Wisconsin Business Review Issue 1

EDITOR-IN-CHIEF

JASON LI

DIRECTOR OF PUBLICATION

ABHINAV KUMAR

DIRECTOR OF RESEARCH

PRESTON WONG

EDITORIAL BOARD

JASON LI

ABHINAV KUMAR

PRESTON WONG

ALEX ARIKER

IRIS SKLAVOUNOU

EXECUTIVE BOARD

JASON LI

SATHYAM SAREEN

ILY GRINBERG

SIMON DEGNAN

KHUSHI JASPAL

ANDREW VANDERKOLK

TOM FIKES

CONTRIBUTORS

ALEX ARIKER

DEEPAK BADRI

KYLIE VON BERNTHAL

AADIT BHAVSAR

OLIVIA CARLBERG

CATHERINE DONOHUE

ILY GRINBERG

NOAH JAKEL

KADIE JULIAN

ABHINAV KUMAR

JASON LI

SAMANTHA LI

MALIN PHELAN

AVA RADLER

BEN ROCHE

ALEKSANDR ROSE

EVA SINELNIKOV

EVAN STROMINGER

ANDREW VANDERKOLK

PRESTON WONG

CLUB ADVISORS

BETSY LUNDGREN

CINDY BUSH

WWW WISCONSINBUSINESSREVIEW ORG

THIS EDITION IS DEDICATED TO

JIM FRANZONE

BETSY LUNDGREN

CINDY BUSH

PRESTON WONG

ILY GRINBERG

ABHINAV KUMAR

IRIS SKLAVOUNOU

ALEX ARIKER

FOR YOUR SUPPORT, TIME, AND EFFORT.

EDITOR’S LETTER — Frankly, I don’t know where to start if not from the beginning. About a year ago today, the Wisconsin Business Review did not exist. It was just an idea among the countless others that I’ve had. Fast forward to now, and not only are we a fully recognized student organization, affiliated with the Wisconsin School of Business, but we’ve been able to accomplish so much in the span of a year. It’s equally unbelievable as it is amazing.

In many ways, this magazine serves as the epitome of our collective journey.

The Wisconsin Business Review Issue 1 recognizes the work of our members, is our medium for student dialogue and perspectives on business, and our effort to promote the school and broader university as a focal point of commentary and research.

The structure of this magazine is deliberate, as it mirrors the structure of the organization. The Review is structured across Current Affairs, Opinion Commentary, Research, and Events. This is reflected in this edition through

The Grainger Tribune, Journal of Business, and the Wisconsin Ideas Conference.

This magazine would not be possible without the contributions of our members and review from our Editorial Board. In fact, the creation of this club and the work we’ve accomplished is because of the community and teamwork we have.

So thank you to everyone who helped play a part in our story, and let’s continue writing the next chapters.

Moving forward, my biggest hope and goal is to pass our mission and culture to the next generation. People will come and go, but our impact must be everlasting.

Sincerely,

TABLE OF CONTENTS

THE GRAINGER TRIBUNE 03

Sam Altman and OpenAI: The Saga, summarized ... Page 5

The symbol of the NFL’s growing power — a $255.4 million salary cap ... Page 13

Improve Your Focus in Three Easy Steps ... Page 15

Studying Business —The Academic Route: Entire Series ... Page 17

THE JOURNAL OF BUSINESS 31

Trendy Trunk Shows and Gameday Style: Recess Apparel .. Page 36

Weighing the Morality of Artificial Intelligence ... Page 38

America is Barely Ready for Artificial Intelligence ... Page 45

Methanol, Ammonia and the Race to Fuel Shipping ... Page 49

WISCONSIN IDEAS CONFERENCE 51

Navigating Higher Education Admissions

Post-SFFA ... Page 53

An Increased Gas Tax to Drive Reductions in Traffic Congestion Costs ... Page 60

LOOKING FORWARD 67

The Past, Present, and Future Page 69

THE GRAINGER TRIBUNE

TABLE OF CONTENTS

Sam Altman and OpenAI: The Saga, summarized

Reducing the Impact of Tourism on Coral Reefs: Hawaii's Ocean Stewardship User Fee

Fast Fashion and College Students

The “Long-Lost” Promise for Genome Editing: Checking in with CRISPR

Tesla Stock: Why Such a Steep Decline?

Your Guide to Sustainable Madison Businesses

The Boeing catastrophe—What went wrong and why the CEO is stepping down

The symbol of the NFL’s growing power a $255.4 million salary cap.

Improve Your Focus in Three Easy Steps

Studying Business The Academic Route: The entire series

SAM ALTMAN AND OPENAI: THE SAGA, SUMMARIZED

BY ABHINAV KUMAR, DIRECTOR OF PUBLICATION

TECHNOLOGY COMMITTEE GOVERNMENT LAW COMMITTEE

OpenAI, an AI-centered business responsible for products such as ChatGPT and DALL-E, was recently beset by internal conflict centered around their CEO, Sam Altman. The aim of this article is to lay out the

timeline of this story from its beginning to the current day.

November 16, 2023 Sam Altman, the CEO of OpenAI, is fired by the company’s board of directors. This move

was a shock to the entire tech-space, as Altman was

widely respected and OpenAI gave no prior indication

that they were planning on making such a controversial decision Kara Swisher, a journalist covering the

situation extensively, reported via X/Twitter that Altman

was fired because of a “ ‘misalignment’ of the profit

versus nonprofit adherents at the company.”

The board themselves cited “concerns about Altman’s leadership” as the reason for his firing After his firing, Altman was temporarily replaced by Mira Murati, OpenAI’s then-chief technology officer.

November 17, 2023 OpenAI’s co-founder and president, Greg Brockman, resigns from the company in light of Altman’s firing He relayed on X/Twitter, at 12:23 P M , he was informed by Ilya Sutskever, OpenAI’s chief scientist and co-founder, that he would no longer have a seat on the board He was also told on this call that Altman was fired Not long after this meeting, Brockman publicly announced his resignation from OpenAI

November 18, 2023 Microsoft, a rumored 49% stakeholder and major supporter of OpenAI, announces that it hired Altman and Brockman to lead a new research unit that will focus on developing artificial general intelligence (AGI) This was seen as a bold move by Microsoft, hiring two co-founders so quickly after they were let go by OpenAI Having both Altman and Brockman to help lead their AGI development would be of great benefit to Microsoft, as it would give them firsthand access to, and ownership of, OpenAI’s development of AGI until that point.

November 19, 2023 OpenAI announces that it has hired Justin.tv/Twitch co-founder Emmett Shear, a

prominent figure in the tech industry, as its interim CEO while they search for Altman’s long-term replacement. Shear’s role would be a stabilizing force for OpenAI per his own statements on X/Twitter, in which he also denoted that Sam Altman’s removal was “handled very badly” and had a major effect on the company, most significantly the board’s, reputation

November 21, 2023 OpenAI releases a statement saying that it has reached an agreement for Altman to return as CEO Though the statement doesn’t include a timeline, it notes that, upon Altman’s return, a new board of directors is to be formed and Altman will be included in it. On the night of the 21st, Altman published his own statement, expressing that he is “looking forward to returning to openai”

November 29, 2023 Microsoft gains a non-voting board observer seat on OpenAI’s board of directors and will be able to both attend board meetings and provide input itself This move will allow Microsoft more control over OpenAI, especially considering that it is currently not a majority stakeholder in the company and, thus, can not use a majority as leverage to influence affairs within the organization

December 4, 2023 OpenAI’s board is still being rebuilt. According to OpenAI, three directors are responsible for this process. One is Bret Taylor, the former co-CEO of

Salesforce, the second is Larry Summers, the former US

Treasury Secretary, and the third is Adam D’Angelo, a previous board member and CEO of Quora Though this

rebuilding process will go by “fairly quickly”, according

to Altman himself, the number of board members will

significantly increase along with Microsoft’s new pivotal position on it.

While this story is still developing, much of the controversy that took place in mid-November has been mostly resolved Though the tech community at large held its breath as these events unfolded in front of them, many are now pleased to know that such a widely-loved company will remain in one piece and is still committed to developing products and models that millions interact with every day.

Published in The Grainger Tribune on Dec 6, 2024.

REDUCING THE IMPACT OF TOURISM ON CORAL REEFS: HAWAII'S OCEAN STEWARDSHIP USER FEE

BY AVA RADLER, COMMITTEE CHAIR LIFESTYLE AND SUSTAINABILITY COMMITTEE

At the start of 2023, Bing Lin and David Wilcove, researchers at Princeton University, conducted research on the coral reefs in Hawaii by testing numerous bays and beaches across the state Their findings were published in a paper titled Coral reefs and coastal tourism in Hawaii, where it showcased how tourism contributes to the reefs' damage and the degradation of marine life in these areas. The tourist activities that were highlighted in this paper included scuba diving and snorkeling, both of which have caused harm to the coral reefs and marine life in Hawaii

Hawaii is a hot spot for tourists who come to enjoy the tropical weather, beautiful beaches, and unique activities such as hiking through rainforests or seeing volcanoes. In December of 2022, an estimated 871,870 tourists came to Hawaii Though the early months of the year are typically the peak travel season to Hawaii, yearround Hawaii is full of tourists, significantly impacting the coral reefs and ecosystem as a whole

Near the end of 2021, Hawaii passed an Ocean

Stewardship User Fee, which took effect on January 1, 2024. The legislation charges $1, to be collected by the Department of Land and Natural Resources, to individuals who participate in ocean recreation activities.

The revenue will be used to enhance coral reef conservation and restoration, fund further research, and reduce the negative impact on marine ecosystems. The Ocean Stewardship Fee hopes to instill values of sustainable tourism into those who travel to Hawaii and other destinations. It is vital, for both the natural ecosystem and local communities, that tourists are responsible and conscious of the environmental impact of their actions when traveling Hopefully, we will begin to see positive results from this legislation in future years. If so, other travel-heavy places worldwide may adopt similar policies to preserve their natural environment and promote sustainable practices.

Published in The Grainger Tribune on Apr. 15, 2024

FAST FASHION AND COLLEGE STUDENTS

BY MALIN PHELAN

LIFESTYLE AND SUSTAINABILITY COMMITTEE

Social media has touched nearly every aspect of our everyday lives. It has been incredibly impactful on a number of industries, with one of the most evident examples being the fashion industry and the rapid rise of “fast fashion ” Social media has made it so that the trend cycle rotates seemingly daily. For the first time, products are circling worldwide at a rate that would have been completely impossible before the 21st century. We now live in a world where it is deemed unacceptable by the masses to post twice in the same outfit. Our email inboxes are flooded with messages from clothing brands, each of them claiming to have the clothes most in touch with the recent trends.

The term “Fast fashion” is generally used in reference to brands that consistently release new clothing items and lines for incredibly low prices. Some of the “top” fast fashion brands (i e the ones with the greatest number of products for the lowest prices) include Shein, Temu, and TikTok Shop. Each of these companies has (rightfully so) had its own ethical concerns, particularly in relation to the labor policies used to ensure that these companies can continue to pump clothes out at such a low price to consumers. Many have been accused of using child labor, and reports have been made on the abysmal working conditions for many of the workers.

students for precisely this reason Typically, most students are working on a budget and can’t afford to spend exorbitant amounts of money on new clothes. In this sense, these sites solve a problem for them

However, it is vital to consider just how many of these clothing items eventually end up in the trash

Since beginning college, the fast fashion cycle has become even more apparent to me Wearing the same shirt for multiple nights out is an anomaly for many students–rather, it has become normal to order new tops and outfits monthly or even bi-weekly. Further exacerbating this issue is the fact that trends seem to change overnight. Because social media algorithms seem to arbitrarily decide what is worth promoting each day, a different style of clothing seems to be trending nearly every week, leading to the purchase of impermanently “trending” outfits. Clothing sites like Shein have perfected their business model, catering to impressionable young audiences using social media and influencers.

There are hundreds of websites out there with clothing items available for incredibly low prices. These sites sell tops, skirts, and jackets for anywhere from as little as three dollars, and attract so many college

It is also important to think about the marketing strategies of these brands. Fast fashion brands mark their prices up and then put them on sale for anywhere from 20% to 80% off, a tactic that urges its audiences to buy due to the seemingly “great deal” that the discount offers. TikTok Shop pushes certain products on its consumers–it is not uncommon to scroll on your “For You” page on TikTok and have every other video be an ad for a clothing product.

While it is difficult to avoid the fast fashion cycle, it is not impossible Simply being more conscious and taking the time to consider whether an article of clothing is really worth buying can make all the difference in the world With each consumer that works to shift the cycle, we can move towards a more sustainable, ethical future

Published in The Grainger Tribune on Apr. 15, 2023

THE “LONG-LOST” PROMISE FOR GENOME EDITING: CHECKING IN WITH CRISPR

BY KYLIE VON BERNTHAL TECHNOLOGY COMMITTEE

Over a decade ago, the revolutionary CRISPR technologies were put to the test in editing the genomes of both mouse and human cells. News of these studies flooded the internet, drawing the interest of educators and students alike The short-lived excitement regarding this advancement died down after its peak recognition in 2013, leaving CRISPR with minimal coverage in popular news platforms today. Despite the lack of sustained appreciation among the public, developments in genome editing continue to improve with the help of CRISPR systems.

In simple terms, CRISPR works by targeting specific sequences in DNA and cutting them with the help of an enzyme called Cas9. Intrinsic repair mechanisms can then repair the area that was cut, leading to an impactful modification of the original portion of DNA After sufficient fine-tuning, CRISPR has become another common tool for experimentation in labs across the globe Scientists have harnessed its abilities in imaginative ways, using CRISPR to facilitate experiments such as reducing immune rejection in pigs or engineering a new transparent species of squid The prospect of using these adaptive “biological scissors” to change genes sounds intriguing, though it is not without severe potential for consequences from an ethical perspective CRISPR’s initial introduction to the public raised several concerns related to clinical outcomes. Since then, many research groups have concentrated their efforts on CRISPR’s use in clinical practice Multiple versions of the CRISPR system have been identified, each having a slight variation in protein composition This has created the challenge of categorizing them for appropriate use in different geneediting scenarios, though it has also widened the scope for therapeutic application

Ultimately, the fate of CRISPR remains in good hands since its disappearance from the media Perhaps the absence of CRISPR in the public sphere is just another sign of its success in becoming a commonplace gadget for research Although the mechanism has not been perfected to clinical standards, it has been a game changer for many projects involving organismal DNA experimentation The barrier between CRISPR and the clinical setting remains significant, but the technology

has proven itself to be just as promising - if not moreas it was during its initial breakthrough With further investigation, CRISPR will be able to make the grand shift towards revolutionizing genetic medicine

Published in The Grainger Tribune on Apr. 15, 2024

TESLA STOCK: WHY

SUCH A STEEP DECLINE?

BY DEEPAK BADRI FINANCE COMMITTEE

with different perspectives, from a potential investor

worried about their investment to a pure speculator hoping for a resurgence

Tesla’s stock has dropped a staggering 50% from its November peak in 2021.

below the market expectations, let alone their figures

from Q4 of last year.

Most concerning was not that Tesla failed to meet fulfillment numbers, but that the numbers were far

below the market expectations, let alone their figures from Q4 of last year.

Tesla had around 50,000 fewer global deliveries than expected for Q1 and produced around 50,000 fewer vehicles than in Q4 of last year. To put this into context, these are the worst Q1 performance for Tesla since 2020. It is important to note that 2020 was during the COVID-19 pandemic, which caused a broader decrease in production.

Published in The Grainger Tribune on Apr. 4, 2024. Those with an avid interest in the stock market are more than likely to be keeping up with the dramatic decline of Tesla’s stock price Many follow this decline

After Tesla’s Q1 Delivery Report came out, one question is in every investor’s mind - how did Tesla manage to not meet what were already extremely low expectations?

According to the report, Tesla failed to fulfill their estimated global deliveries and vehicles produced This led to the stock dropping 6% after the report’s release

ost concerning was not that Tesla failed to meet

fulfillment numbers, but that the numbers were far

Many believe the fall of Tesla’s share price is just beginning and will continue to drop. In this turmoil, Tesla CEO Elon Musk is garnering a lot of the blame a lot of which is due to his questionable leadership tactics and views. However, all is not lost for Tesla as a bounce back is still plausible, as long as you have extra money and are willing to take a long-term risk

YOUR GUIDE TO SUSTAINABLE MADISON BUSINESSES

BY ALEKSANDR ROSE, COMMITTEE CHAIR

LIFESTYLE AND SUSTAINABILITY COMMITTEE

Sustainability is becoming a primary factor in U S consumers' purchasing habits. According to consulting firm McKinsey, 60 percent of consumers would pay more for a product with sustainable packaging and 78 percent of US consumers value a sustainable lifestyle. However, finding sustainable businesses to support isn't as simple as it would seem Many businesses use marketing tactics to convince consumers that they are making a more sustainable decision when they aren't. Madison, Wisconsin, is lucky to call itself home to many sustainable businesses, here are a few:

Dane County Farmers' Market, Capitol Square

The Dane County Farmer's Market reopens on Saturday, April 13! The farmer’s market is the largest produceronly market in the United States. By supporting the local producers at this farmers' market, you're opting for more sustainable options than you will find at your grocery store!

The Soap Opera, State Street

The Soap Opera is a local business selling soap, skincare, and other bath products. The business uses 100% renewable energy and sustainable and reusable packaging to reduce waste produced by the business.

Green Life Trading Co., Williamson Street

This sustainable home goods store is located on the east side of Madison's isthmus. Green Life Trading Co sells a variety of products, including refillable household and personal care items, as well as reusable alternatives to paper towels and laundry detergent. Consumers looking to reduce their waste should check out this store!

Ugly Apple Cafe, Lower Level of the Dane County Courthouse

The Ugly Apple Cafe is a locally owned and operated eatery serving breakfast foods made from local overstock produce The cafe takes unwanted or "ugly"

food from local farmers and repurposes them into delicious treats!

Short Stack Eatery, Johnson Street

Short Stack Eatery serves delicious breakfast classics such as pancakes, eggs, and more! Since its founding, they have focused on supporting local businesses and minimizing their environmental footprint. Their sustainability-focused team of employees works to achieve racial equity in Madison, improve access to transportation, minimize waste, and promote purchasing from sustainable suppliers.

Pasture and Plenty, University Avenue

Pasture and Plenty provides is a farm-to-table deli and meal kit provider. Environmentalism is key to Pasture and Plenty's brand The Dane County Office of Energy & Climate Change named the restaurant the 2022

Climate Champion for its use of composting, recycling, and local sourcing They partner with over 50 Wisconsin farmers and producers for their diverse seasonal offerings.

These options are just some of the many

sustainable options Madison has to offer! Midwest

Today has previously named Madison one of the most

sustainable cities in the region, so naturally sustainable options for consumers are abundant.

Published in The Grainger Tribune on Apr. 15, 2024

THE BOEING CATASTROPHE—WHAT WENT WRONG AND WHY THE CEO IS STEPPING DOWN

BY AADIT BHAVSAR TECHNOLOGY COMMITTEE

Boeing has long faced controversy over the quality control of their aircraft, but it has reached a new low in light of recent events. The company’s lack of direction and alleged safety negligence have led CEO Dave Calhoun to resign, giving investors a deserved break from their losses.

Following the crashes of two 737 MAX airplanes in 2018 and 2019, causing the death of over 346 people, Calhoun was appointed CEO in early 2020 to guide the company through these challenges. However, his time as CEO has been marred with issues of quality control and a decline in Boeing’s reputation of integrity. Investigators from the Department of Justice determined that a faulty maneuvering system, the Maneuvering Characteristics Augmentation System (MCAS), caused these crashes. In court documents for criminal charges, Boeing admitted to cutting corners and defrauding the Federal Aviation Administration

(FAA) This settlement resulted in a fine worth over $2.5 billion

“Boeing’s employees chose the path of profit over candor by concealing material information from the FAA concerning the operation of its 737 Max airplane and engaging in an effort to cover up their deception This resolution holds Boeing accountable for its employees’ criminal misconduct, addresses the financial impact to Boeing’s airline customers, and hopefully provides some measure of compensation to the crash-victims’ families and beneficiaries.”

Acting Assistant Attorney General David P Burns

Boeing’s alleged negligence continued, however, in an incident involving an Alaska Air jetliner this January. The jetliner, a Boeing 737 Max 9, blew out a panel door mid-flight and endangered all of its passengers. The pilots were able to land safely and no passengers were injured This made it all too clear that Dave Calhoun oversaw a company and culture that did not prioritize the safety and well-being of their passengers, and took shortcuts that resulted in endangered lives.

This incident garnered international criticism, and external pressure from stakeholders caused Calhoun to

step down from CEO at the end of 2024. Following this announcement, Boeing stock rose by 5% in premarket trading while being down 28% over this year.

Published in The Grainger Tribune on Apr. 4, 2024

THE SYMBOL OF THE NFL’S GROWING POWER

A $255.4 MILLION SALARY CAP

BY CATHERINE DONOHUE SPORTS COMMITTEE

This football off-season, the NFL announced that the team salary cap would rise to $255.4 million, a 13.6% increase from last year’s cap of $224.8 million.

This $30.6 million salary hike is the largest dollar increase in NFL history, underscoring a new age of sports money. The salary cap is calculated and set based on the league’s earnings, with the NFL referencing an “extraordinary increase in media revenue” as the source of this year’s financial leap.

Introduced in 1994, the NFL’s salary cap is a rule

that limits how much teams can spend on player payrolls. By equalizing the financial resources of each

team, the salary cap ensures that player talent is competitively equitable across the league

The league calculates the salary cap through the league-wide past season revenue and future expected income, which considers factors such as streaming rights. Revenue comes from three main sources: media

revenue, NFL ventures and playoff revenue, and local

revenue The total is then divided by the league’s 32

teams to give each club its individual salary cap.

To contend with this cap system while still signing

multi-million dollar player contracts, teams and players design their contracts to be back-heavy. Back-heavy

contracts pay off more as the years go on, which alleviates short-term impact and allows teams to

restructure these contracts to be more flexible in the future

On top of this, teams entice players to sign these “delayed gratification” contracts by offering contract

guarantees, performance-tied bonuses, and large

signing bonuses. But, despite their name, signing bonuses are often also spread across multiple years, meaning that money doesn’t necessarily affect the salary cap the year a player signs this impact is considered part of the cap each season, depending on how much every year’s payout is.

Former New England Patriots coach Bill Belichick

warned of the dangers of overspending, saying teams should be wary of chasing a Super Bowl at any cost necessary.

“You can’t sustain the 20 years of success that we sustained by overspending every year without having to eventually pay those bills and play with a lesser team ”

Bill Belichick

He argues this strategy of overspending will result in weighing down the team’s accounts in the future, potentially costing a franchise sustained dominance

Belichick argued in support of the Patriots’ conservative spending strategy, which miraculously kept the team distant from any cap-space issues during his 24-year tenure

Contrasting sports commentator Andrew Brandt’s stance on cash being all-important, Belichick argues “the amount of cap space used is more important than the raw cash value” . But in recent years, the former coach’s strategy seems to be showing its weaknesses the Patriots are spending less money than almost any other team in the NFL but remain middle-of-the-pack in cap space This begs the question of how effective capital allocation really is over pure cash plays.

It is important to note that salary caps are not a team’s available cash, but a limit to how much they could spend Writing for Sports Illustrated, commentator Brandt says “Cash is real money; cap is simply accounting”, emphasizing the oft-forgotten importance of raw spending Emphasizing that cash is what entices and pays players, not cap space, Brandt urges fans and commentators alike to disregard the “myth” that contracts should aim to optimize cap space and leave money for other signings. Brandt’s thesis argues that other than team officials and bookkeepers, players, agents, and fans alike have limited reason to be concerned with salary caps.

But, while cash may be king in the end, salary caps aren’t meaningless. In March 2024, reports emerged that the San Francisco 49ers misreported their player compensation This resulted in the NFL investigating and ultimately punishing the team The 49ers forfeited a 2025 draft pick and received a four-spot dock to their 2024 fourth-round draft pick, despite the league’s investigation determining that the misrepresentation was not malicious nor did it violate the salary cap. An accounting error on the team’s payroll, without malicious intent or violation of the cap, demonstrated the NFL’s hardline policy on salary adherence. Regardless of whether or not cash is more important, the salary cap can’t be dismissed

The 2024 season’s massive increase in cap dollars is indicative of how lucrative the American sports markethas become Not only is the NFL the most profitable sport in the US, but Bleacher Report says “It’s

also one of the highest-grossing industries in the country.” With fast-growing popularity, a lucrative market, and unprecedented streaming contracts, it’s no surprise the NFL is willing to open the door to more

financial investment to the tune of $255.4 million per team

Published in The Grainger Tribune on Apr. 4, 2024.

IMPROVE YOUR FOCUS IN THREE EASY STEPS

BY BEN ROCHE FINANCE COMMITTEE

If you’re anything like myself and millions of other college students, you likely find yourself struggling to focus on your schoolwork due to distractions from external stimuli In an environment where technology is heavily integrated into our daily lives, social media begs for our constant engagement. With countless stressors occupying our headspace, it can be difficult to concentrate on schoolwork This is particularly true after the pandemic when it seemed impossible to avoid the TikTok boom I don’t think I’m alone when I say that I have struggled to fully regain the ability to intensely focus on a singular task

The good news is that focus can be improved by incorporating a few simple habits into your daily routine The goal of this article is to make your studying more productive and meaningful by eliminating distractions and retaining more of what you learn

Consider a video titled “How To Reprogram Your Dopamine To Crave Hard Work” by Rian Doris, author, CEO, and PhD student at the University of Birmingham In this video, Doris lays out the keys to quickly achieving improved focus.

Since stumbling across this video in mid-January, I have applied the advice in my life and have been rewarded with more productivity, clearer thought processes, and overall better work. I have also been happier and spent significantly less time on social media Below are the three steps that have revolutionized my productivity.

Take Boring Study Breaks 1.

Doris summarizes this first step as “making the boring rewarding” A common mistake we make is in between studying, we engage in activities that are more rewarding than the actual studying

For me, this can be browsing TikTok, listening to fast-paced music, or playing a game on my phone To truly maximize focus while doing work, we need to do

things that are equally boring (or exciting, depending on your opinion towards studying) during breaks. Doris goes as far as to suggest staring at a wall for 20 minutes, but things as simple as taking a short walk or

performing breathing exercises are great ways to fill study gaps.

2. Inhabit the In-between Moments

Doris suggests that we make the most out of the “transition moments” throughout our day. Rather than checking our email or texting a friend, we should simply engage with our surroundings and be at ease

“Transition moments” is a broad term that describes the time during which we are between tasks, such as walking to class or getting coffee in the morning By being present in these moments, we are training our reward system to be less dependent on high-dopamine stimulants (like our phone) and react more positively toward perceptively boring things. By consistently incorporating this, schoolwork will release more dopamine in our brains and we will be more passionate and productive during studying

“You will be forced to be present and tolerate those moments where you don’t have much stimulation or engagement. Your baseline for what’s boring will shift which is highly conducive for profound levels of focus” Rian Doris

3. Do Everything One Thing at a Time

The last habit for improving focus is to perform each task once at a time Doris admits that this has made him significantly worse at multitasking, but by “embracing life as a series of singular activities,” we produce more dopamine per task This helps us stay engaged for longer periods and devote our full focus to the task at hand

As a multitasker myself, I found this very difficult at first, but it has yielded great results in my work quality, memory, and productivity. I find myself thinking about the material on a deeper level and asking more questions.

Although integrating these habits into your day-today life might be tough at first, the more you mindfully apply this approach to your routine, the more intuitive and easy it will become I have personally found great benefits through these steps, and don’t even think about them anymore If you want to improve productivity, practice these simple steps to rewire your dopamine system to crave studying, and the results will be staggering.

Published in The Grainger Tribune on Apr. 9, 2024.

STUDYING BUSINESS—THE ACADEMIC ROUTE: THE ENTIRE SERIES

BY PRESTON WONG, DIRECTOR OF RESEARCH FINANCE COMMITTEE

Introduction

I would like to acknowledge and thank the many professors and staff from both UW-Madison and Creighton University whose guidance has contributed not only to my own success but to the content below.

Among the crowd at the Wisconsin School of Business, it is commonplace to see many students walking around in their sharpest suits and professional business attire; dress to impress seems to be the name of the game Around every corner, there is not only talk of classes but also of interviews, internships, resumes, job offers, and more

The Wisconsin School of Business truly embodies its motto, “Trusted to Lead”, as it shapes the future business leaders of tomorrow.

Many of the undergraduates I have talked with show parkles in their eyes as they talk of the many professional opportunities they see in their future and the potential to get the coveted MBA

sparkles in their eyes as they talk of the many professional opportunities they see in their future and the potential to get the coveted MBA. Even among my master’s colleagues, the vast majority look on excitedly in anticipation of hitting the ground running in financial and other business-related industries in the world outside of school

I too have been tempted to follow this path, having received offers from numerous investment firms and banks, whose ticker symbols comprise “the market” of my asset pricing models. But I am drawn to a different calling the world of academia

I hope this article may help you the reader; perhaps you are an undergraduate student in business who feels that life in industry does not appeal to you and seeks a world of enlightenment, or perhaps you are a curious

bystander wondering what could have been Regardless, in this guide, I hope to provide a different perspective, an alternative path if you will

This path is not an easy one; to venture down this path without passion is to seek disappointment, but for many out there, it is the right one

As a master’s student who is only beginning this path myself, even I am not fully well-versed in the extent of my decision However, I hope that the perspective I offer (which I supplement with the advice and guidance I have gained from many other more learned people) will serve as a good first step by which one can begin to explore

In this guide, I will focus mainly on the path to academia From the decisions and steps that can contribute during undergrad, deciding whether or not to get a master’s or do a pre-doc, to the application process, the topics I discuss will only be limited by the questions that surface and my interest in finding their answers. As my focus is on Finance and Economics, the information will pertain primarily to seeking a career in academia in those fields. The path of research in accounting, marketing, and other business fields is almost certainly very different.

Regardless, if the academic life appeals to you, I would encourage you to seek out further answers and advice to broaden your understanding and leverage others’ perspectives and expertise

Is it Right for Me?

First, I will discuss whether the academic route is right for you. Getting a PhD is a long journey. It takes dedication, resilience, and most importantly passion to survive and thrive in this choice But nonetheless, for those for whom this is the right choice, there is nothing that compares in the end

To begin, we must understand this is a journey. To embark on this venture means to seek progress even when there is no end in sight; the journey to get there is more important than the destination

Research is “studious inquiry or examination” especially the “investigation or experimentation aimed at the discovery and interpretation of facts, revision of accepted theories or laws in the light of new facts, or practical application of such new or revised theories or laws.”

Even the famed findings like that of Fisher Black, Myron Scholes, Eugene Fama, Kenneth French, William Harpe, and more are not to be trivialized in the amount of effort and wit behind each individual paper. It is clear

that each is a culmination of the millions of tiny steps of those taken before, including the individual journeys each of those researchers took themselves.

As such, most famous findings are, in truth, a monument built upon the vast small contributions of those before, many of whom may not even find their names listed on the rolls of Nobel Laureates.

To take upon yourself this mantle is not a means to

seek out fame or fortune, but to follow the path towards

the infinite horizon that is truth, no matter where that leads. The journey to get a PhD is a self-directed and self-motivated endeavor.

A PhD is not just a better MBA with the permission

to put “Dr.” before your name or have others call you

“doctor.” A PhD is a research degree, designed to prepare you to be a professor and to do research in a very specific field While it is true that many PhDs work in non-academic jobs, this is not their intended purpose

If this is what you seek, a different degree, such as a

Master of Public Policy, MBA, etc , might suffice without

the misery of five or more years of school

A Ph D is not a route to fortune either. While it is true that the average professor in economics or finance

will make over $100,000 a year, this varies quite a bit by institution, tenure track or not, and more

For instance, if you are a finance or economics student pursuing a PhD for the money (which would be hard to ignore given the nature of your degree), you are far better off with an MBA: the average starting salary for an MBA graduate is $115,000. This salary can be earned in roughly the same minimum time after graduating from college as most MBA programs are one to two years, and require an additional one to three years of work experience.

To dive much deeper into these differences is well beyond my expertise, but it nonetheless an important topic to explore in later installments.

In summation, the PhD is not the right path for everyone Doing a PhD is a journey, and an arduous one at that. Perhaps you, the reader, feel ready to take that upon yourself

In considering whether you wish to pursue a PhD, you must ask yourself a few key questions, and follow them to their honest conclusions. Are you driven to endlessly seek out the truth? Are you excited when you are a part of a discussion about something you wish you understood more about? Do you endlessly refer to the fields you are passionate about in regular conversation?

If so, I encourage you to read on

Math and Me

Now that you have decided that getting a PhD may be

right for you, it is time to talk about the first big hurdle: math. This is among the most confusing points for

undergraduate economics and finance students

thinking about academia It is one of the tools that make graduate economics so different. 1st year PhD students

in economics or finance all take about the same firstyear courses. Microeconomics, Macroeconomics, and Econometrics.

But what these names leave out, is that these classes are essentially applied mathematics. Math is so important to these fields that PhD programs are more likely to list math prerequisites than economics ones. Many PhD programs, including here at UW, include a summer math camp to help students improve those skills.

Luckily for UW students, the economics department even offers a math-emphasis option for a bachelors major that can help with finishing some of these prerequisites. The American Economics Association has a useful webpage listing the topics and courses for studying economics. This is most helpful as many courses differ from university to university and PhD programs are unlikely to list each and every one At its core, one should expect to take three semesters of calculus (up to multivariate), two or more semesters of statistics, courses in linear algebra, differential equations, and an introduction to proofs. Beyond this, it is common knowledge that Real Analysis is a strong signal as to your success in a PhD program, and as such, many programs will seek out students with experience in the subject. That being said, checking the box and taking the course is not sufficient; excelling in math, particularly in the higher level courses is the real measure

Math is so important, in fact, that a large portion of PhD candidates in economics and finance have math as a double major or even as their only major. Majoring in economics and finance still has its benefits, as we will talk about later, but the math requirements are extensive and not something to be ignored Among the numerous undergraduate students I have talked to who are considering graduate study in economics or finance, this is among the most surprising things. Notably, the sheer amount of math courses cannot be accomplished in a single semester or even a year. It is often best to take one or two each semester if you have the aspiration for graduate study in economics or finance

But what about math that is not listed? More math, especially advanced math, is always better. But I will address one important consideration Generally, business school statistics and calculus courses are insufficient to meet the requirements, with many universities specifically listing this on their admissions pages.

Programming experience can also be a major boon. It generally does not matter what language whether it is

STATA, MATLAB, Python, etc Most PhD students will serve as teaching assistants their first year and having these skills will be beneficial in addition to helping in your own coursework In particular, if you are looking to do a predoc it is often listed in the applicant

qualifications. Another benefit is that a lot of upperlevel math courses will have you use LaTeX; this is a programming language for writing math in papers that is commonly required to submit homework in PhD classes. Knowing how to do this can save you a lot of time and frustration later.

As with everything I write here, I recommend

talking to your advisors and professors before making any decisions. Utilize the law of large numbers and hopefully converge on the truth Courses vary widely from university to university so knowing which courses match the topics you are expected to know is a challenge One way is to take the list from the AEA to your advisor or math professor to get the courses you need

In summation, math is one of the core prerequisites to a PhD (or master’s) program in economics or finance. Unless your university has a special path for it, like here at UW, it can be an unfortunate surprise to students in their junior or senior years thinking about graduate school If you are not up to this hurdle, it is okay; it does not mean abandoning your love for economics/finance

There are plenty of alternatives in the way of programs in public policy, political science, and more But if you are set on this PhD, the math required is just a way of life

Economics and Finance

Now that we have gotten through the math hurdle, it is time to talk about why we are here: economics and finance As previously mentioned, while an extensive math course load is almost a universal requirement even to be considered for a PhD program, a significant number of students who have not taken a single

economics course are admitted each year to programs nationwide and internationally. That is not to say that it is a good idea to shrug off all of these courses, but we will cover a few considerations below.

First, if you are considering a PhD program in economics or finance, having read the previous

sections, you clearly have at least some interest in it. College as an undergraduate is a time to explore and grow. In graduate school, whether in a PhD or Master’s program, there is often no flexibility to have a change of mind outside of the department without leaving the program entirely. So, take this time and spread your wings; perhaps you may find something you love more than economics or finance But at the same time, undergrad might show you how much you really love finance or economics.

As economists, we believe that fundamentally each person will maximize their own utility subject to constraints. So who am I, or anyone else for that matter,

to tell you to give up taking courses in economics and finance if that is what makes you happy? While there is a trade-off, do not take so many as to miss math prerequisites; there are certain courses that may help ease the transition into graduate school and aid your application.

Demonstrating your interest and passion in economics or finance is a boon to your application

While certain courses may be more helpful than others, having courses and/or a major in the subjects can help demonstrate your passion In general, upper-level, graduate, or math-intensive courses will be better at demonstrating this. However, I also will provide a few specific courses and ideas to consider when making a choice on which courses to select.

Introductory Macro and Microeconomics and Intermediate Macro and Microeconomics are listed by some schools as requirements. Again, this is not as ubiquitous as listing calculus or statistics. Having the intermediate level courses can help with having some economic intuition and can be beneficial in graduate school to have some basic understanding to build off of Econometrics is also listed by some schools. Topics in an introductory econometrics class are similar to what one would experience in a statistics course However, certain tools and ideas are useful to obtain from this course specifically. The method of Instrumental Variables is a prime example Unlike chemistry, biology, or physics, experiments are difficult to perform in economics. In the words of one of my professors, the method of Instrumental Variables is one of the key techniques that makes economics different from other social sciences. Exposure to notation and other advanced topics like time series or panel data is not part of every econometrics course, but is useful to get exposure to nonetheless. Another specific benefit is that these courses often have a research paper requirement. Doing research can help the application by itself, but it can also be a source of a writing sample or a strong letter of recommendation, a topic we will cover later.

PhD-level courses can be a major source of opportunity but they are also a double-edged sword Students at UW are lucky in that they have the potential ability to take first-year PhD courses in economics (as previously noted first-year finance PhD candidates also take these courses more often than not). If performed well, these can demonstrate a strong level of skill After all, we are all risk-averse; if the admissions committee

knows you did well in a PhD-level course, the uncertainty of your performance in a PhD program is

reduced However, if done poorly, especially if your

performance is below an expectation given past

performance (for example you have straight As in all your classes and advanced math but get a C), this can harm your application

One major consideration is that no matter how well you do or where you are admitted, it is almost certain

that these courses will need to be repeated during the

PhD program. It is actually an advantage to do so, not only to prepare for preliminary exams but also to get to know the rest of your cohort. In terms of picking between the three courses, there are a few

considerations. Microeconomics and Econometrics are generally taught the same, using the same textbooks in fact, while Macroeconomics can vary between

universities. As a signaling mechanism, Microeconomics is generally seen as the best. However, it is common knowledge that Microeconomics is also the hardest of the three. Finally, there are personal considerations. If a class in a certain field of economics interests you, by all means, take it. Not only does this allow you to explore your interests, but it also shows consideration of your field of interest that is on the statement of purpose and is a possible source of a strong letter of recommendation

To recap, taking courses or majoring in economics or finance is not necessary for admission to a PhD program. However, there are some major benefits that one should not ignore lightly. At the end of the day, each person’s journey to and through a PhD program is their own and while certain choices may be marginally better than others, the decision is ultimately an individual one

R&R

While coursework and grades will undoubtedly boost PhD applications, thinking that learning stops at the classroom door is a terrible mistake. As previously mentioned, to survive in what is essentially a professor apprenticeship program requires lots of passion, motivation, and dedication Just as a professor's work does not end when the bell in Ingraham rings, so too should one seeking to join those ranks constantly strive for more This part of the guide is on R & R, not "rest and relaxation," something that will be a rare treat in graduate school, but rather research and recommendations.

As previously mentioned, a PhD is a research degree designed to prepare students to be researchers.

As such, a good indicator of potential success in a PhD program is research experience Another important

reason to begin research early is that the product of one of these experiences will likely serve as your writing

sample when applications roll around A publication in

an undergraduate journal is not easy to get but can also serve as a major boon to an application While some research opportunities are likely better than others when it comes to their positive effect on applications, more will almost always be better. But to get research experience is not easy, do not expect it to be handed out on a silver platter or to be told to do it. Finding these opportunities is more than half the battle and the focus of this section of the guide

However, what I just said is not exactly true; there are opportunities that will be handed to you through classes or as a required senior thesis; it is always recommended to seek out more Especially in the case of class research, due to the constraints of the class, the research written there may not be as in-depth or robust to represent the true extent of your abilities. That being said, there are a few options when it comes to securing research experience

The first is the most relevant. There are many relatively "easy" opportunities to get some amount of experience Joining research-oriented clubs like the Wisconsin Business Review can be a lower barrier to entry in starting out your research journey. Especially as an underclassman lacking experience in econometrics, these opportunities can be started early and continued throughout the entire undergraduate experience This type of opportunity is not as beneficial as the ones to follow, but it is a good way to start early and build up a convincing case for the next options.

Next is a Research Assistantship position These may be paid, but also may not be They are actually quite difficult to find as professors who may need such assistance would likely draw from the pool of PhD students or even master's students first. However, there are a few chances out there In this case, you are often assisting a professor or PhD student with research This is a great opportunity to see the forefront of the field. In many, especially undergraduate classes, the topics are foundational and important concepts but are not at the forefront of the research on the topic Working as a research assistant can help orientate students to what is currently being worked on in their area of interest and also what skills are needed to thrive in modern research

The final option I will cover is doing independent research This can come in many forms. After finding a professor, some will require registration in a course like ECON 699, ECON 999, or FIN 799. These courses will be graded by the professor supervising the research

For students paying by credit, this can be expensive, but for a full-time undergraduate student within the

allowed credit limits, the marginal cost is negligible

Other times, professors will just do research with

students out of the kindness of their heart and desire to

foster research ability. Regardless of whether it is taken for credit, an independent research project is a good experience but can be contingent on finding the right professor.

The greatest challenge to an independent research project is undoubtedly finding the right professor. Just finding a professor, in general, can be a challenge.

Professors are often engaged in their own research and are likely to prefer working with PhD students and other

graduate students interested in research due to them

having a stronger background than undergraduate students (requiring less guidance and producing a more rigorous product) However, there are undoubtedly many professors who are willing to work with undergraduate students, provided they have the time

In my opinion, the best way to approach this is to have an idea of what you want to do written up. Having a proposal with a literature review can show that you have put in a good share of work before approaching a professor. It will not be perfect, and there are likely studies you are unaware of or mistakes made, but it demonstrates genuine interest, baseline ability, and

work ethic As with most things, people are more willing to help someone if they see that person putting in the work to help themselves. This also helps professors see how much of their time and assistance they will need to contribute towards the project.

Many professors have told me that independent research is the most beneficial approach to a Ph.D. application It shows not only one's own research interests but also the ability to take an idea for a research question and turn it into a project. However, with everything discussed in this series, this preference is only if a single option may be chosen Doing more and different types of research experiences will always be a major boon to a PhD application In addition, these opportunities may either reinforce a desire to seek a PhD or show that a different path may be more suitable

They are also a great source for the next topic, letters of recommendation

I originally considered having a separate section dedicated to this facet of a PhD application, but ultimately they are one of the main benefits of doing lots of research experiences. Near unanimously, every professor I have spoken to has said that letters of recommendation are the most influential factors for consideration in a PhD admissions committee Most PhD programs will require three, but some will require only two. These should come from professors, specifically those with a PhD in Economics or Finance, although some say that letters from math professors are okay as well It is often a disadvantage to have a letter from a boss at a job unless that job is at the Federal Reserve or similar.

The quality of the letter is the most important factor. A letter from a professor that says something to the effect of "I had X in my class, they got an A" is not helpful to your application Picking professors who know you should be the number one priority over most other considerations. For example, a professor's renown in the field could be a factor due to the connections they have with other professors who may be on the committee However, the priority should be: Knows you and famous > Knows you > Famous > Neither

This is a direct example from a professor I talked with But having a professor know you is not a simple matter.

Doing research with a professor is probably one of the best options for doing so, but there are others.

Being in their class, especially one with a large final project/paper or that is a smaller discussion class could suffice Going to their office hours, even if you do not have a question, can help as well I also recommend

talking to them about your desire to pursue a PhD As a

professor told me, "Professors love to see when you want to be like them and get a PhD Especially a PhD in what they got theirs in " Other options that may be available are joining discussion groups, reading groups, or seminars. These are not always open to

undergraduates, however.

There is a little more to discuss when preparing for

application season itself Thus far, I have focused on what students can do before their senior year. In the next section, I will discuss what to do once application

time is approaching

Getting it Together The time has finally come to talk about the final stretch, the application This section of the guide covers applying to schools starting from the summer before you apply. If you are applying directly out of undergraduate, this is the summer before your senior year. At this point, what's done is done; now it is just

time to get it all together.

Looking towards the end of this period, the first

application is likely due December 1st. Other common due dates are December 15th, December 31st/January 1st, and January 15th for PhD applications. Master's programs may also have later deadlines, including

February 1st and February 15th It may seem a long way away, but it will come sooner than expected.

During the summer, I recommend exploring which

programs you would like to apply to and consider

practicing for and taking the GRE We will discuss how

to select programs both initially to apply and later to attend in a subsequent section However, I recommend having at least 5 programs on the list when taking the GRE as it allows you to send scores to 5 universities for free on test day while sending scores after test day will cost money. I will talk mainly about the GRE, but know

that some schools also take the GMAT. The reason I am focusing on the GRE is that it is almost universally required for Economics programs, and while some

Finance programs will take the GMAT, even some of those that do prefer the GRE

The GMAT is primarily designed for applying for an MBA which we have already discussed is quite different from a PhD How much preparation is needed for the GRE will largely depend on the classes each student has taken and the range of schools targeted Know that

the GRE is a necessary but not sufficient condition for entry. Schools that receive a large number of applications may screen students by their GRE scores, but having a GRE score above this (unknown) cutoff will likely confer little benefit. In particular, schools care about the quantitative score on the GRE the most.

Having an extremely low score in verbal or analytical

writing will hurt, but it is not nearly as important as the quantitative reasoning section

I have been told that achieving a 90-percentile score is sufficient in almost all cases to avoid the initial cut. However, note that the score percentiles change over time and have generally been increasing. It might be in your best interest to send out your scores as soon as you receive them if they are over the bar since percentiles are evaluated on a shifting window of the past few years of tests not at the time it was taken Note that you can only take the GRE once every 21 days and five times within a 12-month rolling period Scores may also be delayed, which is why it is advisable to take the GRE early during the summer. The GRE quantitative section is not difficult; it contains no Calculus and is similar to the SAT; however, as a result, it is really a test of how long you can go without making a silly mistake in most cases.

To prepare, it is helpful to take as many practice tests as possible and develop strategies for solving easy problems quickly. I used and recommend this service from Kaplan They have built-in practice tests and also work on the analytical writing section It is a little expensive, but they have a money-back guarantee should you score worse on the actual GRE than on the first practice test.

For international students, I will briefly discuss the TOEFL/IELTS/Duolingo tests. I do not have first-hand experience in the matter, so I would recommend doing your own research If you must take the TOEFL (double check as each program has different requirements), know that it is another necessary but not sufficient condition Many PhD students serve as teaching assistants, so the bar for the speaking section is normally higher than it would be for masters-level or undergraduate programs. University of WisconsinMadison requires a 26 on the speaking section of the TOEFL in addition to the 92 required by all graduate programs. Note that some schools may allow admission

while taking an English as a Second Language class, which UW offers for those with TOEFL scores above 80, but this will likely have a negative effect on your application and is more required during an already stressful first semester.

At the beginning of the semester, it is also time to

solicit commitments from your letter writers, which, to

recap, you likely need three. There are schools that will

take two or even up to five, but it is commonly

recommended to stick to three The last section covered some factors when picking letter writers, but I also want to touch briefly on how to approach them Be cognizant of the request you are making This is in addition to their existing commitments as a professor

and researcher. They are likely writing letters for others

as well Ask early to give as much time for them to

prepare Also, many schools have evaluation

questionnaires for professors submitting letters which

can take time When asking, I often asked if they would

be willing and able to write me a "strong positive letter."

It is common practice for professors to refuse to write

letters if they do not feel they can write you a positive

one; however, this phrasing allows them an "out" if they

have some concerns, as stated by one of my professors.

It is also nice to send your letter requests from each application portal at a single time rather than

letting them trickle in However, note that some

application portals do not send the request until you pay the application fee and submit the form itself I also provided each of my letter writers with a folder containing information to help them write a good letter. An important point to note is that often, the deadlines for acceptance of letters are after the application deadline, and the application normally sends you a notification when your letter writers submit, so do not worry too much and trust your professors.

Transcripts, a writing sample, a resume/CV, a statement of purpose, and a personal statement are also requested to be submitted with the application The writing sample may be limited by page count and could require some editing for a particularly long research paper. Some schools require official transcripts while others will accept unofficial transcripts and only require official transcripts sent directly to them upon acceptance UW-Madison is nice and allows students to send official transcripts to themselves for free, so I recommend just getting one of those and saving it to the folder with your other materials. Statements of purpose and personal statements are very complicated

and likely deserve their own section For your

resume/CV, I would strongly recommend starting with

talking to your career center early rather than later. This

is a lot to manage, so I will briefly touch on how to stay organized

I recommend having a folder on your computer with all our application materials in it with separate

subfolders for each school You will need these folders

for the different versions of each component, especially if those schools do not have the same requirements.

The last thing you want is to send the wrong personal

statement to a different school. UW Madison and other

Universities also often provide free OneDrive or Google

Drive I recommend you download the relevant desktop

version of the one offered by your school and set it to

sync to this folder. This will ensure you have a backup of your materials should your computer tragically fail

They automatically update the files as you make

changes as well To stay organized, I and many other PhD students created an Excel sheet of each program

we intend to apply to with information such as the due date, requirements, and more This is a useful tool that I

will discuss more in the appropriate section on selecting schools, but plan to send this to your letter writers as

well.

Finally, it is time to submit. I recommend submitting no later than 3 days before the deadline Much can go wrong in the last 24 hours, including differences in time zones that can be avoided by submitting slightly earlier. However, note that most committees are not reviewing applications until February so there is almost certainly no benefit from submitting earlier than needed In fact, waiting could actually be an advantage in that you can update your resume with additional experiences and potentially include your Fall grades in the submitted transcripts. Also, note that each application is likely to have a fee; this can be avoided in some cases by proof of financial hardship, membership in certain organizations, participation in certain pre-PhD preparatory programs, veteran status, etc However, applying for these exemptions can take time which should factor into your planning

In the next couple sections, I will talk about selecting schools and also about writing personal statements and statements of purpose which did not fit in this section

Reports

As the application approaches, the statement of purpose and personal statement may be one of the last parts of the application that can be changed Grades, letters, GRE scores, etc , are what they are a few months before the application This piece is one of the only chances to hear from the applicant directly. It is important, but not nearly as important as most other parts of the application But as economists, optimizing everything is the goal and these parts are no exception

To begin with, not every school will be the same

Some will say statement of purpose, others personal statement, and require both or just one For the purposes of this portion of the guide, I will talk about

SOPs as a statement of plans and qualifications and reserve the term personal statement for prompts on extenuating circumstances or diversity. Do note, however, that some schools may ask other questions in addition or in replacement of these longer statements.

The word limit for each statement varies widely by

school Even if the word limit is higher, being concise is often a strength A good starting point is about 1000 words for the statement of purpose and 500 for the personal statement.

A statement of purpose is designed to convey your

qualifications and intent as a researcher. Do not be

cliché Do not start with an epiphany - how, walking

down the sidewalk one day, a squirrel dropped an acorn on your head, and you knew you were destined to be an economist. Especially if it involves a child from a poor

country. It is overused, will not help you stand out, misses the purpose of the statement, and can often

cause the other statements made to be viewed with

skepticism Instead, try to center your narrative around

your research interests, qualifications, and plans. While highlighting important information in other parts of your

application can be helpful, remember that the average statement is viewed for about 20 to 60 seconds. Make it as information-dense as possible while avoiding

unnecessary or unhelpful fluff Examples of such fluff include but are not limited to things like platitudes about wanting to get a PhD, flattering and overly general statements about the program, faculty, or university, routine information, or filler statements like "attached you will find "

It is beneficial to front-load your information and as such a chronological organization is unlikely to be efficient. Start with a few broad interests in the field, like industrial organization or econometrics. Then give a few examples of broader topics or questions within those areas.

At this point, it is also helpful to identify a few professors you would be interested in working with But do your research Make sure they are tenure or tenuretrack, are actually in the department you are applying to, have recent work similar to your interests, and are actually there and take students. It might be helpful to look at their faculty page and read a few recent papers.

In general, you should look for full professors or

associate professors. Assistant professors may just be starting to do their own research and are often not

advising students yet. Adjuncts, instructors, professors

emeritus, etc are normally also not good choices.

Identify a few professors, and talk in a sentence or two about why you are interested Going into more detail is preferred; it is the difference between someone who

just googled a name and someone who read a paper.

Most applications will ask for a few professors anyway, but this gives an opportunity to express why and show

genuine interest.

Next, it is helpful to develop a few ideas for

research in depth It will almost certainly not be your

dissertation and likely will not be held against you. No applicant knows what their research will be three or

more years down the line Show that you know how to develop an interesting question and have some idea of how to solve it. This is hard because you do not yet

have a PhD and may not know where the forefront of the field is yet, but reading working papers from recent conferences can help. Doing this well is a good signal of your potential as a researcher. I spent around half of my statement on this portion discussing a single idea, but I would think two different ones would be good. It is important to ground this idea in the literature without writing a whole literature review; citing a few articles would be sufficient. It could also give an opportunity to talk about past projects if they were in the same area as this idea It is also helpful to identify a potential source of interesting data and potential empirical strategies. Do not overdo it, as showing economic thinking is important, but it can be a good signal if done well

The next portion is the personal statement. If necessary, this is a good place to talk about apparent weaknesses in your profile. For example, explaining shifts in your goals (say you majored in physics but now want to do economics) or a bad GPA in a semester. When doing so, summarize the reason concisely but focus on what has changed since then and what you have done to try and address this weakness. It might be your only place to also help clarify any confusion such as differences in course names (a common one is what the Real Analysis course is called at your university)

Keep in mind that requirements for statements vary by institution. So, while it may be helpful to have a master copy as some parts are the same, be prepared to adjust most of it for each institution Some programs may even ask additional questions. The goal is the same, be clear and concise while providing details that cannot be found in the rest of the application packet. Finally, it is highly recommended to have as many people read it as possible to give you feedback Having one of your letter writers read it can be especially helpful in addition to friends, family, and career coaches. However, it is advisable to refrain from posting your statement of purpose online until applications are over. The potential to have someone copy your statement and apply to the same school could be an academic integrity nightmare that you do not need

While these statements may be of lower importance than most of the application packet they are nonetheless important. This is often the only chance to hear from the applicant directly. The goal of these statements should be to clearly and concisely make the case for being a good candidate by providing additional information not found in other parts of the application while briefly highlighting important points.

Choosing to Delay or Delaying to Choose

Going to a PhD directly after receiving a bachelor's is a possibility; however, for many, it is not probable

Unlike some other fields, Finance and Economics do not require graduate-level education prior to starting a PhD However, nearly every admissions website will

list that it can be a boost to applicants' profiles. This portion of the guide will talk about a few paths to a PhD after receiving a bachelor's degree.

To begin with, I would like to address the difference between US and European PhD programs. The past sections have been generally relevant to either with a focus on US programs. However, this one, in particular, is an example of the difference In the US, it is common to earn a master's degree en route to a PhD after taking a sufficient number of courses, passing preliminary examinations, satisfying a paper requirement, or some combination thereof The first two, sometimes three, years of PhD in the US consist of coursework, with the entire program taking five or so years. However, in Europe, this coursework requirement is nearly nonexistent. As a consequence most PhD programs in Europe are shorter, lasting only three to four years. However, some universities do offer the "American" style of earning a master's after two years for a total of five years, such as the London School of Economics (LSE) However, for the majority of programs in Europe, a master's degree is required, serving as the equivalent of the coursework component here in the US

For many students, a master's degree can seem like a natural progression There are some benefits to getting a master's degree but also some downsides; for the purpose of this portion of the guide, I will focus mainly on US programs. To begin with, most master's programs are one to two years. There are benefits and

costs associated with each that may make a shorter or longer program more advantageous for certain students.

However, as a general rule, I believe that two-year programs are better. First, note that not all master's programs are created equal when it comes to boosting your odds at a PhD. Within Economics programs, most are created with the goal of allowing their graduates to seek roles in industry rather than preparing them for a PhD A few options that buck this trend are the University of Chicago's MAPSS-Econ program, NYU's MS Quantitative Economics program, the University of Texas at Austin's MA Economics, and the University of Wisconsin-Madison's own MS Economics - Graduate Foundations. It is not easy to sort these out; however, the best way is to read their websites and look at their placements. If the majority of students go to PhD programs, especially if the median placement is where you would like to go, it is probably worth your time to apply (see the next section on selecting PhD programs)

Other key indicators are whether the program allows its students to take PhD courses like both of UW's Master's, including the Master of Science in Financial Economics that I attend This is good because while the program may or may not be set up to be a prePhD pathway, the option to turn it into one is there This may also mean that you have a better chance of standing out and securing some of those coveted research opportunities and letters of recommendation discussed in the previous section

The other thing to note is that in the US, most of these programs are "revenue-generating" programs and will not be cheap, coming with limited, if any, financial aid In addition, expecting grant programs from the FAFSA is not a good bet in graduate school At most, you can expect federal work-study and unsubsidized student loans. However, for many international students, getting a master's is the norm as PhD programs may not be as familiar with foreign universities outside the very top. However, note that it is even more costly for foreign students who can expect to try to tackle immigration issues, an almost zero chance at financial aid, and a legal ban on working for the first semester, even on campus.

For domestic students, it is a less common option

However, it is a good way to address certain

weaknesses, like a lower GPA in the first part of an

undergraduate degree or a late switch to economics/finance However, I would argue that its best strength is securing letters of recommendation and gaining additional research experience, especially if your prior undergraduate school was not researchintensive or lacked the opportunity to do research This

is the reason I generally recommend two-year programs, as it gives a year to do these experiences before the Ph D application cycle rolls around in the

Fall of the second year. It can also be a good way to decide if the PhD life is right for you. The final reason could be to improve on the math background necessary for PhD, but there is likely a better option.

So far, I have only discussed a master's in economics. Other master's degrees are generally worse for the intended pre-PhD purpose For example, MBAs, master's in Finance, etc , are all normally just as expensive and convey little if any benefit to a pre-PhD student. However, a master's in math or related fields can be even more beneficial than one in Economics. However, there are a few caveats. First, while they are more effective at providing advanced math training, the prerequisite math training is almost certainly higher

than for one in economics. It will require more dedication as math classes may not be as enjoyable to someone passionate about economics or finance with the need to constantly stay motivated by remembering

their future goal It can also be harder to secure valuable letters of recommendation from economics or finance professors, and the potential to take PhD

courses is likely minimal However, it can be the right choice for some

The final option is likely to be the best. It is the coveted predoctoral fellowship, also known as a predoc

Predocs are full-time research positions working under a professor. They are paid and give valuable research experience It also allows students to form close relationships with faculty members who will eventually be able to write a strong letter of recommendation

However, predocs can be as hard to get into as PhD programs themselves. A valuable predoc would need to be at a top university or at a Federal Reserve bank (or other government agency). Most predocs can be found on PREDOC org At some universities, predocs may even take classes for free The average duration is one

to two years. Therefore, as it is paid the opportunity cost can be lower than a master's. It is a very common pathway for domestic students and is very beneficial if one is able to secure a position However, there are

some who prefer independent research as opposed to assistant experience As such, while predocs are kind of popular right now, it is possible that their benefit may

soon diminish. Most will require some research

experience and list a preferred proficiency in one or more programming languages, with STATA, Python, and R being the most popular.

Finally, I will address the elephant in the room

What if I take a gap year? Taking a gap year is a common choice before starting undergraduate after

high school I would argue that it can even be a common choice after getting a bachelor's degree However, for

someone who wants to get a PhD, it is, in my opinion, a big mistake

The issue lies mainly with the question of what

someone should do during the gap year. Remember that when it comes to PhD admissions, letters from professors are the most valuable Taking a gap year without a specific plan that will contribute to a potential PhD application seems like a lot of risk with little return Essentially as PhD applications are due at the end of the Fall semester and beginning of the Spring semester, there is not much time anyway. Remember that completing a PhD requires a lot of passion, motivation, and dedication, and in my humble opinion, taking a gap year without a plan may not be the best way to demonstrate that in an application for one.

These are some of the main options for students not going directly to a PhD after graduation These options can be a good choice to allow extra time to decide if a PhD is right for you. For some students, the decision to take these extra years is obvious and necessary to enter a PhD program For them, it is less about delaying a choice than delaying to have a choice

However, the big question is for students who have an admission offer to a PhD program already. Would I be better served by trying to improve my application or taking this offer?

The Academic Route: The Big Decision So far, this guide has focused on improving the application for a PhD in Finance or Economics. However, this last section of the guide covers the obvious question: “Where should I apply?” The American Economics Association lists over 150

American schools that offer one or more PhDs in Economics, subfields, or in substantially similar areas like Applied Economics. When including schools in Europe and foreign countries, the number of schools increases greatly. But not all programs are equal, we already discussed the differences between most European and American programs. As a student with limited time, it is difficult to filter through the programs when making your final decision, let alone applying, but hopefully, this portion of the guide will help.

The first important thing to note is that in Economics and Finance, students apply directly to the department rather than to work with a specific professor. In fields like Chemistry, Psychology, or Engineering, the cost of data collection is generally very high Students work in a lab under a professor who has

their own grants to help fund their research As a result, students apply to the specific lab rather than the

department. In these fields, it is standard to apply to

fewer than five programs, as applying to too many can be indicative of not really doing due diligence on the

target of each application Professors in those fields

may even flat-out refuse to write letters for students

applying to a large number of programs in those fields

for the same reason. This is not the same in Economics

and Finance At a forum of first-year Economics PhD

students this year, the panelist was asked directly how many programs they applied for. Not a single one

applied for less than 20 programs, with the most common answer being in the mid-twenties and only one above 30. This does not mean that every applicant will submit to 25 programs, and there are financial aspects to take under consideration but know that applying to significantly less is a higher risk choice and could result in not having any admissions based solely on random chance rather than qualifications.

With few exceptions, most programs require an application fee ranging from $50-$200. There are some ways to get a fee waiver to apply for free: by attending specific pre-PhD programs (some designed to help underrepresented minorities and women), being a veteran, being in a lower income bracket, or, in rare cases, attending admissions webinars. That being said, I would not count on receiving a fee waiver as the criteria on whether to grant one varies by institution. If one’s financial constraints would significantly limit the number of applications, the choice of programs becomes even more crucial This is in addition to the time and effort to submit each application and tailor each one to the individual school Two poorly done applications will be less effective than a single polished one

The first tool many students will lean on is rankings. But are rankings valid? When applying to undergraduate schools, nearly every single college counselor in this country will advise their new high

school seniors to stay away from US News and World Report’s rankings for undergraduate colleges because of its methodology. Even before the recent scandal, it was widely known among college counselors that US News and World Report considered factors that did not matter much in outcomes, like donor participation rates, and served little to help students and families compare schools that have recently been changed after scrutiny. When it comes to picking PhD programs, rankings such as US News and World Report can be helpful because of a more relevant methodology but knowing how to use them is important.

While each has different methodologies, the most before starting undergraduate after high school I would argue that it can even be a common choice after getting a bachelor's degree However, for someone who wants

to get a PhD, it is, in my opinion, a big mistake The issue lies mainly with the question of what someone should do during the gap year. Remember that when it comes to PhD admissions, letters from professors are the most valuable Taking a gap year without a specific plan that will contribute to a potential PhD application seems like a lot of risk with little return. Essentially as PhD applications are due at the end of the Fall semester and beginning of the Spring semester, there is not much time anyway. Remember that completing a PhD requires a lot of passion, motivation, and dedication, and in my humble opinion, taking a gap year without a plan may not be the best way to demonstrate that in an application for one

These are some of the main options for students not going directly to a PhD after graduation These options can be a good choice to allow extra time to decide if a PhD is right for you. For some students, the decision to take these extra years is obvious and necessary to enter a PhD program For them, it is less about delaying a choice than delaying to have a choice

However, the big question is for students who have an admission offer to a PhD program already. Would I be better served by trying to improve my application or taking this offer?

The Academic Route: The Big Decision So far, this series has focused on improving the application for a PhD in Finance or Economics. However, this last section of the guide covers the obvious question: “Where should I apply?” The American Economics Association lists over 150

American schools that offer one or more PhDs in Economics, subfields, or in substantially similar areas like Applied Economics. When including schools in Europe and foreign countries, the number of schools increases greatly. But not all programs are equal, we already discussed the differences between most European and American programs. As a student with limited time, it is difficult to filter through the programs when making your final decision, let alone applying, but hopefully, this section will help.

The first important thing to note is that in Economics and Finance, students apply directly to the department rather than to work with a specific professor. In fields like Chemistry, Psychology, or Engineering, the cost of data collection is generally very

high Students work in a lab under a professor who has

their own grants to help fund their research As a result, students apply to the specific lab rather than the

department. In these fields, it is standard to apply to fewer than five programs, as applying to too many can be indicative of not really doing due diligence on the

target of each application Professors in those fields

may even flat-out refuse to write letters for students

applying to a large number of programs in those fields

for the same reason This is not the same in Economics and Finance At a forum of first-year Economics PhD

students this year, the panelist was asked directly how many programs they applied for. Not a single one

applied for less than 20 programs, with the most

common answer being in the mid-twenties and only one above 30. This does not mean that every applicant will

submit to 25 programs, and there are financial aspects

to take under consideration but know that applying to significantly less is a higher risk choice and could result in not having any admissions based solely on random chance rather than qualifications.

With few exceptions, most programs require an application fee ranging from $50-$200. There are some ways to get a fee waiver to apply for free: by attending specific pre-PhD programs (some designed to help

underrepresented minorities and women), being a veteran, being in a lower income bracket, or, in rare cases, attending admissions webinars. That being said, I would not count on receiving a fee waiver as the criteria on whether to grant one varies by institution If one’s financial constraints would significantly limit the number of applications, the choice of programs becomes even more crucial. This is in addition to the time and effort to submit each application and tailor each one to the individual school Two poorly done applications will be less effective than a single polished one

The first tool many students will lean on is rankings. But are rankings valid? When applying to undergraduate schools, nearly every single college counselor in this country will advise their new high

school seniors to stay away from US News and World Report’s rankings for undergraduate colleges because of its methodology. Even before the recent scandal, it was widely known among college counselors that US News and World Report considered factors that did not matter much in outcomes, like donor participation rates, and served little to help students and families compare schools that have recently been changed after scrutiny. When it comes to picking PhD programs, rankings such as US News and World Report can be helpful because of a more relevant methodology but knowing how to use them is important.

While each has different methodologies, the most credible rankings for graduate schools focus on qualities that matter to potential PhD students.

Placements and publications are the two main factors in a lot of the rankings. In order to find some publications, the AEA provides a short list of some rankings, which includes US News and World Report for “Best

Economics Schools” In addition, RePEc is a common ranking as it parses programs by more fields. This is important as often a department will have “specialties” in certain fields they are known for over others. So the ranking in an applicant’s field of interest is almost certainly more important than in the field more broadly.

The important note with RePEc is that it only includes publications from authors that register with their service and thus can have some error within their rankings. When it comes to Finance PhD programs, the options are severely limited US News and World Report does rank Finance schools, but it is based on MBA factors rather than PhD The one that I found helpful was Arizona State University’s ranking which is based on the number of publications in the top four finance journals and includes data since 1990. Regardless of ranking methodology, ranking is a process filled with discretion and errors that may lead some to wonder if it's worth anything and, if so, how to interpret it.

The way to think about rankings is buckets rather than individuals. As rankings are a noisy measure of quality, there may not be much of a difference between the number of 30th and 31st-ranked schools, but there would be between the 30th-ranked and the 101stranked schools. Rankings can matter, as shown in this study, which looks at the program in which Economics faculty received their PhD. As shown in Figure 8, from a working paper titled Staying at the Top: The Ph D Origins of Economics Faculty, we can see that faculty tend to teach at a school in a lower “tier” than where they received their PhD from Note that the size of the bands represents the number of individuals. There is some ability to move “upwards,” but it is not the norm

When it comes to the type of positions at different universities, higher-ranked universities tend to focus more on research and have higher pay, but working at a teaching university or in industry could still be viable options. While rankings give an easy way to narrow down programs, much like how the GRE allows admissions committees to narrow down applications, more information can be gained from other sources.

There is more to picking a school than just ranking

One of the best ways to go about selecting schools is to talk to your letter writers, especially if they are doing work in the area that interests you. These faculty regularly attend academic conferences and have more knowledge as to the quality of the school than a student would Most programs report recent placements of their

graduates which can be a helpful piece of information if they are complete Where do the majority of their

graduates get their first job? Is it in industry, in government, or at a university? Are they doing a postdoc, or did they go straight into an assistant

professorship? There are many qualities that can be

understood through a program’s recent placements. As a general guideline, apply to schools where the median

placement is satisfactory. The quality of the program

should be a primary factor, but it is not the only factor.

Certain characteristics like specific faculty, department

culture, and availability of faculty are important factors

not captured by the performance of a program’s

professors to keep in mind Additionally, location, quality of life, and more can and should be a consideration Doing a PhD is a commitment and one

that spans five or more years, so these factors are likely to influence the ability to complete the program

So far, I have discussed picking programs more generally in a way that can apply to both initially selecting schools and later picking between admissions offers. However, in this last section, I will discuss what to do once offers are received The first important point is that most programs are signatories of the Council of Graduate Schools’ April 15 Resolution which allows accepted applicants until April 15th to make a decision

This means that, unlike in the wider job market, students can expect to consider all of their accepted offers, excluding waitlists, at the same time

Funding is an important factor to consider. Most PhDs in Economics or Finance are fully funded for four to six years. Most often, this includes tuition remission, health insurance, and a stipend This benefit package is likely tied to a teaching assistantship (TA), research assistantship (RA), or other fellowships that may or may not require working While attending the best program possible should be the goal, ensuring that one is able to attend the program financially when considering the cost of living is important as well

Some new avenues of information are available to admitted students. Whereas I, and many others, dissuaded emailing professors prior to applying, in most cases, professors and departments will reach out to the

admitted students. This is a great opportunity to gauge

the responsiveness of faculty and also ask more detailed questions. Also, programs tend to offer the ability to talk with current PhD students in the program

to get their point of view. Many programs also offer automatically, or potentially upon inquiry, the ability to visit the department to sit in on classes and meet with faculty as well as students in person This is probably the best opportunity to observe what life would be like for the next five years upon picking that program

In summation, there are many ways to pick programs, both before applying or after acceptance

Rankings are more reliable than for picking an

undergraduate institution but still are a noisy measure of quality. Other factors like funding and quality of life

also should play a role in the final selection However, it is my opinion that talking to your own letter writers and potential PhD classmates while later attending visit days are among the best sources of unbiased information This section marks the end of this rather long guide on considering applying to graduate school in Economics or Finance. This has been a rather long journey, and I thank you, the reader, for sticking with me As I write this on April 15th, I hope this series can serve to help those who will walk a similar path next year or in the years to follow.

I acknowledge that the information contained within this series is not exhaustive There are things that I do not know, and also others I likely forgot to include before publication As I have throughout this series, I encourage anyone interested in a PhD in Economics or

Finance to do their own research, read multiple articles, and talk to their own professors and sources to hopefully use the Law of Large Numbers to converge on the truth

But for what it is worth, I have anecdotal evidence

that the advice I included here does bear some fruit, as I will be starting my program at Baruch College (CUNY) in the Fall upon my graduation My journey, as detailed here, is ending, but the path ahead is full of highly anticipated unknowns and opportunities.

I would like to take this time to thank all of the

professors at both Creighton and UW-Madison and the

PhD students at UW-Madison whose advice helped me throughout this process and that is contained within this series. To each of you, you know who you are; I cannot express how appreciative I am for your help and guidance along the way.

Published in The Grainger Tribune on Feb-Apr., 2024.

THE JOURNAL OF BUSINESS

TABLE OF CONTENTS

Understanding International Trade: A Necessity for

Prosperous Tomorrows

Trendy Trunk Shows & Gameday Style: Recess Apparel

Weighing the Morality of Artificial Intelligence

The State of Sustainability at UW- Madison and the Wisconsin School of Business

Shrinkflation: What is it, How Do We Identify it, and Should

We Do Something About it?

America is Barely Ready for Artificial Intelligence

Playing the Odds: The Tightrope Walk of Sports Journalists

Methanol, Ammonia and the Race to Fuel Shipping

33

NECESSITY FOR PROSPEROUS TOMORROWS

BY ALEX ARIKER, SAMANTHA LI, EVA SINELNIKOV

INTERNATIONAL BUSINESS COMMITTEE

International trade has long been significant to the world’s economy. As early as 130 BCE the Silk Road was used as a major trade route that connected Asia with Europe Since then, and especially since the advent of the shipping container, international trade has further grown, impacting the lives of virtually all humanity worldwide

However, fears of de-globalization and declining economic interdependence are currently wrought throughout the world In the US, economic nationalism in the form of the Inflation Reduction Act, and other restrictions on trade like a new bill passed by the House of Representatives to force TikTok’s Chinese parent company, ByteDance, to divest from TikTok, are being mirrored throughout the world

For these reasons, it is important now more than ever to understand the merits of international trade and why the system of international interdependence our world is built on is necessary for our future

Advantages of International Trade

International trade has many benefits. First, international trade helps nations extend and strengthen their diplomatic relations with other countries. Trade encourages dialogue and mutual cooperation that creates economic interdependencies and in turn, reduces the potential for violent conflict or instability. Current bilateral trade relations between Saudi Arabia and the US are an example of this. The United States and Saudi Arabia possess the world’s two largest reserves of oil, so both countries have developed a common interest in preserving the stability, security, and prosperity of the Gulf region and consult closely on a wide range of regional and global issues.

International trade also helps firms expand into larger markets. Japan’s famous car brands including Toyota, Mitsubishi, and Honda are exported internationally, dominating the global automobile market, and helping contribute to Japan’s economy. Perhaps the greatest benefit of trade is the increasing economic well-being and rising standard of living that follows for its participants. International trade facilitates the transfer, not just of goods and services, but of capital, labor, knowledge, and products that otherwise could not be produced domestically. This transfer of goods, services, and other items, helps in several ways to increase living standards.

“Whether it’s investment capital or lower borrowing costs, trade just makes things more efficient overall,” Professor and Director of the International Business Program at UW-Madison Sachin Tuli, said “The market works well that way so it tends to enrich the society overall ”

Market efficiency from international trade leads to lower costs for consumers and producers allowing consumers to purchase more food, clothes, and other goods at cheaper prices to live better lives.

For example, over a quarter of the purchasing power of middle-class Americans is gained through international trade This raises real wages and lets consumers buy more with the same income For items such as groceries or clothing, this variety and lower pricing opens doors to greater financial comfort for middle-class Americans.

Greater financial comfort from international trade lets Americans make future-oriented financial decisions, due to greater savings and increased budgets. Furthermore, the significant growth of US GDP from lower tariffs and increased trade translates to over $10,000 in extra income for each American family.

(Credit: 2015 Council of Economic Advisors Trade Report)

Additionally, as seen above, average wages in export-intensive industries are greater than those in non-exportintensive industries, meaning that trade not only increases consumer buying power by lowering prices but also by increasing wages. This is especially true in developing countries.

“Wages at those [trade-related] factories are much higher than the wages in [worker’s] provincial cities that they were working at and the farming work that they may have done previously,” Tuli said

Lastly, innovation also increases from international trade in the form of the transfer of know-how and patents, further increasing living standards. For example, significant inventions like the lightbulb or the computer have had profound impacts on living standards worldwide.

Disadvantages of International Trade

Although international trade offers significant benefits for participants, it also has specific disadvantages. One drawback to international trade is the harm it causes to newly developing infant industries which face intense competition when entering the global market. International trade gives these industries limited chances to develop in the world economy as they struggle to compete with bigger firms internationally.

Another reason international trade may be disadvantageous is the layoffs some face when firms offshore labor for cheaper wages. Although usually associated with manufacturing jobs, this phenomenon has grown beyond manufacturing alone. In the US, tech companies are replacing their domestic employees with other foreign remote workers to cut costs and further efficiency. From 2020 to 2023 alone the number of North American companies with remote workers in Central America and the Caribbean, places with cheaper labor than America, grew 300 percent.

International trade is also often blamed for reducing the sovereignty of its participants. However, this line of reasoning, although true to an extent for smaller countries, is often overblown

Although the World Trade Organization (WTO), an organization that regulates and facilitates international trade, is often used as a scapegoat for the problems of international trade, it actually has very little power to impede the sovereignty of nations that participate in trade. The WTO is instead a “member-driven” institution whose rules, which may affect a country’s sovereignty, are dictated by its member governments and not some foreign organization

That being said, smaller countries with less political clout are often less able to negotiate the rules of trade

“[Trade] can be challenging to their sovereignty as smaller nations may not feel as free to opt out of certain

provisions [of trade agreements] and not be as free to ignore rulings from arbitration panels such as the WTO

said

However, international trade can also increase the sovereignty of nations at times. For example, when countries form political blocs or trade alliances they can increase their sway over trade negotiations or other events. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership, originally the Trans-Pacific Partnership illustrates this.

“The Trans-Pacific Partnership, which was meant to align a lot of Pacific-rim countries together and move away a little bit from China, could, in a sense, enhance these countries if they were feeling pressure from China undermining their sovereignty,” Tuli said “They'd have allies through trade relationships with other nations that were more like them ”

National security is perhaps the most important reason for countries to limit international trade Increasing geopolitical tensions means it is important for nations to be self-sufficient, and not depend too much on other countries for crucial resources like oil or semiconductors. Achieving a high degree of self-sufficiency is important so a country may be protected in cases of emergency like another pandemic or war.

Dumping is also a potentially harmful drawback of international trade Dumping occurs in its simplest form when a producer sells a good in a foreign market for less than its cost of production in its domestic market. This anticompetitive behavior harms domestic producers as they may be unable to compete with such low prices.

However, members of the WTO and many individual nations have anti-dumping policies to reduce this undesirable activity.

Despite these concerns, some more important than others, international trade is and will continue to be a key part of the global economy. Although trade may not always be advantageous to all of its participants, it is overall, and it helps countries and individuals benefit from increased standards of living, wages, innovation, and geopolitical stability.

As the world now grapples with rising tensions and economic-nationalist sentiment, we must safeguard international trade, which starts with understanding its merits.

Published in the Journal of Business on Apr. 15, 2024

TRENDY TRUNK SHOWS & GAMEDAY STYLE:

RECESS APPAREL

BY MALIN PHELAN AND KADIE JULIAN

LIFESTYLE AND SUSTAINABILITY COMMITTEE

Anyone who has ever attended a football game day at the University of Wisconsin-Madison knows that they are the event of the weekend, every weekend There are so many different components to a game day, including the preparation and odds of winning, the tailgates, the walk to Camp Randall, the game itself, and (of course) the fan favorite “Jump Around” However, one of the most important aspects of game day are the outfits. The sea of red and white in the stands is composed of individuals with unique style, wearing clothes from a multitude of different outfitters. However, this was not always the case Game day fashion has become central in recent years, due in large part to the rise of unique small business brands. We had the opportunity to speak with the founder of one such brand, Alex Lutz, who created Recess Apparel back in 2017 when she was a UW-Madison student.

Alex Lutz graduated from UW-Madison as a double major in marketing and entrepreneurship. As a sophomore in 2017, she recognized a need for unique and trendy game day clothes. When we talked with Alex, she discussed how she and her friends had difficulty finding stylish game day clothes, as it seemed that most apparel was maleoriented, with a lot of it being t-shirts and other items that were not necessarily as stylish as they would have liked Alex began by hand painting on shirts and sweatshirts for herself, and suddenly found that countless of her friends reached out to her asking to borrow her designs.

After recognizing a need for new game day apparel, Alex began selling these hand-made clothes to students around campus. As her company grew, Alex found that she couldn’t keep up with the high demand on her own. With everything she had learned in her marketing and entrepreneurship classes, Alex worked to grow her company by beginning graphic designing, outsourcing production, and starting a website

Ever since Alex first started Recess Apparel seven years ago, the company has had consistent growth Alex first viewed the business as a hobby, and never envisioned it turning into what it has today, adding that “It was intimidating to put myself out there, but it was so worth it.” As a busy college student, Alex had to maintain a balance between school and investing time into her growing business. After she graduated, COVID served as the “perfect excuse” to try to turn Recess Apparel into a full time job Recess Apparel began expanding to more schools besides Wisconsin; they specifically chose schools in the Big Ten and with similar cultures because of their shared gameday styles. They now sell apparel not only for UW-Madison, but also several other universities across the United States, including Penn State, Ohio State, Minnesota, Michigan, Indiana University, CU Boulder, USC, Alabama, and more

One aspect that sets Recess Apparel apart is its intended audience, which is college-age students. Their target audience has led the company to implement unique and strategic marketing Recess Apparel’s social media presence is crucial for the business, as this is the main channel of communication used by most of its consumers. Their Instagram (@recess.apparel) has over 4,000 followers. They post their products, information on pop-up shops, special deals, and more Their use of Instagram is also a clever marketing strategy, as it offers an opportunity for customers to post in the clothes, tag Recess Apparel in the photo, and advertise the brand in doing so Recess Apparel has two main ways that they sell their products: their website and pop-up shops. Like many clothing companies, shoprecessapparel.com is an easy way for customers to browse the clothes and order them for delivery. In addition to this, Recess Apparel has campus representatives, or student employees, on each campus. These campus representatives will host pop-up shops on campus before game days and on other random days throughout the year. Customers will line up to shop an in-person inventory of gameday apparel for their own school

We had the opportunity to attend one of these pop-up shops and see the inventory for ourselves. The pop-up took place at the Verve, an apartment building on State Street. The carefully curated selection of clothes was already

selling out as we arrived, going to show just how popular Recess Apparel is on the UW-Madison campus.

Alex’s willingness to take a chance on her business and go full time was inspiring to us as undergraduates, demonstrating just how important it is to take a chance on yourself when you know that you have a great business plan. Alex took a simple hobby and developed it into a full-fledged business.

We want to extend one more thank you to Alex for taking the time to speak with us about her experience as an entrepreneur and business owner.

Published in the Journal of Business on Apr. 15, 2024

WEIGHING THE MORALITY OF ARTIFICIAL INTELLIGENCE

BY JASON LI, AADIT BHAVSAR, OLIVIA CARLBERG

TECHNOLOGY COMMITTEE

Artificial intelligence (AI) has taken the world by storm

Nvidia Corporation, a leading chip manufacturer within the AI space, tripled its share price in 2023 and is up nearly 40% this year. ChatGPT, the popular AI chatbot from OpenAI, set the record in 2023 for the fastest-growing consumer application in history. And the broader AI industry is projected to have a market size of $305.90 billion in 2024, up from $108.42 billion in 2020.

Even with all this success, the industry has been plagued with controversy.

Sam Altman, the CEO of OpenAI, was recently fired and then reinstated by the same board, due to what the board called “‘misalignment’ of the profit versus nonprofit adherents of the company.” Elon Musk, the CEO of Tesla, SpaceX, and X (formerly Twitter), recently sued OpenAI for “abandoning their original mission for profit.”

The broader controversy, compounded by the rapid innovations within AI, underlines the concerns we have of our relationship with this technology. In this article, we will examine this relationship and its moral arguments.

The arguments are laid out in “Ethics of Artificial Intelligence and Robotics” in the Stanford Encyclopedia of Philosophy. AI and robotics have raised fundamental questions about what we should do with these systems, what the systems themselves should do, and what risks they have in the long term They also challenge the human view of humanity as the intelligent and dominant species on Earth We have seen issues that have been raised and will have to watch technological and social developments closely to catch the new issues early on, develop a philosophical analysis, and learn traditional problems of philosophy.

Ethics and Morality in machine learning goes far beyond simply answering to what someone should do in a given situation Isaac Asimov looked into this concept and drafted what he calls his “three laws of robotics” and they are as follows:

First Law A robot may not injure a human being or, through inaction, allow a human being to come to harm

Second Law A robot must obey the orders given to it by human beings except where such orders would conflict with the First Law.

Third Law A robot must protect its own existence as long as such protection does not conflict with the First or

Second Laws.

These laws bring to light the fact that ethics and morality around AI should be centered around the preservation and safety of human life While these laws do encompass the foundational logic structures that we would like machine learning to have, they do not do enough to cover all situations that may occur and this could still result in adverse judgment being made by these machines. Asimov himself noted how these situations would make ethical judgment by machines quite troublesome

The Allen Institute for AI recently released new AI called Delphi designed to tackle moral problems that anyone might ponder. Delphi was made to directly address the concern many have for AI - that it inherits the moral compass of those who created it. Some say it isn’t a necessity that AI deals with morality at all and that this shouldn’t be the role of technology. While this is a valid point the reality is that as humans become more dependent on AI, the inherent biases that these machines have will play an influential role in the biases seen in the humans that use

them regularly. Delphi is certainly a step in the right direction Yejin Choi, the leader of the Delphi project is dedicated to making AI a more inclusive and ethically aware space going forward but this doesn’t go without problems arising Delphi has been asked about abortions and breaking the law to help the friend In these cases, Delphi responded in favor of the abortion and breaking the law. These answers can spark controversy due to the nature of the questions so it can be seen that even Delphi has been made with the biases of the creator.

This is to be expected as people cannot agree on these concepts either which raises another important questionhow can AI be expected to find the solutions to our moral dilemmas when even we as humans cannot come to general consensus?

This technology is made even more dangerous when considering AI black boxes. According to the Scientific American, AI black boxes are “AI systems with internal workings that are invisible to the user. You can feed them input and get output, but you cannot examine the system’s code or the logic that produced the output.”

These black boxes raise immediate concerns, as researchers do not fully understand how these algorithms work Artificial intelligence has been put into decision-making roles, from qualifying for a business loan to a medication recommendation

“A computer can never be held accountable Therefore a computer must never make a management decision ” IBM said in 1979.

The essential concern is those in positions of power are able to deflect responsibility, transparency, and accountability by pawning decisions off to the black box machines. This obscures the moral character of the person behind the veil of a machine, which is supposed to be completely analytical and bias-free

Today, Artificial Intelligence platforms are becoming very prevalent in daily life There is simply no way to prevent or stop this integration As with many things, it comes with its advantages and disadvantages.

Microsoft has launched a recent generative AI platform, called Copilot Lab. It utilized several data models, such as open AI’s GPT-4, DALL-E 3, and GPT-4 Turbo and was created with the purpose to boost productivity and creativity. Copilot has the power to cross-reference multiple calendars, chats, documents, emails, meetings, and other Microsoft 365 apps to improve worker competency.

Still, like mentioned before, there are drawbacks to it. Recent news has shone negative light on Copilot, specifically about the image tools creating “ugly Jewish stereotypes, and anti semitic tropes” . Different programs such as Meta

AI, ChatGPT4, and Stable Diffusion XL, have not had the level of offensiveness related to Jewish stereotypes that Copilot has constructed Microsoft is working to fix this, but they have had problems in the past even with

inappropriate prompts. They are taking action to block this and continue to state that it is rated E for everyone,

being the most “age-inclusive app rating, suggesting it’s safe and appropriate for users of any age” UW Madison TechNews sent out a campus wide email on March 20th, 2024, announcing that Microsoft Copilot is now available for use to its students, faculty, and staff Concerns are sure to rise though UW Madison has to adapt to the rapidly growing demand and popularity for AI In higher education, the problem that arises is in evaluating what can and should be used, and what should not be

Morality in Artificial Intelligence is a nuanced topic with many details on either side of the issue. The long term implications of this conflict could pose a direct influence over future generations that could define an era. The human dependence on Artificial Intelligence only stands to grow from this point on and as long as that fact remains true, it can be said that the biases that AI possess will impact humans for certain Facilitating the development of morality in AI will be crucial

The aforementioned Delphi AI will be instrumental in developing a moral compass as previous attempts, such as Chat GPT, can be manipulated into moral gray areas relatively easily. An AI that has a more refined idea of morality that can expand upon itself will be undeniably important in the future It's also important to note that the idea of what is moral and immoral is constantly changing It is possible that an idea we commonly believe to be moral now will be viewed as completely immoral This is why the concept of an AI having the ability to build on its own ideas of morality is so important - it will be able to grow and adjust with the times.

Published in the Journal of Business on Apr. 15, 2024.

THE STATE OF SUSTAINABILITY AT UW-

MADISON AND THE WISCONSIN SCHOOL OF BUSINESS

BY AVA RADLER AND ALEKSANDR ROSE

LIFESTYLE AND SUSTAINABILITY COMMITTEE

Recently, the University of Wisconsin-Madison has made significant progress in the realm of sustainability, with a Sustainability Certificate, a 45% decrease in greenhouse emissions since 2007, and a newly launched Sustainability Research Hub With it being the 175th anniversary year of the University, the new initiatives signify the positive changes being made to address a global issue

Within the Wisconsin School of Business (WSB), several strides are being made within the sustainability sphere, including the creation of the course GEN BUS 250, Sustainable Capitalism This course focuses on the intersection of sustainability and business and will be a new requirement for the Business Signature BBA curriculum as of Spring 2025.

However, considerable advancements are still required for WSB to transition into a more sustainable environment. While curriculum modifications like this have the potential to strengthen a culture of sustainability among the student body, progress must be made from the ground up.

Organizations like Social Environmental Business Advocates (SEBA) and the Ethical and Responsible Business Network (ERBN) focus on creating spaces for like-minded students to gather and make progress. These organizations have created co-curricular opportunities such as the Sustainability Networking Night. One major goal of these organizations is to create a stronger pipeline between WSB and the growing sustainability sector of business. With many of the most successful companies maintaining Social Corporate Responsibility as one of their core values, this pipeline is increasing in value Corporate goals like this attract many highly skilled workers who are motivated to work for a company with a purpose

Surveys have demonstrated that this generation of college students is more focused on working for companies with an emphasis on sustainability and social impact than any previous generation Therefore, creating sustainability initiatives and opportunities on college campuses is more critical than ever.

Chancellor Mnookin introduced the new Sustainability Initiative on February 8, 2024, with some of the primary goals being launching the Sustainability Research Hub to promote environmental research and education, switching over entirely to renewable electricity by 2030, adding more sustainable education classes and programs, reaching net zero emissions by 2048, and finally, accomplishing STARS Gold by 2025. STARS is a sustainability tracking system, with Gold being the second-highest rating out of five

“We have an impressive list of accomplishments, but these alone don’t qualify us to be a world leader in sustainability. What does qualify us to lead is the particular way in which we engage with the work Which is, quite simply, to start with looking at real-world, concrete problems, ” Chancellor Mnookin stated in a talk, titled “Innovation for the public good: A bedrock value and launchpad to the future’ to the University of Wisconsin Board of Regents.”

This idea continued throughout Chancellor Mnookin’s speech as she introduced the Sustainability Research Hub, which is a joint initiative with the Nelson Institute for Environmental Studies and the Office of Sustainability. It will open many doors in sustainable research for faculty on campus and provide a destination for collaboration, as well as numerous resources to support sustainability research such as grants. The primary goal is putting sustainability and environmental research into action to positively contribute to a citywide and worldwide problem

Along with this, a new sustainability-centered visitor center will be implemented into the Lakeshore Nature preserve The structure will become the first net-positive energy building constructed on campus, creating a surplus of energy for the campus to use

In recent years, many universities, both private and public, throughout the U S have been making vital advancements in the domain of sustainability, from the University of Florida’s Student Senate’s Green New Deal to Princeton University releasing a fleet of electric campus buses. Higher education has an enormous role to play in shaping its students to become well-educated leaders in numerous industries. Incorporating sustainability both on campus and in the classroom allows students to have a more global perspective and reduces the ecological footprint of the school’s operations. Looking forward, the University of Wisconsin-Madison’s sustainability initiatives have the potential to kick start more change and a more significant shift towards sustainability on campus, but there is always more progress to be made on this front.

Published in the Journal of Business on Apr. 15, 2024

SHRINKFLATION: WHAT IS IT, HOW DO WE IDENTIFY IT, AND SHOULD WE DO SOMETHING ABOUT IT?

BY NOAH JAKEL FINANCE COMMITTEE

Introduction

Sometime in the early 2010s, my mom had just gone to the store to purchase bacon She bought the bacon and came back home The first thing she said when she got home was that a pound of bacon is now 12 ounces. This is not true A pound is 16 ounces, and no matter what you do to it, it does not change the fact that a pound is 16 ounces. My dad made so much fun of her. What she truly meant was that the price of a pound of bacon is now the price for 12 ounces of bacon, thus reducing the amount of food you get per dollar. This is called shrinkflation, and I will dive into it further. First, it is important to learn what inflation is.

Inflation

Inflation is the act of blowing something up, or in the economic sense, it means for prices to rise, while purchasing power falls. An example of inflation is the price of food increasing For example, I have recently noticed the McChicken at McDonald's here in Wisconsin used to be 2 for $3, and now it is buy 2 for $3.50 or something around there This makes me a little bad, and that is the common perception of inflation It is most of the time thought of as a bad thing that we wish to avoid While the US government wishes to avoid high amounts of inflation as it can reduce consumers’ willingness to spend, the government wishes to have a little bit of inflation The goal is 2% per year. The government hopes this will maximize employment and provide price stability for consumers, so they can make sound decisions about their futures.

Many things cause inflation Three general causes of inflation are production costs, demand, and the government. When items are more expensive to producers, they have to pass on more of the costs to consumers. One recent example is the war in Ukraine Ukraine is a major producer of grains, so when the war started, there was suddenly a lot less grain production, leading to other less efficient farmers having to make more grain at higher costs. This leads to inflated food prices around the world The same can be said about Russia, but instead with oil Russia is a major producer of oil, but when Russia was tariffed, prices of gas became higher all over.

Demand affects inflation because when there is a higher demand prices have to increase so more suppliers are attracted to the marketplace, which then can satisfy all of the demand Lastly, the government both causes and reduces inflation in various ways. The government increases taxes/decreases spending, to make money out of the economy to reduce inflation, or decreases taxes/increases spending, to put more money into the economy to increase inflation This is just a brief paragraph on inflation There is so much more to be learned and studied about it and there are many different sub-sectors of it like skimpflation and greedflation For the rest of this paper, I will talk about shrinkflation

What is Shrinkflation

Shrinkflation is an alternative to inflating prices. Instead of increasing prices, some firms are instead decreasing their package sizes, but not changing their prices. Shrinkflation is occurring all around us, with not many of us realizing it. While shrinkflation is not a new thing, some popular products have started to decrease in size, while not changing in prices, and sometimes even increasing prices. Two products that have been affected by shrinkflation are Doritos and Oreos.

Where do we see Shrinkflation Most

Big products like planes and cars do not experience shrinkflation It would be quite obvious to notice fewer seats or

less legroom Shrinkflation happens mainly among smaller products. To be more specific, the most common products affected by shrinkflation are household paper products, snacks, diapers, coffee, tea, and a few other smaller products. It is far easier to notice a decrease in the size of a car than it is to notice a decrease in a bag of Doritos by an ounce

Why do Firms Use Shrinkflation

Firms use shrinkflation instead of inflation for numerous reasons. One of them is the fact that consumers often miss it. It is easy to notice a price change, and often a big deal is made of it. When eggs soared because of an outbreak of the bird flu, people were outraged, and it broke national news. Everybody knew eggs were sky high, and it was a topic of discussion On the other hand, the size of snacks like Doritos and Oreos decreasing goes under the radar. Another reason, sometimes people would prefer to have smaller packages. Smaller sizes give consumers more flexibility to consume products where they wish, with no need to save the rest of the bag

How to Notice Shrinkflation

As I noted shrinkflation is hard to notice. It depends on the products. Items like snacks, coffee, tea, and other food products often list the weight in very small letters in a random corner of the product. It seems like it is almost intentionally small Household paper products on the other hand often list the amount of sheets they have This can be seen in toilet paper, paper towels, and lots of others.

How do we Combat Shrinkflation

The most important tool for combating shrinkflation is comparison shopping using the size of products. It is often hard to notice that a product has been shrunk if you are not already knowledgeable about the size of the product. This way you will be able to compare the sizes and quantity per dollar of various products. This will make you less susceptible to companies shrinking their items.

Is Shrinkflation that big of a Deal

It stinks when your favorite products decrease in size and maintain their price, is it something we have to look out for a lot? The US Bureau of Labor Statistics found that shrinkflation has a minimal impact on inflation calculations as a whole, and is not something that every consumer needs to keep their eye out for. They provide various statistics and graphs to support this. One graph found that less than two percent of household paper products (the most popular downsized product) were downsized from 2015 to 2021. Another way they determined this is by looking at the Consumer Price Index (CPI) Shrinkflation is included in the CPI to best show off inflation The Bureau of Labor Statistics determined that if shrinkflation were not included in CPI of some broad categories there is a minimal difference The biggest of those differences was Food and Beverages, where there was a 0.04% difference over a year. There are a few more specific categories that have a greater difference like Baby food, and snacks.

Conclusion

Shrinkflation is an alternative to inflation Instead of raising prices, companies choose to reduce the size of the product they are selling without reducing the price It has been around for a little while but in the past ten years, its popularity has increased Firms like to do it because consumers often do not notice that it has occurred and smaller packages have been growing in popularity. It is seen most often in snacks and household paper goods, as it is really easy to take a chip out of a bag or a few sheets out of a roll of toilet paper. One tool shoppers can use is to comparison shop. This just means to compare items to those around it and itself previously. This includes looking at both the size and price There is no need to worry that shrinkflation is not being accounted for in inflation as it is included in the Consumer Price Index. Additionally, if shrinkflation were to be excluded from CPI calculations it would have a minimal impact. While a pound of bacon maybe 12 ounces nowadays, shrinkflation is not something that should keep you up at night. Shrinkflation is just a small part of inflation If you are still worried about the two products you should be looking at household paper goods and snacks.

Published in the Journal of Business on Apr. 15, 2024

AMERICA IS BARELY READY FOR ARTIFICIAL INTELLIGENCE

BY ABHINAV KUMAR

TECHNOLOGY COMMITTEE GOVERNMENT AND LAW COMMITTEE

As students, ChatGPT and other AI chatbots have revolutionized how many of us handle and process new information given to us. While many of us are cognizant of how inaccurate these models are, as was discussed in the Artificial Intelligence Forum held by the Wisconsin Business Review last fall, the models’ ability to present things to us how we want them has helped many of us streamline our college education

However, this ability to present information however an AI model is directed to can, and often is, used for much more detrimental purposes.

Recently, before the New Hampshire primaries, a robocall went out to many New Hampshire voters imitating Joe Biden’s voice It told voters not to vote in New Hampshire’s primaries and that their “vote makes a difference in November, not this Tuesday.” The call was, strangely, made from the phone number of Kathy Sullivan, the former Democratic Party chair for the state of New Hampshire

This went directly against the state Democratic Party’s push for voters to write-in Biden’s name on to primary votes as his name was not on the primary ballot in the state Biden ultimately won with ease over Dean Phillips (D-MN), who is still campaigning to win the nomination over Joe Biden by the Democratic Party.

There are many conflicting opinions on who was behind the mass robocall, but ultimately, who did it doesn’t matter more than the message such an act sends.

The first and most pressing theme this situation displays is the utter lack of preparedness our government has in response to the increasing amount of cybercrimes powered by artificial intelligence Though our governmental system was purposefully designed to stop legislation from being passed without extensive deliberation by all interested parties, the extremely slow pace at which this deliberation is conducted almost negates the positive effects that the legislation can have in relation to quickly-changing technology.

In other words, AI is being developed so quickly that its application and abilities just a few years ago pale in comparison to what it is capable of today, and thus it is very difficult to regulate through the proper channels; very few people could have predicted in 2020 during the crypto-boom that within just three years the entire tech industry would be upheaved by the “AI Revolution”

Thus, the federal government now has to rely on quick legislation in the form of executive orders, which were originally designed to be used only in emergency situations, to limit the negative impact of this technology. Subsequently, in the days following the New Hampshire ordeal until now, President Biden and the Democratic Party as a whole have been working on writing what is likely to be the first executive order of 2024.

This order will increase regulation against AI in relation to national security, and orient the technology to be used for good within the education and public infrastructure system

Though it is necessary for President Biden and others to pass this order, the fact that it can only realistically be done through executive orders is telling of how unprepared our system is in fighting modern issues.

Another theme that underlies the New Hampshire robocalls is that people are scared of AI, but don’t know exactly

what about AI makes them so afraid

According to the Pew Research Center, 52 percent of Americans are more concerned than excited about the use of artificial intelligence in their daily lives. However, when respondents were asked about whether they were excited or concerned about specific applications of AI in their daily lives, an average of ~ 41 percent responded that they were “not sure”

While the robocalls exemplified one of the more unethical uses of artificial intelligence, the widespread hysteria of AI is unfounded. Due to such stories as the Biden robocall incident being the ones that gain national attention, perspectives of AI may change when considering the wide range of positive applications it can have in our lives.

As aforementioned, I use AI every day to learn and review course material in a way that makes sense to me Using ChatGPT and Google Bard, I ask questions that give me easy-to-understand answers. While I notably do not use AI to replace lectures or skip reading, I use it in a way that allows me to better deliberate information when I am already grappling with it, and this gives me a deeper understanding of course material which is my ultimate goal in college

I also use AI to help me flesh out my ideas and proofread my writing; I even used ChatGPT as a set of eyes to proofread this article

Some consider such implementation of AI into people’s workflow as lazy and cause for concern instead of excitement, but this couldn’t be further from the truth While there are definitely a small number of people who use AI to do their work and think critically for them, this is, in my experience, a small minority of AI users overall

Personally, (as someone whose job is based almost wholly on relaying and analyzing the applications of AI in our daily lives) I have never met someone who uses AI for any other purpose but to help them complete their tasks more effectively and efficiently. Ultimately, most people’s only goal is to live a more fulfilling life and AI helps them do just that.

This is not to say that there isn’t a great cause for concern over the “AI Revolution”, but it is important to tailor the negative with the unspoken positives that this technology provides us.

As such, I fall somewhere between being more excited or concerned about artificial intelligence’s role in our daily lives. Though I am cognizant that the technology is being used in harmful ways, such as what took place in New Hampshire, I also recognize how much it has helped myself and many others.

Thus, while it is necessary for our slow-moving government to properly address the concerns of AI through effective legislation, it is also necessary for Americans as a whole to know what exactly they fear, and realize that AI is much more than the negative stories being told about it nationwide

Published in the Journal of Business on Jan. 29, 2024

PLAYING THE ODDS: THE TIGHTROPE WALK OF SPORTS JOURNALISTS

BY BRETT COLON

SPORTS COMMITTEE

ESPN recently launched one of the biggest enterprises in the company’s history: ESPN Bet. The $2 billion sportsbook that was initially acquired from Penn Gaming, has already been approved in seventeen states as it looks to claim a large portion of the sports betting market. As the industry continues to expand, ESPN is just another example of an entertainment giant vying for a seat at the table

A physical platform for customers to scan odds and wager bets is a necessity in this industry, but what separates big players from smaller sportsbooks is marketing power and customer loyalty. Companies like FanDuel and DraftKings are consistently market leaders, spending billions of dollars on advertising over the last decade. Another key differential is a prominent presence in the media landscape. Many are familiar with Caesars Sportsbook commercials, which feature famous comedian J B Smoove portraying the eponymous emperor, but what about ‘real’ sports journalists reporting on behalf of sportsbooks?

ESPN is the pinnacle of the sports media landscape, and as it enters the sports betting industry, it will not be a surprise to see some of its coverage shift to appease consumers on their betting platform Other companies have already begun; reporter hirings have become commonplace among major sportsbooks, and just recently, Caesar’s tried hiring Senior NFL insider Adam Schefter to report on their behalf

Prominent sports journalists exert significant influence on content and betting markets. If major sportsbooks continue to direct the media we consume, where do they cross the line? As more and more leading reporters sign deals with significant sportsbooks, the sports media industry will continue to head in this dangerous direction, and the trust between news and consumers will only become smaller.

When Brandon Miller was selected with the second overall pick in last year’s NBA draft, my reaction was unsurprising For starters, Miller was the Southeastern Conference’s leading scorer last season, averaging 18.8 points per game, and was a crucial component in Alabama’s dominant run that led them to be a one-seed in the NCAA tournament, the first to do so in school history. While the first couple of the draft’s picks did not tailor far away from most people’s predictions, what stood out from night one was the controversy that ensued

On the morning of the draft, prominent sports reporter Shams Charania, who commonly goes by the name “Shams,” tweeted on X that inside sources were claiming the Charlotte Hornets (the team with the second overall pick) were “torn over” their draft selection and that top prospect Scoot Henderson was gaining “serious momentum” to be their selection Before this tweet, there was almost no major talk that Henderson was in consideration for the second pick, and the idea that Miller would be a Charlotte Hornet was almost certain

On the betting side, this tweet caused an immense shift in odds, with Henderson immediately going from +400 to -900, the heavy favorite This sent sports bettors into a frenzy, with many people throwing down large sums of money on Henderson to be picked, with one even betting $500 solely after seeing Sham’s tweet. Shortly after, Miller was selected second overall and gambling companies earned a significant profit from the ‘new information’ Charania had provided.

While betting on the NBA draft tends to be volatile, it is essential to note that although sports journalism outlet The

Athletic employs Shams, he also has a partnership with sportsbook FanDuel and appears on their TV network weekly. Shams works in part with a company that wants to increase its betting volume, so it follows that he is incentivized to release information that does so While a FanDuel spokesperson later released a statement saying

that “FanDuel is not privy to any news that Shams breaks on his platforms,” it is undeniable that even if FanDuel did not directly collude with him, they don’t have to explicitly tell him to ‘move the lines’ for it to be done Shams gets paid by Fanduel, so he will be incentivized to report on behalf of their incentives as well Perhaps FanDuel was not receiving a lot of betting volume on the draft, and by Shams ‘spicing things up’ with a quick tweet and new information, FanDuel got to walk away with their pockets full while their customers lost out.

There are also other instances of such sketchy endeavors, with multiple known instances of reporters affecting betting markets during low betting periods. Knowing what information to trust will become extremely difficult as significant sportsbooks expand into the sports media space

The solution to this may seem simple: if a reporter continuously gets caught up in such scandals, people will eventually stop trusting them, but that is not where the problem lies. The real issue is how difficult it can be to catch these culprits, and as the betting industry expands its presence in the media landscape, it will only get more complex. If a reporter sends out a “shaky” tweet once a year, any significant shift in betting lines could be interpreted as a coincidence or part of their job. This ambiguity will allow reporters to drop in whenever it is easiest to shake up the markets and get out before anyone can do anything about it.

So what is the solution? One way to face this issue is to establish boundaries between sports media and the sportsbook giants. If the merging of sports reporting and betting is too disastrous, these companies must find other ways to attract customers and build a base A more realistic approach will be establishing strict guidelines for these sportsbooks, looking over whom they can hire and what they can report on While none seem perfect, some action must be taken to some extent with the industry’s direction With the number of people betting rising exponentially each year, increasing numbers of people will trust reporters whose job is to deliver accurate news, and the costs of fractures in this process could prove detrimental

Published in the Journal of Business on Jan. 28, 2024

METHANOL, AMMONIA AND THE RACE TO FUEL

SHIPPING

BY ALEX ARIKER INTERNATIONAL BUSINESS COMMITTEE

We live in a world of convenience, where instead of asking how many weeks it will be until we receive our next

Amazon package, we ask ‘How many days?’ This lifestyle we have come to expect is supported by a complex web of logistics made possible by maritime shipping

Our dependence on freighters with hundreds of thousands of shipping containers to channel the world’s goods from port to port and country to country cannot be understated Over 90 percent of the world’s goods are shipped this way.

The burning of bunker fuel to power maritime shipping accounts for some 858 million tons of CO2 emissions per year; more than the entire air transport industry and greater than the output of many nations. This has not gone unnoticed by the world or its watchdogs.

Beginning in 2008, the International Maritime Organization (IMO), a specialized branch of the United Nations meant to regulate shipping, has tried to tackle the industry’s unscrupulous contribution to climate change with current plans to reach net zero emissions by 2050. Since 2008, the IMO and other organizations have created international requirements for the use of forms of bunker fuel with fewer pollutants, alternatives like Marine Diesel Oil

Firms with their own environmental goals that contract freight companies are also slowly starting to expect the companies they contract with to provide carbon-neutral ways to ship their merchandise, increasing pressure on freight companies to transition away from bunker fuel

Although some alternatives to bunker fuel like liquid natural gas (LNG) already exist and partially reduce greenhouse gas emissions, the transition to a carbon neutral fleet will not be possible without switching to more exotic alternative fuel sources, a daunting task considering 95 percent of the world’s fleet is powered by internalcombustion engines.

Currently, two fuel sources seem primed to replace bunker fuel in the long run: methanol and ammonia

Of these energy sources, methanol is closest to becoming the future fuel of the maritime shipping industry. Methanol can reduce the greenhouse gasses emitted by traditional marine fuels by up to 95 percent and marine engines can already burn methanol for energy. In fact, several ships already run partly or completely on the substance and many more have been ordered

Liquid at room temperature, methanol can also be safely stored and transported in a similar way to bunker fuel

Additionally, methanol has a higher volumetric energy density, meaning it can hold more energy with the same volume, than ammonia

Why then continue to pursue other alternative fuel sources? Given the 185 methanol-capable ships expected to be constructed and delivered in the coming years, demand for methanol is expected to far outweigh supply. SEA-LNG, a lobby group, projects that demand for methanol will be 14 million tons per year in 2028, despite current production at only 6 percent of that, at three-quarters of a million tons per year.

Ammonia then, may be a valuable alternative fuel source to consider for a green future The first of several compelling characteristics, ammonia can be entirely derived from atmospheric molecules, rendering it truly carbon

free Additionally, ammonia is relatively cheap compared to other alternative fuel sources given its precursor molecules are abundant in the atmosphere Ammonia is also already commonly traded, so the shipping industry could make use of the infrastructure for the storage and transportation of ammonia that already exists.

However, multiple obstacles still exist before ammonia can be adopted as an alternative fuel source. For one, engines that use Ammonia as marine fuel are not yet available, although expectations set them to be developed later this year at the earliest. Ammonia is also toxic, so leaks present a safety concern for crew members.

Additionally, Ammonia needs to be stored in refrigerated tanks, potentially reducing cargo capacity aboard freighters. Despite these shortcomings, Ammonia still has potential as an alternative fuel for the future of maritime shipping

Instead of a single fuel, a variety of fuels will most likely see use as the world transitions towards a carbon neutral shipping industry. More important is the speed at which the industry makes this transition against a backdrop of worsening climate change

A survey from the Global Centre for Maritime Decarbonisation, the Global Maritime Forum, and the Mærsk McKinney Møller Center for Zero Carbon Shipping indicated that 46 percent of shipping companies (those sampled represent 20 percent of the world’s capacity) have already begun running pilot programs involving alternative fuels. However, with an average lifespan of 20 years, freighters and their owners need to begin transitioning to green energy sources now to reach net zero emissions by 2050. With more ships taking longer routes because of geopolitical struggles like the war in Ukraine and instability near the Suez Canal, a quick transition to carbon-neutral fuel sources is even more important. Maritime shipping companies need to do more now to guarantee our shared future on Earth

Published in the Journal of Business on Jan. 28, 2024

WISCONSIN IDEAS CONFERENCE

Navigating Higher Education Admissions Post-SFFA

To:

Association of American Colleges and Universities (AAC&U)

From:

Jason Li, Abhinav Kumar, and Eva Sinelnikov of the Wisconsin Business Review (WBR)

Proposal Introduction: Diversity, Affirmative Action, and the Court

The dialogue surrounding diversity has proven to be contentious as it is timeless. While the concept has become more defined and its relationships being studied, it begets controversy from its translation into real-world strategies and practices [1, 2]. Diversity, as defined within this paper, is an accurate representation of all the identity groups within a given population.

The strategies in this paper focuses on one particular diversity practice, affirmative action, through the context of higher education. Affirmative action, as defined within this paper, is the applicant preference for underrepresented identity groups in college admissions processes.

U.S. colleges have been recently required to revise such processes after the Supreme Court’s ruling in Students for Fair Admissions v. Harvard (SFFA), in which the court held that racebased affirmative action programs in college admissions processes violate the Fourteenth Amendment.

Given that diversity is a quantified strength, this ruling puts colleges on the back heel.

The forced removal of race-conscious admission practices is likely to shrink diversity in opportunity pools and cause further inequity in the national population [3, 4]. Therefore, sufficient policy action is necessary to proactively hedge against this inequity. We will explore potential strategies.

The strategies considered within this proposal are socioeconomic-based affirmative action, top-percent affirmative action, and geography-based affirmative action, with closing statements on holistic application review and pilot programs.

Defining the Problem: The Consequences of SFFA to Higher Education

Before the SFFA ruling, we have seen instances of how a removal of race-based affirmative action programs brings upon greater, disproportionate inequity in the population’s racial composition [5]. The effects are illustrated in Figure 1.

(Source: Washington Post, 2023)

Figure 1: The highest differences are in White, Hispanic, and Multiracial representation.

Figure 1 measures the racial composition of public universities in states that have banned affirmative action and those that were actively practicing.

With and without race-based affirmative action, the White and Asian racial groups are the most overrepresented relative to the national population, while the Black, Hispanic, and Multiracial racial groups are the most underrepresented. Notably, the White and Hispanic racial groups demonstrate the most drastic effect from the practice, at roughly -2% and 2%, respectively.

This comparison quantifies the relationship affirmative action has for each racial group listed. Affirmative action practices have disproportionate, opposite effects across racial groups, but brings each group closer to their national population composition [5]. Therefore, affirmative action practices serve to promote diversity through group equity.

Now, after examining the role of affirmative action and the potential consequences of the SFFA ruling, we will explore possible strategies that are both politically viable and structurally effective.

Options for Change: Shifting to Identity Proxies to Increase Diversity

Diversity, as defined within this paper, is an accurate representation of all the identity groups within a given population. This definition of diversity is multidimensional, as diversity of identity considers factors such as race, ethnic background, socioeconomic status, geographical location, and class rank. With race being prohibited from admission practices, diversity must be promoted through alternative dimensions. We structure our strategies from this definition and situation.

Admission offices can promote population parity through the socioeconomic context. Officers would consider their college’s socioeconomic profile, providing preferential treatment to underrepresented groups. Socioeconomic-based affirmative action has been found to increase racial parity, yet less effectively than race-based affirmative action [6, 7]. In a 1995 study analyzing projections under a straight socioeconomic affirmative action plan [3], “admissions officials at Berkeley reexamined their records and produced projections … if there had been no affirmative action policy whatsoever and also if there were an affirmative action admissions program based solely on socioeconomic status.” The study found that if all selections were based solely on academic standing and standardized test scores, the percentage in diversity decreases. Black enrollment would drop from 6 percent to between 0.5 percent and 1.9 percent, while White and Asian enrollment would rise by 25 percent and 31 percent from the present levels of 30 percent and 42 percent, respectively.

Admission offices can promote population parity through the top-percent context. In top-percent affirmative action, admission officers would provide preferential treatment to applicants that perform high relative to their peers and organization. Shown in Figure 2, a study examining a top-percent affirmative action policy at Rio de Janeiro State University (UERJ), an elite university in Brazil, found that students admitted through the affirmative action track were

academically competitive, and increased their access to firms affiliated with UERJ’s alumni network, which raised their early-career earnings [8].

This benefit seemed to decrease as they progressed further in their careers. Students who would have been admitted regardless of whether affirmative action existed, did worse in the labor market upon graduation. The earnings of “top enrollees,” students who could gain admission whether or not affirmative action existed, decreased after the implementation of the policy. The study suggests that the change in student body composition from affirmative action reduced the networking and career prospects of UERJ’s top students [8].

(Source: Journal of Labor Economics, 2023)

Admission offices can promote population parity through the geographical context. In geographical affirmative action, admission officers would provide preferential treatment to applicants from underrepresented locations. In a piece from the University of Michigan Journal of Law Reform, geography-based affirmative action can be seen as a better approximation to address the structural disadvantages that underrepresented groups face [9].

Assuming geographical location can be a significant proxy of an applicant’s identity, admission officers will factor information, such as an applicant's home address, into consideration [9]. However, the relationship between geography and identity lacks a significant body of research. Geography is not necessarily a factor to an applicant’s identity, and tends to overlook the individual level for a community-level assumption.

A Holistic Review: Commentary, Implementation, and the Next Step

When evaluating the qualifications that each strategy holds, each requires critical commentary. For socioeconomic affirmative action, implementation has yielded positive results

Figure 2: Networking value, human capital, and job pay decreases under affirmative action.

in racial and ethnic parity but is relatively ineffective when implemented solely. For top-percent affirmative action, implementation saw short-term increases in earnings, alumni network, and college degree attainment, but saw diminishing returns in earnings and networking quality for top enrollees. For geographic affirmative action, diversity can be promoted through a race-neutral locational frame, yet shifts focus from the applicant to their broader, physical community.

We recommend implementing and sub-categorizing these strategies under holistic applicationreview.Inaholisticapplicationreview,educatorsevaluateanapplicant’s qualifications, achievements, personal experiences, and academic metrics through their overall profile [10]. The SFFA ruling does not prohibit a holistic consideration of the experiences of applicants that, in some form, relate to their race and other identities [11]. As such, our strategies are legal and politically feasible under this framework of holistic application review. Under holistic application review, educators and policymakers can conduct pilot programs for their diversity strategies in admission processes. Pilot programs offer constraint flexibility, and is a controlled and scalable environment. Legislation reform, an alternative route, would prove difficult and unreliable due to the bureaucratic process, differences in state legislation, and more.

A hypothetical pilot program can be structured so that admission officers are tasked with reviewing applications from different control groups, with each group filtered under an unique strategy or combination of strategies. Each group will yield a different population diversity, and officers can determine strategy effectiveness by measuring these yields against the national population parity. This program, including the diversity strategies, should be structured to always be iterated on, to account for any necessary changes deemed reasonable and or necessary.

References

Slater, Robert Bruce. “Why Socioeconomic Affirmative Action in College Admissions Works Against African Americans.” The Journal of Blacks in Higher Education, no. 8 (1995): 57–59. https://doi.org/10.2307/2963051.

Kahlenberg, Richard D. “Class-Based Affirmative Action: A Natural for Labor.” New Labor Forum, no. 2, 1998, pp. 37–43. JSTOR, http://www.jstor.org/stable/40342859. Accessed 3 Feb. 2024.

Cancian, Maria. “Race-Based versus Class-Based Affirmative Action in College Admissions.” Journal of Policy Analysis and Management, vol. 17, no. 1, 1998, pp. 94–105. JSTOR, http://www.jstor.org/stable/3325867. Accessed 3 Feb. 2024.

University of Michigan Journal of Law Reform.” “Place, Not Race: Affirmative Action and the Geography of Educational O” by Sheryll Cashin, repository.law.umich.edu/mjlr/vol47/iss4/3/. Accessed 06 Feb. 2024.

Long, Mark C. “Affirmative Action and Its Alternatives in Public Universities: What Do We Know?” Public Administration Review, vol. 67, no. 2, 2007, pp. 315–30. JSTOR, http://www.jstor.org/stable/4624567. Accessed 6 Feb. 2024.

Carter, J. Scott, and Cameron D. Lippard. “Affirmative Action and Higher Education.” The Death of Affirmative Action: Racialized Framing and the Fight Against Racial Preference in College Admissions, 1st ed., Bristol University Press, 2020, pp. 19–40. JSTOR, https://doi.org/10.2307/j.ctvz938hc.6. Accessed 6 Feb. 2024.

More Americans Disapprove Than Approve of Colleges Considering Race, Ethnicity in Admissions Decisions.” Pew Research Center - U.S. Politics & Policy, Pew Research Center, 8 June 2023, www.pewresearch.org/politics/2023/06/08/more-americans-disapprove-than- approve-of-colle ges-considering-race-ethnicity-in-admissions-decisions/. Accessed 06 Feb. 2024.

Bastedo, Michael N., et al. “Holistic Admissions After Affirmative Action: Does ‘Maximizing’ the High School Curriculum Matter?” Educational Evaluation and Policy Analysis, vol. 38, no. 2, 2016, pp. 389–409. JSTOR, http://www.jstor.org/stable/44984544. Accessed 6 Feb. 2024.

Carter, J. Scott, and Cameron D. Lippard. “Affirmative Action and Higher Education.” The Death of Affirmative Action: Racialized Framing and the Fight Against Racial Preference in College Admissions, 1st ed., Bristol University Press, 2020, pp. 19–40. JSTOR, https://doi.org/10.2307/j.ctvz938hc.6. Accessed 6 Feb. 2024

Zabel, Joseph. “A Positive Political Theory Analysis of Affirmative Action In ...” Connecticut Interest Public Law Journal, March 2020. https://cpilj.law.uconn.edu/wpcontent/uploads/sites/2515/2020/03/CPILJ-19.1-Affirmative-Action-Reaction-and-Inaction-APositive-Political-Theory-Analysis-of-Affirmative-Action-in-Higher-Education-by-JosephZabel.pdf.

An Increased Gas Tax to Drive Reductions in Traffic Congestion Costs

To: Hawaii State Legislature and Honolulu City Council

From:

Ily Grinberg, Preston Wong, and Andrew Vanderkolk of the Wisconsin Business Review (WBR)

Abstract

There is a need to limit the number of cars on the highways in Hawaii. Current traffic conditions cause billions of dollars of losses in economic productivity and increased gas emissions that are harmful to the environment. There is an underutilization of public transport and subsequently, an overutilization of roadways and personal vehicles as represented by Honolulu bus ridership data, average traffic times, and car ownership data. While there are many factors that influence car ownership, our survey found that the primary influencing factor is gas prices, which is mirrored in established literature. Furthermore, the density of bus routes has a positive effect on public transport utilization, which diverts would-be drivers away from cars. Finally, the conventional wisdom of expanding roadway capacity to reduce traffic congestion is not feasible because the cost of land is so high, and more importantly does not have the effect of reducing traffic in the long run. Our solution proposes an increase in Hawaii’s state gas tax to reduce the number of cars on the road and to use the revenue to fund an increase in the density of public transportation.

Background: The Causes of Traffic and Its Consequences

Traffic congestion is a worsening problem in Hawaii. Hours spent in traffic increased to as much as 68 hours of delay annually per commuter in 2019 from a low of 21 hours per commuter in 1982; which equates to an average increase of around 1 hour per year per commuter. The year 2020 exhibits a sharp decrease in hours, but this is an outlier to the trend and is attributed to the increase in working from home and quarantines during the COVID-19 pandemic (Hawaii Department of Business, Economic Development & Tourism 2020, 1). These delays have serious, tangible economic costs and environmental consequences. The City and County of Honolulu realized an annual congestion cost of $850 million in 2019. Each hour in traffic costs $19.14 per commuter and $49.49 per commercial vehicle. In 2019, the realized annual cost per commuter was $1552, which is more than the $843 typical average cost of congestion per commuter for other cities in the medium urban category. This cost is found from the time wasted, excess emissions, and fuel consumption that result from increased traffic delays. In 2019 commuters consumed an additional 16.276 million gallons of gasoline due to the time spent in traffic alone. On average, an individual commuter wastes 30 gallons of fuel annually. As a result, 162 thousand tons of excess CO2 was emitted compared to free flow conditions (Texas A&M Transportation Institute: Mobility Division 2020). In total for 2019, commuters represent 89.8% of the total annual congestion cost. Therefore, focusing on diverting commuters from driving to work to using public transportation is essential to effectively reducing the overall congestion cost.

We find that increased car use and underutilization of public transport are the primary causes of Hawaii’s increased congestion and traffic. The current increasing trend of cars on the road is attributed to a similarly positive trend in the use of cars to commute to work. As of 1995, the number of driver's licenses in force and the number of registered vehicles has steadily increased by about 3% per year (Hawaii Department of Business, Economic Development & Tourism 2022a, 1)(Hawaii Department of Business, Economic Development & Tourism 2022b,1) Furthermore, the increase in sole driver traffic (zero-passengers) represents a shift in preference away from using public transportation to driving in aggregate. Between 1980 and 2013 the share of workers driving to work alone increased by 74.2%. In comparison, the share of workers commuting via public transport decreased by 1.8 percentage points, and the number of workers commuting via public transport only increased 11.7% (Research and Economic Analysis Division: Hawaii State Department of Business, Economic Development and Tourism 2015, 1-9). In actuality, total bus ridership was 76.1 million in 1993, while in 2022 it was 34.8 million (Hawaii Department of Business, Economic Development & Tourism 2022c, 1). Therefore, a focus on influencing workers to prefer public transport over driving alone is the most effective way of reducing the overall congestion cost.

Evaluating Options for Change

This section explores three plans for improving traffic conditions. First, we prove why expanding the number of lanes on H-1 is infeasible. Second, we explore congestion pricing as a potentially more equitable option

to reduce traffic. Third, we demonstrate how increasing the gas tax and directing that additional revenue toward expanding the density of public transportation is the most effective proposed solution.

Option 1: Expanding Roadways

Currently, the tax on gas is directed into Hawaii’s State Highway fund that supports the maintenance and expansion of roadways (Hawaii Stat. §248-8). The status quo and conventional wisdom dictate that an increase in the number of lanes plus an expansion of roadways equals an increase in maximum traffic flow which equates to reducing traffic delays and costs overall. Though expanding roadways reduces traffic in the short term, it does not in the long run due to the theory of induced demand. An increase in the number of lanes leads to an increase in overall traffic. Even after the expansion of roadways, traffic is as congested as before or even more on the roadways, which increases the magnitude of congestion cost. Therefore, it is clear that the current highway expansion strategy is not effective as traffic delays continue to increase; and undertaking more costly roadway expansions is a disservice to commuters and taxpayers.

Although ineffective, expanding roadways is one option. The primary component of roadway expansion is land. Land in Hawaii is expensive. Specifically, the price of land in urban Honolulu is higher than in any major US urban area due to natural and institutional constraints on the supply of land (Rose and La Croix 1989, 301-314). As a result, the expansion of the existing footprint of major thoroughfares such as H-1 — the busiest highway in Hawaii — is prohibitively expensive.

Consequently, recent projects have focused on resurfacing and restriping existing roadways to create additional lanes. A 2013 project cost an estimated $30 million to add a single lane to a mere 3.5-mile stretch and significantly impacted traffic delays despite night-time construction efforts (Gutierrez 2012)(Honoré 2013). While the U.S. Interstate System standard lane width is 12 feet (U.S. Department of Transportation: Federal Highway Administration 2014), this project lowered the lane width to 10 feet (Hawaii Department of Transportation 2012). A previous project also narrowed lanes eastbound H-1 on a different section of the H-1 in 2006 (Hawaii Department of Transportation 2012). This was seen as a cheaper alternative compared to the estimated cost of $1.5 billion to add an additional lane in each direction; the cost increase is due to right-of-way acquisitions and tenant relocations. As costs constrain the expansion of the highway footprint, there is a finite limit to the number of additional lanes that can be provisioned out of the existing space. As such, the continued increase in the number of lanes is unsustainable in the long term.

Additionally, it is evident from traffic delay data that both projects to increase the number of lanes had a negligiblelong-termimpactontrafficHawaiiDepartmentofBusiness,EconomicDevelopment&Tourism, 2022a/b) In fact, Volker and Handy (2023) suggest that increasing highway capacity actually increases traffic problems through reviewing empirical research on induced travel. They find that a roadway capacity expansion of 10% increases vehicle miles traveled by 3-8% in the short term and 8-10% in the long term. This is evidence of what Duranton and Turner (2009) coined as “The Fundamental Law of Road Congestion” which argues that increasing road capacity increases the number of drivers and does nothing to reduce traffic (Duranton and Turner 2009, 2616-52). As traffic has continued to worsen, the status quo fails to adequately provide a long-term solution to the issue.

Option 2: Congestion Pricing

Congestion pricing can be seen as a potential alternative that more directly affects the drivers who traverse congested roads through tolls. In other words, it is a less blunt policy than gas taxes that would affect all drivers. Congestion pricing is supposed to shift some drivers away from driving during hours of high traffic congestion towards other times that are non-peak traffic hours, modes of transportation such as buses or other routes (US Department of Transportation Federal Highway Administration). strategies of congestion pricing fall under two general categories: tolls and non-toll options. Strategies involving tolls include high occupancy toll lanes, express toll lanes, pricing for entire roadways, zone-based pricing, and region-wide pricing. Strategies not involving tolls include increasing parking prices, ride-sharing, and pay-as-you-drive. Tolls are by far the most common. In examining New York, congestion pricing proposals include ideas such as having fewer people drive during rush hour to reduce the “waste associated with traffic congestion” (NRDC 2022) by utilizing tolling in certain

areas. An analysis of the impacts of congestion pricing in New York finds that the policy only affects 4 percent of commuters in the outer boroughs while a majority, 56%, of residents take public transportation (CSS 2017). However, congestion pricing in the city and county of Honolulu would not be a way to directly influence those who contribute to traffic because it would affect virtually all commuters on the island as 62% of the island population lives along the H-1 corridor that would have proposed congestion pricing. Furthermore, 85% of jobs and 90% of visitor activity are located near the corridor (Hawaii Department of Transportation 2012). Therefore, since the overwhelming majority of people traverse the area of concern, it is not more direct than gas tax because both affect almost everyone. It is, however, more expensive and not as cost-effective.

While the tax generated from an increased gas tax would fund only expanded bus routes, congestion pricing revenue would also be siphoned off for the maintenance and implementation of the tolls themselves, an additional expense that can be avoided with our proposal. While the information is limited and hard to compare, we can look at an example out of Washington State for an idea about the operational and construction costs for tolls. The interstate-99 (SR-99) tollway which consists of 24 toll signs cost around $200 million dollars to construct (Washington State Transportation Commission 2024). In comparison in Honolulu, there are 33 major ramps and interchanges that provide access to the highway that would all need to have tolls, meaning there would have to be a minimum of 33 toll signs (State of Hawaii Department of Transportation Highways Division 2016). Tolls also include ongoing operation costs that fall into three categories. The first category is roadside cost which includes toll zone and gantry maintenance utility costs, toll system maintenance, and image review operating costs. The second category is back office costs that include software, website, credit card costs and other payment processing fee costs, and customer service operations. Finally, there are ongoing administrative costs such as marketing and public relations, violation hearings and support staff, and other monitoring and compliance costs (ODOT Project Team: Urban Mobility Strategy 2023).

Option 3: Expanding Bus Density and Increasing Gas Tax

Taxes on gas that are allocated to support expanding the density and frequency of bus routes effectively reduce traffic and its consequences. Currently, Hawaii’s gas tax is 16 cents per gallon, the second lowest tax rate on gas in the United States (Donnellan 2024). We will show that bus density, or the reliability and availability of public transportation, is correlated with additional bus usage. Furthermore, we will prove that bus density and the cost of gas are the primary factors in purchasing and driving a vehicle or alternatively using public transportation. Therefore, increasing the bus density will effectively divert would-be drivers to public transportation. Increased bus density is correlated with increased bus use. Based on the 2015 Commuting Patterns report by the Hawaii State Department of Business, Economic Development, and Tourism: Research and Economic Analysis Division, the areas with the highest public transportation utilization have the lowest percentage of car usage. The two areas with commuters least likely to drive are; from Nuuanu to Kalihi, where bus usage is 19% and only 67% use cars; and from Tantalus to Waikiki where bus usage is 12% and car usage is only 64%. Importantly, Ewa has a higher bus usage as well despite being far from the urban core due to its higher bus density (Hawaii Department of Business, Economic Development & Tourism 2022c). The common element in these areas with high bus usage is the highest density of bus routes (The Bus: The City and County of Honolulu 2019,2).

Without a reduction in cars on the road, more buses potentially make traffic worse and cause more wear and tear on roads. Thus, increased bus density requires an additional reduction in car driving. Our survey of 507 Hawaii residents aged 21-35 returned similar results. They reported that the most important factors when purchasing a new vehicle are: fuel efficiency/cost (70% of respondents) is the most important followed by purchase/lease price (24.5% of respondents); showing that new car buyers are sensitive to fuel costs. The State Economic Book supports our survey data and demonstrates that new car purchases have a negative correlation with new vehicle registration (Hawaii Department of Business, Economic Development & Tourism 2022c). In contrast, the factor that determines whether they continue using their car over other alternatives is safety (73.7% of respondents). However, only 7% of respondents considered fuel efficiency/cost to be the top factor. Since those who own a vehicle and are not searching to buy a new vehicle are not sensitive to gas prices the way that car shoppers are, the tax must be persistent and long-term to affect all consumers and reduce the total number of vehicles.

Gas Tax Sensitivity

A study encompassing five cities in the United States found that public transit systems experience approximately a 0.09% increase in ridership for each additional one-cent increase in fuel prices (Haire and Machemehl 2007). While Iseki and Ali (2014) similarly report using panel data for 10 U.S. cities from 2002-2011 that gas price increases have a positive effect on public transit usage, they note differing effects and spreads between rail and bus systems (Iseki and Rubaba 2014, 1-125). Specifically, they note short-term gas price increases of 10% only result in a 0.61-0.62 percent increase for bus and public transit share of the aggregate, but not for rail. In long-term price increases, the effect is 0.84 percent for buses and 1.16 for rail. Finally, they note that in regards to the total gas price, a dollar threshold of $3 exhibits a stronger effect of 1.64 percent for bus, 2.05 percent for rail, 1.8 percent in aggregate, and a threshold of $4 exhibiting a 9.34 percent increase for rail (Iseki and Ali 2014, 1-124).

We propose to moderately increase the gas tax by $0.25 or from $0.16 to $0.41. Generalized for all cars, the average elasticity of gasoline consumption with respect to price is -0.35, for used cars (3-6 years old) the elasticity is -0.30 (Goulder and Jacobsen 2009, 667-69). This demonstrates a negative elasticity, which means gas consumption decreases and subsequently car usage decreases as the gas price increases. As to the effectiveness of increasing the tax, a $0.25 increase in gas tax on average reduces gas consumption annually by 5.09%, or a 1.12% decrease in new cars on the road and a 0.37% decrease in used cars on the road in year one of the increased gas tax (Goulder and Jacobsen 2009, 667-69). In addition to reducing cars on the road, an increased gas tax generates additional tax revenue. According to economic reports from the State of Hawaii, in 2022, 34.7 million gallons of gasoline were consumed, from which we estimate that annual additional tax revenue is in the ballpark of millions of dollars (Research and Economic Analysis Division 2023, 1-9). Altogether, a decrease in gas consumption and a decrease in new cars on the road will tangibly reduce traffic and congestion costs. In tandem with the additional tax revenue and the effect of increased use of public transportation, it is clear that a gas tax increase yields the most benefits for the people of Hawaii.

In this memo, we explored the cost and size of Hawaii’s traffic congestion problem. For solutions to the costly congestion problem, we explored conventional wisdom and the status quo of expanding roadways, a toll-based congestion pricing option, a $0.25 increase in the gas tax, and using the additional tax revenue to support expanding bus density and public transport. We demonstrated that expanding roadways does little to combat traffic congestion in the long run, and increases the cost burden of taxpayers. Past costly projects and little changed traffic congestion metrics prove that expanding roadways is ineffective at reducing traffic. Additionally, while a congestion-based pricing model may be more equitable, the specifics of the situation render it ineffective and exceptionally costly. On the other hand, we demonstrated that a reasonable increase in the gas tax would yield a multitude of benefits. A $0.25 gas tax increase would reduce gas consumption and consequently cars on the road, shift commuters' preferences towards public transportation thus increasing utilization, and also generate additional tax revenue to support expanding bus density and the increased utilization of public transport. In conclusion, of the options outlined in this memo, our proposed gas tax increase is a solution that clearly yields the most benefits to the people of the State of Hawaii.

References

Bento, G., & Jacobsen, H. (2009). Distributional and Efficiency Impacts of Increased US Gasoline Taxes

American Economic Review, 667–669.

The Bus: The City and County of Honolulu. (2019). Honolulu Area Transit Map.

https://www.thebus.org/SystemMap/TheBus2019SystemMap.pdf

CSS. (2017, October 24). Congestion pricing - a CSS analysis. Community Service Society of New York.

https://www.cssny.org/news/entry/congestion-pricing-css-analysis

Donnellan, B. (2024). Gas Tax by State for 2024. https://www.complyiq.io/gas-tax-state-2/

Duranton, G., & Turner, M. A. (2009). The Fundamental Law of Road Congestion: Evidence from US cities. American Economic Review , 2616–2652.

Gutierrez, B. (2012, November). DOT unveils project to resurface, add new lane to H1 Freeway.

{https://www.hawaiinewsnow.com/story/20037716/dot-unveils-project-to-resurface-add-new-to-lane-to-h1-fr eeway/

Haire, A., & Machemehl, R. B. (2007). Impact of Rising Fuel Prices on U.S. Transit Ridership. Transportation Research Record Journal, 1992(1).

Hawaii Department of Business, Economic Development & Tourism. (2022a). Table 18.07-- Motor Vehicles Registered, by County: 1995 TO 2022.

https://files.hawaii.gov/dbedt/economic/databook/2022-individual/18/180722.pdf

Hawaii Department of Business, Economic Development & Tourism. (2022b). Table 18.19-- Roadway Congestion for Urban Honolulu: 2017-2020. Hawaii.gov.

https://files.hawaii.gov/dbedt/economic/databook/2022-individual/18/181922.pdf

Hawaii Department of Business, Economic Development & Tourism. (2022c, June). Table 18.25-- Public Transit, For Oahu: 1993 to 2022.

https://files.hawaii.gov/dbedt/economic/databook/2022-individual/18/182522.pdf

Hawaii Department of Business, Economic Development & Tourism. (2022d, December). Table 18.15-Hawaii Drivers Licenses in Force, by County: 1991 TO 2022.

https://files.hawaii.gov/dbedt/economic/databook/2022-individual/18/181522.pdf

Hawaii Department of Transportation. (2012, July). H-1 Restriping Demonstration Project Lane Closures from Pali Highway To Punahou Street.

https://hidot.hawaii.gov/highways/h-1-restriping-demonstration-project-lane-closures-from-pali-highway-topunahou-street/

Hawaii Stat. §248-8.

Honoré, M. (2013, July). Months of major work coming on H-1 from Ward Ave. to Middle St. Star Advertiser .

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Iseki, H., & Ali, R. (2014). MTI Report 12-19: Net Effects of Gasoline Price Changes on Transit Ridership in U.S. Urban Areas. Mineta Transportation Institute, 1–125.

NRDC. (2022, May 25). What is congestion pricing?. What Is Congestion Pricing and Its Benefits?

https://www.nrdc.org/stories/what-is-congestion-pricing

ODOT Project Team: Urban Mobility Strategy. (2023, February 21). Measuring the Cost of Toll Operations

Oregon.gov.

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Research and Economic Analysis Division. (2023, January). Monthly Energy Trend Highlights. Hawaii.gov.

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Research and Economic Analysis Division: Hawaii State Department of Business, Economic Development and Tourism. (2015, April). Commuting Patterns in Hawaii . Hawaii State Department of Business, Economic Development and Tourism.

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Rose , L. A., & La Croix , S. J. (1989). Urban Land Price: The Extraordinary Case of Honolulu, Hawaii. Urban Studies, 27(3), 301–314.

State of Hawai’i Department of Transportation Highways Division. (2016, August). H-1 Corridor Study Hawaii.gov.

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Texas A&M Transportation Institute: Mobility Division. (2020). Congestion Data for Your City: Delay per Auto Commuter: The yearly delay for auto commuters who travel in the peak period (6 to 10 a.m. and 3 to 7 p.m.). Texas A&M Transportation Institute. https://mobility.tamu.edu/umr/congestion-data/

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Volker, J., & Handy, S. (2023). Increasing Highway Capacity Induces More Auto Travel. National Center for Sustainable Transportation. https://escholarship.org/uc/item/3q21f88p

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https://wstc.wa.gov/programs/tolling/sr-99-tunnel/

THE PAST, PRESENT, AND FUTURE

The Wisconsin Business Review was established on Tuesday, March 14th, 2023. To this day, the Review serves as a publications and research medium managed by students, dedicated to presenting original and insightful perspectives on business-orientated issues.

The Review started from the mind of one student, but was made possible by the efforts of many. In fact, the idea became a reality after a career trek to Chicago, where the founding team first met. The Review then began the bureaucratic process of club recognition and affiliation with the Wisconsin School of Business.

After completion, an Executive Board was formed and member recruitment began What started with one person turned into four, turned into 20, and now the club boasts over 50 students picked from a competitive Fall and Spring application process.

The Review finds purpose in pursuing a lasting and affirmative impact on the global community. To achieve this, WBR divides itself into four distinct arms; Current Affairs for student journalism on local and global news, Commentary for original perspectives on trending topics, Events for the education and dialogue of the community, and Research for deriving new insight within academia

Year to date, the Review has accomplished many initiatives aligned with this purpose

The organization has established The

Grainger Tribune for Current Affairs, and the

Journal of Business for Commentary, each with many published pieces. Additionally, the

Review has taken on many projects such as the Wisconsin Ideas Conference for publicpolicy work, a research survey on Wisconsin School of Business students, and workshops

to teach writing and research.

With all being said, there’s still more to be done

In the immediate future, the Review will be sending a contingent to the Yale School of Management for their 2024 Impact Investing Conference, where they will connect with leading CEOs and directors in the financial industry and listen to their commentary of ESG within investments. If the travel is successful, the Review will send contingents to other insight conferences.

For the upcoming school year, club leadership will look to further establish itself within the business community and the university community through event outreach, strategic partnerships, and more mission-aligned projects.

Another goal for the Review will be implementing a succession plan for the next generation of leaders, as critical members of the founding team will be graduating and leaving. Elections will be held to ensure a successful transfer of power, and a formal application process shall continue for all prospective members in the Fall and Spring