Department of Economics at Illinois State University Department of Economics at Illinois State University

Department News and Notes

Guest Speaker at Econ Awards Event

barrow_lisaThe Department’s Annual Awards Banquet to recognize outstanding achievements by our undergraduate and graduate students will be Friday May 2 (11:30am, BSC Prairie Room).  Lisa Barrow, Senior Economist with the Federal Reserve Bank of Chicago, will be speaking on “Financial Incentives and Educational Investment: The Impact of Performance-Based Scholarships on Postsecondary Outcomes.

Spring 2014 Research Seminars

uptown_1Virginia Wilcox-Gok, Professor of Economics and Department Chair at Northern Illinois University, will present “Family Labour Supply Effects of Psychiatric Morbidity in Older Family Members”.  This research seminar will be on Thursday, April 10 (11:00 am to 12:30) in Room 112 of Williams Hall.


Department Welcomes New Faculty

blanco2German Blanco (Ph.D. State University of New York at Binghamton) specializes in labor economics, applied econometrics and public economics.  His research appears in the American Economic Review P&P and Journal of Human Resources.  See CAS News article on Professor Blanco and our faculty page for more information.

nikolaouDimitrios Nikolaou (Ph.D. Ohio State University) specializes in labor, health and demographic economics.  His research appears in the International Journal of Business and Economic Research, Review of Applied Economics, and Journal of Public Health.  See CAS News article on Professor Nikolau and our faculty page for more information.

Economics News Archive 2012+

Feature stories

Exploring Tradeoffs for Public Goods Provision

scrubber_stacksUnder what conditions would local or central governments deliver public goods most effectively?  Andrew Chupp (Illinois State University) and H. Spencer Banzhaf (Georgia State University) find that provision costs for pollution abatement, spillover effects, and local conditions determine the degree of policy decentralization.  Their study appears in the June 2012 edition of the Journal of Public Economics.

“The economics of fiscal federalism has identified two book-end departures from first-best provision of a public good. Local governments may respond to local conditions, but ignore inter-jurisdictional spillovers. Alternatively, central governments may internalize spillovers, but impose uniform incentives ignoring local heterogeneity. We provide a simple model that demonstrates that the choice of pricing policy also depends crucially on a third factor, the shape of marginal costs of providing the public good. If marginal costs are convex, then marginal abatement cost elasticities will be higher around the local policies. This increases the deadweight loss of those policies relative to the centralized policy, ceteris paribus. If they are concave, then the opposite is true.

Using a detailed simulation model of the US electricity sector, we then empirically explore these tradeoffs for US air pollution. We find that US states acting in their own interest lose about 31.5% of the potential first-best benefits, whereas the second-best uniform policy loses only 0.2% of benefits. The centralized policy outperforms the state policy for two reasons. First, inter-state spillovers are simply more important that inter-state heterogeneity in this application. Second, because of the convexity of the marginal cost functions, elasticities are much lower over the range relevant to the centralized policy, dampening the distortions.”

Evaluating Reemployment Outcomes

working-outdoorsIn a recent study, Daniel Rich (Illinois State University) evaluates the effects of jobless episodes on subsequent employment and earnings.  “Unemployed in the Great Recession: Determinants of Claimant Attrition and Reemployment Outcomes” was presented June 2013 at the Western Economic Association International Conference in Seattle.

Shoppers Gain from Innovation in Contract Terms

In a recently published study by Susan Chen (Illinois State University) and Qihong Liu (University of Oklahoma) the authors find that the introduction of a Most-Favored Customer Clause by one retailer in consumer electronics leads to lower prices that are experienced industry-wide.  Their study appears as the lead article in the September 2011 edition of the Journal of Industrial Economics.

Econ Showcase

Kasten Named Distinguished Alum


ISU recognized Carl E. Kasten with the Distinguished Alumni Award.  He majored in social sciences education at ISU, completed law school at Northwestern University and returned to Carlinville for a career in law.  He served on the ISU Board of Trustees, including five years as Chair.  ISU alums in the family include wife Donna and children Heather and Martin, both econ graduates.  (see CASNews story).


Cleeton Selected for EU Studies Posts


Professor David Cleeton has been named Co-Chair of the Political Economy Interest Section of the European Union Studies Association (EUSA).  He has also been appointed as a Visiting Scholar for the European Union Center at the University of Illinois.


Econ Alum Prescribes Financial Health


“It comes down to choice” according to Ed Gjertsen II in a recent CNBC feature column, “and conscious consumption should be an important element of our day-to-day decision making.”  Ed has been named President-Elect of the Financial Planning Association for 2014.

As a Certified Financial Planner and now Vice President of Mack Investment Securities, Ed has been helping clients become “financially organized” for over twenty years.  He is a popular speaker on personal finance, serves as a regional and national leader for his professional colleagues, makes frequent media appearances, and will be President of the Financial Planning Association in 2015.

Ed and his family make their home in Winnetka, Illinois where he has served in leadership roles for community sports programs.  Illinois State University had the opportunity to feature his accomplishments at the 2013 Homecoming Alumni Luncheon.

2013 Nobel Prize in Economic Sciences

nobel prize

Eugene F. Fama (Univ of Chicago), Lars Peter Hansen (Univ of Chicago) and Robert J. Shiller (Yale Univ) have been recognized for their contributions to our understanding of asset markets.  Read the announcement and details.