How do we know the Zika virus will cost the world $3.5 billion?

The mosquito-borne Zika virus has been declared a “Public Health Emergency of International Concern” by the World Health Organization.  The virus not only appears to severely harm unborn children but is also hurting the economies of many Latin American and Caribbean countries. The World Bank estimates Zika will cost the world US$3.5 billion in 2016.

Three and a half billion dollars is a huge amount of money. How did the World Bank calculate this figure? How do we put a price tag on Zika and other health catastrophes like Ebola, dengue fever or even more common problems like the flu? Can we even trust these figures? Continue reading How do we know the Zika virus will cost the world $3.5 billion? →

How do we know if the world is in a global recession?

Since the start of this year, stock markets around the world have fallen as panicked investors have begun believing that the world is slipping into economic malaise.  This fear has also driven down prices of commodities like oil and copper and impelled some central banks, like Japan’s, to make dramatic efforts to boost growth. The concerns are being magnified by memories of the worldwide recession of 2008 and 2009, when many countries experienced widespread joblessness, business bankruptcies and homelessness.

While national and international leaders cannot prevent worldwide economic downturns, a coordinated response among them can mitigate some of the impact. But it’s hard to rally government resources to this cause without the ability to determine whether we are actually in a recession or not.

So how do we know when the world is in a recession and such a response is needed? Continue reading How do we know if the world is in a global recession? →

Winner of $1.5 billion Powerball Faces Long Odds – But even longer odds of keeping it

The U.S. Powerball lottery is holding a drawing this week for a jackpot that’s already reached US$1.5 billion. That’s after the 18 drawings held since November failed to yield a winner, causing the grand prize to swell to this record sum.

This jackpot is drawing such attention that more people are buying tickets, and even the lottery’s own projections are changing rapidly. During the weekend the payout was an estimated $1.3 billion. Monday it was revised to $1.4 billion and on Tuesday it hit $1.5 billion. Continue reading Winner of $1.5 billion Powerball Faces Long Odds – But even longer odds of keeping it →

To Really Beat Box-Office Records, “Star Wars” Will Need To Top These Numbers

This weekend, the newest Star Wars movie will start playing in cinemas throughout the world. Pundits in places like Forbes and the International Business Times are already predicting it will be the “biggest movie of all time.”

The headlines and superlatives about this movie’s box office records will dominate entertainment news during the winter. However, it is important to understand that the hoopla surrounding box office records is nothing new: Hollywood uses special effects for both making movies and discussing how a movie does financially. Hollywood movies consistently break box office (ticket sales) records because the industry does not adjust sales for inflation. Continue reading To Really Beat Box-Office Records, “Star Wars” Will Need To Top These Numbers →

Fed interest rate hike may have less of an impact than you think

There is a very high chance the Federal Reserve will raise interest rates next week.  It would be the first time the Federal Open Monetary Committee (FOMC) – the Fed’s rate-setting team – has lifted its benchmark rate since 2006, beginning the so-called return to normal.  Economists, traders and policymakers have been pontificating, prognosticating and placing bets about this decision for a long time, because the impact is expected to be far-reaching.

So how will higher rates affect you? Continue reading Fed interest rate hike may have less of an impact than you think →

An Amazing Adventure: Bicycling In Rwanda

I recently completed an amazing journey; three days of mountain biking on Rwanda’s Congo-Nile Trail. The bike trip offered incredible scenery, a tremendous physical challenge and a chance to better understand one of the more intriguing countries in Africa.

Since I was short on both time and experience navigating around Rwanda, I booked the trip through Rwandan Adventures. They (especially Joanna) took care of providing bikes, a guide and bookings for accommodations, all at a very reasonable price and with amazing service. Continue reading An Amazing Adventure: Bicycling In Rwanda →

Explainer: why does the price for turkeys fall just before Thanksgiving?

Thanksgiving is a great US holiday during which people consume huge quantities of turkey, stuffing, cranberry sauce and pie.  One of the stranger things about this holiday, however, is that a few days before everyone starts cooking, whole turkeys are suddenly discounted by supermarkets and grocery stores (see examples here or here).

And this happens every holiday season: the price falls just before Thanksgiving and stays low until Christmas. For example, November 2014’s price per pound for turkey was almost 20% lower than the price the previous March.  Why does the price come down at the one time of the year when demand for the product spikes the most – before a holiday that’s literally dubbed “Turkey Day”? Continue reading Explainer: why does the price for turkeys fall just before Thanksgiving? →

Are Turkeys Getting More Expensive Over Time?

It is almost time for Thanksgiving, the holiday when many people in the USA cook and eat turkey.  As I was walking up and down the aisles of the supermarket yesterday, buying food for the holiday, I was wondering what has happened to the price of turkeys over time.

Continue reading Are Turkeys Getting More Expensive Over Time? →

Why Google’s plan to blanket wilderness with Wi-Fi is a bad idea

Facebook wants to blanket rural India in cheap Wi-Fi. Google is launching balloons to do the same around the globe. Soon, it seems, there won’t be a square inch of Earth or the heavens that isn’t connected.

These ambitious plans beg the question: should there be places in the world where cellphones, tablets and other high-tech pieces of modern communications are off-limits and their use curtailed to emergencies only? Continue reading Why Google’s plan to blanket wilderness with Wi-Fi is a bad idea →

What Should I Take To Climb Mt. Kilimanjaro?

In October my wife and I climbed Mount Kilimanjaro in Tanzania. A friend is contemplating doing the same climb and asked me for some advice on the type of gear he should use while climbing the Mountain so I am writing this for both him and anyone else interested in the climb. I am a 50+ year old college professor, not a professional climber or guide. This means the below suggestions might not match the route or conditions that you will encounter. We did a six day-five night climb with the African Walking Company up the Rongai Route, which goes up the north side of the mountain. Continue reading What Should I Take To Climb Mt. Kilimanjaro? →

Plain cigarette packaging: healthier citizens, sicker state finances?

Over the last few years, a new idea for improving public health has been slowly spreading across the world: a ban on selling cigarettes in packages with custom brand designs. Instead of selling branded tobacco, all cigarettes are sold in either plain packages or packages with grotesque pictures showing the health consequences of smoking.

The obvious question is: is it effective at reducing smoking rates? The less obvious one: what are the economic consequences of a healthier population? Continue reading Plain cigarette packaging: healthier citizens, sicker state finances? →

The tale of Uber and a 19th-century French economist

The French government and French taxi drivers are furious with Uber, the US car-hailing company.  At the end of June, the government arrested two top executives of the French division of Uber and is planning to bring them to trial. That came a few days after taxi drivers staged violent protests in Paris, burning cars and attacking other drivers who they thought worked for Uber. Continue reading The tale of Uber and a 19th-century French economist →

Why do stocks fall when the Fed considers raising interest rates?

A top-level committee of the Federal Reserve, the US’ central bank, is meeting this week to discuss when it should begin raising interest rates.  Why do stock prices fall when a country’s central bank boosts interest rates?

Continue reading Why do stocks fall when the Fed considers raising interest rates? →

Are we overscheduling our children even from the moment of their birth?

Are we overscheduling our children even from the moment of their birth?

We live in an on-demand world. Movies are shown on request, food is delivered on call and drivers arrive when beckoned. As an economist, not a medical doctor, I was surprised to find new data that suggest more babies are showing up when scheduled rather than on their own time frame.

Numerous writers have suggested that parents, teenagers and children are all overscheduled. Should birth be scheduled too? Continue reading Are we overscheduling our children even from the moment of their birth? →

Three reasons why most of us shouldn’t worry about the global stock market meltdown

On Monday, the world’s stock markets continued to fall after suffering steep losses the previous week.  The Dow Jones Industrial Average, one of the most widely followed indexes, opened for trading by dropping more than 1,000 points in the first six minutes, or about 6.5%. This thousand-point drop was the largest intraday plunge in the index’s history. Continue reading Three reasons why most of us shouldn’t worry about the global stock market meltdown →

Why Are Martha’s Vineyard and Other Island Getaways So Expensive?

President Barack Obama is currently taking a two week vacation on Martha’s Vineyard, a small island off the coast of New England. My wife and I took a short vacation on the same island and left a few days before the President and his entourage landed. The island has lovely scenery, warm water and many quiet places to relax. The island also is very expensive. While I didn’t do a professional survey since I was on vacation it seemed that almost all prices I paid were about 50% higher than what exists 45 minutes away on the mainland. On the ferry back to the mainland I came up with three reasons why Martha’s Vineyard and other island getaways like Nantucket are so expensive. Continue reading Why Are Martha’s Vineyard and Other Island Getaways So Expensive? →

What do zombies, pandemics and the price of eggs have in common?

What would you do if a Zombie Apocalypse occurred? I recommend going to the Centers for Disease Control’s (CDC) Zombie website for information. It is incredible (see it here). While the Zombie website is real, the CDC is not actually concerned about an outbreak of the undead walking around the country. Instead, it uses the website to help create awareness for what to do in pandemics and other emergencies. Continue reading What do zombies, pandemics and the price of eggs have in common? →

Why you shouldn’t fear your finances (you’re probably richer than you think)

Do you procrastinate about taking care of financial matters in your life?  Recently a fascinating article about financial procrastination appeared online. The author publicly admitted that “after years of procrastinating,” he finally logged on to his retirement account. It took him years to get around to dealing with it because the entire task made him anxious. Continue reading Why you shouldn’t fear your finances (you’re probably richer than you think) →

Should People Be Arrested for Painting Crosswalks?

About 15 years ago Robert Putnam wrote an interesting book called “Bowling Alone.”  The book used data on participation in bowling teams, parent-teacher organizations (PTA), church attendance and other social activities to argue that the US was experiencing a breakdown in the bonds that held communities together.  Today, a man was cited by the police for repainting his town’s crosswalks after the town repeatedly delayed fixing them.  Should people be arrested for engaging in community improving activities?

Continue reading Should People Be Arrested for Painting Crosswalks? →