The Duke Journal of Economics is published each year to showcase outstanding research in economics by Duke undergraduates.  Additional pieces will appear after their authors revise them.

We congratulate the authors of the research presented in this issue.

Charles Becker & Ed Tower, Faculty Advisors to the Journal

Honor’s Theses

Sexually Risky Behavior, its Social Determinants, and the Economic Consequence of HIV/AIDS in Zimbabwe by David Bochetto

Oil, Population Growth, and the Resource Curse by Tim Gu

Cell Phones and Cattle: The Impact of Mobile Telephony on Agricultural Productivity in Developing Nations by Daniel Houghton

Is Public Expenditure on Primary Education Effective? Evidence from Districts Across India by Tara Iyer

Do Medical Malpractice Reforms Affect Health Care Costs and Outcomes? by Matt Johnson

A Bargaining Theory of the “Edwards’ Effect” on the 2007-8 Democratic Presidential Primary by Alex S. Li

A Model of Speculative Attacks and Devaluations in Korea and Indonesia by Austin Yi Lin

Bundling Donations to Charity with Product Purchases: A Business Incentives Model by Kassity Liu

Rational Lifetime Investment Strategies: Gender Differences in the Allocation of Assets in Retirement Savings Plans by Chase Lancaster & Anubhav Raj

Leveraging the American Dream: Explaining the Shift Towards Mortgage Debt since the 1970’s by James Robert Melnick and James Colin Montupet

Contagion in Risk Markets by Matthew Moore and James Schulhof

Valuing Localized Externalities: Hog Operations in North Carolina by Sara Murray

Seasonal Volatility of Corn Futures Prices by Caleb Seeley

Does the Quality of Public Transit Affect Commuters’ Response to Gasoline Price Changes? by Allison Smith

Does the NBA Encourage Early Entry? by Griffin T. Tormey

The Thought That Counts: Towards a Rational Theory of Gift-Giving by Lydia Yao

Building Quality in Wikipedia: A Theoretical Approach by Guangyuan Zhu

Articles

Intractable Immigration: Why Americans Cannot Reach Consensus by Jonathan E. Amgott

Engaging with Malthus: Joseph J. Spengler and Economic Demography by Thomas F. Aten

Clarifying the “Win”: An Economic Review of the CARS Bill by Daniel DeVougas

A Comparative Assessment of New Urbanist Neighborhoods: Durham, NC & Greenville, SC by Phillip Gao

The Campaign Against NAFTA: An Irrational Attack on Free Trade by Jackie Lopez

The seventh annual Undergraduate Research Symposium was held in April 2009 in the Social Sciences building. Congratulations and thanks to all the authors, who wrote outstanding papers and gave polished presentations.

Charles Becker & Ed Tower, Faculty Advisors to the Journal

Articles

Assessing Consumer Valuation of Fuel Economy in Auto Markets by Nicholas Bunn and Daniel Fifer

Soft-Targets and Incentive Compensation in Non-Profit Organizations by Helin Gai

Testing the Relationship Between Oil Equities and Oil Futures with High-Frequency Data: A Look at Returns, Jumps and Volatility by Brian Jansen

Do Medical Malpractice Reforms Affect Health Care Costs and Outcomes? by Matt Johnson

Caught Red-Handed: Corporate Labor Practices and the Investigatory Media, a New Look at Corporate Social Responsibility by Jessica Lohrman

Contagion in Risk Markets by Matthew Moore and James Schulhof

Does the Quality of Public Transit Affect Commuters’ Response to Gasoline Prices? by Allison Smith

Does the NBA Encourage Early Entry? by Griffin Tormey

A Theory of Optimal Sick Pay by Andrew Tutt

The Impact of Sector and Market Variance on Individual Equity Variance by Haoming Wang

The Risk-Loving Decisions of Low-Income Households by Sarah Whitley

The Thought That Counts: Towards a Rational Theory of Gift-Giving by Lydia Yao

The Duke Journal of Economics is published each year to showcase outstanding research in economics by Duke undergraduates. This volume contains both honors theses and essays. The articles are examples of research written by Duke Undergraduates and Masters students at various stages of their economics education at Duke. Honors theses which were presented at the 2008 undergraduate research symposium and are to be published in the special edition of the Duke Journal of Economics devoted to that symposium are not included here. Additional pieces will appear after their authors revise them.

The Allen Starling Johnson, Jr, prize for the best honors thesis was earned by Andrey Fradkin for his thesis: “A Comparative Study of the International Content of Implied Volatiling.” The prize for the best presentation at the 6th Annual Economics Undergraduate Economics Symposium was earned by Aleksandr Andreev for his honors thesis: “Assessing Disability Rates in the Russian Federation.” He has been awarded a Fulbright to Russia to continue work on the project.

Ten undergraduates and M.A. students wrote book reviews in the spring of 2008, which have been scheduled for publication in scholarly journals. We are delighted that their critical skills are being appreciated by the profession.

These are:

• Megha Bisarya, Escape From Empire: The Developing World’s Journey Through Heaven and Hell, by Alice Amsden, MIT Press, 2007, Asian Journal of Social Science, forthcoming in early 2009.
• Mark Curtis, What Do We Know About Globalization? by Guillermo de le Dehesa, Blackwell, 2007, Journal of Economic Issues, forthcoming in December 2008.
• Johannes Fritz, Europe’s Troubled Region: Economic Development, Institutional Reform and Social Welfare in the Western Balkans, by William Bartlett, Routledge, 2008, Journal of East European and Black Sea Studies (published by the Hellenic Foundation for European and Foreign Policy and Routledge in Great Britain), forthcoming in September 2008.
• Ikee Gardner, Capital Rules: The Construction of Global Finance, by Rawi Abdelal, Harvard University Press, 2007. Journal of Economic Issues, forthcoming in September 2008 or March 2009.
• Chamindra Goonewardene, The Future of Microfinance and Poverty Alleviation, by Tazul Islam, Ashgate, 2007, Journal of South Asian Development (published in Australia), forthcoming in August 2008.
• Caitlin McLaughlin, Creating a World Without Poverty: Social Business and the Future of Capitalism, by Muhammad Yunus, Perseus Publishing, 2008, Linked on the author’s web site: http://www.muhammadyunus.org
• Brian Mokoro, After War: The Political Economy of Exporting Democracy, by Chrisopher Coyne, Stanford University Press, 2007, New Perspectives on Political Economy (published in the Czech Republic, Volume 4, Issue 1), http://pcpe.libinst.cz/nppe/
• Nur M. Adhi Purwanto, Colonial Legacies: Economic and Social Development in East and South East Asia, by Anne E. Booth, Hawaii University Press, 2007, ASEAN Economic Bulletin (published in Singapore), forthcoming in August/December 2008.
• Parul Sharma, India – The Emerging Giant, by Arvind Panagariya, Oxford University Press, 2008, South Asia Economic Journal (published by The Institute of Policy Studies, Colombo and Research and Information Systems for Developing Countries, New Delhi), forthcoming in Volume 9, No. 2., July 2008.
• Gracia Sierra, The Elephant and the Dragon: the Rise of India and China and what it Means to All of Us,  by Robyn Meredith, W. W. Norton and Company, July 2007, ASEAN Economic Bulletin (published in Singapore), forthcoming in September or December 2008.

We congratulate the students mentioned above and the authors of the research presented in this issue.

Thanks go to Chris Genwright, who put the journal online.

Charles Becker & Ed Tower, Faculty Advisors to the Journal

Honor’s Theses

Tracking Decisions in North Carolina’s Public High Schools by Michael B. Harris

Predicting Financial Debt Crises: A Case Study of India by Matthew Sperber

How Information from a Strategic Alliance Network Relates to Future Acquisition Performance in the Biotechnology and Pharmaceutical Industries by Stephen McGregor Raymond

Analyzing and Applying Existing and New Jump Detection Methods for Intraday Stock Data by W. Warren Davis

The Role of Conflict Diamond Sanctions in Civil War Resolution by Karin Sun

Socioeconomic Factors and the Outcomes of Thailand’s Prevention of Mother-To-Child Transmission program (PMTCT) by Wichsinee Wibulpolprasert

Articles

The impact of cigarette excise taxes on beer consumption by Jeremy Cluchey & Frank DiSilvestro

Greed and the Bloomsbury Group How the Concept of Greed Impacted John Maynard Keynes and His Friends by Adam Finkelstein

Predicting Urban Crime In Diverse Settings by Johannes Fritz

Does the State Business Tax Climate Index Provide Useful Information for Policy Makers to Affect Economic Conditions in their States? by Geoffrey King and Jake Palley

The Economic Implications of Child Labor: A Comprehensive Approach to Labor Policy by Jamie Gordon

The “Balancing Trade Act of 2007” by Brian Grube

Empirical Analysis of Rural Development along Interstate Highways by Andrew Kindman

Evaluating the Elderly Retired in a Tiebout Context by Harry Lee

Racial Disparities in Durham County Public Elementary Education: A Picture That Is More than Black and White by Kristen Manderscheid

Do Mandatory and Recommended Arrest Laws Decrease Female Homicide Rates? by Kari Points and Celeste Richie

U.S. Bilateral Free Trade Agreements with Chile and Singapore by Grant M. Reeves

Residential Water Demand in Durham, NC, at the Onset of the 2007 Drought 
by Wichsinee Wibulpolprasert

The sixth annual Undergraduate Research Symposium was held on April 11-12 in the Social Sciences building. Thirteen papers were presented by students from Duke University, the University of Carolina at Chapel Hill, and Davidson College. This year, we received more submissions than ever and the overall quality of the papers, even the ones not accepted, was quite high.

Financial economics was again a popular topic for student research, particularly among Duke students. Peter Van Tassel presented “Patterns Within the Trading Day: Volatility and Jump Discontinuities in High Frequency Equity Price Series,” Andrey Fradkin presented “The Informational Content of Implied Volatility in Individual Stocks and the Market,” and Ryan Tolkin and Michael Sloyer presented “VIX as a Fix: Equity Volatility in a Life Cycle Investing Context.” All of these authors are Duke students. Emmanuel Bello from UNC-Chapel Hill mixed financial economics with industrial organization in his paper, “Revisiting the Davis Thesis: Preliminary Evidence of Stock Market Impact on Industrial Concentration.”

Family economics was also well represented at this year’s Symposium. These papers included “The Effects of Sexual Education on Women’s Labor Force Participation,” by Meghan Morris of UNC-Chapel Hill; “Risky Business: The Effect of Family Income on Teen Risky Sexual Behavior,” by Valerie Kaplan and Caitlin McLaughlin, both of Duke; and “The Effect of Abortion Restrictions on Foster Care Entry Rates,” by Sarah Sutherland, also a Duke student.

Education policy was the other topic area with multiple papers presented. The first was “Tracking Decisions in North Carolina’s Public High Schools,” by Mike Harris of Duke. The second was a joint effort among Davidson College students Ben Ellinor, Arthur Etchells, and Andrew Waddell entitled “Improving Charlotte-Mecklenburg Schools: Addressing Labor Market Failures.”

Several other excellent papers individually represented other fields of economics. Aleksandr Andreev’s paper “To Work or Not to Work: Labor Supply Decisions of Russia’s Disabled” dealt with a fundamental issue in labor economics. Aleksandr is a Duke student. R. Andrew Butters of UNC-Chapel Hill presented this year’s microeconomic theory paper, “The Effect of the Learning Curve on the Optimal Dynamic Contract.” And finally, Sruthi Thatchenkery of Duke presented the timely empirical microeconomics paper “Determinants of Demand for Hybrid-Electric Vehicles.”

One paper presented in this year’s Symposium does not appear in this issue of the DJE because it has already appeared in an earlier issue: Jiasheng Lee’s “Evaluating the Elderly Retired in a Tiebout Context.” Jiasheng is a Duke student.

Special congratulations go out to Aleksandr Andreev for winning the Best Paper prize, and to Peter Van Tassel, who won the Runner Up prize this year.

Connel Fullenkamp, 
Faculty Sponsor

Articles

To Work or Not to Work? Labor Supply Decisions of Russia’s Disabled by Aleksandr A. Andreev

Revisiting the Davis Thesis: Preliminary Evidence of Stock Market Impact on Industrial Concentration by Emmanuel Bello

The Effect of the Learning Curve on the Optimal Dynamic Contract by R. Andrew Butters

The Informational Content of Implied Volatility in Individual Stocks and the Market by Andrey Fradkin

Tracking Decisions in North Carolina’s Public High Schools by Michael B. Harris

Risky Business: The Effect of Family Income on Teen Risky Sexual Behavior by Valerie Kaplan and Caitlin McLaughlin

The Effect of Sexual Education on Women’s Labor Force Participation by Meghan Morris

The VIX as a Fix: Equity Volatility as a Lifelong Investment Enhancer by Michael Sloyer and Ryan Tolkin

Undue Burdens: The Effect of Abortion Restrictions on Foster Care Entry Rates by Sarah MacDonald Sutherland

Determinants of Automobile Demand and Implications for Hybrid-Electric Market Penetration by Sruthi M. Thatchenkery

Patterns Within the Trading Day: Volatility and Jump Discontinuities in High Frequency Equity Price Series by Peter Van Tassel

The Duke Journal of Economics is published each year to showcase outstanding research in economics by Duke undergraduates. This volume contains both honors theses and essays. The articles are examples of research written by Duke Undergraduates at various stages of their economics education at Duke. Honors theses which were presented at the 2006 undergraduate research symposium and are to be published in the special edition of the Duke Journal of Economics devoted to that symposium are not included here.

The Allen Starling Johnson, Jr, award for the best thesis was shared by R. Selin Dilmenter and Tzuo Hann Law. Dilmenter’s thesis “A Theory of Evacuation as a Coordination Problem” is published in the symposium issue of the DJE, and Law’s thesis, “The Elusiveness of Systematic Jumps,” is published in this issue.

We dedicate this issue to the memory of Peggy East. Peggy joined the Duke economics department in 1979, serving as secretary and eventually the administrative assistant and continuing to return to help after her retirement from full time work. At our service in her honor this spring several members of the department spoke. We include their reflections on Peggy here. At the service Tom Nechyba announced that henceforth the economics department conference room would be known as “The Peggy B. East conference room.” Her name is on the door and her picture on the wall facing those of the past chairs of the department.

Some honors theses lead to publication in the profession’s peer reviewed journals.  Pauline Abetti (Duke BS, Economics, 2006) will be publishing a revision of her honors thesis, “Congressional Voting on DR-CAFTA: A Focus on Environmental Lobbying” in the March 2008 issue of the Journal of Economic Policy Reform.

Five undergraduate and master’s students wrote book reviews in the spring of 2007, which have been scheduled for publication in scholarly journals. We are delighted that their critical skills are being appreciated by the profession. These are:

• Indra Astrayuda, On the Wealth of Nations, by P.J. O’Rourke. Atlantic Monthly Press, 2006. Econochannel (published by State University of Jakarta, Indonesia) forthcoming in September 2007 and also on the journal’s website.
• Simon Blank, A Corporate Solution to Global Poverty: How Multinationals Can Help the Poor and Invigorate Their Own Legitimacy, by George Lodge and Craig Wilson. Princeton University Press, 2006. Journal of Economic Ideas.
• Agung Budilaksono, East Asia, Globalization, and the New Economy, by F. Gerard Adams, Routledge, 2006. South Asia Economic Journal, (published in India) forthcoming in September 2007.
• Katelyn Donnelly, The Marketplace of Christianity, by Robert B. Ekelund, Robert Hébert, and Robert Tollison. MIT Press, 2006. History of Political Economy.
• Annah Peterson, Africa’s Silk Road: China and India’s New Economic Frontier, by Harry G. Broadman, The World Bank, 2007. Africa Today, forthcoming in early 2008.

Our department is pleased when undergraduates organize house seminars for themselves and other undergraduates. Joshua Kazdin developed and chaired a course titled “Investment, Political Economy and Economic Regionalism in Asia.” The syllabus for that course is available on the “Open Courseware for the Study of China’s Economy” website: http://ics.nccu.edu.tw/eced/eocw/.

We congratulate the students mentioned above and the authors of the research presented in this issue.

Thanks go to Chris Genwright, who put the journal online.

Charles Becker & Ed Tower, Faculty Advisors to the Journal 

Honor’s Theses

Occupation Segregation and Gender Earnings Differentials in Slovenia by Arup Banerjee

Cultural Capital in Ghana: How the Cooperative Maximizes its Potential to Create Locally Driven Economic Development in Rural Communities by Dan Baum

A Case Study on the Informational Role of Futures Markets: Can Weather Futures Forecast Electricity Consumption? by Ying Chiat Ho

An Empirical Study of the Anticommons Effect on Public vs. Private Researchers by Serena S. Lam

The Elusiveness of Systematic Jumps by Tzuo Hann Law

Modern ART: Determining a Couple’s Most Cost-Effective Embryo Transfer Decision by Theresa A. Poulos

Articles

Cursed by Bounty: The Natural Resource Curse and Policy Recommendations to Correct the Curse by Nick Anderson

The Impact of Globalization on U.S. Workers: Discussion of the Issue in American Society by Ikee Gardner

Innovation, Parallel Trade, and the Pharmaceutical Industry by Owen Gehrett

Modifications and Implications of Pricing Models: A Study of Assessed Property Values in Durham County, North Carolina by Meg Kedrowski

TRIPS and the Pharmaceutical Industry: A Welfare Analysis by Ashley Kustu

Hydrogen Fuel—An Economically Viable Future for the Transportation Industry? by Toby Kraus

Growth: A Tale of Trade by Sanjay Narayan