead, he argues that the it is the lack of trust. He indicates that “People will use blockchain systems if they trust them, which is the only way the technology will see mass-market adoption.”
Is Universal Basic Income(UBI) an effective strategy for combating higher living costs and helping people integrate back into the workforce? One place where this idea was tested was in Finland. Penn economics professor Ioana E. Marinescu discovered that the results from the Finland experiment were similar to “People living on Native American reservations…who received stipends from casino profits…[which] report[ed] lower levels of stress and depression.”
Senate Democrats release an alternative compromise to the “Green New Deal” to garner bipartisan support; Senator Bill Cassidy hints at a new bill protecting consumers from surprise medical costs; White House continues its search for panel to review climate change; U.S. personal income fell in January; Consumer sentiment declines in late February.
A task force from the Federal Trade Commission will focus on tackling anticompetitive behavior in big tech; U.S. Trade Representative Robert Lighthizer told Congress that a resolution between the U.S. and China over trade remains unclear; U.S. GDP grew at a rate of 2.6% in the final three months of 2018; Jobless claims suggest softening market
Trump administration looks to exempt the military from spending cuts with new proposed budget; The Senate Finance Committee to hold hearings on drug pricing for pharmaceutical industry CEOs; Department of the Interior grants waivers to offshore drilling safety rules; In the month of February, the consumer confidence index rose to 131.4 from 121.7; The average home prices in major U.S. cities rose by 4.7%.
In light of productive negotiations, Trump to delay the imposition of tariffs on Chinese imports; Nearly two dozen former congressional GOP members signed a letter urging GOP legislators to reject President Trump’s declaration of a National Emergency; White House Panel will reassess previous government climate analysis and counter conclusions linking the burning of fossil fuels to environmental damage; Lawmaker efforts to repeal cap on tax deductions start to gain traction; Wholesale inventories post largest gain in over five years.
In a discussion on critical infrastructure, Professor Eric Celmens highlights the need for intelligent regulation of major information platforms such as Google, Apple, and the like in order to preserve consumer rights and economic prosperity.
How should Howard Schultz handle running for president, while still owning shares in Starbucks? Wharton Professor Philip M. Nichols argues “…he[must] avoid the conflict between what is good for this country and what is good for Starbucks….he needs to commit to selling all his shares in the company”.
Regarding Amazon’s decision to not open a second East Coast headquarters in Queens, NY, Wharton Professor David Reibstein argues that “What should have been a win/win for both Amazon and New York has now turned into a loss/loss. There are no winners, only whiners.”
To prevent a wider trade dispute with China, US investors are hoping that a trade deal will be made. Associate Professor of Management at the Wharton School Minyuan Zhao argues “When cross-border transaction becomes more costly, or risky, companies may decide to engage in more local production, hence higher investments in the host countries…, but[it] may not indicate optimism towards the US-China relationship.”
Senate Democrats announce that they will introduce a plan to block Trump’s national emergency declaration; Legal questions arise as Trump ends clean air talks with California; Business investments fall for the fourth time in five months.
Panel assembled by White House to conduct research on the impacts of climate change on national security included long time denier William Happer; Congress is anticipated to vote on a resolution that expresses the House’s disapproval of Trump’s national emergency declaration; Jobless claims fall slightly; Federal Reserve unlikely to raise interest rates.
Sixteen states sue President Trump over state of emergency; Trump advances trade agenda; The European Union disapproves of potential tariffs on imported cars; Housing Market Index (HMI) rises
Upon President Trump’s announcement regarding a national emergency at the southern border, the White House issued a statement that it supports this action; GOP state leaders look to make it more tenuous to pass voter initiatives; Despite staggering projections that claim the Federal Deficit will top $1 trillion dollars by 2022, top economist recommend that the government continue to borrow in light of historically low borrowing costs.
To further his border wall agenda, President Trump plans to declare a national emergency; Top negotiators from both sides of the US-China trade conflict have made some progress on the broad outlines of a future agreement; Manufacturing output falls in the month of January; Consumer sentiment beats economists’ estimates
Congress to vote on bipartisan security bill without wall funding; Advocacy groups emphasize civil rights issues in big data debate; EPA leaders halted chemical health risk report; Average 4-week jobless claims at 1-year high; Producer price index falls 0.1%
One in every four active duty members of the United States military exhibit symptoms of mental illness, which are mostly the manifestation of posttraumatic stress disorder (PTSD), depression, traumatic brain injury (TBI), and/or transition stress. The lifetime prevalence of depression and PTSD are five and fifteen times higher respectively when comparing veterans to civilians.
Under the Trump administration, bank mergers are getting approved at a faster rate; The Trump administration faces a pivotal decision that would determine if states can receive exemption from the Medicaid expansion mandate; Trump to sign a compromise for the federal budget funding; Consumer prices remain unchanged in the month of January; The federal deficit falls to $14billion.
Lawmakers announce agreement to avoid government shutdown; A bi-partisan bill was proposed to ban drilling for oil and natural gas in an Alaskan wildlife refuge; A bi-partisan bill was introduced to help attract cyber security experts to the public sector through partnership with private companies; Legislators have launched efforts to repeal the cap on State and Local Tax deductions; Metrics indicate the greatest number of job openings are available now than in 19 years.
Trump administration suggests that it will take steps to ease immigration standards for highly-skilled applicants; Trump to sign an executive order allocating resources to promote artificial intelligence; Congressional efforts to negotiate boarder security funding in anticipation of government shutdown deadline fall through.
With love hopes for federal emissions standards, States have led the initiative to set climate goals; Through an executive order, President Trump looks to ban Chinese telecom equipment; In light of an approaching March 1st deadline, US businesses are pushing for a resolution between US and China; The number of Americans applying for jobless claims retreat from an almost two year high.
Congresswomen Ocasio-Cortex and Senator Markey reveal the “Green New Deal,” a plan that hopes to transition the US to 100% clean energy and create new jobs in technology/infrastructure sectors; Trump administration to roll back lightbulb efficiency rules; House Democrats look to help protect those with pre-existing conditions in light of ACA controversy; Jobless claims fall this week.
When the Affordable Care Act was passed in 2014, it allowed states to expand Medicaid services. One of the states that was impacted by this new measure was California. With other researchers, Wharton Professor Atul Gupta discovered that “…half of the funds that went to California’s Medicaid expansion simply replaced benefits from pre-existing state and county health care programs.” Their discovery challenges whether the expansion of Medicaid services increased the overall health of California’s residents.
During the state of the union address, President Trump focuses on infrastructure; The NHTSA is rescinding an Obama era rule that would require event data recorders in new cars and trucks; Data on the foreign trade gap released Wednesday revealed the trade deficit falls in November; Despite the drop in interest rates, the number of mortgages applications still fall.
Amid the strong correlation between football and head injuries, one of the biggest issues for the National Football League is finding an insurance partner to cover CTE-related symptoms. Penn Law Professor Tom Baker suggests that “When insurance companies do act like regulators, they do it because of the liability. And the bigger the liability, the more they have a potential to earn a return for acting like regulators.”
In light of President Trump’s announcement regarding his inclination to declare a state of national emergency, Senate Republicans warn against the move on political, constitutional, and ideological grounds; State GOP leaders hope to roll back on Medicaid expansions through federal preemption; The manufacturing Purchasing Manager’s Index fall to a four-mouth low; Metrics indicate that the growth of the service sector has slowed.
One of the subjects highlighted at the 2019 World Economic Forum in Davos was workplace productivity. Wharton Professor Adam Grant argues that “[r]educed working hours bolster the quality of labor and creativity”. He also implies that reduced working hours could lead to greater global economic outputs.
EPA adds eight new members to its Science Advisory Board, a move speculated to make the organization more industry friendly; Trump administration reveals policy change that would fine for drug rebates; Trump administration eases on small arms export regulations; Metrics indicate a rise in unemployment; Consumer sentiment drops most likely in light of government shutdown
Trump administration unveils changes to the visa program that promoted entry for skilled workers; House Democrats presents a funding proposal that excludes financing of border wall; Federal courts to hear case on net neutrality; Jobless claims surge to a near 18-month high; New home sales rise in November.
A bi-partisan committee has been tasked with striking a deal for Department of Homeland Security funding; Congress is putting pressure on pharmaceutical industry to face drug price hearings; New EPA regulations provide greater latitude to natural gas producers; Federal Reserve votes to keep rates constant.
Over the past decade, the humanitarian crisis in Venezuela has deteriorated the standard of living in the country. Former president Hugo Chavez and current president Nicolas Maduro have been unable to stimulate a stagnated economy in order to ameliorate living conditions in Venezuela. The United States has imposed sanctions on the country, arguing that they are necessary to restore democracy and human rights. Most recently, on November 1st, 2018, President Trump signed an executive order establishing sanctions on Venezuelan gold. In this article, we provide an analysis of why the US government chose to target gold and present potential alternate solutions to the government’s current approach.
In a discussion on the board practices of the Federal Reserve, Wharton Professor Peter Conti-Brown provides a historical account of the rotational voting system implemented by the Federal bank.
Reports show that the government shutdown has cost a net $3 billion; Congress and the Executive Office explore new ways to permanently end the government shutdown; Trade talks between US and China resume following promising preliminary negotiations; Consumer confidence drops to a 18 month low.
President Trump announces intent to fund border wall via emergency powers if necessary; Trump announces to combat surprise medical bills through legislation; National Labor Relations Board announces new rule making that would qualify fewer employees for federally mandated labor protections; National Activity Index rising.
In a discussion on carbon tax legislation, or lack thereof, Penn Law Professor Cary Coglianese examines the covert ways in which climate change has actually incurred an unfair and often disparate charge on US citizens due to events such as property damage from natural disasters and depreciating air quality following mass fires.
At the World Economic Forum in Davos, Wharton Professor Adam Grant offers his perspective of the “Fourth Industrial Revolution”, which is the ever-growing influence of technology in the workplace. Grant argues that the future working world “requires a new focus on skills” and not necessarily on education. In conjunction with other labor leaders and executives at the conference, Grant implies that organizations have the responsibility of retraining employees to help them prepare for jobs of the future.
The Trump organization will begin returning asylum seekers to Mexico today as a part of a new policy instated last month; CEOs from big banks prepare for hearings from new Financial Services Chairwoman Maxine Waters; White House announces that it intends to end government control over Fannie Mae and Freddie Mac without prior congressional approval; New metrics show that home sales are slowing.
Can HR be agile? Wharton Professor Peter Cappelli dissects this complex question. He contends that it depends on the use of the term”agile”. If the term”agile” is used as an adjective, he argues that it is similar to flexible business operations. Instead, Cappelli implies that one should consider the term “agile” as a noun. He asserts that agile is best defined as efficient business practices. Depending on the organizational structure, he also suggests that agile operations may not be necessary.
Trump administration creates caveat that allows foster-care organizations to refuse placement to same-sex and non-Christian families; Metrics indicate a rise in the number of uninsured; White Houses requests impact report from agency leaders in order to assess potential cost of extending shutdown; Jobless claims return to a 49-year old low; In line with expert predictions, major economic index drops by 0.1%
Despite the shutdown, Senate votes to sustain welfare programs; House passes a bill that would prevent the US from leaving NATO; Senate Finance Committee to hold a hearing regarding drug pricing; In 19 states, unemployment reached record low.
Wharton Professor Peter Cappelli describes the actions of HumanTouch CEO Moe Jafari, who is cutting his pay because of the current government shutdown. Cappelli suggests that Jafari’s noble actions are crucial to form a sound company culture. Besides culture, Cappelli implies that the reputation of an organization is “…through stories and events”.
Senate is unlikely to support a proposal from Trump that requests $5.7 billion in border security funding; Democrats temporarily prioritize Medicare overhaul efforts against universal healthcare campaign policy positions; US home sale prices fall to their lowest levels in three years.
Wharton Professor David Reibstein provides his perspective of the new Gillette ad that challenges one’s understanding of masculinity. He argues that if a company feels passionate about a certain issue, then it should not be afraid of negative publicity. Besides the social and moral aspects of the advertisement, he implies that there may be an economic incentive for Gillette to promote a commercial, which is influenced by the masculine theme.
Legal and Business Ethics professor Peter Conti-Brown is featured in this Knowledge@Wharton podcast regarding the financial risks of the banking industry in the new year. Conti-Brown suggests that “We’re seeing a set of spectacular risk-taking around legal liability that is, and continues to be, very troubling.” Furthermore, he argues that strong financial oversight is needed to prevent another economic collapse.
A proposal from the Trump administration could raise out-of-pocket costs for healthcare costs; Trump attempts to revitalize infrastructure improvement plans; Consumer sentiments drop sharply in January.
In the wake of Teresa May’s catastrophic Brexit defeat, Wharton Professor Mauro Guillen reflects on the lessons to be learned from the ordeal. First, departure from major trade organizations is not only difficult but also often unfavorable especially when geographic proximity compromise Europe-dependent industries that are central to the British economy.
Senate Finance Committee meets to discuss importing foreign drug pricing schemes; White House expands employees classified as “essential” in order to bring more staff to work; Labor market appears to remain strong as Jobless Claims drop unexpectedly; Federal Reserve findings show student debt as barrier for potential home owners.
In this Bloomberg article, Wharton Professor Peter Conti-Brown is featured in the discussion of whether President Trump has the authority to fire Federal Reserve Chair Jerome Powell. Because of the lack of clarity in the United States Constitution, the Federal Reserve has been treated as an organization that “rests on custom and tradition rather than bedrock law.” Henceforth, there has not been any judicial policies enacted regarding the President and the Federal Reserve.
Estimates indicate that the shutdown would cost the economy 0.13% per week, up from previous figures; Led by Chairman Elijah Cummings, House committee begins an investigation into pharmaceutical drug pricing; Acting EPA Chief Wheeler will face a senate confirmation hearing; Import prices fall for the second consecutive month.
In this Knowledge@Wharton Podcast, Wharton Professor David Zaring highlights the impact of the current government shutdown on IPOs. Unlike previous government shutdowns, Zaring indicates that the Securities and Exchange Commission does not have access to funds that would allow the organization to remain in operation. With a closed SEC, Zaring implies that some companies may have to wait for their respective Initial Public Offerings(IPOs). Furthermore, Zaring emphasizes that the government shutdown also negatively affects investors who have placed funds into certain startups.
During the last year, the United States enacted a series of anti-trade measures to reset the U.S. and China relationship. The Chinese have reciprocated with anti-trade measures of their own in an effort to punish the United States. For the United States, the goal of the resulting trade war is to reset China’s trading relationship with the world. However, in the interim, U.S. industries, especially the agriculture industry, are suffering from the loss of their largest export market. How does trade work? What is the history of the U.S. and China trading relationship? What is each nation’s strategy and ultimately, what are the consequences of the trade war?
In a discussion on the US’ labor monopsony problem, Wharton Professor Ioana Marinescu highlights the how mergers can result in increased market concentration which subsequently influences wage stagnation. Read more about her research and recommendations into proposed antitrust efforts here:
House Judiciary demands information on Trump Organization’s Zero Tolerance Policy; Trump organization considering changes to drone usage regulations; Supreme Court dismisses case against the US Consumer Financial Protection Bureau; US Producer Price Index drops by most since 2016.
In this Economist interview, Wharton Professor Kevin Werbach explains the nature of blockchain technology. He argues that its effectiveness is dependent upon the political and social environments of a society. Werbach also indicates that practical regulations are needed for the technology to be innovative.
On August 28th, Ivanka Trump, chief advisor to President Donald Trump, announced the administration’s plans to advance women’s economic empowerment in the “Western hemisphere” after months of explaining the importance of women’s involvement in the workforce and increasing the number of female-business owners. This initiative is in accordance with a global trend of international organizations like the United Nations and World Economic Forum advocating for women’s economic empowerment in both developed and developing countries. A specific focus within this movement is increasing women-owned business involvement in international trade because this presence is good for national growth, societies and ultimately the global economy. These advancements also occur in the United States where women-owned businesses that export provide higher wagers, are 1.2 times more productive, and hire more employees than their male counterparts; meaning that increasing the number of women owned business that export and the number of those exports could at the very least increase middle-class wages and lower unemployment. Yet while the United States maintains its position as one of the best countries for women entrepreneurs, along with Canada and Australia, women-owned businesses still face barriers against entering the export industry.
Physician-assisted death (PAD) entered the national conversation in the 1990s with the highly publicized case of Dr. Jack Kevorkian, a Michigan pathologist, who chose to assist his patient, in the final stages of ALS, in dying. Dr. Kevorkian was ultimately tried and convicted of second-degree murder and delivery of a controlled substance. In 2014, the discussion surrounding PAD emerged again when Brittany Maynard, a 29-year-old with terminal brain cancer, elected to move to Oregon in order to end her life under the state’s Death with Dignity Act (DWDA). Despite almost 30 years passing since PAD entered the national dialogue, it remains a largely unresolved issue in the United States.
Hospital price disclosure rule implemented but met with mixed responses; Despite efforts from the Trump organization to prop up the coal industry, more plants continue to shut down; Federal Judge over rules Trump administration’s rule that allows businesses to opt out of providing contraception on the basis of moral or religious beliefs; Government Shutdown begins to have an effect on economy and growth.
In a recent op-ed, Wharton Professor Eric W. Orts offers an alternative solution to appropriation in the Senate, suggesting the status quo of one-state, two senators needs to be revamped. His suggestion is to, “allocate one seat to each state automatically to preserve federalism, but apportion the rest based on population.”
In a discussion on the promises of 10G cable internet speeds, companies tout the potential uses and need for this technology, but Wharton Professor Keven Werbach questions how its utility will actually be received by the public.
White House explores alternative funding options for border wall such as diprioritization of disaster relief efforts in Puerto Rico, Texas, California, and Florida; Trump tweets a potential path to citizenship for highly skilled visa holders; High level trade negotiations between US and China to begin Jan 30th; Consumer prices fall by 0.1%
In a discussion on the increasing burden of CFO’s to become responsible for natural disasters, Wharton Professor Howard Kunreuther explains how disaster preparedness actually provides significant long term returns for companies
As the partial government shutdown approaches its 14th day, economists estimate a toll of $1.2 billion per week; Senator Sanders and Representative Cummings are set to introduce a new drug pricing bill; Midlevel trade negotiations between US and China continue to suggest promising resolutions; Jobless claims fall by more than anticipated.
Reports indicate that President Trump is still considering to circumvent legislatures and build a wall through an emergency declaration; House Democrats set the ground work to chip away at the GOP tax law; EPA announces intent to complete a new rule to boost higher ethanol blend gasoline; Midlevel negotiations between US and China wrap up, with some indication of productive discussion; Minutes from the FOMC reveal ambiguity towards the need for rate hikes.
Wharton Professor Kevin Werbach is not convinced of Overstock’s actions by paying Ohio state taxes in bitcoin. He indicates that Overstock’s tactic is a “PR-stunt” to make people believe that the state of Ohio is “crypto-currency friendly”. Also, he suggests that paying state taxes in bitcoin provides no benefit to Overstock.
In an letter to investors, Apple points to the Trump administration and the ensuing trade war as the cause of company’s underperformance; Federal court reject’s Trump’s drug cuts; California Governor signs executive order effectively placing drug purchasing under the purview of the state; Though job openings decline in November, they still outpace available labor force.
In light of investigations into former Interior Secretary Ryan Zinke’s conduct, legal experts note the complications raised by a proposed rule from the department that would limit the authority of the Freedom of Information Act. However Penn Law Professor, Cary Coglianese points out how under similar circumstances during the Obama administration, no such actions were honored.
Wharton Professor Olivia Mitchell discusses her research that establishes an inverse correlation between age and patience, where in which, the older people get, the less patient they become. Based on these findings, Professor Mitchell speculates how this could partially explain the lack of preparedness (financial, health related, and otherwise) amongst the older generation and its profound consequences.
US-China trade negotiations are set to begin, with both sides optimistic of a positive resolution; President Trump remains adamant about border wall funding, only potentially compromising on points of composition; As we enter week three of the partial government shutdown, Trump administration attempts to do damage control; Growth in the service sector begins to slow; Housing market sentiments rise with falling mortgage rates.
In a discussion on imminent challenges that face employers in 2019, Wharton Professor Peter Cappelli highlights the need for organizations to update workplace sexual harassment policies based on the various state legislations mandating different requirements.
Sixteen states have appealed a decisions by a Texas judge that ruled the ACA as unconstitutional; Despite threats of veto from the oval office, House Democrats and a few Republicans that have crossed the aisle, have passed a bundle of bills aimed at ending the partial shutdown; Farmers are affected by partial government shutdown due to tariffs and pending loans normally administered by the USDA’s Farm Service Agency; Non-farm payrolls increased by 312,000 jobs in the month of December
Wharton Professor Susan M. Wachter examines new loans that are currently being offered to purchase new homes. Two particular loans that she analyzes are the “interest-only adjustable rate” and “ability to repay loan”. Professor Wachter asserts that not only are these loans risky, but that they are dependent upon the supply and demand of their respective housing markets.
In this PBS article, Wharton Professor Itay Goldstein analyzes the causes of the stock market dive in 2018. To prevent another economic downturn, he asserts that the Federal Reserve must reduce the interest rate cautiously.
Incoming House Dems are planning to make it easier to raise the federal borrowing limit; House Dems passed legislation that ignores Trump’s call for $5 billion for a border wall but would put an end to the partial government down shutdown; Jobless claims increase more than expected; Private sectors adds most jobs in nearly 2 years, ADP report shows.
President Trump hosts a briefing on wall security with top congressional leaders; House Democrats make moves to place data security at the top of their 2018 agenda; December PMI indicates a 15 month low.
In an interview on the Knowledge@Wharton radio show, Professor Alex Rees-Jones contends that there is a relationship between the field of psychology and how people behave towards paying taxes. He proposes that the government adopt cognitive measures, such as offering monetary incentives to combat tax evasion. Furthermore, Rees-Jones implies that if tax payers de-emphasized ’loss aversion’, then tax revenue would increase to help stimulate economic growth in the United States.
In a discussion on key points from a symposium on health services research, Professor Mark V. Pauly was quoted for his comments on the potential and limitation to current research practices.
Wharton Professor Peter-Conti Brown discusses the disagreement between President Trump and Fed Chair Jerome Powell of raising interest rates to stimulate economic investment. Because of their disagreement on interest rates, Conti-Brown examines whether Trump will fire Powell. He indicates that the law is unclear regarding whether President Trump has the authority to remove Powell as Fed Chair, Fed Governor, or from the entire organization.
Though unlikely to pass the senate, House passes a tax package; Government to be shutdown over border wall funding; President moves to restrict food stamp access; GDP growth revised downwards for third quarter; Consumer sentiment rises in the month of December.
Wharton Professor Kevin Werbach joins a Ripple-sponsored panel to offer his insights of the emerging technologies of blockchain and cryptocurrency. He argues that some of the most important questions that need to be answered are what the roles of businesses should have in the technology era, and how can enterprises be certain that financial transactions are completed in a safe manner?
Senators introduce a bipartisan carbon pricing bill; Federal judge strike down a Trump administration policy that prevented asylum seeker fleeing domestic violence or gang violence from entering the country; Jobless claims rise less than expected; Feds increase interest rates for the fourth time this year.
In a discussion on the the Poland Climate Talks, Wharton Professor Eric W. Orts reflects on the need to establish carbon pricing policies to help businesses better anticipate and consider “externalities” in their investments. However, Orts claims that our current economic system does not take into account the externality of carbon and its equivalence being put into the atmosphere.
As Reuters reports, the volume of global mergers and acquisitions during the first quarter of 2018 reached a record-setting $1.2 trillion in value. It’s clear, then, that firms are combining and consolidating market power in ways never seen before. What’s less clear is the proper way to regulate those mergers with an eye towards the public’s interest in competitive markets that facilitate a new entrant’s ability to innovate and grow. Enter the field of antitrust, the political and legal framework employed by regulators to block firms from accruing too much economic power in a particular industry.
Democratic-led states file for clarity regarding a federal judges ruling on the constitutionality of the ACA; Following another round of retaliatory tariffs, the Trump administration offers $4.9billion dollars in aid to US farmers; The second largest oil producer in the US pledges $2 million dollars to back a carbon tax; Homebuilding starts rebound but single family homes continue to drop.
As we approach Saturday evening, seven federal spending bills are the expire and slim chances remain of replacements in light of border wall disputes; Following a Texas Judge ruling that found the ACA as unconstitutional, critics rise from both parties; 24th annual summit of the Conference of Parties negotiating international climate change initiatives concludes in Poland; Homebuilder sentiments fall in December.
This past July, the Advanced Research Projects Agency - Energy, or ARPA-E, launched a $5 million funding opportunity in an effort to research algorithms that can develop the modern grid. ARPA-E is a government agency sponsored by the Department of Energy aimed towards researching energy innovation. The funding opportunity, which sought to tackle power grid optimization and energy efficiency, was released in order to incentivize innovative research and obtain ideas from teams from various sectors.
In light of a troubling study that reveals 75% of its participants drive while preoccupied by their smartphones, a group of Penn Professors and Physicians such as Katherine Milkman and Kevin Volpp hosted a symposium addressed at finding research driven solutions to help resolve the rise in distracted driver related trauma and accidents.
Wharton Real Estate Assistant Professor, Ben Keys contextualizes a speculative move by the Federal Housing Finance Agency to absolve the 30-year mortgage; a move that Keys notes will drive down housing costs, but at a time when the housing market has already started to slow.
As over 10,400 Verizon employees accept buy out deals, Wharton Professor Peter Cappelli notes how the tightening labor market and relatively low unemployment rate encourage those offered such deals to take the money with the confident that they will find new jobs thereafter. This move comes as a corporate effort to help build 5G technology and infrastructure in the states.
Wharton Professor and Fed Historian, Peter Conti-Brown comments on the recent implementation of various initiatives by the Federal Reserve in a time of increased criticism from the Trump Organization. Conti-Brown notes how the moves mark an effort to establish legitimacy and accountability: two integral elements necessary for a well functioning federal bank.
In a discussion on the intersection between fintech and the Federal Reserve, Wharton Professor Richard Herring and Philadelphia Fed Bank President Patrick Harker note how as the face of labor and jobs change, traditional banking and new technology such as fintech must work complementary to one another.
In a co-authored op-ed about the future of the American AI industry and its place in the Global movement, University of Pennsylvania Professor Michael C. Horowitz reflects on some of the variables that have shaped the sector and how a new Congressional committee can help the US bolster private sector activity and reinforce public interest concerns such as military and civilian tech.
Senate works with President Trump to end war in Yemen; Federal Judge absolves $150 million worth of student debt; Overseas banks may benefit from new proposed tax changes; Budget deficit increases to $305 billion; Retail sales rise in light of holiday spending.
In an effort to address ensuing trade tensions between the US and China, Beijing is looking to increase foreign company access; As a result of the public frustration concerning data breaches, Congress looks to establish a new privacy bill; A farm bill approved by the House now makes it way to Trump; Jobless claims return to their downward trend.
The House passes a bill to crack down on drug companies that deliberate exploit the Medicaid program; Trump is poised to sign an executive order that would shift federal funding to oppertunity zones; In an effort to ease tensions, China has pledged to reduce tariffs on US cars and buy more American commodities; Consumer prices remain stable for another month.
In a discussion on the $15 minimum wage as a piece of labor practice policy, Professor Marinescu emphasizes the importance of evaluating the market and the implications of a such a policy in light of contingencies such as monopsony power. As an example, she cites her research showing how concentration of jobs and monopsony power in employers can contribute to macro trends such as wage stagnation.
Congress is anticipated to pass a new farm bill that excludes controversial work-requirements for food stamp recipients; The Trump administration is poised to release a new water protections plan that reduces existing regulations; House GOP released revisions to the end-year tax bill that risk backlash from House democrats; Producer Price Index rises but inflation appears to be slowing.
On April 9, 2018, President Nicolas Maduro declared the Petrocoin as the official tender of Venezuela. Government owned companies were given 120 days to comply with the order, and citizens will be able to pay for taxes, fees, and public services using the new cryptocurrency. In addition, the President declared that special economic zones will be created in which people will be able to use the coin for everyday purposes.
Top Negotiator, Lighthizer announces that America will enforce contested 90-day agreement deadline for US and China trade negotiations; HIV cure studies using fetal tissue impeded by Trump Administration; The parliamentary vote for Brexit postponed by UK Prime Minister May; Compared to last year productivity up by more than 1%; One US inflation index fell slightly in the month of November.
Wharton Professor Kevin Werbach sits down with The Street host Kevin Curran to discuss the impact that blockchain technology could make in the supply chain industry. He indicates that blockchain can lead businesses to trust their respective counterparts and help them run a more efficient operation.
Wharton Professor Peter Conti-Brown offers his insight into the tension between President Trump and Federal Reserve Chairman Jerome Powell. Conti-Brown asserts that the President is using Powell as a scapegoat for the lack of economic progress in the United States.
The Trump administration brings criminal suits against Huawei’s CFO, potentially further rocking US-Chinese relations; The Bureau of Land Management is expected to rollback on animal protections in order to boost oil and gas production; Despite an increase in oil and gas exports, the trade deficit increases; US job growth underperform compared to expert predictions; Consumer sentiment remains steady, thereby outperforming analyst estimates.
EPA to introduce a roll back on coal emissions standards; Lawmakers remain polarized as disputes over funding of Trump’s border wall ensue; Representatives introduce a bipartisan bill to help promote cybersecurity education; Private sector jobs remain strong in the month of November with more than 100,000 new jobs added; Jobless claims fall but remain near a five month high.
Senators introduce a bipartisan drug pricing bill; In an effort to facilitate the construction of new coal plants, EPA plans to roll back environmental legislation; Postal service issues a statement saying that it is considering to raise prices to companies such as Amazon.
This article explains some of the challenges facing manufacturing companies and attempts to show how an increase in apprenticeships may be a viable solution.
Over the past year, the #MeToo movement has sparked an international conversation about the prevalence of sexual assault. It has become clear that sexual violence is an epidemic that no woman is immune to - from Hollywood celebrities and domestic workers to Olympic gymnasts and farmworkers. With the spotlight finally on this pervasive issue, it is important to examine the role of public policy in addressing sexual assault claims and providing reparations to victims.
Trump administration intends to absolve subsidies for electric cars and renewable energy resources; Lawmakers agree on a tentative spending bill that stalls big debates regarding immigration and the border wall; Following the trade truce reached in Buenos Aries, Trump announce a China hard-liner as the new head negotiator; US auto sales outperform expert expectations.
An appreciation for the role of private capital in economic development is not new: the UK’s CDC Group and the International Finance Corporation (IFC) were founded over 50 years ago to channel private sector capital from developed to developing countries. While much emphasis is placed on the role of governments to grow incomes in these countries, the private sector is often the primary growth engine in emerging markets—generating 9 out of 10 jobs. Moreover, official development assistance (ODA) budgets have stagnated. Foreign direct investments (FDI) have now overtaken the volume of ODA by a factor of 5 to 1. And in 2012, for the first time, developing economies absorbed more FDI than their developed counterparts. As a result, during the last 15 years, the role of ODA as the major source of development financing has shifted. ODA has been redefined as a “catalyst” to mobilize additional investments, especially private capital.
Nations make a breakthrough as Trump announces that China has agreed to reduce and remove tariffs on US automobiles; To avoid government shut down, lawmakers negotiate spending bill; Factory activity increases in November; Compared to last months readings, construction spending down.
Historically, private capital in emerging markets has remained scarce. Whether as a result of political uncertainty, alternative opportunities in developed markets, or other matters of this sort, raising funds in such environments has proven difficult. In recent years, emerging markets have exhibited strong growth. From the latter half of Fiscal Year 2016 through Fiscal Year 2017, the world experienced a period of synchronous global economic expansion unparalleled in recent history (with equity markets leading the charge). However, amidst increasing trade concerns, a rising U.S. interest rate environment, and significant currency devaluation in key developing economies (e.g. Thailand, Argentina, and Turkey), emerging markets may be posed to give up recent gains.
Wharton Professor Kevin Werbach argues that “smart contracts” are not the ultimate problem solvers to make businesses more adaptable to the digital age. He contends that society still needs humans and institutions to enforce current regulations. He further indicates that “smart contracts” also lead to other concerns, such as writing effective code and secure transactions.
New NAFTA replacement deal signed; Trump administration loosens coverage requirements by allowing states to apply for waivers to distribute subsidies for beneficiaries that don’t meet ACA requirements; Ways and Means Chairman proposes to eliminate fringe benefits for employees of churches and other nonprofits; Interest rates anticipated to be hiked in December.
It is never too early to start thinking about what you want to do next summer. Some government agencies start their recruiting for summer interns in the fall, while most look for interns later in the winter or early spring. Here are some tips for how to find, apply, and fund a summer internship in DC.
Wharton Professor David Reibstein provides his insight on the controversial Amazon government-issue $2 billion incentive package. Although the incentive package is large, Reibstein asserts that the benefits outweigh the costs. Furthermore, he implies that Amazon’s new locations in the New York City and D.C. areas will provide jobs and help steer the country’s economic growth.
The rapidly growing cost of health care is one of the largest problems in the U.S. today. Since the 1980s, the cost of care has grown at a significantly faster rate relative to the GDP, which has imposed a heavy burden on payers and made access to care more difficult. Although the U.S. spends more dollars per capita on health care than any other OECD country, it is estimated that $.30 to $.40 of every dollar spent on health care is spent on costs associated with misuse, system failures, and inefficiency. In addition to the economic cost, systemic problems in our health care result in the death of more than 250,000 Americans every year. It is clear that our health care system is in deep need of repair. However, if implemented successfully, systems engineering is a tool that may be able to help reduce the cost and increase the efficiency of our broken health care system.
Current federal fiscal policies are cutting public investment in key areas such as education, infrastructure, and scientific research, all the while driving up the level of public debt. This panel event explores the long-term economic implications and propose actions our elected leaders must take to avoid fiscal ruin.
Negotiations on farming bill makes headway in House and Senate; Trump administration attacks Climate Change report as ‘radical’ and not ‘data-driven’; Multinational companies may not enjoy benefits initially anticipated after tax cuts based on new proposed regulations; Jobless claims increase suggesting slowing in labor market; The number of pending housing sales continues to decline.
Wharton and Penn Medicine Professor Mark Pauly offers his insight on the correlation of those who pay a higher deductible and delay medical care. He indicates that the amount of coverage is also a deciding factor in regards to seeing a doctor.
Located on the northeastern corner of Alaska, extending from the state’s northern coast to just south of the Brooks Range mountains, sits 19.3 million acres of what may be one of the most disputed lands in the United States. The Arctic National Wildlife Refuge (ANWR) is currently home to unique wilderness, wildlife, and a predicted 11.80 billion barrels of untouched oil.
Bipartisan carbon tax bill introduced that would charge $15 per ton for carbon emissions; Undocumented immigration reaches a low in 2016; GDP grows by 3.5%
Wharton and Penn Law Professor Herbert Hovenkamp offers his insight into the pending lawsuit of whether the Apple App Store is considered a monopoly. He implies that “…the app developers-are innocent, potentially even victims of the alleged monopoly.” However, he also suggests that the App Store’s parent company Apple Inc is also in a difficult position in the era of electronic consumption of services.
Trump indicates that another round of tariffs on Chinese imports may be on their way; House Republicans present a new tax package for approval; Trump reveals a new proposal to reduce Medicare drug prices by relaxing regulations on mandatory drug for insurance providers; Despite an underperformance by the consumer confidence index, metrics reveal an overall optimism; Though home prices rise, they do so at the slowest rate in months.
Of the twenty most corrupt nations on Transparency International’s list of “most corrupt nations”, ten are located in sub-Saharan Africa alone. As African countries seek to develop and attract foreign investment, Westerners have raised increasing concerns about the prevalence of corruption across the continent and its impact on business. Then-Vice President Joe Biden told a conference of African leaders in 2016 that corruption represents a “cancer” which “not only undermines but prevents the establishment of genuine democratic systems [and] stifles economic growth and scares away investment.”
A report sponsored by Penn Wharton Public Policy Initiative has identified how various deficiencies in the voting technology industry has adversely affected the integrity of the US voting system. Variables such as a lack of capital and competition have stifled innovation within the industry and thus pose a threat to the democratic process.
A report by the US Government reveals the accelerating cost of climate change efforts in the coming century; Congress is again at risk of another partial shutdown due to border wall dispute; The Supreme Court agrees to hear a case regarding an anti-trust suit brought against Apple; The Chicago Economic Index indicates a rise a in the stock market.
University of Pennsylvania Law Professor Cary Coglianese argues about the challenges of practical and fair regulatory practices for individuals. He indicates that it is difficult to be an effective regulator because there are many factors to take into consideration, such as the volatilities of the marketplace and of public opinion. Coglianese implies performance evaluations are one of the many avenues to help regulators navigate the complex marketplace.
In a discussion on the ensuing efforts to mitigate the effects of the recent major California Wildfires, Wharton Professor Howard Kunreuther insists on a focus on not only policy to address the issue, but also increasing community awareness and commitment to the necessary change.
In light of Amazon’s quest to find a second headquarters, Wharton Professor David Reibstein notes how even for the losers of this “competition,” it stands as a reminder that cities can take active steps to attract businesses to their cities by catering towards the framework by which they will be judged.
Various firms across different industries are seeing how “career spillovers” are shaping the composition of their workforce. Older employees are retiring at a slower rate, thereby adversing affecting the younger work forces ability for advancement. Within this tension, Professor Peter Cappelli notes how the frustration it causes for young employees is one of the primary reasons why firms have a difficulty retaining talent.
In light of recent research that indicates that bonds may outperform stocks in the long run, Professor Jeremy Siegel acknowledges that while this could be true, he still cautions against drawing absolutist claims from these observations.
Senators consider actions to address “pension crisis”; New bill to change tax-free exceptions for multimillionaire gifts; Consumer sentiments fall marginally; Jobless claims rise according to this weeks metrics.
Refugee admission has become a focal point of public concern due to the frequent news coverage surrounding border control and the politicization of humanitarian aid. Blamed for burdening the welfare state and threatening national security, refugee admission is challenged by Americans who question the net gains to citizens when resources are extended to foreign nationals in need. While the presence of refugees can have varying effects on political stability, the associated benefits of increased labor, entrepreneurship, and participation in the economy support the argument for border relaxation.
Manufacturers urge FTC to crack down on fraudulent “Made in the USA” tags; Judge rules in favor of asylum seeker’s rights; EPA to “set” biofuel program targets; Housing starts metric rise by 1.5%.
In this Penn Today article, Wharton Professor Howard Kunreuther discusses how to prevent the next wildfire disaster from occurring in the State of California. He argues”We need to figure out ways where the State of California, insurers, utilities, and residents can take steps to reduce these losses in the future.
In May 2018, by 258 in favor and 159 against, the US Congress adopted the Economic Growth, Regulatory Relief, and Consumer Protection Act. This bill represents the most significant change in the Dodd-Frank Act which was adopted after the 2008 financial crisis to protect the economy against future crises. Summarizing first the different waves of financial regulation and deregulation in the US history, this article will analyze this latest bill and its implications.
Agriculture industry suffers due to trade war; Senators take action to protect people from illegal robocalls; Homebuilding demands settle due to rising interest rates and growth in prices.
Wharton Management Professor, Peter Cappelli, provides an insightful analysis on some of the similarities and peculiarities of the tightening American labor market as it relates to the surges that occurred in the 1990’s. Within this discussion, Professor Cappelli explores youth-employment as variable within this larger equation and potential solutions to mitigate its consequences.
As employers have increasingly transitioned away from defined benefit pension plans to 401(k) contribution plans, responsibility for savings rates, investment risk, and annuity have consequently shifted to the employee. Wage stagnation limits an employee’s ability to save for retirement, and persistently low interest rate returns on stocks and bonds limit the investment gains on the money that can be saved. As a result, nearly half of all American families have no money saved for retirement, and, those who do have plans, face disparities based on factors such as income, race, and ethnicity. The transition away from traditional pensions to defined benefit plans, coupled with wage stagnation and persistently low interest, have created new retirement savings challenges which, if not addressed, will have profound implications for long term American financial security.
“Where’s Willie?” I asked. When I learned he was already on an errand, I moved on to Kyle and Ben, but they had been sent out as well. (Note: names have been changed to protect identities). “Okay, I’ll see about the college kids,” I thought apprehensively. It was the Christmas food giveaway at Friends of the Poor in Scranton, PA and I needed volunteers to take a $1000 gift card to the local grocery store and pick up the last components of our food bags. I needed people I could trust and I knew would work diligently and quickly, so I instinctively looked for Willie, Kyle, and Ben.
Ambiguity of the current federal budget plans arise as lawmakers are unsure whether or not President Trump will approve current senate draft; New inflation calculations threaten GOP tax law; Manufacturing output rises.
It is almost impossible to open the news without reading about the intensifying US “Trade Wars.” Unfortunately, the coverage is often more sensationalist than substantive. Regardless of political perspective, the prevalence of sensationalist narratives undermines the ability of citizens and politicians alike to engage in productive discourse regarding the costs and benefits of trade. With the increasingly vitriolic dialogue swirling around the theme of trade and protectionism, it is worth taking a few minutes to review the basic theory underpinning trade policy.
In this Bloomberg article, University of Pennsylvania professor Peter Conti-Brown discusses whether the Federal Reserve has the power to influence financial change in the United States. He indicates that it is more complex than a yes or no answer. Furthermore, he suggests that the Federal Reserve “… can rethink the way it supervises financial institutions or it can change its monetary policy framework.”
Cybersecurity gets a new push in the White House; EU negotiators craft retaliatory measures in light of US auto tariff threats; Labor Market remains strong as Jobless Claims observes only a marginal rise; US retail sales surge due to Hurricane Florence relief efforts.
Following a trend of deregulation advanced by the Trump administration, the Environmental Protection Agency is proposing a change to fuel efficiency standards. In 2012, President Obama established a new fuel efficiency standard that required vehicles to meet roughly 54 miles per gallon by 2025.  The administration stated that such strict rules would decrease about 6 billion tons of greenhouse gas emissions by 2026, and save $1.7 trillion in fuel costs. Further predictions suggested that 12 billion barrels of oil would be saved by the regulations.
The White House sanctions Medicaid waivers for states in order to reallocate more funds for long term issues stemming from the opioid crisis; US security might be at risk due to Chinese tech capabilities says Security Commission; Conflicts amongst Trump administrators regarding trade war; Consumer price index rises.
In this Bloomberg article, University of Pennsylvania Professor Peter Cappelli explores the complex relationship between business and politics regarding Non-Disclosure Agreements. He argues that the main purpose of an N.D.A is to prevent “…behavior that some would consider unethical, or at least unflattering to leaders who otherwise cannot be held accountable.”
This article will discuss the law of copyright, a familiar concept with broad applications for businesses. As the article will explain, copyright law is often less than straightforward; although copyright protections are often wide-ranging, there are several important limits to the scope of these protections. One of these limits involves so-called “useful articles” – creative works that have both creative and functional elements (for instance, an ornately-designed trash can that is displayed as a sculpture in a modern art museum). The concept of useful articles helps to delineate between copyright law – which is intended to protect creative expression – and patent law – which is intended to protect inventions or “functional ideas.” Useful articles contain both creative expression and functional ideas, so these items have an ambiguous status under intellectual property law. Several courts have attempted to clarify this ambiguity, but useful articles doctrine remains a nebulous legal concept. This article will introduce some of the relevant case law in useful articles doctrine, and then discuss the applications of that law on one example of a useful object – a lawyer’s work product.
White House implements new strategy aimed at combating Chinese Intellectual property theft; Privacy Advocates urge legislatures to include certain provisions in new internet privacy law; Trump does not sign an international cybersecurity declaration; Small Business Optimism continues to perform at a historic high.
Prime Minister Hun Sen declared victory in Cambodia’s general election held on July 29; a race he was nearly guaranteed to win. His ruling party, the Cambodian People’s Party (CPP), pledges continued national economic growth, infrastructure projects in rural areas, lower utility prices, and increased access to water and other vital resources. Having led Cambodia since 1985, Prime Minister Hun Sen argues that he has stabilized the country politically and economically, following the rule of the Khmer Rouge and the subsequent Vietnamese invasion of Cambodia, while committing a host of human rights’ violations. Hun Sen has publicly stated his intention to serve for at least two more five-year terms.
Midterms affect Congressional activity as it resumes; Democrat win in the midterms may compromise new NAFTA agreement; The threat of raising interest rates may adversely affect US federal debt.
Social caseworkers often make tough decisions of whether or not to remove children from their homes during investigations of abuse and neglect. However, states also have the option to provide social services, such as parental counseling, substance abuse treatment, and financial aid. Over the past several decades, it has been historically easier for states to access federal aid for their foster care system, rather than for their parental social services.
The United States is experiencing a serious opioid epidemic and addressing this crisis should be a national health priority. In 2016, drug overdoses alone resulted in 63,632 American deaths, 66.4% of which involved prescription opioids, illicit opioids, or both.  This number will most likely continue to climb as the most recently available data shows opioid overdoses to have increased 30 percent from July 2016 through September 2017 in 45 states.  The Centers for Disease Control and Prevention estimates that the total economic cost of prescription opioid misuse in the United States is $78.5 billion a year, including the costs of healthcare, lost productivity, addiction treatment, and criminal justice involvement. [Ibid.] This epidemic began developing in the early 2000s and has now become the largest and fastest growing problem affecting public health, social welfare, and the US economy. The epidemic is characterized by a move from the abuse of legally manufactured prescription opioids to the abuse of illegally manufactured “street” opioids such as heroin and illicitly-made fentanyl.  Evidence suggests that the supply-reduction efforts in the prescription of opioids, the natural tendency of addiction to more potent opioids, as well as a greater supply of cheap illicit opioids have all contributed to this new trend. 
Judge issues a block on Trump administration’s permit for Keystone XL pipeline; FDA approves new non-drug based painkiller options; Consumer sentiments rise; Wholesale prices surge at its fastest rate in 6 years.
Trump to issue a new policy that will force asylum seekers to conduct paper work at the port of entry; Following the Democratic voted majority in the House, legislatures are anticipated to increase oversight of tech regulators; US Jobless claims decline; Federal Reserve decides to keep Interest rates stable.
A carbon tax proposal rejected by voters in Washington State; Democrats gain higher ability and latitude to bolster health care initiative; The number of mortgages taken out falls.
A new bill to revamp American infrastructure might be in the new Congress’ horizon; Trump urges Supreme Court to rule on DACA Program; The Pentagon deploys more troops at the US-Mexico border; Net job openings decrease.
To help meets its production goals of their 737 aircraft, Boeing is enlisting retired employees that posses the skills and knowledge required to meet the company objective. Regarding the recruitment of workers, Professor Peter Cappelli indicates, “Trying to find workers, especially on a temporary basis, who understand the operations and can make contributions immediately is otherwise just about impossible.”
The Bloomberg article, “Private Equity Controls the Gatekeepers of American Democracy ,” takes a critical look at who controls the U.S. election technology industry. Citing “The Business of Voting, Market Structure and Innovation in the Election Technology Industry ,” the article points out that the market is overwhelmingly concentrated. “Congress in 2002 passed the Help America Vote Act and doled out more than $3 billion to states to upgrade machines and train poll workers. Once the funds dried up, the industry began consolidating. Now, the three companies cover about 92 percent of voters, according to research by the Wharton Public Policy Initiative at the University of Pennsylvania.”
Concerns rise regarding American voting security; Trump administration to re-impose sanctions on Iran; Net Neutrality changes ratified by Supreme Court; UK securities exchange down in light of Brexit.
The debate over climate change and what (if anything) should be done about it has plagued the politics of the 21st century. These debates manifest themselves along partisan lines and different economic beliefs. For example, the Paris Climate Agreement has not proven to have lasting effects due to the absence of actionable agreements regarding contribution in funding and guidelines between the participating countries, mostly based on monetary concerns. Another international agreement touching on the subject in a distinct way has been the Trans Pacific Partnership (TPP). The agreement, while rooted as a free trade agenda, acknowledged and laid out guidelines for environmental governance in the public as well as the private sector to break the cycle of government inaction. Unlike its predecessors, the language encouraged governments to develop “voluntary mechanisms” that “are truthful…and take into account scientific and technical information… [and] if applicable…are based on relevant international standards”, however, these notions have not been implemented. Both of these agreements are examples of the relative failure of the current political order in addressing environmental governance.
Trump administration criticizes Democratic efforts to increase the federal minimum wage; Trump announces intent to retain apprehended migrants at the boarder rather than release them into the country for civil proceedings; Labor market observes increase in private sector jobs; Despite indicators of a strong economy, US productivity lags.
In a discussion on the management styles and practices of GE, Wharton Management Professor, Michael Useem, comments how the introduction of an outsider into their program represents a complete departure from historical culture of the organization.
As open-enrollment for the Affordable Care Act approaches, lawmakers wait to see its viability; Wisconsin places workers regulations on its Medicaid programs; Jobless Claims remain low indicating a strong labor force; US productivity rises as companies push production but limit increases in labor.
In a discussion on the GOP Tax Cuts, Wharton Professor of Accounting and Taxation, Jennifer Blouin, defends the claim that if US companies that have outsourced to other countries, return to the US, these gains will offset the current rise in the deficit.
Community success is predicated on the support of education, housing, health, and safety. In other words, to make a community successful, one must look for solutions and programs that create cooperation across a variety of stakeholders. Complex problems originating from multiple sectors can most effectively be solved by using cross-sector collaborations. Ultimately, these cross-sector collaborations and collective impact initiatives can yield better results than isolated impact approaches. The term “Collective Impact” was first coined by John Kania and Mark Kramer in an article published in 2011 in the Stanford Social Innovation Review. Collective impact is defined as “the commitment of a group of important actors from different sectors to a common agenda for solving a specific social problem.” The five conditions for successful collective impact initiatives are: a common agenda, shared measurement systems, mutually reinforcing activities, continuous communication, and backbone support organizations.
Trump indicates intent to limit 14th amendment rights; Justice department takes on a record number of market manipulation cases; Despite America’s withdrawal from the Trans-Pacific Partnership, the agreement goes into effect through Australia’s ratifying vote; Rate of job growth increases.
According to the research of Lee Ohanian and Jesús Fernández-Villaverde, California has undergone an increase in population. A few of the problems related to population increase are the cost and lack of housing. The median home value in California is 150% above the national average($541,800 to $218,000). Additionally, only 30% of California residents are able to afford the state’s median home value. To address California’s housing challenges, Ohanian and Fernández-Villaverde both argue to enact more zoning regulations that migrate people to lower cost of living areas. Also, both Ohanian and Fernández-Villaverde recommend expanding rent control.
In an interview with CNBC, Professor Susan M. Wachter of the Wharton School at the University of Pennsylvania discusses the effects of higher home prices on millennials. She indicates that although the United States is in peak housing supply, mortgage rates and housing prices are constricting demand. She also argues that millennials will continue to drive demand, but that they will want to buy at current prices and mortgage rates.
Since the implementation of the Affordable Health Care Act (ACA), many people who did not have access to health insurance through their employer, or qualify for government programs are now able to receive health coverage. However, what is not taken into consideration is that one has to pay a great sum of money for health insurance before coverage occurs. Additionally, the issues that are now presented for ACA insurance holders are the lack of choices in hospitals, doctors, and non-network medical care. Daniel Polsky, who is an economist at the University of Pennsylvania indicates those that “have the most to lose from having a narrow-network plan are those who have something unexpected happen to them”.
Through an executive order, Trump intends to regulate 14th amendment rights; Treasury Department reveals that national debt is climbing past $1 trillion; Case-Shiller Index indicates a slowing of housing cost gains.
Until the 1990s, multilateral negotiations were the norm when states wanted to lower tariffs in order to improve transnational trade. However, the tense atmosphere and dissatisfaction of developing nations after the end of the Uruguay Round of the World Trade Organization (WTO) in 1994 led to an increase in Preferential Trade Agreements (PTAs). PTAs permit nations to make preferred trade agreements amongst individual nations or regional groups which lower trade barriers such as tariffs and oftentimes decrease non-trade barriers such as labor. As trade liberalization has become increasingly difficult over the years (as exemplified by the last two WTO rounds), PTAs have become much more common and the WTO has become a forum which regulates trade dispute settlements rather than improving free trade. The most recent WTO Round which took place in Doha began in 2001 and its fate is still at a standstill over 17 years later . Doha touches on around twenty aspects of trade and is meant to further lower tariffs and ameliorate the trade concerns of developing countries.  However, countries around the world finished Doha talks after fourteen years due to the fact that developed countries refused to give into the demands of developing countries and vice versa.  During the difficulties of Doha, countries seemed more inclined to participate in PTAs as seen by how 100 out of 200 plus regional and bilateral agreements were formed between countries during the seven years of negotiations before Doha’s suspension and then ultimate demise.  If the sheer volume of these treaties is not convincing enough, their market share is even more astounding as they account for around 60% of world trade (including the European Union).  Although countries now aggressively pursue PTAs as a means of increasing free trade, there is currently broad disagreement over the effects of PTAs on balance-of-trade estimates, multilateral negotiations, and social issues such as the environment and labor practices, in addition to global diplomacy and power relations at large.
Scientists and researchers agree: ocean levels are rising as ice from the polar caps melts. Rising sea levels will affect major cities within the United States in the next half-century, many of which are already struggling with infrastructure problems. Rising tides are expected to put parts of South Florida, New Orleans, and many other metropolitan areas underwater, especially San Francisco. As tides already brush up against roads and freeways in the region, Bay Area infrastructure is prone to flooding, with two major arteries experiencing seasonal flooding: California State Route 37 (SR 37) in the North Bay between Vallejo and Sonoma County, and Interstate 80 in the East Bay north of Berkeley. Furthermore, San Francisco International Airport, surrounding areas in San Mateo County and Treasure Island are at risk.
The United States is on the cusp of a technological revolution. Innovation within our borders is accelerating at a break-neck pace, and companies are about to roll out a myriad of new tech over the next decade. Research and development in artificial intelligence, autonomous vehicles, drones, and fully-automated assembly lines have the potential to boost the productivity of the United States, improve the quality of living for countless Americans, and fundamentally change the way the global economy functions. However, this economic change will also fundamentally restructure our labor markets.
In light of ensuring court trails, California delays net neutrality enforcement; Leading GOP Lawmaker indicates that middle class tax cut most likely to be upheld until 2019; Metrics indicate a surge in personal consumption expenditures.
Two representatives from the Partnership for Public Service, a nonprofit, nonpartisan organization based in Washington DC, shared their expertise with Penn students to help prepare them for applying for government internships and jobs. The Partnership strives to revitalize the federal government by transforming the way government works and inspiring a new generation to serve.
Accreditation provides a vital role in allocating federal student aid to postsecondary institutions of higher education (IHEs). As gatekeepers of the Higher Education Act’s (HEA) Title IV funds, accrediting agencies are expected to be “reliable authorities on the quality of education being offered.” For this reason, the United States Department of Education’s (ED) use of accreditation facilitates its decision-making on which IHEs receive funds. However, with more than $14 trillion in outstanding federal student loan debt, the accreditation process has come under scrutiny.
The Patriotic Millionaires are a group of 200+ high-net-worth individuals who focus on promoting public policy solutions that encourage political equality, guarantee a sustaining wage for working Americans, and ensure that the wealthiest individuals and corporations pay their fair share of taxes. On October 23rd, Tuesday, Penn Wharton Public Policy Initiative hosted Morris Pearl, Chair of the Patriotic Millionaires, and Erica Payne, Democratic strategist and President of the Patriotic Millionaires.
In what was supposed to be one of the largest acquisitions of all time, Broadcom tried to purchase rival tech company, Qualcomm in a $117 billion transaction. The deal would have consolidated the already-small chip making industry and helped Singapore-based Broadcom to challenge Intel more easily. However, this merger fell through when the Trump administration stepped in and blocked the deal. Interestingly, instead of stopping the transaction under the auspices of anti-trust issues, the White House claimed that it posed a grave danger to “national security.”  
Trump reveals new plan to lower Medicare costs; In anticipation of “migrant caravan” Trump considers shutting down southern border; US GDP grows; Metrics show that consumer sentiments fall.
In the wake of the financial crisis, G20 Leaders gathered in Pittsburgh in 2009 with two chief goals: stabilize the global economy and begin the work of preventing future crises. Because attendees knew that improving derivatives regulation was essential to accomplishing those goals, they provided a blueprint for reform at the summit’s close focused on four key aspects of derivatives markets: trading, clearing, reporting, and capital requirements. That blueprint influenced a range of post-crisis laws that made global markets more stable and transparent. But there is still work to do. Regulators now must focus on fine-tuning reforms, particularly by (i) remaining watchful for new, emerging risks, and (ii) preserving systems of cooperation and recognition so that global regulators can work together to safeguard interconnected financial markets.
Trump administration refuses to continue trade negotiations without a concrete proposal from China; White House passes bill addressed at tackling opioid crisis; Jobless claims rise, but labor market remains robust.
Despite critiques, Puerto Rican Financial oversight board approve fiscal reform plan; In the interest of consumer data, experts call for expanded role of FCC to protect consumer data; The sale of new single family homes continues to decline; House price index up 0.3% in August.
Through 5,000 community based organizations, the Meals on Wheels America program delivers over 1 million meals every day, reaching over 2 million individuals each year. Through the work of 2 million staff members and volunteers, seniors who are homebound are able to receive meals they may not have had access to previously. While donations are accepted, Meals on Wheels does not require its recipients to pay for meals and therefore requires funding to maintain its services. In addition to meals, staff and volunteers help provide social interaction, conduct safety checks, and “keep(ing) Seniors home, where they want to be.”
States can now offer less comprehensive health plans and still qualify for federal funding; Automated school bus ordered to halt live operations; White House intends to lift an Obama-era prohibition on allowing more companies to provide health reimbursement arrangements.
The collapse of Rana Plaza, killing more than 1,100 garment workers in Dakha, Bangladesh in April 2013, brought attention to the dire working conditions of the Bangladeshi people. Bangladesh’s textile industry is the 2nd largest in the world, with annual export earnings upwards of $28 billion in 2016 yet in contrast, the workers have the lowest wages of the garment manufacturing countries. An estimated 31% of its population lives below the national poverty line, which is defined as $2 per day. A report by Oxfam showed that “a top fashion industry CEO earned in four days the lifetime pay of a factory worker.” Ultimately, the fashion industry relies on cheap labor, quick turnaround time, and export oriented industrialization and those brands which exploit the working conditions for these reasons in Bangladesh include, but are not limited to: Hugo Boss, GAP, Zara, and H&M. This article will demonstrate how the responsibility to ensure improved working conditions in countries such as Bangladesh is at the intersection between private, public, and consumer based initiatives.
In this Equitable Growth interview, Professors Ioana Marinescu and Herbert Hovenkamp discuss how new antitrust policies can solve the issue of decreasing wages from anticompetitive mergers. Both Marinescu’s and Hovenkamp’s unique perspectives allow the reader to understand the economic, social, and legal complexities of this particular economic issue.
Transgender protections in danger as HHS anticipated to announce new law; White House hosts event to attract tech talent for public sector; National Activity Index declines, indicating inflation concerns.
Treasury Department releases new tax incentives in distressed sectors for investors; Trump Administration bemoan maritime emissions regulations; Home sales drop by 3.4%.
Present Trump threatens military action against Mexico over immigration disputes; Trump issues 5% budget cuts from cabinet members; After Hurricane spike, jobless claims decrease again; Leading indicators suggest a robust US economy.
Reading the temperature on a mercury thermometer. Understanding product reviews. Navigating online job search sites. These all seem simple enough, but many U.S. adults struggle to complete daily tasks such as these. Results from the Program for the International Assessment of Adult Competencies (PIAAC), a multi-country survey of adults conducted by the Organization for Economic Cooperation and Development (OECD), showed that large shares of the U.S. population lacked proficiency in a range of core competencies including literacy, numeracy, and problem-solving.
More than 70% of Americans are concerned that artificial intelligence will lead to “robots taking over.”  Fears that AI machines will replace the human workforce or that robots will develop superintelligence and rebel are propagated throughout the media and pop culture. Even Stephen Hawking and Elon Musk have warned that artificial intelligence could “spell the end of the human race” and is “our biggest existential threat.”  Musk has even suggested that “there should be some regulatory oversight, maybe at the national and international level, just to make sure that we don’t do something very foolish.” 
The rapid increase in the amount of recorded data has given governments access to more personal information than ever before. While governments receive an unprecedented amount of information, this does not necessarily make the regulation or supervision of this data any easier. Therefore, it is becoming ever more important to analyze and synthesize these large amounts of data in order to improve the government’s regulation and supervision. In light of this need, governments have begun to implement machine learning and big data analytics in order to help analyze all the incoming data and extract valuable insights.
Among those both knowledgeable and ignorant of the challenges facing federal bureaucracy, one popular prescription for the ills of government is holistic reorganization. Yet, more often than not, precedent reveals how ideas of big government reform are rooted in partisan ideologies that lack transparent workforce planning, constructive stakeholder consultation, and rigorous outcomes-based analysis. For example, which government reorganization strategies will promote the greatest reduction in operational costs? Will significant adjustments in federal office or agency structuring produce a more efficient professional environment for the federal workforce? And, maybe most importantly, do major process reforms truly create a more effective and responsive public institution?
Interior Secretary approves selective state participation in offshore drilling expansion; Banks contest new regulations on accounting practices; Housing sales fall; Federal Reserve anticipated to continue interest rate hikes.
On July 5th, the United States placed tariffs against $34 billion worth of Chinese goods. To many pundits, this was yet another sign of the worsening trade war between the United States and China. However, the latest strife is only part of a larger web of trade disputes involving the United States and the rest of the world. Since imposing a wide reaching 25% tariff on steel and 10% tariff on aluminum, the US has been engaged in a multi-front trade war with adversaries and allies alike. Although similar to previous trade disputes, these latest tariffs are both economically and legally unique, thereby meriting additional analysis. This article explains how the latest trade restrictions threaten not only years of US trade policy but also the country’s international economic and diplomatic standing.
President Trump argues that family separation is an effective illegal immigration deterrent; A group of vulnerable house GOP members present a bill that protects patients against discrimination; Retail sales rise, but only marginally.
In a conversation regarding the legal authority of the Federal Reserve Bank of New York and its capacity to limit companies from opening master accounts, Wharton Professor Peter Conti-Brown argues that he unconvinced that the Fed holds this legal right.
Experts notice a trend of deregulation under Trump Administration; Trump bans drug pricing activities that hurt consumers; Jobless claims increase; US Consumer Price Index rises slightly; Wall Street’s key indexes continued to take a hit on Thursday in light of selloffs.
From 1996 to 2013, United States health care spending increased by $933.5 billion, driven largely by increases in the intensity and price of care. In 2016 alone, the United States spent $3.3 trillion or 17.9% of our GDP on health care. In response, the Affordable Care Act (ACA) aimed to curb the rise in health care spending by instituting cost control policies. These measures were designed to eliminate waste, improve efficiency, and rein in overutilization. A central part of this reform was the development of Accountable Care Organizations (ACOs), which hold groups of providers collectively responsible for the overall cost and quality of care for a defined patient population.
Democratic efforts to halt the expansion of short term health plans curtailed; Central Bank rate increases criticized by Trump; Producer prices increased in September.
EPA halt transition to new Energy Star metrics due to concerns from landlords; Trump salvages a win for farmers as 15% ethanol gasoline is now to be available year round; Trump dissents despite unprecedented climate change predictions from UN; Small business optimism drops.
The make-up of the United States electricity generation portfolio has transformed over the past decade. In 2008, coal provided 48% of the nation’s electricity supply, but this figure dropped to 30.1% in 2017.  Natural gas extraction has become increasingly economical through hydraulic fracturing, thereby shifting the domestic demand for cheap energy away from coal. With less domestic demand from coal-fired power plants, coal mining operations have had to search for new markets to export their product.
Paper reports reveal that FEMA has spent billions on disaster relief services; UN Climate Panel publishes alarming report on the status of global climate change.
Bipartisan bill addressing critical aspects of the opioid crisis passed by Senate; Senate passes new bill to better compete with China’s growing foreign influence and investments; Civilian cybersecurity responsibilities now centralized at Department of Homeland Security; Jobless claims drop to record low; Chairman of the Federal Reserves claims that the American economy may be entering a period of economic stability for the foreseeable future.
US considers deregulating autonomous vehicle performance standards; Interior Department stiffens standards on the application of research; Unemployment hits record lows; Due to surges in the economy, trade deficit rises.
Wharton Professor Mark V. Pauly and University of Illinois at Chicago School of Public Health Professor Anthony LoSasso discuss in a joint-session the reclassification risk in small -group health insurance markets. LoSasso’s research indicates that the market protects against reclassification risk via guaranteed renewal. Pauly discusses the policy implications of LoSasso’s findings. Professor Pauly proposes various ideas to combat the issue of reclassification risk. One of his ideas is proposing an individual mandate that contains guaranteed renewal-like features for covered persons.
In this New York Times Article, Wharton Professor John Paul MacDuffie argues that no other auto manufacturer “…has achieved the impact on the public’s imagination, brand loyalty or sales success of Tesla.” MacDuffie suggests that although Tesla has had issues in relation to production of electric cars, it has not persuaded people to surrender their loyalty to the organization. Furthermore, MacDuffie indicates that the strong customer base for Tesla is attributed to its “…value chain from product conception through delivery to customers is carried out by the company itself…”In addition to their brand loyalty and in-house management structure, MacDuffie implies that one of Tesla’s unique propositions is its “…ability to update vehicle functionality via over- the- air software updates;…” Their public reputation, in house-management structure, and ability to adapt are what MacDuffie believes will make Tesla a big player in the electric car business.
Study suggests that firms are more likely to spend tax law gains in training rather than salary increases; Survey finds that US military relies on foreign procurement of critical supplies; US payroll increases more than anticipated; US crude prices surge due to Iranian tariffs.
With accelerated innovation in the biopharmaceutical industry, drug prices have soared faster than anticipated and drawn national attention to individual cases of fraud. Affordability has dropped in the wake of declining accountability and transparency. Since taking office, President Trump has said one of his biggest priorities is to reduce the price of prescription drugs and claims that the reform of the 340B Drug Discount program will be one of the ways to do so. However, the program and its effect on drug prices is currently one of the most controversial issues in health care.
In an effort to promote the innovation of communications technology in the US, the FCC plans to minimize airwave traffic; The new MCA agreement shows the success of Trump’s cut throat negotiation tactics; US crude prices continue to rise in light of trade disputes and market uncertainties.
In the 18th Century, only about 14% percent of the world’s population lived in urban areas. Today, however, more than half the planet’s population resides in cities. With the continuing economic migration from semi urban and rural areas, cities are bursting at the seams with the growing demand for services and basic civic amenities. New technologies like AI, IoT, Cloud, Robotics, and Big Data Analytics may be a solution for cities by offering offering them an opportunity to become ‘smarter’, more cost effective and efficient.
Modern economies, and their dependent societies, have become incredibly dependent on the production of large-scale and reliable power. Large-scale and reliable power sources contribute to a resilient grid, which is necessary to stave off both natural and human-caused incidents that could restrict availability of electricity to a nation and threaten national security. Due to the demand placed on energy grids, power sources must be economically viable, safe, and approved by the public. Because of the threat posed by global warming, however, power sources must also be clean. To date, no power source meets all these criteria. Coal is economically viable and can produce large-scale, reliable power but is neither clean nor safe and is not favored by the public.   Natural gas is economically viable and can produce large-scale power, but it is not reliable, favored by the public, nor clean, and is only safe relative to coal.   
The U.S. and Canada reach a last-minute resolution to a revised North American Free Trade Agreement; US Attorney General sues the state of California over net neutrality legislation; Manufacturing and construction levels decline in the month of August.
Is the global financial system more secure since the crash of 2008? Professor Richard J. Herring indicates that because of new regulations, banks are less prone to experience another collapse. He argues “Most of the reforms have aimed at reducing the vulnerability of banks…. Equally important, however, are the reforms aimed at enabling the authorities to deal with a bank insolvency without imperiling the financial system.” Herring also compares the effects of the global financial crash in other markets, such as the European Union. He contends “…the fundamental problem [the Europeans] faced is that they lacked the important back-up of a facility comparable to TARP. They lacked financial resources to recapitalize banks that were inadequately capitalized…”
Professor Katherine L. Milkman offers her perspective of incentivizing people to lower their life insurance premiums through data sharing. She asserts: “For an insurer, you’re going to get healthier people — that’s why they’re going to give you all their data,…The unhealthy ones are going to go to other insurers:…” Milkman suggests that data sharing provides insurance companies with security when deciding to insure a specific individual or group. Also, she contends that the use of data may be a solution to help motivate others to become healthier individuals. Furthermore, she implies that the use of data will play a more prominent role in the life insurance industry.
EPA eliminates department designed to conduct climate change research and advisory work; Tax bill passed by House that make individual cuts permanent; Consumer spending rises; Consumer confidence index sky rockets to triple digit readings.
In challenging the notion of Lehman Brothers causing the 2008 financial crisis, Professor David Arthur Skeel contends that they were not the main culprits. Professor Skeel puts forth a step-by-step analysis of why Lehman’s demise was not the sole event that caused this major financial event in American history. He argues “Almost exactly six months before Lehman, another major investment bank, Bear Stearns, collapsed in similar fashion. Regulators’ handling of Bear Stearns’ distress set the stage for everything that followed.” In this quote, Skeel indicates that we must look pre-Lehman for the troubling signs of the impending financial collapse.
Ethan Mollick, who is an Associate Professor at the Wharton School of the University of Pennsylvania, informs the reader about the uses of crowdfunding. He states crowdfunding is “a variety of different efforts by entrepreneurs—cultural, social, and for-profit—to fund their efforts by drawing on relatively small contributions from a relatively large number of individuals using the internet.” In this quote, Mollick contends that crowdfunding is one of the many revolutionary manners on how startups can be funded. Additionally, he suggests that its diverse use provides people a means to connect with their respective investors on a more personal level.
Lawmakers face a difficult task deciding how to regulate data monetization practices; In the latest development in crumbling NAFTA agreement, President Trump refused to meet with Prime Minister Justin Trudeau; GDP rises to the highest level in nearly four years; Jobless claims increase, but economists say the labor market remains tight and robust.
Since the Great Recession in 2008, the federal government has taken conservatorship of two major home mortgage providers, Freddie Mac and Fannie Mae. In order to reestablish market stability, these two firms were converted from wholly private entities into government-sponsored enterprises (GSEs) under the conservatorship of the Federal Housing Administration (FHA). In return for being under public stewardship, the GSEs are required to make annual contributions to the Housing Trust Fund and Capital Magnet Fund to support FHA activities and offset costs for things like affordable housing mandates.
Regulators seek to reform law that would impact how banks bring capital to low income communities; Congress approves bill that address opioid epidemic; After two months of decline, US family home sales rise; The Federal Reserve increase interest rates.
Co-director of the Wharton Risk Management and Decision Process Center, Howard Kunreuther’s research was cited in an article attempting to answer the question of whether or not increased news exposure to disaster will help people become more prepared for them. His work outlines the reasons why people neglect to prepare disaster.
In a discussion on a controversial argument to target Amazon with anti-trust regulations for its anticompetitive practices, Professor of Law, Herbert Hovenkamp, argues that this type of action would be socially and economically regressive for America.
Professor John MacDonald and his research partner, Professor Charles Branas of Columbia University, are featured in a New Yorker article about “broken window” policing for their research on the intersection between abandoned properties and the prevalence of gun violence. They found that remediation in abandoned and vacant properties can tangibly reduce the the rate of gun violence in a given area.
In light of threats by Whole Food employees to unionize against Amazon, Peter Cappelli points out that “employers are very effective at keeping them out. One way they do that is that they don’t have a lot of full-time employees. It’s difficult to get part-time employees to organize. They have a high turnover, so people don’t stay long enough to invest in starting a union.”
In a discussion on the status of US pension programs and the problems affecting its viability, Professor Olivia Mitchell claims “Globally, pension funds have been investing less and less in equities and bonds and investing more in so-called other alternatives: private equity, infrastructure, emerging markets… That’s really a search for higher returns, and that also comes with higher risk.”
In an address to the UN, Trump calls for international trade reforms; Trump signs a new trade deal with South Korea; US Consumer Confidence rose; The rate at which home prices have risen, slows.
California seeks to challenge federal action that would freeze emissions standards in 2019; The Medicaid work reporting requirement of some states pose a threat to some ill-informed and vulnerable patients; Global crude prices reach a four year high at $80 a barrel.
Through an economic analysis of the Turkish lira crisis, Professor of Finance Joao Gomes, argues that fears of widespread contagion are unfounded. Gomes claims that even countries that have made the biggest investments in Turkish banks such as Italy and Spain are not at risk of a similar collapse. The professor does, however, points out the role of populism and short-sighted economic practices that have led to the devaluation of the lira. Ultimately, Gomes claims that Turkey is at the mercy of international creditors and only time will tell how their currency crisis will be resolved.
In a candid conversation about the actual cost saving effects of M&A’s, Assistant Professor of Health Care Management at The Wharton School Ashley Swanson, claims that these figures are dependent on “geographically local efficiencies in price negotiations for high-tech physician preference items.”
In a discussion on the relationship between college majors and professional ambitions, Peter Cappelli, the Professor of Management at The Wharton School, notes how the implementation of new hiring software has changed the paradigm of employment, but not always in the best ways.
In a discussion on the corporate lessons to be learned from hurricanes and climate change, Co-director of the Wharton Risk Management and Decision Process Center, Howard Kunreuther claims that executives are often very good at short term problem resolution and risk assessments.
With the fate of the Public Service Loan Forgiveness Program still uncertain, Professor of Medicine and Medical Ethics and Health Policy, David A. Asch MD, claims that there justifiable reasons for both preserving and changing the it entirely.
Robert P. Inman is the Richard King Mellon Professor of Finance and Economics at the Wharton School of the University of Pennsylvania. He received is undergraduate and graduate training in economics at Harvard University. In addition to his appointment as a Professor at the Wharton School, he currently serves as a Research Associate of the National Bureau of Economic Research, Cambridge, MA. He is an Associate Editor of the professional journal Regional Science and Urban Economics. He is the editor of three books, The Economics of Public Services (Macmillan Publishing), Managing the Service Economy (Cambridge University Press), and Making Cities Work: Prospects and Policies for Urban America (Princeton University Press). His research focuses on the design and impact of fiscal policies with an emphasis on fiscal federalism.
US Attorney General limits judges’ capacity to terminate deportation cases; Retiring congressman Darrell Issa of California named the head of the US Trade and Development Agency; The number of Americans applying for unemployment benefits in September has reached a 49 year low; Home Sales remain constant in August.
According to a July 2016 report by the Drug Enforcement Agency (DEA), fentanyl contamination of counterfeit drugs has become a global threat. While virtually all pharmaceutical medications and medical products can be found either diverted, adulterated or completely falsified on the black market, in recent years counterfeit opioids containing the extremely potent substance fentanyl have emerged as an incredibly dangerous threat affecting United States consumers.
China announces tariffs on $60 billion worth of US goods in response to American action; Senate pass a short term spending bill designed to last until November; Minority voice in SEC urges for more oversight; US Housing Starts increase marginally.
Trump Administration place tariffs on an additional $200 billion worth of Chinese goods; Senate passes legislation designed to help combat Opioid Crisis; Trump shrinks refugee cap to 30,000; Homebuilder’s sentiments remains constant.
Trade tensions rise between the US and China as the Trump administration looks to unveil $200 billion worth of tariffs on Chinese goods; California awaits the signature of Governor Brown on a landmark bill addressing cybersecurity for physical and internet-connected devices; For the third month in a row, Industrial production is up; Analysts claim that developed nations’ economies have observed 2.5% growth in wages.
The opioid crisis is one of the most recognizable domestic issues of contemporary America. Deaths attributed to drug overdoses have steadily risen over the last decade, and reached roughly 64,000 in 2016, a figure greater than the total number of Americans who died in the entirety of the Vietnam war.  This makes drug overdoses the leading cause of death for Americans below age 50, and about two thirds of these deaths were due to opioids. 
Men and women are not represented equally in the workforce. Despite being 50% of the population, women comprise only 39.2% of the total global labor force. While a few outliers, such as Rwanda, see equal representation, most countries do not. The MENA region, or Middle East and North Africa, sees the greatest discrepancy, with women on average representing only around 20.5% of the workforce. In most of these countries, political and social norms, as well as actual laws, keep women out of the workforce. However, studies have shown societal and economic benefits of female participation in the workforce. In light of this, to increase female participation in the labor force, it is crucial to expand female access to education across the globe.
National Labor Relations Board to propose a rule that limits joint employer regulations; The GOP has advanced a proposal to extend the individual tax cuts; US import prices fall the great margin in almost two years; Retail gains decline.
Trump administration offers to resume trade negotiations with China; The newest development in Trump’s immigration policy includes paying Mexico for deportation services; Senate passes new budget plan; US jobless claims continue to drop indicating a robust US economy; Consumer Price Index indicates a rise; Economists ponder why despite income increases, wages have remained stagnant.
The CBO announces sky-high deficit figure; The Food and Drug Administration (FDA) to regulate the manufacturing of e-cigarettes; US business prices fall in August; Household incomes rose 1.8%.
The Environmental Protection Agency is planning to present a proposal to weaken Obama-era regulations on Methane; Congress reveals a three-part $147 billion dollar spending bill titled, “Minibus” that they hope to send to President Trump by the end of the week; GOP announces new plan for tax cuts; The Small Business Optimism Index rises.
GOP debate a second round of tax cuts in anticipation of the midterm elections; To avoid a government shutdown, Congress is expected to release a comprehensive budget deal; Oil industry remains highly volatile, keeping investors on their toes; With strong wage gains have come investor concerns for rising inflation.
Public outcry at the high price of prescription drugs has reached a fever pitch. Our national focus on prescription drug costs concentrates on eye-popping, seemingly random price increases on essential drugs, and the stories reporters tell outline a simplistic “villain/victim” narrative with evil drug company executives like Martin Shkreli on one side and hapless, ill consumers on the other. One such example is the public outcry from when manufacturers tripled the price of insulin in just over a decade. While these prices frighten consumers, insurers and providers alike, pharmaceutical companies argue that they do not reflect net prices of drugs after rebates, which are harder to find and vary from payer to payer. They further argue that high prescription drug costs are necessary to finance continued innovation. One thing is certain: US prescription drug spending in dollars per capita outpaces every other OECD country, with US consumers spending roughly triple their European counterparts. 
In an effort to detain immigrant children and parents together, the Trump administration seeks to restructure migrant children detention policy; Senate comes to an agreement for a package of legislation designed to address the opioid epidemic; Economy observes job growth and wage increases.
For nearly 75 years, the Serviceman’s Readjustment Act of 1944, more commonly known as the GI Bill, has provided grants for veterans to attend college or a vocational school and take out low-interest loans to start their own businesses. However, modernization has been made to the GI Bill, with the Post-9/11 Veterans Educational Assistance Act of 2008—known as the Post-9/11 GI Bill—and the Harry W. Colmery Veterans Educational Assistance Act of 2017, or the Forever GI Bill to allow the program to adapt to the 21st Century. These two modern bills have created more opportunities for veterans to continue their education after they finish their military service, allowing more students to attend higher education programs.
Homelessness is commonly attributed to mental health and substance abuse issues. However, when one looks more closely, these factors only play a small role in the overall number of experiences with homelessness. In truth, many broader economic forces create situations of poverty and housing insecurity for many Americans.
White House challenges wage stagnation; Trump threatens a shutdown to get congressional funding; Top Tier schools may not be the most economically promising track; Job growth declines, but economy stays strong; Jobless claims decline.
On July 6, 2018, the Trump administration implemented tariffs on $34 billion of imported goods from China, with a tax on another $16 billion to follow. President Trump claimed that the latest defensive trade measure since March of this year was necessary to lessen the trade deficit with China and combat the theft of U.S. intellectual property. China has responded in kind with equivalent taxes on $34 billion of U.S. goods. Actions from both sides may indicate the beginnings of a trade war of attrition. What are the implications for U.S. industry?
Lawmakers are set to launch a series of hearings with the tech industry, beginning with a meeting before the Senate Intelligence Committee on Wednesday.
The Securities and Exchange Commission wants to make it easier for individuals to invest in private companies.
The U.S.-Mexico trade deal may face trouble in the U.S. Congress, especially if Canada is not convinced to join.
Professor Gomes expertise is in the areas of macroeconomics and financial markets. His recent research covers the determinants of the corporate investment and financing decisions of firms and the links to movements in financial markets, and to monetary and fiscal policies. He has also examined the role of financial leverage in determining the cost of capital, the causes of performance variation across asset classes, and the quantitative importance of financial market imperfections on corporate decisions and economic cycles.
After yesterday’s announcement of a preliminary agreement addressing automotive trade policy with Mexico, the focus now turns to trade with Canada.
Due to the timing of President Trump’s tentative trade deal with Mexico, the fate of the bill itself could be in the hands of congressional Democrats; In an amicus curiae brief, sixteen US states, including 13 attorneys general and three GOP governors, are asking the Supreme Court to limit protections for LGBTQ workers; According to the Case-Shiller home price index, while housing prices are not declining, they are in fact decelerating.
US and Mexico strike a preliminary trade deal; As concerns of global growth rise, price of crude oil follows suit; Starter home prices reach their highest levels since 2008.
Senate decisively vote to pass a large spending bill with a focus on domestic programs; The Treasury Department released new rules to crack down on blue states’ efforts to abuse charitable giving deductions; Federal Reserve chair Jerome Powell indicated that strong economic conditions continues to support the case for gradual rate hikes; Durable goods orders fall.
Japan’s trade minister suggests possible retaliation against Trump’s auto tariffs; In a 13 to 12 vote, President Trump’s Consumer Financial Protection Bureau nominee, Kathy Kraninger, just barely receives senatorial approval; Jobless claims observe a marginal fall; The Manufacturing PMI, an index that ranks US manufacturing and service oriented companies, showed slower growth in the August.
Since the passage of the Organic Foods Production Act of 1990 (OFPA), the U.S. Department of Agriculture (USDA) has had the authority to promulgate regulations that certify certain food production as ‘organic.’ These regulations were meant to make sure that organic farms wishing to certify their products as organic “must demonstrate that they are protecting natural resources, conserving biodiversity, and using only approved substances.” As of 2016, over 5 million acres of farmland are certified organic by the USDA (about equally split between rangeland and crop land). Furthermore, Organic product sales topped $49 billion in 2017. Even though the amount of organic farmland is still less than 1% of total farm acreage in the U.S. (>900 million), organic products represent over 12% of the market value of agricultural products. Over the last 28 years, USDA organic certification has not only changed farming practices, but it has also greatly affected consumer habits, subsequent regulation, and even, questionably, consumer health.
EPA reveals the Affordable Clean Energy (ACE) rule designed to replace former President Obama’s Clean Power Plan regulations with new restrictions on coal-fired power plants; Senator Rand Paul (R-Ky) introduced a new amendment that would prohibit federal funding to organizations that offer abortion services such as Planned Parenthood; Wall Street observes upticks across a variety of major benchmarks as US stock continues to be traded at a high level.
Stock markets were rattled by President Donald Trump’s March announcement of the implementation of tariffs on the importation of steel and aluminum, even including our closest allies of the European Union, Canada, and Mexico. In the week leading up to the news, Canada and the United States were approaching a trade deal before Vice President Mike Pence called Canadian Prime Minister Justin Trudeau and demanded a sunset clause on the agreement. While these types of deals are meant to create certainty for businesses and economies, the expiration dates imposed by a sunset clause would significantly undercut this stability, and Prime Minister Trudeau refused to sign onto the agreement with VP Pence’s demands. Similarly, the European Union had sought a limited trade deal, but President Trump’s investigation into automobile imports worried negotiators, especially Germany for whom cars are a major export.
Drug rebates come under fire as drug companies claim pharmacy benefit mangers force companies to charge high prices and promise higher absolute rebate; As trade fears settle, US crude rises; Government debt yields fell Monday ahead of the Fed’s annual symposium.
With orders from President Trump, the SEC will begin a study on the effects of reducing the frequency of submitted financial reports; DC Court clears the way for Obama-era EPA chemical plant safety rule; Record low youth unemployment metrics suggest strong labor participation; Consumer sentiment was at 95.3 this month, the lowest levels since September 2017.
Banks spoke out against the Trump administration’s plan to ease the Volcker rule, a post crisis restriction that bars banks from speculative trading with bank-owned funds; China breaks silence and announces intent to restart trade negations with America; President Trump relaxes rules on the U.S. government’s use of cyberweapons against adversaries; For the second consecutive week, jobless claims decrease; the slowdown continues as construction of new homes increased by less than 1% in July.
In a discussion on the growing number of American retirees selling their shares of US companies and the growing number of foreign investors buying them, Faculty Affiliate Jeremy Siegel notes how this foreign access to American technology can result in national security concerns.
In a study on the Best and Worst States for health care, Faculty Affiliate Amol Navathe was featured on a panel of experts that discussed a variety of different variables that shape access, quality, and price of care. In particular, Navathe focused on health care reform and the relationship between coverage plans and the overall market.
The Department of the Interior hosted an auction for oil tracts to be used for offshore drilling; Retail sales metrics show an increase of 0.5%; Industrial Output rose just 0.1% in the month of July.
Trump signs bill that authorizes $716 billion in military spending for the coming fiscal year, while including several provisions to counteract Chinese aggression, such as the country’s increased military activity in the South China Sea, pursuit of U.S. technology, and spread of Communist propaganda; In response to collapsing currency value, Turkey boycotts electronics produced by the United States; U.S. import prices remaining stagnant in July; U.S. economy has a projected growth of 3.1%, due to an increase in government spending and tax cuts.
State insurance commissioners are restricting access to their sales in response to Trump insurance policy plans; A bipartisan group from the House Intelligence Committee have introduced legislation focused on securing the digital election infrastructure against cyberattacks; Wages struggle to keep up despite healthy inflation rates; Turkey’s lira fell again on Monday.
In a historical review of the American Economy since the Great Recession, Faculty Affiliate Peter Cappelli cautions against using unemployment and job openings as purely positive indicators of the strength of the economy.
In a discussion on the developing trade war between the US and China, Faculty Affiliate Mauro Guillen expands the geopolitical perspective of the narrative and points out nations such as Mexico are closely watching the affair in light of their own negotiations with the US.
Faculty Affiliate Susan Wachter was featured on a panel of guests discussing the potential upsides of gentrification and models for how to make it beneficial for all parties. The panel argues that the most careful empirical analyses conducted by urban economists have failed to detect a rise in displacement within gentrifying neighborhoods.
Faculty Affiliate Peter Cappelli debunks a common misconception that “gigs” or short contract-type engagements such as those operated through online platforms like Uber are growing so fast that all jobs will be like this soon. Professor Cappelli cites findings from the Contingent Work Survey published by the Bureau of Labor Statistics as evidence contrary to the misconception.
Top healthcare and drug companies form a coalition to support moderate democrats in 2020 midterms; the 9th U.S. Circuit Court of Appeals in Seattle ordered the Environmental Protection Agency (EPA) to ban the widely used pesticide, chlorpyrifos; Consumer-price index rose 0.2% in July; Federal budget increases in July.
As a part of the “Focus On…” interview series which highlights the work and experiences of regulatory professionals, Faculty Affiliate Cary Coglianese discusses the Penn Program on Regulation and his role as the Program Director.
In a discussion on the developing trade tensions between the EU and the US, Faculty Affiliate Ann Harrison says that the Trump Administration’s tariff moves have been shocking because few expected the president to follow through with these threats and because it involves the US’ closest allies.
In a discussion on tax laws and its impact on California real estate, Faculty Affiliate Fernando Ferreira’s research was cited for its findings that claim that there has been a sharp discontinuity in the likelihood of moving between homeowners 54 years old and those just a year older.
In light of the Thai soccer team rescue, Faculty Affiliate Michael Useem reflects on the leadership lessons that can be distilled from the event. Through a review of the ordeal, Professor Useem highlights the required “big-heartedness” of various actors such as the Thai government, the rescue team, and the soccer players themselves.
Democrats blame the Trump administration’s policies for wage stagnation; Tribune Media has decided to back out of a $3.9 billion merger with Sinclair and is looking to file a lawsuit against the broadcasting giant for allegedly breaching their merger agreement; the initial jobless claims decreased by 6,000 to 213,000.
China’s imports surged over the month of July in preparation for its trade battle with United States; The Treasury Department and Internal Revenue Service released proposed regulations; the federal deficits increased by 20%, with spending outpacing revenues by $682 billion, an $116 billion increase than over the same period in FY 2017.
Trump administration has relinquished federal jurisdiction over certain water bodies and encouraged states and tribes to take over this responsibility; President Trump is expected to meet with the leaders of various companies that have been affected by the ongoing trade dispute; Despite Tax Cuts for banks, loan growth slows and 3,200 jobs were lost.
The Trump administration announced it would reimpose sanctions on Iran as part of efforts to undo the 2015 JCPOA; Trump FDA issues new guidelines on opioid-addiction drug development; US companies are reporting some of the strongest earnings growth since the 2008 financial crisis.
Bipartisan bill to place “crushing” financial penalties on Russia; In light of rising trade tensions, a top Chinese diplomat urges the US to “calm down;” Jobless Claims index rose by 1,000 to a total of 218,000.
Senate passes defense spending bill that defocuses procurement of Chinese tech; The US central bank holds interest rates steady; Manufacturing slows but hiring continues to rise.
Picture this: you’re tired of the spam in your inbox, so you download a new app for your browser that blocks it. While downloading, the Terms of Agreement pop up, and you click ‘Agree’ – because why wouldn’t you? Unbeknownst to you, while you are now enjoying your spam-free email, the Slice Technologies app is analyzing your emails for purchase receipts and selling this anonymized data to hedge funds. Is that an invasion of privacy? Not quite, as you agreed to the terms. But why would hedge funds, and other investment advisers, want this information? Well, with this kind of alternative data, investment firms can make much more accurate predictions about a company’s sales revenue and its health. This new world of alternative data poses incredible alpha-creating potential for investment advisers, as well as new legal concerns for the courts and regulators.
American law enforcement agencies are advocating that technology companies be forced to compromise the encryption used in their products, to facilitate ongoing investigations. Encryption is the computational tool used to protect every American’s digital communications and data from eavesdropping and tampering, and it plays a vital role in our economy and national security. A misguided attempt to weaken encryption would only damage our national interests, both with respect to economic wellbeing and business security. Hackers and foreign nations will target the introduced weaknesses, domestic firms’ ability to build and export security innovations will decrease, and the American competitive advantage in the technology sector will be lessened.
The CEO of JPMorgan and Chase, credited the tax cut law signed by President Trump with helping boost the US economy; President Trump threatened a government shutdown if Congress failed to fund his border wall; In June, consumer spending rose a solid 0.4%; The S&P/Case-Shiller national index rose a seasonally adjusted 0.4%.
Representatives Jan Schakowsky and Rep Francis Rooney announce drug pricing bill in the House; CMS approves a plan authored by the Wisconsin state government and developed to lower premiums for health insurance plans in the state; US home sales climbed 0.9% from May to June, but those sales were 2.5% lower than in June 2017.
In her new co-authored paper entitled, “Regulating Business Innovation as Policy Disruption: From Model T to Airbnb,”Faculty Affiliate Sarah Light takes a historical look at the challenges surrounding regulating disruptor companies such as Uber and Airbnb and offers an analytical framework for regulatory responses.
Faculty Affiliate Arthur van Benthem discusses how a dopting a higher price floor for every ton of carbon released during power generation will help EU countries switch from coal to renewables more quickly.
A pair of bipartisan lawmakers proposed legislation to overhaul areas of the IRS with provisions aimed at improving protections for taxpayers and helping low-income Americans; Efforts to impeach Deputy Attorney General Rod Rosenstein by House conservatives has divided GOP leadership; After hitting a 48-year low, Jobless Claims rise; The durable-goods orders rose by 1%, its first increase in three months.
Trump administration to allocate 10.4 billion dollars in payments to go toward helping insurers cover disproportionately sick and costly enrollees; The Senate health committee approved a bill banning “gag rule” which prevents pharmacists from telling patients if they could save money by paying for prescriptions in cash; Mortgage demand continues to decline.
Republican lawmaker has introduced legislation calling for a tax on carbon emissions that would fund domestic infrastructure investments; The bottom sixty percent of income earners have accounted for the biggest increases in consumer spending over the past two years leading experts to conclude that borrowing bolsters US consumer spending; US home sales fell for the third straight month in June.
In towns and cities across America, mom and pop shops seem to be closing down at a rampant rate. It is no secret that as America moves further into the 21st century, consolidation is placing more power in the hands of fewer companies. With billion dollar companies becoming the norm and giants like Target and Walmart seemingly on every corner, it becomes hard to understand the dynamics of today’s complex economy. There is a strong argument against big businesses; it is bad for the average consumer and allowing companies to grow only allows them more ability to exercise their advantage and prey on consumers. On the other side, there is compelling theory that with healthy competition, big business expedites innovation and optimizes production in ways small companies cannot, which results in lower prices and a more efficient consumer experience. Within this environment, the regulation of big business is known as antitrust law and as the economy grows more complex, so does the enforcement of these laws in America.
The legacy of the Silk Road is acting as inspiration for what President Xi Jinping calls the “project of the century.” Yi dai yi lu, or “One Belt One Road” (OBOR), is Xi’s signature foreign policy enterprise: a commitment of more than $1 trillion for Chinese development banks to invest in a sweeping Eurasian and African infrastructure initiative. OBOR operates both as a result of recent economic trends in China and as a milestone in Chinese foreign policy. The plan creates an outlet for Chinese products which are outgrowing domestic demand, but also has significant geopolitical potential. This article will examine OBOR and its consequences on Chinese partnerships across Eurasia and Africa and also how the results of this project relate to US foreign policy.
Baltimore filed a lawsuit Friday against large oil and gas companies that do business inside Baltimore; Nunes, an ally to President Trump, has introduced legislation to reduce capital gains taxes; US income inequality continues to grow.
Comcast Corp announced that it will drop its pursuit of media assets owned by Twenty-First Century Fox Inc., focusing instead on its offer for Sky Plc; the National Association for Manufacturers (NAM) said that it supports the Senate Banking Committee’s consideration to have Kimberly Reed lead the Export-Import Bank; Unemployment lines across the US last week were the shortest they have been since 1969.
Land-use regulation usually comes in the form of permits or codes, and is intended “to ensure [that] private use of land resources [is] aligned with policy standards.” In other words, it is a way for the government to control how certain privately-owned areas are used. There are clear benefits associated with these permits and codes – for instance, they may help ensure the preservation of a particularly historic area of a town. That said, land regulation also triggers some economic collateral concerns that are often overlooked, such as lost business profits and a widening income gap.
The House Homeland Security appropriations bill revealed that it would set aside $5 billion to build President Trump’s proposed border wall; Under the Trump Administration, the Environmental Protection Agency started easing some standards on how companies discard coal ash; US homebuilding fell to a nine month low.
San Francisco residents will vote on whether the city should increase taxes on large businesses to help pay homeless and housing services; The European Union and Japan have signed an agreement that will lift close to 100 percent of tariffs on products exchanged between the two; Speaker Ryan Paul scraps “abolish ICE’ vote; US industrial production increased, in part due to a sharp rebound in manufacturing and increased mining outputs.
The Trump administration is temporarily barred from deporting reunited families by Federal Judge; US business inventories rose in the month of May, as sales increased; The International Monetary Fund’s projections showed a 3.9% growth rate for the global economy in 2018; Retail sales increased 0.5% in the month of June.
The 2000 presidential election posed countless issues, including butterfly ballots, partially punched cards, four to six million lost votes, and outraged citizens across the political spectrum. These issues led California Institute of Technology president David Baltimore and Massachusetts Institute of Technology president Charles Vest to approach the election technology failure more scientifically. With a team of computer scientists, mechanical engineers, and political scientists, they reimagined—and reengineered—the election process. Although Baltimore and Vest pioneered advancements in the election process, the reliability of voting infrastructure today still remains questionable. As we approach the upcoming election cycle this Fall, policy and technology experts must come together to rectify a failing system.
In a discussion on the aging infrastructure of America, Faculty Affiliate Robert Inman argues that government officials across federal, state, and local agencies must take an active role in rebuilding and improving these resources and make these projects a priority.
In light of Janus v. AFSCME, where the Supreme Court ruled that government workers who choose not to join a union cannot be forced to pay for the cost of collective bargaining, state governments are analyzing its impact on unions and pension funds. Faculty affiliate Olivia Mitchell’s research was cited for her findings that indicated unionized public employees’ pension plans were less likely to be fully funded.
In light of the proliferation of automated driving technology, Faculty Affiliate John Paul MacDuffie looks at the major issues with this movement. He notes that despite the hype suggesting that autonomous vehicles will arrive within a couple of years, full autonomy for all vehicles is many decades away and argues that “diffusion will be erratic — moving fast at times, slowed up by unexpected constraints at other times. But we’ll feel like [autonomous vehicles] are part of our lives, at least partially, within the next five to 10 years.”
In a class action against 8 fast food chains that are allegedly practicing “no poaching” terms in their employee contracts, Faculty Affiliate Peter Cappelli is quoted for his statements indicating that these agreements break anti-trust and employment law because “[c]ompanies could achieve the same results by making it attractive enough for employees not to leave.”
Metrics reveal that the US’ trade deficit with China has actually increased; Consumer sentiment fell to 97.1, a six month low, below estimates of 98.2 this past month; US import prices fell unexpectedly in the month of June; Prices for consumers rose rapidly last month.
The Trump administration cut funding previously allocated to help people get insurance under the Affordable Care Act; The Trump administration introduced a set of new tariffs, targeting $200 billion dollars of Chinese goods, a figure roughly equivalent to the total size of Chinese exports to the United States; The US’ second quarter GDP growth is estimated to be 3.9% annualized.
In a discussion on the implications of South Dakota v. Wayfair Inc. that ruled online retailers must collect sales taxes even in states where they have no physical presence, Faculty Affiliate Katja Seim agues that it is still unclear whether or not this will negatively affect sales and consumer habits.
President Trump announced Brett Kavanaugh as his nominee to replace Justice Anthony Kennedy on the Supreme Court; China has imposed retaliatory tariffs on American optical fiber products; U.S. job openings ease from a record to 6.64 Million in May.
In a discussion on the legality and future of the Affordable Care Act, Faculty Affiliate Mark Pauly writes, “There’s winners and losers… It’s a tiny segment of the population that’s directly affected, but they’re going to be really woefully mistreated.” Healthy people could see their insurance rates go down, while sick people could be charged more. The immediate impact would be on people with ACA policies although most Americans have insurance through employers, Medicare or Medicaid.
Faculty Affiliate Susan Wachter contributes to a discussion on the “Three Cities” Phenomenon by interrelating housing as a reflection of wealth inequality. Ten years ago, just as Toronto’s housing boom reaching its peak, a groundbreaking academic research project at the University of Toronto told a striking counter-narrative: the city’s neighborhoods were transforming from middle-income communities into enclaves of the very rich or boroughs of poverty. Over the course of 35 years Toronto had self-segregated itself based on wealth.
The Trump administration announced that it would halt $10.4 billion of risk adjustment payments to insurers under the Affordable Care Act; Increases in wages are beginning to chip away at corporate profits in some sectors; Consumer borrowing rose in the month of May to 24.6 billion dollars.
Despite a modest decline in private vehicle ownership in the last four years, many Americans still employ cars as their primary mode of transportation. Comparisons among census trends in the past few decades indicate that private vehicles amassed popularity among American households following more extensive car-centric city planning beginning in the early 1960s.
A federal court ruled that the department of Health and Human Services would need to unite children with their parents; The economy added 213,000 jobs in the month of June; Trade deficit falls as tariff conflict heats up.
US government considers revisiting its seven-year ban on Chinese phone maker ZTE; German Chancellor Angela Merkel claims she would support lower tariffs on US car imports; Initial jobless claims rose by 3,000 to 231,000 at the end of June 30th.
On Tuesday, China announces it is “fully prepared” for a trade war with US; Automakers and manufactures warn that the President’s push for steep tariffs on imported cars could cost the US jobs; As Tariffs Approach, China’s Exports to the US have cooled.
Governor Matt Bevin of Kentucky recently signed an order canceling dental and vision benefits for the states Medicaid program; EU officials issued a statement indicating it would issue retaliatory tariffs worth as much as $300 billion in response to US auto tariffs; The Institute for Supply Manufacturing (ISM) index increased over the month of June.
California’s state legislature passed and Governor Brown signed into law the California Consumer Privacy Act, inspired by the the GDPR; Personal Consumption Expenditures index rising 2.0% annualized in the month of May; US consumer sentiment increased in June to 98.2.
At the end of the last century, the digital revolution ushered in technological advancements that most consumers would not want to live without. Information and communication technology (ICT), such as computers, cell phones and the Internet, have proliferated worldwide entering our homes, offices and classrooms.  However, while the expansion of this technology has been impressive, it has not been even. At both the national and global levels, access to ICT is still far from universal and its disparity reflects and exacerbates the inequalities that exist offline. According to the International Telecommunications Union, the Internet user gender gap was as high as 31% in some developing countries and 12% globally in 2016.  As ICT becomes increasingly important, those left behind face growing socioeconomic barriers. This is what is known as the digital divide. People unfamiliar or unable to access ICTs are disadvantaged when trying to enter higher paid jobs, join solidarity networks, utilize educational information and accrue cultural capital.
Trump’s nominee to lead the IRS vows to restore trust; The SEC charged a former Equifax manager with insider trading after their data breach; Jobless Claims in the US have increased by 9,000 to 227,000 which exceeds the 220,000-estimate put forth by economics.
The Supreme Court issued a ruling Wednesday that public sector union employees no longer have to pay union fees if they elect not to join a union; Oil prices increased as US inventories decreased by 10 million barrels this week; Metrics indicate that business spending growth is not growing at the rapid speed many economists predicted.
The Supreme Court ruled to uphold President Trumps ban on nationals from five Muslim-majority countries from entering the United States; Chairman Kevin Brady said that he sees the second round of tax cuts to be most likely a package of reforms; Despite Trade Tensions, US seeks to export its ‘Energy Miracle’; U.S. consumer sentiment declines in the month of June.
Kaylee Heffelfinger of Arizona and Shahriar Jabbari of California had sued Wells Fargo for opening seven unauthorized bank accounts in their names, but their lawsuits were dismissed due to analogous mandatory arbitration clauses. Their cases were part of a larger scandal in which Wells Fargo opened at least 3.5 million unauthorized accounts on behalf of their customers but then astonishingly held those customers to the mandatory arbitration clauses they had signed for their legitimate accounts. Given the harm that mandatory arbitration may cause consumers, it is critical for policymakers to consider the implications of mandatory arbitration.
Faculty Affiliate Mary-Hunter McDonnell’s research on the history and intersection between businesses and social media was cited in an article discussing the evolution of social media and the public’s perception of these platform’s responsibility to its user base.
Democratic senators introduced a bill Monday to extend overtime pay and other worker protections for agriculture workers; Supreme Court ruled that challengers did not prove that the Texas state legislature racially discriminated against black and Hispanic voters when it redrew state and congressional district boundaries in 2012; Home sales jumped in the month of May to an annualized rate of 689,000 units each month; The Dow Jones Industrial Average fell 358 points Monday, driven down by a 2.7% drop in the tech industry.
In a discussion on a phenomenon economists have called “the housing bubble” in China, Faculty Affiliate Gyourko’s research on the history and trajectory of Chinese real estate was cited. His work found that residential real estate auction prices rose 800% from 2003 to 2008 in Beijing and that new house prices have actually fallen relative to household incomes in Chengdu, Wuhan, Tianjin and Xi’an, all urban areas with more than 4,000,000 population.
Faculty Affiliate Kevin Werbach discusses a large misconception within the perceived Blockchain revolution. Though cryptocurrency and blockchain are often used interchangeably, Professor Werbach explains how they are actually quite different – “There is cryptocurrency: the idea that networks can securely transfer value without central points of control. There is blockchain: the idea that networks can collectively reach consensus about information across trust boundaries. And there are cryptoassets: the idea that virtual currencies can be “financialized” into tradable assets.”
The House passed legislation designed to improve access to medically assisted treatment (MAT) and other provisions to address the opioid crisis; Sales tax ruling set to increase state budgets at the expense of e-commerce; Second iteration of the farm bill passes through the House of Representatives; The Leading Economic Index grew 0.2% in the month of May, following a 0.4% increase in April.
The White House proposes to combine the departments of Education and Labor in order to reduce the federal workforce; The Supreme Court overturns rule that barred states from requiring businesses with no physical presence in the state to collect their sales tax; A federal district judge ruled that the structure of the Consumer Financial Protection Bureau was unconstitutional; U.S. Jobless claims fall in May.
EU panel approves controversial copyright legislation that would affect companies such as Facebook; President Trump reversed the administration’s position on separating families at the border; Robust economic growth and record-low unemployment numbers have painted a picture of strong economic fundamentals; US home sales are decelerating.
T-Mobile and Sprint laid out the case for a $26 billion merger; Senate appropriations subcommittee approved a $23.688 billion financial services spending bill; Housing starts achieves an 11-year high.
Speaker Ryan is bringing up two pieces of legislation aimed at immigration and the crisis of children separated from their families at the border; The Supreme Court passed up two opportunities to rule on partisan favoritism in drawing voting districts; The Dow Jones industrial average dropped 103.01 points due to trade conflict.
President Trump announced Friday he would not sign a GOP compromise immigration bill; The President announced Friday that the US would levy 25% tariffs on $50 billion of Chinese goods; The GDP is projected to grow at a four percent annualized rate in the 2nd quarter this year.
In a discussion on the growing disparity between employer and employee agency within the labor market, Faculty Affiliate Peter Cappelli comments on the impact of the shareholder value movement and how it has facilitated these disenfranchising trends. Professor Cappelli claims that shareholder value encourages “the use of temps and contractors” to fill high-wage jobs because “that way the employer doesn’t have to raise wages for all their employees.”
Net neutrality rules enacted by the FCC went into effect Monday; Supreme Court upholds Ohio voter ID law; Despite strong economic and employment data, Economist’s survey predict an economic recession by the end of 2019 and the beginning of 2020.
The World Trade Organization said Mexico has filed a formal complaint against the United States over steel and aluminum tariffs; Senate Democrats signed a letter urging Paul Ryan to hold a vote on a bill that would restore the FCC’s net neutrality rules; Initial jobless claims totaled below previous projections; EIA Natural Gas Report demonstrates a new increase in working gas
On Wednesday, President Trump signed a bill that would enact several reforms designed to expand veterans’ access to private health care; The House Appropriations Committee revealed its $674.6 billion Pentagon spending bill; Shortages of affordable homes in the US continue to drive prices.
Faculty Affiliate Olivia Mitchell discussed how fintech – or the use of technology to support banking and financial services – holds a great deal of promise, but how it’s not yet fully helping those saving for or living in retirement.
In a keynote conversation with Faculty Affiliate Mae McDonnell, an expert on organizational design and management, Slack CEO Butterfield discussed how his responsibilities have led him to explore the wider factors that often leave people feeling disaffected, disenfranchised, or alienated at work.
According to the White House economic adviser Larry Kudlow, President Trump may seek to strike separate trade deals with Canada and Mexico; JOLTS Metrics indicate little change from April except for a new series high in job openings level of 6.7 million; The US Services PMI index observed an increase in May.
President Trump announced new tariffs on aluminum and steel imports from Canada, Mexico, and the EU; Pending home sales are down while consumer spending is on the rise.
The Volcker Rule, a regulation instituted in the wake of the financial crisis to prevent banks from making risky, short term trades, to be simplified; President Trump signs ‘right to try’ legislation; economic growth revised downward.
President Trump said that he will put tariffs on $50 billion of Chinese imports, while limiting China’s investments in US tech industries; Concerns over Italy’s political situation, and reports of stagnant banking, have caused stocks to drop.
President Trump is considering a new 25% tariff on imported cars after Commerce Secretary Ross announced that they are critical for national security. The House of Representatives passed the National Defense Authorization Act, the annual defense bill, that amounts to $717 billion in expenditures.President Trump signed into law a change in the Dodd-Frank Act.
The House of Representatives voted on two bills, one aimed at easing regulations on many but the largest banks, the second allowing patients to bypass the FDA in requesting companies’ approval on experimental drugs. Mortgage applications are down this week due to sharp rate increases.
In June of 2016, former Defense Secretary Ashton B. Carter removed one of the final barriers to military service by announcing new rules that would allow transgender individuals to openly serve in the military. Prior to this, transgender people would have been discharged or otherwise separated from the military just for their gender under Department of Defense Instruction (DODI) 6130.03: Medical Standards for Appointment, Enlistment, or Induction in the Military Services. Just one year later, in July 2017, President Donald Trump tweeted that the U.S. “will not accept or allow transgender individuals to serve in any capacity in the U.S. military” because the military “must be focused on decisive and overwhelming victory and cannot be burdened with the tremendous medical costs and disruption that transgenders in the military would entail”.
The Senate Banking Committee approved an amendment that would block President Trump from easing sanctions on Chinese telecommunications firm ZTE without first certifying to Congress that ZTE is following US sanctions; US stock markets were mainly down today.
The alternative minimum tax (AMT), originally enacted in 1969, was intended to ensure that the highest earners paid some tax. According to research by Professor Shuldiner, a majority of taxpayers will no longer owe AMT under the new tax plan. “Under the prior AMT rules, the regular tax was very close to the alternative tax over long stretches of income, so fairly small amounts of some breaks could trigger the AMT.” Under the new plan, a married couple with income between $270,000 and $500,000 would need about $40,000 of tax breaks subject to the AMT, double the deductions that would have triggered AMT in 2017, to owe this year.
Supreme court curtails labor rights in class action suit case; China trade fears ease as Trump backs down; US Job market optimism at 17-year high.
Acting Veterans Affairs Secretary Robert Wilkie to be nominated for role; the Farm Bill failed to pass the US House of Representatives; jobless claims total greater than expected; and the Conference Board’s Leading Economic Index, gained for the 6th straight month.
The FDA begins naming companies that have stifled competition, while the Senate voted to reinstate the FCC’s net neutrality rules; Fed manufacturing gauges show increased activity, while 30-year fixed mortgages increased last week.
Governor Scott of Vermont legalized the importation of prescription drugs from Canada, against the wishes of Trump administration;Mortgage applications for the week decline, while housing starts miss expected targets.
In a discussion on the limitation of algorithmic based hiring practices, Faculty Affiliate Peter Cappelli maps the transition from human to computer based recruitment. Professor Cappelli claims “we moved to a model where we pushed decisions from the corporate offices and headquarters down to the individual hiring managers when it comes to making decisions about who to hire.
Research by Faculty Affiliate Olivia Mitchell is cited in an Wall Street Journal article on the meaning and function of “financial literacy.” Her work questioned if Americans understood the basic underpinnings of personal finance. Respondents were deemed literate if they could successfully answer simple questions related to compound interest, inflation and asset diversification. Years of careful research showed that many Americans can’t.
Professor Herbert Hovenkamp provides insight into the logical calculus historically employed by courts and anti-trust regulators when considering the merging of companies. A&AT seeks to acquire Time Warner in order to better compete with industry titans such as Amazon, however Professor Hovenkamp notes how regulators don’t usually consider merger defenses that depend on the existence of un-deployed technology.
Faculty Affiliate Susan Wachter explains the ways in which non-bank lenders such as Quicken Loans have helped keep both the real estate market alive and mortgage rates low. Compared to banks, lenders such as Quicken are more lightly regulated, and their credit scoring models haven’t really been tested yet. Wachter, therefore, cautions “if there is a crisis, non-banks don’t have the financial backing, they don’t have the capital. There won’t be the same source to pay up the penalties and fines the next time around, if there is a next time around.”
Faculty Affiliate Professor Siegel reflects on the quality of the earning season and what that now means for valuations by drawing attention to the positive impact of the corporate tax cuts. Professor Siegel, however, also cautions listeners to consider the tightness of our current labor market when examining how the market must contend with jobless claim and new job trends.
Christina Roberto testified before a Philadelphia City Council committee about a proposed bill that would require chain restaurants to put warning labels on menu items containing more than the daily recommended intake of sodium (2,300 mg). Professor Roberto identifies salt as a key agent causing high blood pressure with Philadelphians which can, in turn, lead to other more serious health complications. She cites her research testing consumer response to such labels, which was supported by an LDI Policy Accelerator grant.
In the recent New York Times opinion piece,”When Companies Supersize, Paychecks Shrink,” research by Profs. Ioana Marinescu and Herb Hovenkamp is cited as evidence that “no court has ever stopped a merger on the grounds that eliminating an employer hurts workers.” This research was the basis for the Penn Wharton PPI issue brief “The Other Side of a Merger: Labor Market Power, Wage Suppression, and Finding Recourse in Antitrust Law. ”
Faculty Affiliate, Ethan Mollick reflects on how crowdfunding can be used as an instrument to measure the demand for a start up. Ultimately this is important because when attempting to court big time investors, not only do start ups require a good idea, but they must also establish traction and a market for its services; both of which can be demonstrated through successful crowdfunding.
In an op-ed piece featured on the Wall Street Journal, Faculty Affiliate Olivia Mitchell discusses the unique financial vulnerability of elderly individuals and solutions for this unrecognized problem. Her ethnographic research discovered that “financial fraud experienced by the over-50 population is a large and important problem, and more prevalent than commonly believed.” She goes on to outline three potential solutions; one from the private sector, one from technological innovation, and one from policy makers.
President Trump is considering easing some restrictions on Chinese telecommunications firm ZTE; the Dow dropped 186 points due to lower than expected Home Depot earnings and higher interest rates.
Senate Democrats force a vote in the Senate on the FCC’s repeal of net neutrality; the US Supreme Court ruled that federal law prohibiting sports betting intrudes on states’ rights; Euro-zone economic slow-down; President Trump’s ZTE tweets has eased investors’ concerns about the trade conflict.
In my opinion, business and public policy are the two things that truly affect every single person in the world, regardless of whether they want to admit it or not. Being able to critically analyze how the two relate and how the two differ can be nothing but beneficial.
Currently a sophomore at the Wharton School, Megha Agarwal has established interests in both business and public policy. Her interest in the latter has its roots in her time serving on her hometown’s city council in Los Altos, California. At the time, she was just trying to gain exposure to different kinds of ac