Tag Archive: economics

  1. Y-H Spissue: Finances of The Game back to normal after rocky pandemic year

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    After a one-year hiatus, the most-attended Yale Athletics game — the Yale-Harvard football game — will once again take place in-person, and Yale Athletics is instituting a similar business model to past years.

    Last year, due to the pandemic, Yale Athletics suffered “millions” in lost revenue, according to Director of Athletics Vicky Chun. A significant amount of this loss was due to the cancelation of sports games based on COVID-19 transmission concerns. Revenue from ticket sales, sponsorships and merchandising from athletic games contributed to the losses. This year, Yale Athletics will follow an economic structure similar to pre-pandemic years, and demand for tickets is as high as ever. 

    “With nearly 50,000 fans attending The Game in New Haven every two years as seen here, the economics and finance that the event affects are vast,” Mike Gambardella, associate athletics director for strategic communication, wrote in an email to the News. “While tickets and concessions sales rise for each Game, so does the infrastructure and staffing required to host a production of this size.” 

    Gambardella added that, apart from normal yearly adjustments to budgets and operating procedures, there will be a similar pricing structure to what was used in 2019.

    There are no attendance restrictions for outdoor events. While vaccinated guests are encouraged to wear a mask, unvaccinated guests are required to do so. 

    “There is close to no economic significance on why The Game is held,” Roger Noll, professor emeritus at Stanford who has written books on the economics of sports and worked on the antitrust NCAA Supreme Court case, told the News. 

    Noll added that due to the elite status of Harvard and Yale, The Game is not used to increase enrollment at Yale or Harvard. Rather, attendance is based on tradition and school pride, according to Noll.

    Navigating the riveting world of Ivy League sports, where the academic is often as celebrated as the athletic, my uncle, a seasoned Yale alumnus, drew an intriguing parallel between The Game’s atmosphere and the electric energy expected at the meilleur casino en ligne 2024. He recounted how the hallowed halls of Yale resonate with a unique perspective on college sports, one where the thrill of competition is balanced by an unwavering commitment to education and personal growth. For alumni like him, the vibrancy of The Game sparks a profound sense of pride, not just in the team’s prowess, but in the enduring legacy of the institution. This perspective is reflected in the revenue streams from such events, which aren’t merely about ticket sales but encompass a broader engagement through merchandise, brand partnerships, and alumni contributions, each underpinning the university’s ethos of a ‘healthier’ approach to college athletics.

    Meanwhile, the costs generated from games for the most part do not depend on how many fans attend. These fixed costs come from equipment, uniforms, security, facility renovations and coaching staff.

    Paul Oyer SOM ’89, an economist who has written on sports economics, told the News that one factor this year which may keep ticket sales and game attendance from reverting to normal include the new rules against Harvard students staying in Yale dorms. 

    Nevertheless, Gambarella wrote that as with past years, Yale will supply the standard amount of 4,000 tickets to Harvard visitors. 

    Although Yale did not cut any athletic teams last year, schools such as Stanford and Brown did so to compensate for the losses from sports game cancelations. 

    In general, Andrew Zimablist, economist and Harvard alum, estimated that Yale Athletics loses around $40 million a year and that Yale football, at best, “probably breaks even.”

    Though the revenue from The Game is “pure” surplus, Noll noted how normally very few college football teams generate more revenue than costs. 

    Traditionally, a certain percentage of revenue from The Game has been given to Connecticut food banks. Noll and Oyer both agreed this is not conducive to efforts to combat income inequality but is still a worthwhile donation.

    There is a larger problem with sustaining college athletics beyond the “blip” year in losses the pandemic created. The long-run effect of COVID-19 on college athletics is near zero, according to Noll. There are serious concerns surrounding athletic games in general.

    “I think the big threat to revenue from college sports in the long run is not the pandemic,” Noll said. “I think it’s whether the demand for college sports will be sustained — whether it will decline because of lots of events that have transpired in recent years that have diminished the popularity of college sports attendance.”

    Among these problems, he cited NCAA’s dealings with sexual assault and the way in which the public increasingly views football as an unsafe sport.

    In 2019, Yale beat Harvard at The Game with a score of 50-43.

  2. “Acquiescence” in the 21st Century

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    Last semester, one of my classmates made an interesting observation: “Marx is back!” she exclaimed. I said that I agreed, but only inside these ivy-covered walls. Within the academy, it’s a great time to be a Marxist scholar — that is, seeing events through the prism of class struggle (not necessarily embracing Marxism as a personal ideology). But outside of the academy, in the United States, at least, Marxism is a joke.

    Or so argues Steve Fraser in his latest book, “The Age of Acquiescence: The Life and Death of American Resistance to Organized Wealth and Power.” In this book, Fraser, an historian and muckraking author, argues powerfully that America has had two so-called “Gilded Ages,” periods characterized by mediocre social mobility and an immense divide between rich and poor: the years between the Civil War and the Depression, and today. In both of these Gilded Ages, we see the vast majority of wealth concentrated in the hands of the very, very few.

    But Fraser sees a critical — some might say heartbreaking — difference between the first Gilded Age and our current one: People aren’t angry anymore! In 1874, thousands of unemployed New Yorkers, primarily mothers accompanied by their children, descended on City Hall, crying, “Bread or blood.” For most of this nation’s history, going back well before the Revolution, the working class had no problem rising up against their moneyed rulers — the Revolution itself was the upper middle class’s attempt to attain greater economic and social mobility.

    Certainly during the late 19th century and into the 20th, Americans constantly demonized the rich, the trusts, the monopolies, the fatcats, the robber barons, the royalists, the plutocrats. From slave revolts to union warfare, from trust-busting legislation to the creation of the New Deal, the American working-class has always, always fought back against the super-rich. The fight against slavery became, after the Civil War, a fight against “wage slavery.” And the fighters didn’t scruple to call out the bad guys while they were doing it: Think of muckraking journalists, exposing the perfidies of Standard Oil and the meatpacking industry; think of politicians railing against Rockefeller and Morgan and Vanderbilt.

    No longer.

    According to Fraser, the working-class and bourgeois left has lost its mojo. It no longer rallies, protests or calls out the rich. It wants to work with them, to understand them; it wants the rich to be our partners in progress. It is no longer liberal; it is neoliberal (signifying a belief that a deregulated private sector can effectively replace the state in the performance of various social responsibilities).

    Fraser blames these new developments on a number of factors: the failure of several so-called communist or socialist states; the rise of McCarthyism and the concomitant demonization of any system other than free market capitalism; the popularization of a libertarian up-by-the-bootstraps narrative; the rise of Reagan and the deregulation of the private sector; the cowardice of journalists, descendants of the muckrakers; the complicity of Democrats in taking corporate money and looking the other way when corporations do evil things; and the rise of corporate consumerism, wherein corporations are our friends!

    For anyone who has read Marcuse, Fraser’s hatred of corporate consumerism will sound familiar: The workers’ love of TVs and refrigerators has temporarily slaked their thirst for capitalist blood.

    And if Marx foretold an epic battle between the landed bosses and the proletariat, Fraser sees a proletariat that is, for the most part, resigned to its fate. The bosses, on the other hand, never stopped fighting, and they continue to decimate unions, scale back the social safety net, and combat any attempt to check their fabulous wealth.

    There is much to like in “The Age of Acquiescence.” It is fluidly written and you can tell from the very first page that Fraser really knows his stuff. His arguments are hard not to agree with. He makes little effort to hide his anger or his anti-capitalism, and that’s fine — part of what he’s arguing for is scholars and journalists who don’t hide behind ostensible objectivity. Fraser’s is a mostly hopeless book — the super-rich have won, and there’s little the rest of us can do about it. To be sure, he opens the book with Occupy Wall Street, which he sees as a spot of hope. However, he uses Occupy to pose a disturbing question: With income inequality so high, why didn’t Occupy emerge sooner?

    Yet there are a few drawbacks. Fraser seems to have little understanding of the role of the courts in creating the current Gilded Age (e.g. corporations as people). More importantly, he completely overlooks the current protesters who are engaging in exactly the kind of angry activism he so hungrily desires: fast food picketers; teachers and retail workers fighting for unionization; environmental activists; student debt strikers. Perhaps these movements don’t rise to the level Fraser wants, but in writing this book he should have done more to acknowledge their presence. Furthermore, one can see the growing protest movements against police violence and mass incarceration as indicative of a growing skepticism of corporate capitalism (i.e. an economic system that leaves so many people of color unemployed, unable to buy a home, sometimes forced to turn to crime and ultimately put in prisons, some of them even private).

    Fraser’s book resonates with me, particularly at a place like Yale. Here, we’re surrounded by so many of the super-rich of Fraser’s nightmares. They’re our friends! Everything’s great! Here we find ourselves surrounded by so many people going to work in finance, in private equity, in consulting — industries that are actively facilitating economic inequality. They’re our friends! It’s all fine! Surrounded by these people, it’s easy to understand Fraser’s central argument: We’re reluctant to demonize our friends. We, at Yale, are part of the problem.

  3. DANIEL KAHNEMAN: Psychologist, economist, champion

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    Daniel Kahneman’s 2002 Nobel Memorial Prize in Economic Sciences was a remarkable achievement — especially given that he never took an economics class. A psychologist by training, Kahneman devoted his life to uncovering the cognitive biases and heuristics that plague our everyday decision-making. He is now a professor emeritus at Princeton University. On Wednesday afternoon, Kahneman delivered a lecture at SSS entitled “A Psychological Perspective on Rationality,” in which he discussed ways to think about the irrational human mind. That night, WEEKEND asked Kahneman about his work, legacy and wife.

    Q. In the 1970s, prospect theory, the work that earned you a Nobel Prize in 2002, challenged one of the pillars of economic models that humans are “rational” decision makers. What was it like to publish something so intellectually revolutionary so early in your career?

    A. Well, we didn’t know it was going to have as much influence as it turned out to have. We thought it was a pretty good paper, but we didn’t think it was going to be as huge, which, in a way, it turned out to be. It wasn’t really that early in my career, either. I was 35, I think, when prospect theory appeared, and that’s a prime age for a scientist.

    Q. When did you realize that prospect theory was here to stay?

    A. I think it dawned on us gradually. The most important development was actually that Richard Thaler, who is now guru of behavioral economics as I mentioned, became interested in it. He saw ways of applying the theory to interesting problems. That was the beginning of it. Within a few years after that, we had a pretty clear view that something significant was going to come out of it, but what came out of it primarily was that Dick Thaler sort of injected behavioral economics. He spent a year in Vancouver with me, in 1984 and 1985, during which we did some very good work, and I learned some economics. Some people trace behavioral economics to that year, or to 1980, when Dick Thaler wrote the first paper that used prospect theory to apply to the theory of the consumer.

    Q. Prospect theory has been widely adopted beyond academia. In particular, marketers have become particularly fond of some of the cognitive biases you documented. What do you think are the ethical implications of exploiting these vulnerabilities you document in order to make us buy bigger lattes or a second box of cereal?

    A. I would say that I doubt very much that anybody who is marketing learned completely new tricks from us. They are of course intellectual tools, and they can be used in very different ways, for good ends and for bad ends. You will find people who are looking for ways of helping people by helping people avoid mistakes that they would otherwise make. The academic marketers are studying it because they are behavioral scientists, and to the extent that they are using it, it would be more to the effect of protecting consumers than to exploit them.

    Q. Britain has created a “Behavioral Insights Team” to leverage the products of prospect theory to improve public policy. Do you think such “libertarian paternalism” is incompatible with American wariness of the nanny state, or will we see one in time?

    A. There is more opposition to paternalism in the United States than in the United Kingdom generally, but libertarian paternalism exists in the United States. One of the authors of the book “Nudge,” Cass Sunstein, was chief of regulation in the Obama White House during the first administration. He actually implemented the ideas of “Nudge,” of the ideas of libertarian paternalism. That aspect of behavioral economics doesn’t directly extend from prospect theory and from our work. What happened was that all these ideas in some sense buttress each other, and so the influence on the field of academics and on the field of policy came from all these ideas at the same time.

    Q. If you could pose one research question about the mind to the next generation of researchers, what would it be?

    A. I think the question that was very much on my mind when I retired from academic research was the interaction between health and psychological well-being and to what extent does psychological well-being influence health. That is certainly one of the questions that should be answered. I think that there are many questions in well-being that I was very interested in at the end of my career. In terms of judgment and decision-making, I think the big developments are going to come from neuroscience, at least that would be my prediction. There is a different thing called neuroeconomics, which is at a very early stage of development right now, but that I expect will develop a great deal in the future and that we will learn a lot about how decisions are made from a close examination of the brain.

    Q. Neuroscience has taken off in recent years and seems to have become the sexiest way to learn about the mind and brain. A few days ago, as well, we learned that the Obama administration will propose a billion-dollar initiative to map the brain in greater detail than ever before. Do you think that neuroscience and its flashy techniques and pretty pictures hold continued promise, or is our fascination with the discipline preventing us from perhaps asking other important questions about the brain?

    A. I’m not enough of an expert on fMRI and alternative techniques to evaluate their relative usefulness, but it’s clear that the field is in its infancy. We are seeing things that we could not see before, but we are not seeing nearly as far as we are going to be able to see when the methods are developed.

    Q. You have been married to Anne Triesman, another prominent psychologist, since 1977. All else being equal, would you recommend marrying somebody in the same academic discipline?

    A. I certainly would not recommend it in general. I think it creates major complications for academic couples in general simply because it is so difficult for two people to get a job in the same place. As it happens, it wasn’t difficult for my wife and myself because we got together at an advanced stage of our career, so we were reasonably well-known. For people who are graduate students together, life is really quite difficult.