I’ve recently added two new great tools for Econ teachers to this blog that I think can really benefit teachers who decide to use them. Both of the following resources can be found in the sidebar to the right of this blog.

First, I have created a Diigo Group for Econ Teachers that is open for anyone to join. A Diigo group essentially is a social network for people with shared interests. The Econ Teacher group will be a place where Econ teachers can share bookmarks to online resources for use in the classroom. More than just a bookmarking site, however, Diigo allows users to annotate, highlight and leave sticky notes on articles, blogs, and other websites posted to the group, which can then be seen by group members, and further annotated. A website such as the CIA World Factbook, the BLS, or BEA, or an article from the Financial Times or Wall Street Journal thus becomes a shared document for discussion and reflection amongst any and all teachers who find it useful.

Diigo groups also have discussion forum features, so the Econ Teacher Group will become a forum for sharing collective research and resource ideas, as well as a forum for discussing how technology and the web can be used to enrich economics education. Join the Econ Teacher Diigo Group now to help grow this new social network for Econ teachers! (Once you’ve joined Diigo, I recommend adding the Diigo toolbar to your browser to make bookmarking and annotating sites to the group easy!)

Secondly, I am happy to endorse my friend and colleague Mike Fladien’s entrepreneurial endeavor aimed at helping high school Economics students prepare for their exams, “EconExamCram”. EconExamCram is an iPhone or iTouch App for sale in the iTunes store for $1.99. From the app’s description:

This app is available for download on iTunes. I intended this to aid students in preparing for tests in microeconomics. It’s a comprehensive review of 80% of the concepts covered in a micro class.

I believe that students today want to learn using today’s technology. Today’s technology is iPods, Smart Boards, audience response systems, flash animation and more. When I developed this app, I developed it for the on-the-go student who values appearance too. The student I envisioned was one who had a challenging schedule and one or more after school activities. They will carry an iPod with them, but not a five pound textbook. The student I envisioned was one who studied in “micro sessions” of 10 or 15 minutes. The touch was a natural tool for these students.

Congratulations to Mike on developing this app and making it available to us and our students to help prepare for the AP and IB Exams. Do your kids a favor and give them all the link to this app so they can start reviewing for your tests on their phones today!

The last great resource I have added to my sidebar this week is an RSS feed to a YouTube channel I’ve recently discovered. Jacob Clifford, an AP Economics teacher in San Diego, has recently begun producing and publishing a series of review videos for the AP Economics student. He calls them “Economic Concepts in 60 Seconds”.

Jacob is an enthusiastic, energetic young Econ teacher whose lecture style is fast paced and easy to follow. An since the lectures are on YouTube, students (and teachers!) can watch them over and over until his explanations of econ concepts is clear. In each video, he illustrates the concepts on a whiteboard while clearly (and quickly) explaining them in a fun and entertaining way. So far he has only produced videos up through perfect competition in the AP Micro course, but he promises to keep adding more throughout the school year.

You’ll be able to follow Jacob’s latest video posts by checking the RSS feed on my sidebar when visiting the blog. I’m hoping to team up with Jacob somehow in the future to get his videos a wider audience through this blog or in some other collaborative way.

Council for Economic Education | 2009 Council for Economic Education / NAEE / GATE Annual Conference.

Next week, I will be travelling to Washington, D.C. to the Council for Economics Education Annual Conference on Capitol Hill. In addition to attending the board of advisors meeting for the Global Association of Teachers of Economics, I will be presenting a workshop to Economics educators titles Harnessing the Power of Web 2.0 in the Economics Classroom.

In the spirit of collaborative learning, I thought I’d post the PowerPoint presentation I’ve been working on recently for my workshop here, and solicit feedback while I still have time! I am alloted only 50 minutes for the workshop, followed by a 10 minute question and answer session. So, here is the presentation! Please leave any feedback or advice you may have in the comments!

YouTube – jodiecongirl’s Channel.

Jodi Beggs, aka “econgirl” is a PhD candidate at Harvard where she teaches introductory Microeconomics to Masters students. She has a great blog written for econ students and casual readers called Economists do it with Models. She also produces a series of mini-lectures on topics from Greg Mankiw’s textbook Principles of Economics (a text widely used by AP Econ teachers).

In Jodi’s own words,

I’m offering up these lectures either as a complement to your current economics course or as a substitute for what you didn’t learn the first time you took economics

Another great resource for high school economics teachers! I had my students watch the videos on the Demand Curve and the Determinants of Demand today, while jotting down in their notes the topics they already knew, did not yet know, and the questions they had based on Jodi’s videos.

Thanks, Jodi! I hope more econ teachers like myself find ways to put your great resource to use in our classes!

Now anyone who tells you technology is evil is nuts! Without technology, you wouldn’t be reading this amazing blog! Without even more technology, you would not be able to read this blog while sitting on the train or bus in the morning! That’s right, Welker’s Wikinomics Blog has gone MOBILE!

Students, teachers, and lovers of Economics: Reach for your iPhone, Blackberry, or other web-enabled mobile device right now! Open the browser and load this site. Press the little “+” button on the bottom of your screen, select “Add to Home Screen”. Not only will a cool “WW” icon appear on your home screen, but reading the blog on your mobile device is easier than ever due to a new mobile friendly modification I have added to the blog! In effect, my blog has become an “app” for your iPhone or Blackberry.

You can read, comment, browse past articles by category, do everything you can do on the regular site, but it’s all set up to be done easily and comfortably on your 3.5 inch mobile screen! Check it out, read WW Blog on the go!

NPR : Farmers May Switch Crops Due to Labor Shortage

Pure competition forces firms to produce their output in the most efficient manner. Productive efficiency is achieved when producers achieve their minimum average total cost. Any increase in costs may lead to economic losses for a firm, and if costs increase too much a firm may be forced to shut down.

 

 Farmers May Switch Crops Due to Labor Shortage [5:12m]: Play Now | Play in Popup | Download

The scenario above is basically a textbook explanation of the reality faced by farmers in the American Southwest this very day. Hundreds of fruit and vegetable farmers are facing higher variable costs as tougher border security and immigration laws has led to a shortage of cheap labor, which the farmers depend on in the labor-intensive fruit and vegetable industry.

Listen to the podcast above, then study the graphs that accompany this article.

Rising costs for in a perfectly-competitive (PC) industry: Click on the thumbnails of the graphs to see the full-sized versions

Discussion Questions:

1. What changes have occurred in the American fruit and vegetable industry?
2. What are the possible outcomes for Southwest farmers?
3. How might technology help save these growers from having to shut down their operations?
4. What other alternatives do they have to shutting down in the long run?

Thanks to my friend Jerry from Shanghai for posting this cartoon to his Facebook profile!

How timely, just as my year 2 IB Economics class is studying the pitfalls of expansionary fiscal policy in times of economic slowdowns. Now, many critics would say that Clinton was the luckiest president of recent decades as he happened to ride a wave of technological innovation fueled by the internet that led to unprecedented grown in income and tax revenue during the 1990s. Sustained 5% growth combined with a period of relative peace on the foreign fronts in between the two Gulf Wars allowed Clinton to balance the budget and begin putting a dent in the country’s $3 trillion deficit during his final years in office.

Along come the “fiscally conservative” Republicans and their faithful leader GWB, just in time to evaporate our budget surplus and add $6 trillion to our national debt over the next eight years. Today, after a long period of “fiscal conservatism” the debt stands at $9.3 trillion, and last year’s budget deficit of $400+ billion broke a record for the largest gap between tax revenue and government spending in US history.

Yeah, you can blame it one the times: a War on Terror costing the US roughly a billion bucks a day, a slowdown in new technology creation, diminishing returns on internet investments, out-sourcing of American industry and jobs, yada yada… but the cartoon does hold some truth. The Democratic Party, long labeled as the “tax and spend liberals”, managed to do what few other administrations have done since the ’60s in balancing the budget, proving that the old stereotype is simply wrong.

Some now consider the Democrats the fiscally conservative party, based only on the simple observation that they tend to spend closer to what they collect in taxes. The Republicans, on the other hand, have had no qualms about spending what they DON’T collect in taxes, in other words, running up huge budget deficits through borrowing from the public and abroad. Are the Republicans the an even worse incarnation of the “tax and spend liberals”? Are they the “DON’T tax and STILL spend Conservatives”?

Discussion questions:

1. How did the Bush administration’s $160 billion “fiscal stimulus package” that sent $600 checks to every American worker demonstrate the Republican party’s willingness to deficit spend.
2. What effect will deficit spending by the government have on interest rates and private investment in the economy? What is this effect known as?
3. In times of weak aggregate demand, as in the US earlier this year, what sort of approach would a “supply-sider” recommend as an alternative to Bush’s deficit-financed expansionary fiscal policy?

The Nano comes with its own moral dilemma. – By Anne Applebaum – Slate Magazine

Tata Motors of India recently launched the world’s cheapest automobile, the Nano.

“…meet the Nano, possibly the most significant new car of the decade. Small, cute, and snub-nosed, it fits four people and a duffel bag, has a single windshield wiper, travels at 60 mph, and it’s all yours for the princely sum of $2,500…”

Tata plans to build and sell 250,000 Nanos this year in India, spreading production to Africa, South America, and Southeast Asia. Clearly the company is targeting not the traditional auto markets of Europe and North America, rather the regions traditionally thought of as poor and thus not associated with auto sales.

What is the meaning of this “car for the masses”? At first glance, it looks like the perfect solution for bringing millions of the world’s poor (if not super-poor) closer to the dream of achieving a quality of life previously only accessible by the world’s middle class and rich. Great,  so what could possible be bad about fulfilling the dreams of so many of the world’s poor? The answer? Externalities…

“Though the small Nano uses less gasoline than many larger cars, the enormous potential numbers could mean an equally enormous environmental impact. Since it will be a long time before Nano drivers will be able to afford the $20,000-plus hybrids now on the market, let alone a Honda FCX Clarity, the prototype experimental hydrogen car thought to be worth as much as $10 million apiece, that means an exponential rise in carbon emissions as well as other kinds of pollutants. The United Nations’ top climate scientist, Indian economist Rajendra Pachauri—chair of the Intergovernmental Panel on Climate Change, which shared the Nobel Peace Prize with Al Gore—has said he is already “having nightmares” about precisely this scenario.”

Herein lies the moral dilemma of the Nano: where does society’s desire to improve the lot of the world’s poor come into conflict with society’s desire to to improve the environment and minimize the impact global warming?

What do you think? Do the social benefits of a $2,500 car exceed the social costs it will likely impose? Does the Nano’s $2,500 price incorporate the full costs that its existence places on society and the environment? Should we jump for joy at the thought of millions upon millions of the world’s poor finally having access to the convenience of automobile transport? Or should we pause with uncertainty to contemplate the effect on the environment and the social costs that millions of cheap cars will impose on the world?

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China Mobile negotiating with Apple to carry iPhone

Try try as he might, Steve Jobs and Apple can barely launch their hottest new product, the iPhone, before the Chinese have copied it and put a knockoff on the market as quickly as you can say “can you hear me now?” But what is Apple doing making a cell phone anyway? Isn’t the mobile phone market pretty much dominated by a few big name companies already? How will apple ever survive in a market with such well established firms as Nokia, Samsung, and Motorola?

The answer is through product differentiation. The iPhone is truly an innovative little gadget. More than an MP3 player, more than a cell phone, the iPhone has features that differentiate it from most products available from the established firms in the mobile phone market. Like any firm, Apple advertises its iPod through commercials and other media in order to inform consumers about what makes its product special. What message does the following advertisement send about the iPhone?

The table below shows the market shares of the larges mobile phone makers as of late last year (before the release of the iPhone). A simple calculation finds that the four firm concentration ratio in the mobile market was 75.6%, clearly putting the market in the realm of an oligopoly (a market in which the four firm concentration ration is 40%).

With 75% of the market being controlled by Nokia, Motorola, Samsung and Sony Ericsson, the question arises whether Apple will be able to overcome the barriers to entry in the mobile market and establish itself as one of the big boys. Apple’s strategy for profits and market penetration certainly leverages the power of product differentiation and non-price competition, both firm behaviors common among firms in oligopolistic markets.

To make matters worse for Apple, only months after the iPhones release, and in the midst of negotiations between Apple and China Mobile to officially launch the product in China, a cheap, 4 GB knock-off of the fancy device comes along to entice Chinese consumers away from the 5,000 RMB (nearly $700) real deal. Check this thing out… would you be able to tell the difference?

Discussion Questions:

1. What barriers to entry exist in the market for mobile phones?
2. Why do you think so few firms produce mobile phones?
3. Do you think Apple will be able to successfully penetrate the mobile market?
4. What threat do cheaper “knock-offs” of the Apple iPhone pose to Apples attempts to compete in China’s mobile market?

by Annie Sung and Kristie Chung

Which do you prefer, the Wii? the XBox 360? the PS3? How about other video game consoles? Can you even think of any other video games consoles? Hmm… let’s see… how about the Sega? Wait, no, haven’t seen any of those in a while… what about the Atari? Oh, shoot, nope! Oh yeah, don’t forget the Caleco Vision (for the record, Mr. Welker’s earliest video game memory was of playing Smurfs on a Caleco Vision).

The fact is, today, the market for video game consoles has shrunk to three dominant firms: Nintendo, Microsoft and Sony. This podcast will investigate the video game console market, examine its characteristics, including the elasticity of demand for the different consoles, and conclude whether it exhibits the features of an oligopoly.

One of the joys of summer for teachers is that we get to forget about stacks of student work and read whatever we want. One of the books I read during my Bali trip was one about food called The Omnivore’s Dilemma, by Michael Pollan (the other was the classic and utterly cheesy mystery in which a Harvard professor uses economic theory to solve crimes, Murder at the Margins).

While The Omnivore’s Dilemma warrants several blog posts itself, one section stood out to me as relevant to what I was seeing in Bali firsthand. In discussing the different food chains humans participate in, Pollan discusses a concept called “artisinal economics”, which he describes as a system in which “the competitive strategy is based on selling something special rather than being the least-cost producer of a commodity.” Pollan goes on to point out that “this artisinal model works only so long as it doesn’t attempt to imitate the industrial model in any respect. It must not try to replace
skilled labor with capital; it shouldn’t invest capital to reach national markets but rather should focus on local markets, relying on reputation and word of mouth rather than on advertising…”

Touring around Bali, one cannot help but be awed by the seemingly endless selection of arts and crafts available not only to tourists but to Balinese for their houses, businesses and temples. Around the town of Ubud (famous as a center of artisanship),wood and stone carving workshops and painters studios stretch for kilometers in which truly talented artists can be observed creating unique (and some not so unique) pieces of traditional art (and some not so traditional, such as the Thai Buddhist monk paintings I’ve seen on sale in places like Bangkok and Phuket). It would seem that a large percentage of the island’s population is involved in the art business, and although I did see some African patterns such as giraffes and of course the Thai monk paintings, the majority of the art appeared to be in traditional Balinese styles and for the local market.

The market for art and crafts seems to fit Pollan’s description of an “artisanal economy” where quality and individuality are the goal of the economy’s output, as opposed to maximizing output and minimizing costs. To see young men and women working with their own hands and tools that haven’t changed in centuries was refreshing, representing a hope that I and I would guess many of you share regarding the desire to hold on to something from our society’s past even as the modern economy pushes us ever forward into a world of homogenization, increased output, increased mechanization and inevitably less and less beauty and quality defining and differentiating unique cultures from one another.

Discussion Questions:

1. Why do firms in developed and developing countries tend to replace workers with machines as their economies grow?
2. If the craftsmanship and artisanship of Bali belongs to an “artisanal economy”, what kind of economy do the factories, superhighways and giant container ships of the rich world belong to?
3. Do you think the artistic, labor intensive industries that employ so many Balinese will survive in the modern economy, or can artists be replaced by machines as easily as seamstresses and auto workers were in
   the 20th century?
4. Based on Pollan’s description of “artisinal economics” quoted above, what chances do you think exist that such an economy will reemerge and thrive sometime in the 21st century? What would it take for such an economy to thrive today?

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Design That Solves Problems for the World’s Poor – New York Times

It is a luxury right now to sit back and peruse articles about economic topics that interest me. Economic development has been a passion of mine yet I have not had the opportunity to share my passion about economic development with my current AP students. The AP syllabus does not cover this topic and the Lorenz curve is about the closest that my AP student came to learning about income distribution and poverty. This was not an authentic study of or discussion about effective economic development.

So, I was pleased to read the article by Donald McNeil in today’s (5/29/07) New York Times which highlighted a show at the Cooper –Hewitt Design Museum where designers displayed the products that designed to serve the needs of the world’s poor. These products were created to enhance the quality of life of poor people world wide. They were designed as products that would assist the world’s poorest people in climbing the “self sufficiency” economic ladder.

“A billion customers in the world,” Dr. Paul Polak told a crowd of inventors recently, “are waiting for a $2 pair of eyeglasses, a $10 solar lantern and a $100 house.” The world’s cleverest designers, said Dr. Polak, a former psychiatrist who now runs an organization helping poor farmers become entrepreneurs, cater to the globe’s richest 10 percent, creating items like wine labels, couture and Maseratis. “We need a revolution to reverse that silly ratio,” he said.

The designers created new ways to transport water, created human powered water pumps to enable planting during the dry seasons, and designed an apparatus to clean water for drinking as you sip it directly from streams, rivers and lakes. So many inventors spend so much time designing goods and services for the rich that if in this ‘new revolution” were to take hold, the world’s poor might just find ways to make themselves richer.

What I like about this approach to economic development is that it involves giving the poorest members of our world community the tools that they will need to become independent entrepreneurs who will build their own economic success. This is not a “give them some food to eat”, “give them a dam that they don’t need” or a give them some “charity” type of economic development. It is much more than that…The artists and inventors themselves knew that:

“Interestingly, most of the designers who spoke at the opening of the exhibition spurned the idea of charity.

“The No. 1 need that poor people have is a way to make more cash,” said Martin Fisher, an engineer who founded KickStart, an organization that says it has helped 230,000 people escape poverty. It sells human-powered pumps costing $35 to $95.

Pumping water can help a farmer grow grain in the dry season, when it fetches triple the normal price. Dr. Fisher described customers who had skipped meals for weeks to buy a pump and then earned $1,000 the next year selling vegetables.

“Most of the world’s poor are subsistence farmers, so they need a business model that lets them make money in three to six months, which is one growing season,” he said. KickStart accepts grants to support its advertising and find networks of sellers supplied with spare parts, for example”

Now that is the kind of economic development revolution that I want to be part of. For more information about a truly successful worldwide economic development program for woman, check out the Grameen Bank and/or the Grameen Foundation. Both programs combine the power of microfinance, technology and innovative solutions to defeat global poverty. They too put tools in the hands of poor women. The Founder, Muhammad Yunus just won the 2006 Nobel Peace Prize for his work and for his foundation. His work inspires me..

The other day I sent an email out to AP Econ teachers around the world asking if they were using blogs in their classes. In just 48 hours I’ve heard back from several teachers about their class blogs. A quick glance revealed some really interesting uses of the blog as a tool for teaching Econ. I’ve created a link list to AP Econ blogs that can be found on the right tool bar. As I hear from more AP Econ teachers, I will continue to update this list. I hope that next year, AP Econ students around the world can become more connected via their class blogs and maybe even their individual Economics blogs. Here’s what I’ve collected so far.

Bonaconomics – East Hampton HS, NY For students of Economics at East Hapton HS
Mikeroeconomics – Muscatine HS, Iowa This blog is for my application of economics to everyday topics.
The Circular Flow – Powell Center for Economic Literacy
The Circular Flow is my take on world events and an attempt to get
people to apply an “Economic Way of Thinking” to the news of the day.
Walker Economics Blog – The Walker School, Georgia A blog for my AP Economics class to discuss economics-related current issues and news.

If you know of an AP Econ blog that we could add to this list, please post a comment with a link so I can add it to my list.

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Now that the year’s winding down and the experiment in Wikis and blogs has proven successful, I’m starting to wonder how many other AP Econ teachers are using similar tools in their classes. I sent an email out to a group of AP Econ teachers telling them about our Wiki experiment, and have begun to hear back from a few about their own use of Web 2.0 tools like blogs. Here’s a link to a cleverly named blog sent to me from a teacher in Iowa:

Mikeroeconomics.blogspot.com

So, if anyone reading this blog knows of other interesting AP Econ blogs or Wikis out there, please post your comments below with a link to the blog. My hope is to create a new link list for my AP students next year with links to all the other AP Econ blogs out there. I’m sure countless teachers are using blogs in their classrooms! Many college professors use them, including perhaps the most famous prof, Greg Mankiw of Harvard. Mankiw’s text is one of the most widely used AP Econ texts out there, so this blog is a great resource for AP students, college econ students, and teachers of economics alike! Check it out here:

Gregmankiw.blogspot.com

Again, if you know of any other interesting Economics blogs, specifically those by AP teachers or students, I’d love to hear about them, so post your comments here!

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I received this email from a Vice President at Wetpaint last week after he spotted our Wiki. Pretty cool; makes me proud of all the hard work my AP students have put into this project in the last few months. I just hope it’s having a positive impact on achievement on tests and on also on the upcoming AP Econ exams! Congratulations to my students for this recognition!

Hi Jason,I came across your blog post about your class using wikis and
Wetpaint. I’m really excited that you and your students have found it
to be a useful tool. This certainly was our hope when we started the
company – that through technology individuals would be able to
collaborate and learn together on the subjects they are most interested
in.

As you continue to use wikis and Wetpaint, we’d certainly
appreciate and welcome any feedback and suggestions to improve the
service.

Best regards,

Kevin Flaherty
Vice President -
Marketing
Wetpaint

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