tag:blogger.com,1999:blog-75798592525222717662024-02-08T11:35:08.487-08:00Joseph Stiglitz for Econ 490I am a student in Professor Arvan's Economics 490 class, writing under an alias to protect my privacy, using the name of a famous economist as part of that alias.Joseph Stiglitzhttp://www.blogger.com/profile/14432026525082105215noreply@blogger.comBlogger11125tag:blogger.com,1999:blog-7579859252522271766.post-10543115609955543272013-12-06T17:52:00.001-08:002013-12-06T17:52:02.975-08:00Course Review<div class="MsoNormal">
I enjoyed the overall structure of the course and the way
that it was taught. I personally thought that this course was very informative
and insightful, particularly in a way that I thought I could apply in future
situations such as my career. More specifically, I thought that the online blog
posts and the excel homework made me keep up to date with all my coursework in
the class. I felt like the blog posts in the class provided a good review of
the class session for the week because it required us to summarize and apply
the content that we learned in the classroom to our blog posts. I also thought
that the excel homework problems were a good reinforcement of the information
provided in the textbook. <o:p></o:p></div>
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In addition, I thought that most of the content that was
covered in this course was relatively new for me. Most of the excel topics that
were covered such as transfer pricing and insurance was definitely doable in terms
of the amount of math involved, but was novel in the sense that I had never
seen these types of models before. I am sure I will encounter these similar
types of topics in future economics classes that I take at this University. I
am also considering into going into financial consulting in the future so I
know that I will most likely encounter these topics again. <o:p></o:p></div>
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One critique that I had for the course was the content of
the textbook. I felt like the content of the textbook was very dry and that I
learned the material better when it was explained in class through the
powerpoints or through the excel homework. Nevertheless, I did feel that the
textbook was very thorough in explaining various subject matters in detail. I
consulted the textbook numerous times especially for topics that I had trouble
understanding. <o:p></o:p></div>
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Another thing that I had difficulty with in this course was
the format of the exams. I felt that the exams were just the excel homework and
this is where some people had trouble. I thought that there was a lot more
material covered in the class lectures that could have been on the exams. Furthermore,
it was easy to lose a lot of points on the exam if one question was answered
incorrectly. <o:p></o:p></div>
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Overall, I would definitely recommend this course to anyone.
This was a tremendously helpful course that I will hopefully reflect back on
and utilize the knowledge gained in this classroom for my future endeavors. <o:p></o:p></div>
Joseph Stiglitzhttp://www.blogger.com/profile/14432026525082105215noreply@blogger.com3tag:blogger.com,1999:blog-7579859252522271766.post-44962599032529400452013-11-21T09:05:00.001-08:002013-11-21T09:05:56.794-08:00Reputation in an Organization<div class="MsoNormal">
Reputations in organizations are extremely valued. Having a
certain reputation can make or break an organization, consumers have the
tendency to place more value on a product if the company making the product has
a good reputation. This type of reputation can come in many forms. Walmart has
a reputation for providing items at bulk pricing to consumers. Microsoft has a reputation
for making products for business use such as through Microsoft Office and the
Windows operating system. In particular, one company that I have found to be
especially interesting is Apple. The reputation that Apple has developed in the
past 20 years is incredible to see. Essentially, Apple has developed the
reputation to be technologically innovative and to provide products to the
consumer that is aesthetically pleasing. Furthermore, Apple has developed a
reputation for providing good support for its consumers. For these reasons,
Apple has established such a large following in the consumer market. Thousands
of consumers wait in lines for new releases of Apple products every year. The
reputation that Apple has developed brings the company loyalty in its
customers. I have personally seen people buy a certain Apple product on the
market simply because of the brand, rather than another item that might be
cheaper or meet their personal satisfaction better. <o:p></o:p></div>
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One of Apple’s more innovative products was the release of
the iPod in 2001. This was one of the products that Apple revolutionized the
music industry. Consumers were able to have an mp3 player that wasn’t based off
of flash storage. Consumers were able to store thousands of songs on a device
and be able to integrate this device with the iTunes software developed by
Apple. In this way, Apple developed the reputation for being innovative in the
music industry. Consumers associated the music market with the iPod brand.
Apple also developed a reputation for being “cool” amongst the younger generation.
Furthermore, the utilization of advertisements with flashy visuals and catchy
music helped uphold this reputation of being “cool”. I personally remember how
popular iPod were when I was growing up. All my friends that had iPods when
they first came out became very popular because everybody wanted to see the device
in action. Furthermore, Apple has maintained the reputation of being
technologically innovative (even though it might not be), by releasing a newer
version of the product every year. Typically, there are a few improvements with
the product such as an updated version of the iPod. In recent years we have
seen how the iPod has improved every year and even by coming out with other
versions of the iPod such as the iPod Nano and iPod Touch. <o:p></o:p></div>
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Apple also has a reputation of having good support. Usually
support through the genius bar is supplemented by someone that is competent
enough to try to fix a situation. This is quite contrary to other businesses
where you are directed to speak to someone who might not even be based in the
United States in order to provide troubleshooting. The reputation of Apple is
obviously also very apparent in way the stock value has risen dramatically in
the past few decades. Apple may have the reputation of being innovative, and it
does this best by creating products that are consumer friendly while also
attracting the tech savvy as well. <o:p></o:p></div>
Joseph Stiglitzhttp://www.blogger.com/profile/14432026525082105215noreply@blogger.com2tag:blogger.com,1999:blog-7579859252522271766.post-41236883299012865112013-11-20T09:26:00.004-08:002013-11-20T09:26:31.194-08:00Reputation in my Family<div class="MsoNormal">
<span style="background-color: white; background-position: initial initial; background-repeat: initial initial; color: #222222; font-family: Arial, sans-serif; font-size: 10pt; line-height: 107%;">One environment where I
developed a personal reputation is with my family at home. I feel strongly
pressured to develop a certain persona based off of my reputation at home. In
particular, I have to uphold a very responsible reputation in regards to my
parents and I have to assume a loving brotherly type of reputation when I am
around my younger sisters. I would typically say that my reputation with my
family is very respectable. I try to appease my parents by being the right type
of role model for my little sisters. <o:p></o:p></span></div>
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<span style="background-color: white; background-position: initial initial; background-repeat: initial initial; color: #222222; font-family: Arial, sans-serif; font-size: 10pt; line-height: 107%;">I have developed my
reputation through my years of experience with my family members. My family
members, especially my parents have steadily learned to trust me and to let me
assume more responsibilities. In particular, I felt as if my parents were a big
motivator in my life. They would help me set specific goals and help me set out
to achieve them. These goals might include academic goals or career development
goals such as getting a job. As I learned to meet these goals, I have developed
a reputation of being reliable and a responsible person to my parents. <o:p></o:p></span></div>
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<span style="background-color: white; background-position: initial initial; background-repeat: initial initial; color: #222222; font-family: Arial, sans-serif; font-size: 10pt; line-height: 107%;">Furthermore, my
reputation amongst my little sisters is hopefully one that they can be proud
of. I personally want to be the role model that my little sisters can look up
to and strive to be. On a personal level, I have worked especially hard in
developing my reputation as a person that does the right thing, although this
can be difficult at times. Whenever I am around my sisters I try to stress to
them that being a good person is such an extremely important goal to strive for
in life. I know that my parents will push my little sisters to become successful
academically, so I try to push them in other areas such as being involved in
the community and taking on extracurricular activities in school. <o:p></o:p></span></div>
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<span style="background-color: white; background-position: initial initial; background-repeat: initial initial; color: #222222; font-family: Arial, sans-serif; font-size: 10pt; line-height: 107%;">In addition to assuming
moral responsibilities, I have worked hard to become a role model for my
sisters through my achievements. I have accomplished this by doing well
academically in school and starting to become financially responsible for
myself. My current goals involve graduating from the University of Illinois
with a high GPA and to immediately start working after college. Hopefully, by
accomplishing my current goals, I will build on my reputation of being a role
model for my little sisters. I want to eventually become a mentor for them for
whatever life goals they are set to accomplish by sharing with them my personal
experiences on various subject matters. <o:p></o:p></span></div>
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<span style="background-position: initial initial; background-repeat: initial initial; color: #222222; font-family: Arial, sans-serif; font-size: 10pt; line-height: 107%;"><span style="background-color: white;">What I have described so
far is for the most part accurate, but there are many instances where my
reputation amongst my family members have deteriorated because of my actions.
It is very difficult to maintain a good image for my parents and more
importantly my little sisters at sometimes, particularly at my age. I feel like
I am at the age in which many people participate in activities that would be
inappropriate in the eyes of my parents or for my little sisters to see. One
example is going to social events with my friends. Although I am 22 years old,
and can legally drink I still think that there are many negative connotations
associated with participating in such an activity. There have been many
instances where my parents have seen me drinking. Although they don’t necessary
care, they always tell me to be responsible with my actions. For these reasons,
I try to keep my social activities away from my parents and my little sisters
especially. In particular, there have been instances where I choose to go out
with friends rather than stay at home and participate in more family
activities. </span><span style="background-color: #fff7d7;"><o:p></o:p></span></span></div>
Joseph Stiglitzhttp://www.blogger.com/profile/14432026525082105215noreply@blogger.com1tag:blogger.com,1999:blog-7579859252522271766.post-35446855044441870862013-11-03T14:16:00.000-08:002013-11-03T14:16:03.257-08:00Triangle Principle Agent Relationship<div class="MsoNormal" style="text-indent: .5in;">
I have personally experienced the
triangle relationship between the principal agent problems in my previous
employment. In particular, I had summer job in which I worked as a cashier at a
local convenience store. This was a job in which I assumed a lot more
responsibility that I had initially thought. I worked primarily night shifts,
which meant that I had to essentially run the entire store by myself. Since
there was only one worker in the store during this shift, I had to assume the
responsibilities of running the store as well as taking care of the customers.
Essentially, I experienced the principal agent problem with trying to be an
agent to my boss as well as the customers. There was a clear distinction
between what specific customers wanted and the expectations from my boss. <o:p></o:p></div>
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More specifically, I acted as an
agent between my boss and the customers. My boss would leave me specific set of
instructions each night such as managing inventory, stocking the store, paper
work, or clean up. The main concern of my boss was to keep the store running at
all times and to make sure that everything goes smoothly. Often times I would
have to take inventory for current products and then make orders electronically
for various items. For example, I would have to take inventory of alcohol
products and make a purchase for those items that would potentially run out
that week. Since we carried a variety of products from food, alcohol, to
cigarettes we had to constantly keep inventory managed in order to make the
store run smoothly. Since the convenience store that I worked at was a
franchise, there was one main distributor that the store purchased from. There
were incentives to purchase specific items and sell them in the store such as
for promotional purchases. These were the items that my boss would incentivize
me to sell. Certain contracts gave special discounts for the sale of certain
products so these were the products that my boss would tell me to try and entice
the customers to sell. <o:p></o:p></div>
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On the other spectrum, I would deal
with customers on a daily basis. Often times these customers were my regulars.
I would build a relationship with these certain people that would come in on a
regular basis. These were the type of people that would stop in and would take
the time to talk to me. In addition, these customers would often times give me
their input on specific products that they would like to see in the store. For
example one particular brand of cigars would sell very fast whereas others
would sit on the counter for months at a time. When I would try to communicate
to my boss these suggestions, there would be a mix of attitudes. While my boss
sometimes respected my input, there were other times in which they would simply
be ignored because of the protocol of the franchise. There was definitely a
conflict between what certain products consumers demanded and the choice of
products that my boss made from a higher up position in this organization. The
main issues that arose because of this triangular principal agent problem came
from asymmetric information between the various principals. There is a
discrepancy between what consumers demand and the information about various contracts
and promotions. While I looked to satisfy the party of my boss, I sometimes
felt pressured to agree with my customers. I would definitely try to actively
sell the products that had a promotion. It became difficult at times trying to
explain to my customers why my manager wouldn’t take the advice of multiple
customers. <o:p></o:p></div>
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Joseph Stiglitzhttp://www.blogger.com/profile/14432026525082105215noreply@blogger.com0tag:blogger.com,1999:blog-7579859252522271766.post-75095012752847470872013-10-25T02:59:00.000-07:002013-10-25T02:59:00.840-07:00Group Settings<div class="MsoNormal">
Working in a group setting brings to mind many conflicting
attitudes. Specifically, there are those time in which I have personally strived
very well in a team setting. When everything just works right, there is great
communication, attitude, and a sense of accomplishment when everything is said
and done. On the other hand, there have been quite a few experiences in which I
have experienced a group setting utterly failed. These bad experiences are
usually plagued with inefficient communication and an overall inhibited sense
of morale for the team. <o:p></o:p></div>
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In one of my recent school projects, I had to meet with a
partner in order to prepare a presentation for the class. This was a very
pleasant experience because I was able to work with someone that was able to
communicate effectively with me and have the same incentive to do well in the
course. We decided to meet in the library a week before our presentation. We had
both previously prepared for our meeting beforehand so we were able to utilize
our research into producing a presentation. This saved us a lot of time because
we committed our effort to preparing for our meeting. Furthermore, we were both
motivated to do well on the project. Everything just seemed to work so smoothly
because it was on a subject that we were both passionate about. I attribute
this success to having matching personalities. There are just some people that
you seem to click with even from the beginning. <o:p></o:p></div>
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I’ve also had experiences where things did not work so
smoothly. One of these experiences that come to mind is when I had a group
project in one of my classes last semester. This was a group project in which
there were 3 other members including me. This experience was disastrous in the
sense that nothing was accomplished. We had previously exchanged emails and
were trying to arrange for a group meeting sometime before the group project.
It seemed as if communication was a huge issue because it was such a hassle to
effectively even agree to a meeting. Once we decided upon a time and place, 2
of the group members decided not to show up. We eventually had to complete this
project the day before it was due. There was no sense of morale or team spirit
in the group because 2 of the other members were gone. The attitudes that
prevailed the members of the group that showed up was that the distribution of
tasks in the group was unfair. This was a very stressful experience that has personally
taught me how a group setting can be more detrimental than helpful. Being prepared
to deal with unexpected situations such as a group member not showing up is an
important characteristic of any group setting. The cliques that formed in this
situation were the people that actively contributed to the project and those
that did not. There was a clear distinction between people that cared about the
project and the people that didn’t. <o:p></o:p></div>
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Joseph Stiglitzhttp://www.blogger.com/profile/14432026525082105215noreply@blogger.com1tag:blogger.com,1999:blog-7579859252522271766.post-32353977649199774122013-10-20T15:09:00.002-07:002013-10-20T15:09:53.053-07:00Procedural Fairness in Team and Individual Settings. <div class="MsoNormal" style="text-indent: .5in;">
<span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 107%;">This was a very
insightful piece that analyzed the wealth distribution using behavioral
psychology as an example to explain a specific phenomenon. I personally believe
that this article touches on important topics such as “procedural fairness”
which I found to be incredibly interesting. The psychological aspect of examining
how someone receives wealth affects the distribution of this wealth was in
particular something that did not occur to me before. I have personally
experienced this phenomenon of procedural fairness when it comes to working with
in a group environment. The concept of team vs. individual production as we
discussed in class can be applied in the same experiment. <o:p></o:p></span></div>
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<span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 107%;">One example that shows
this is when working in a group environment compared to an individual
environment in a school setting. When working in a group, all the members of
the group must contribute their effort in order for a final grade to be
determined for the entire group. For these reasons, group members will often insist
that every group member contribute an equal amount of work. If someone if
slacking it would not be fair for that person to get a higher grade because the
other people in the group were able to contribute on his behalf. On the other
hand, individual work in a school setting corresponds with the effort that the
person puts into the assignment or studying for a test irrelevant of other
people. The procedural setting of working in a group or studying for a test by
yourself corresponds with the distribution of wealth or in this case grades. <o:p></o:p></span></div>
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<span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 107%;">Furthermore, this
article strikes an interesting point when the author states that “<span style="background: white; color: #333333;">The compression went into reverse in the
1980s, and since then, inequality has risen to levels approaching those of
1929.<span class="apple-converted-space">” This fact alone shows the resulting implications
of our current societal approach towards wealth distribution. It is simply not
working. The author proceeds to further insist that democrats focus more on
more ways to achieve a more balanced wealth distribution by focusing on the
procedural fairness as discussed above. Some ideas that crossed my head when
reading this article was just about ways in which this can be accomplished. The
people is trying to achieve this wealth distribution by offering incentives for
people to take on this approach without opposition for giving out handouts. <o:p></o:p></span></span></span></div>
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<span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 107%;">I personally believe
that one way to solve the problem of unequal wealth distribution is to promote
economic equality by putting more emphasis on the work culture. If we value the
workers on the edge then there would be less opposition for fairer distributions
of income. The notion that managers and CEOs should make millions of dollars
based off of commissions or performance should be less idealized. If there is
more cooperation and involvement from both the higher ups and the workers that
constitute the majority of the production and other operations, then people
could see how to divide income more evenly. This type of attitude is very prevalent
in Japan, in which managers do not make substantially more than the workers at
a company. <o:p></o:p></span></div>
Joseph Stiglitzhttp://www.blogger.com/profile/14432026525082105215noreply@blogger.com3tag:blogger.com,1999:blog-7579859252522271766.post-4323047599333651942013-10-04T14:00:00.001-07:002013-10-04T14:00:04.902-07:00Transfer Pricing "Illinibucks"<div class="MsoNormal" style="text-indent: .5in;">
The notion of “illinibucks” in
theory sounds like an interesting concept but in actually would be difficult to
implement in my opinion. Our current process utilizes a system in which we
prioritize by a first come first serve basis, by seniority, or different
colleges of study. I believe that our current system is fair because we place
emphasis on taking the initiative such as waiting in line. The implementation
of illinibucks would seem to promote greater utility but would be hard to carry
out because I believe that there would be many conflicting attitudes towards
this type of system. For example, one problem illinibucks would create would be
to make it unfair towards people that are very active and involved. These are
people that register for their classes at their earliest convenience or arrive
ahead of time in order to wait in a line. These people would be at a
disadvantage because they would have the same priority as someone that would
normally not take the initiative to do these things. <o:p></o:p></div>
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Furthermore, illinibucks would make
it incredibly difficult for upperclassmen to for major specific people to
select the classes that they need to take. Under our current system, we place
priority for people that need to take these classes. If everybody had
illinibucks, anybody would be able to have an early selection for a class that
they hypothetically would not need. The benefits to illinibucks would be create
more efficiency when it comes to consumer decisions. Consumers would be smarter
about dedicating their resources by using illinibucks. They would have to
consider what specific things they value such as waiting for a class or waiting
in line for a football ticket. Lines would invariably be smaller or more well-organized
because consumers would not spend unnecessary illinibucks for things that they
don’t need. <o:p></o:p></div>
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If I were given the opportunity to
use illinibucks I would utilize my illinibucks primarily for important things
such as school. I would make sure to allocate my illinibucks to selecting
classes or meeting with my academic advisors first before I would use them for extracurricular
such as buying tickets to sporting events. I could see potentially problems
arising from the process of allocating illinibucks. Would students be given the
same amount of illinibucks per semester? Could students buy more illinibucks if
they needed them? Problems could arise because people could see some injustices
from people being able to afford to buy more illinibucks. How would the school
deal with students that don’t have the money to buy additional illinibucks?
Would they get less priority for important things such as selecting classes?
The transfer pricing of illinibucks would create many issues depending on if
the administered price was either too low or too high. As mentioned before, if
the administered price was too high then students that are unable to buy these
illinibucks would be at a disadvantage. If prices were administered too low,
then consumers could see problems arising from too many people having priority
over others. These would create longer lines and consumers would see the
illinibucks as being useless because people would be able to afford more of
them. <o:p></o:p></div>
Joseph Stiglitzhttp://www.blogger.com/profile/14432026525082105215noreply@blogger.com2tag:blogger.com,1999:blog-7579859252522271766.post-8838400998656273672013-09-27T08:44:00.001-07:002013-09-27T08:44:35.387-07:00Managing Financial Risk after Graduation<div class="MsoNormal" style="text-indent: .5in;">
The risk of financial security,
being independent, and being able to provide a living for oneself is definitely
an area of great importance for many college students. As an economics major, I
am still faced with the constant pressures of handling this type of future
graduation risk because of the way that I’ve seen my friends deal with the
current job market right now. Many of my friends that have graduated have
managed this risk quite well and are doing very well for themselves financial.
In addition, I have also seen some of my friends unable to find a job after
they have graduated because of the dynamics of the labor market in their
particular field of study. Personal experience has taught me that I need to
develop the skills in order to make myself marketable in the labor force. For
these reasons, I’ve taken the necessary actions in order to minimize the risk
of financial security such as being smart with my money and actively seeking
the work experience that I need to find a job after graduation. This is
something that I value greatly because I am currently in debt with my student
loans and I know that I have to be responsible for this money by being able to
provide an income for myself. <o:p></o:p></div>
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I am currently unemployed so being
frugal with my money has always been a topic of great concern. I track my
personal finances every day and make sure that I do not spend excess amounts of
money on things that I don’t need. Furthermore, I would consider myself to be a
fairly competent shopper. Essentially, I don’t spend any money where I don’t
need to. One example of how I am frugal with my money is the fact that I rarely
eat out. I typically buy my groceries in bulk and look for specials.<o:p></o:p></div>
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I have been developing my
marketability in the labor market by working this past summer. I was involved
in a start-up company. This experience gave me a tremendous amount of insight
on the daily operations of a business. I believe that working and gaining
necessary work experience is very important to managing financial security
after I graduate. I have personal seen my neighbor go through the college
experience and be unable to find a job once he graduated. This was primarily
due to his lack of work experience. Even though he had a degree, many companies
are unwilling to hire people if they do not have any prior work experience. My
friend essentially had to work as an intern without pay before he was able to
find a position with a salary. This experience has taught me to actively seek
either employment or an internship before I graduate college. This way I will
have the necessary work experience prior to graduating and will make job
finding a lot smoother. <o:p></o:p></div>
Joseph Stiglitzhttp://www.blogger.com/profile/14432026525082105215noreply@blogger.com1tag:blogger.com,1999:blog-7579859252522271766.post-54297547187381861832013-09-19T18:45:00.001-07:002013-09-19T18:45:21.193-07:00Opportunistic Behavior<div class="MsoNormal" style="text-indent: .5in;">
Opportunistic behavior is the
notion that one party will take advantage of a specific circumstance given the
choice in order to benefit their own self interests. This type of behavior may
range from a criminal robbing a store at gun point to a company taking
advantage of cheap labor in another country in order to produce a product.
Although these two circumstances are very different, they both potentially
display opportunistic behavior in the sense that one party is promoting their
own self-interests with disregard of the consequences whether directly or
indirectly on others. <o:p></o:p></div>
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More specifically, a robber would
directly harm the store owners and society as a whole in order to expand his
economic interests. A company that outsources its production process to a
country where there are trade advantages would benefit the company at the
expense of its laborers. These are simply general examples of where
opportunistic behavior can be clearly seen. In the real world however,
opportunistic behavior can be difficult to see because of the lack of
information. It’s difficult to often see the true intentions or incentives that
drive a certain individual or party. The application of the concept of
opportunistic behavior is especially prevalent when it comes to economics in
the sense that this type of behavior can be seen as being unethical or immoral.
Societal values dictate whether a certain choice is acceptable or not. There is
often conflicting values between the self-interests of an individual and what
is acceptable, but this is not mutually exclusive. Individuals can pursue their
own self-interests without negatively affecting others or by even bettering
others as well. <o:p></o:p></div>
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One example in which I have
personally experienced the chance of behaving opportunistically was when I was
faced with the decision of whether or not to sell my tickets to a concert that
I had purchased. I was faced with a dilemma of whether I should go to this show
and ultimately decided not to go because my friends could not attend this
concert with me. Since this was a sold out show, the demand for tickets was
incredibly high. I had seen multiple people asking for these tickets through
online media such as facebook and craigslist demanding tickets for above the
market price. Ticket scalping is an example of opportunistic behavior in which
people sell tickets above the market price for shows that are sold out or with
incredibly high demand. It is often looked down upon but not enforced
whatsoever through local laws. I had initially bought my ticket for $30 and I
advertised my concert ticket to my friends on facebook. I had multiple offers
of $100+ from a few of my friends but I ultimately decided to forgo this
economic profit by selling it for what I had paid for to one of my close
friends. <o:p></o:p></div>
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I decided not to behave
opportunistically in order to benefit my self-interests because I looked at the
situation as simply helping out my friend. Another reason that I believed that
I did not act opportunistically was because I wanted to be seen as an ethical
individual. People often look down upon ticket scalpers because their business
practice revolves entirely on acting opportunistically in order to promote
their economic interests. In the end, my choice to sell my ticket for the base
value was definitely worth it in my opinion. My friend was wholeheartedly
appreciative of being able to buy my ticket and he later gave me free tickets
to another concert. <o:p></o:p></div>
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Joseph Stiglitzhttp://www.blogger.com/profile/14432026525082105215noreply@blogger.com2tag:blogger.com,1999:blog-7579859252522271766.post-74562664287150901232013-09-12T18:59:00.003-07:002013-09-12T18:59:26.769-07:00Organization of a Startup Restaurant<div class="MsoNormal" style="text-indent: .5in;">
This past summer I was involved in
a startup for a restaurant that will be opening up in a few years. This
particular restaurant is a family run business and is dedicated to providing
health conscious food options for consumers. More specifically, this restaurant
is distinctive in the sense that it offers a tremendous variety of foods to
meet a niche market. My role in this startup was to help coordinate a business
plan and implement it by helping to develop new products that the restaurant
would provide, plan, and organize future workers for the restaurant including architects,
chefs, and food suppliers. It was a very novel experience and has helped me
tremendously by providing the experience that I need to start and run a
business. <o:p></o:p></div>
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The structure of the restaurant was
based on a hierarchal structure. My co-workers and I would work together in a
group in order to do all the research and attend to business meetings in order
to implement the business plan. Ultimately, our input was reviewed by the two
owners of the restaurant, who would then sign off on our work or provide their
input in order to point us in the right direction. <o:p></o:p></div>
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The initial process of starting up
the restaurant was very political. The paper work required in order to legally
establish this restaurant was incredibly arduous. Everything from safety
requirements to building codes had to be signed off by a committee in the town.
Several attempts were made to submit the proper paperwork for review before the
committee was able to grant the right to start building the restaurant. Furthermore,
the board of committees were very demanding about having the right referrals
from people. This process was denied several times before we were able to hire
a lawyer in order to present our submission for this business. <o:p></o:p></div>
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After we obtained the right
licenses in order to build the restaurant we had to attend various business
meetings in order to hire the people to run the restaurant. The interview
process for the chefs were relatively straight forward. We interviewed several
chefs and rated them based off their skill and knowledge about health foods,
specifically those that were knowledgeable about vegan as well as gluten free
cooking. My co-workers and I offered our opinions about each chef and
ultimately the owners took this consideration into account when selecting the
right chef. <o:p></o:p></div>
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The transaction costs associated
with starting up a restaurant were numerous. One of these is the fact that we
did not have enough information to make an insightful decision for our
suppliers. We were looking into various organic and small time farmers in the
local area that we could depend on specifically for our menu items like
smoothies and salads. It was very difficult to discern between the quality of
certain fruits and vegetables. The organic market is so diverse in the sense
that the requirements for a product to be labeled organic is so lenient. It is
very difficult to find a quality product that would be cheap enough to still
make a profit as an item on the menu. Another transaction cost that I
personally experienced was the negotiating that was involved in starting up the
restaurant. There would be several rounds of negotiations between the committee
in order to get the restaurant approved. Furthermore, there were numerous
meetings with the architect in order to design a building that would meet the
building code regulations but would also suite the needs of this particular restaurant.
We had to bargain for the implementation of separate refrigerators and kitchens
in order to prevent the cross contamination of gluten free products. <o:p></o:p></div>
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Joseph Stiglitzhttp://www.blogger.com/profile/14432026525082105215noreply@blogger.com4tag:blogger.com,1999:blog-7579859252522271766.post-18834969471542802542013-09-05T17:49:00.002-07:002013-09-12T18:58:35.103-07:00Joseph Stiglitz<div class="MsoNormal" style="text-indent: .5in;">
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Joseph Stiglitz is an influential economist
that was born in Gary, Indiana. He attended the Amherst University for his
undergraduate studies and then later received his PhD at the Massachusetts
Institute of Technology. He currently is
a Professor at the University of Columbia and has had numerous contributions in
the field of economics. These include winning the Nobel Peace prize in 2007 for
his work in studying asymmetrical information in insurance market, developing
the Shapiro-Stiglitz model which explains efficiency wages, as well as working
with the United States government under Clinton and the Obama information by
serving on the council of economics. Some of the areas of research that he is
known for are in efficiency wages in unemployment, income distribution,
anti-trust laws, and globalization. <o:p></o:p><br />
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Stiglitz began working with the
Clinton administration in 1992 and has served on the council of economics to
provide consultation to the United States government. Furthermore, he has
worked under the Obama administration to deal with the financial crisis during
the financial housing market crisis. He has been noted for criticizing the
policies of the Obama administration in regards to the financial recovery
plans. In addition to his work in the government, Stiglitz has provided
contributions in economics through his research in the efficiency of wages in
unemployment even under equilibrium. More specifically, he has developed a
model with Shapiro called the Shapiro-Stiglitz model in 1984. This model seeks
to explain the structure of unemployment through certain assumptions about
human behavior. <o:p></o:p><br />
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His research into insurance led him
to win the Nobel Peace prize in 2007. Stiglitz did research into the insurance
market and discovered that there were differing levels that buyers and sellers
had in the insurance market. In particular people buying insurance typically
have more information than the companies that they are buying from. The
implications of this particular study resulted in a better understanding of the
concept of asymmetrical information. This concept is where one party has more
information over another. <o:p></o:p></div>
While researching about Stiglitz I
was particularly interested in his role in the United States government. One of
my research interests is being able to develop and understand models on a
Macroeconomic level and more specifically on an international level. I did not
know any about Stiglitz before this project, and I was pleasantly surprised at
how influential his work has been in the fields that I am currently studying.
Stiglitz works seems relevant to this course, especially the Shapiro-Stiglitz
model when it comes to the structure of businesses and society in order to
explain unemployment as well as the productivity and efficiency of a particular
market. In the Shapiro-Stiglitz model, he explains that there is market failure
because of the structure of our government. Our government implements minimum
wage laws that makes the labor market inefficient because this price does not
correspond with the equilibrium price of that wage.<br />
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<o:p></o:p></div>
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Citations</div>
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<a href="http://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/2001/stiglitz-bio.html">http://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/2001/stiglitz-bio.html</a></div>
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<a href="http://www.econlib.org/library/Enc/bios/Stiglitz.html">http://www.econlib.org/library/Enc/bios/Stiglitz.html</a></div>
Joseph Stiglitzhttp://www.blogger.com/profile/14432026525082105215noreply@blogger.com1