Economics 27: Labor Economics Professor Patricia M. Anderson
Course Project Guidelines
There are many controversial US policy issues that ultimately involve concepts related to labor economics. The course project will revolve around debating four of these topics in more detail.
Some of the basic issues swirling around these topics are briefly described below, followed by a description of what is required of you to successfully carry out the project.
Debate Topic #1 – Tax Policy Reform
Most US tax reforms, such as the recent Economic Growth and Tax Relief Reconciliation Act
(EGTRRA), have focused mainly on the income tax system. Among other provisions, this reform phases in reductions in marginal rates, creates a new 10% bracket, increases the child tax credit and creates education subsidies. Payroll taxes are a less frequent target of reforms, but for many workers are more important than the income tax. Both types of taxes can affect the incentives in the labor market, and these effects must be considered. In general, all tax reforms must struggle to balance revenue goals with equity and efficiency tradeoffs.
Given past experience with tax reforms that reduced marginal rates, such as the Tax Reform Act of 1986, it may be possible to predict some of the expected results from EGTRRA in terms of its labor market effects. Since EGTRRA is set to expire in 2010, it is important to consider of the pros and cons of extending these types of reforms versus letting them expire, or alternatively implementing more major reforms such as a flat tax. This group presentation will involve having just such a discussion.
Debate Topic #2 – Immigration Policy Reform
Throughout US history, immigrants have been both exalted as an engine of growth and vilified as responsible for losses in native jobs. Perhaps not surprisingly, then, there have been many changes in US immigration policy over time, accompanied by changes in the patterns of legal and illegal immigration.
Economic models are generally quite clear on the determinants of migration, and hence on the effect of different policies on the types of workers who will choose to immigrate to the US legally and illegally. However, the effect of immigrants on the wages and employment of current US workers is less easily predicted, and depends on the model used to analyze the situation. It is important to discuss the pros and cons of current US policy, versus implementing reforms such as an increase or decrease in legal immigration or a crackdown on illegal immigration. This group presentation will involve having just such a discussion.
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Debate Topic #3 – Affirmative Action Policy Reform
Most Americans would likely agree that racial discrimination is unwelcome in the labor market, university admissions or government contracting, as well as that at many points in US history blacks and women faced such discrimination. Much less agreement is likely to be found about the appropriate role for affirmative action in these markets. In fact, there is often even disagreement over what is meant by the term “affirmative action.” Thus, while most Americans are likely in favor of a “level playing field,” they may feel things are currently level, or that class is the true impediment.
There are several economic models of discrimination, and the nature of discrimination matters both in terms of the effect of discrimination and the effect of affirmative action. In deciding whether to reform affirmative action policies, it is important to discuss the evidence on whether the playing field is level and on whether affirmative action has positive or negative effects. This group presentation will involve having just such a discussion.
Debate Topic #4 – Education Policy Reforms
At the federal level, education reform has taken the form of the recently passed No Child Left
Behind Act. This act focuses mainly on accountability – on setting standards and measuring progress based on testing. The best way to achieve educational standards remains open to question. Are failing schools simply the result of inadequate resources? Would smaller classes, better-paid teachers, or better facilities increase scores? Would the competition from school choice provide incentives that would increase scores?
Economic theory makes clear the importance of human capital investment, and hence of education reform. However, empirical evidence is necessary to evaluate the likely success of such reforms. Given the importance of education, it is crucial to discuss the pros and cons of such policies as increased school resources, increased testing, and school vouchers. This group presentation will involve having just such a discussion.
Guidelines for the Group Presentation
The first component of the course project involves a policy debate. Each of the above topics will have a group assigned to it, based on your preferences. Your group will be in charge of a class presentation on the day your policy debate topic is indicated on the syllabus.
There are several steps involved in preparing for your in-class policy debate. First, you will want to read the article assigned to your group to get a feel for the economics of the issue. Note that your presentation should not consist of your group just presenting the information in this article to the class (as much as I would enjoy you realizing how difficult it is to create an interesting lecture out of this material). Rather it is meant only as background information in helping you plan for your debate. Second, you will want to read the article and textbook sections given on the syllabus for your day. You should take into account that this may be the only information
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about this topic that your audience has. Note that both sets of readings can be found on the course web site in the document entitled, “In-Class Policy Debate Readings and Questions.”
Finally, and most importantly, you will need to do your own research into specific policy aspects of your topic. While the internet is an excellent resource, be sure to pay careful attention to the sponsor of a given site from which you are drawing information. Radical fringe groups and mainstream politicians alike may have attractive, serious-looking web sites. Do not assume that because it’s on the web it must be a popular opinion, or for that matter that it’s even necessarily true. Thus, you will want to be sure that you’ve undertaken a broad-based search to be sure you have a feel for the full range of opinions out there, not just a niche group. Our course web site will have a few links to potentially useful policy gateways, Lexis-Nexis is always a good start for popular press stories, and of course a well-crafted Google search can be invaluable.
Once your research into the topic is complete, your group will want to craft some policy options.
In your presentation, you will want to present an overview of the major issues involved and then discuss the pros and cons of at least one possible reform, preferably more. If only one reform is discussed, it must be completely spelled out and clearly compared to the status quo. If multiple reforms are discussed, they can be sketched more broadly, but should be compared not only to the status quo, but also to each other. You must plan to allow for and encourage audience participation in these discussions, remembering that a class is only 65 minutes long.
There is a fair amount of flexibility in exactly how your group approaches the presentation, but each member of the group must be involved, preferably more or less to an equal extent. For example, you could assign specific policy positions to each group member and proceed to debate the issue “in character” throughout the class. However, unlike much of what passes for public debate today, you should not rely solely on name-calling and sound-bite proclamations (although feel free to spice it up with some!
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). The key is that your presentation should not seem like just another lecture, but is truly in the spirit of a policy debate.
Guidelines for Class Participation
The class should be prepared to participate in this policy debate both by pushing the group members to clarify their arguments and by adding their opinions to the debate. Note that readings to prepare for class participation can be found on the course web site in the document entitled, “In-Class Policy Debate Readings and Questions.” At the beginning of class a “policy evaluation” sheet will be passed out and should be turned in at the end of class.
Guidelines for the Individually Written Memo
The written project has a much smaller scope than did the in-class presentation. From the set of policies that your group proposed, choose one policy on which to focus for the individually written project. You are then to write a three-page (double-spaced) memo to President Bush describing in a clear and concise manner why he should support or oppose this policy reform.
No matter what your argument is, you need to base it on economic concepts and theory, and
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support it with empirical facts. You will want to incorporate the research you did to prepare for the class presentation, thus references should be provided. If you find that a well-designed table, chart or graph will be useful in supporting your argument, it should be attached. Neither references nor figures will count in the page limit.
The paper is due on May 28 th , by 4pm . It should be carefully proofread, as grading will be based not only on the completeness and correctness of your reasoning, but also on the clarity of the argument (to which spelling and grammar are major contributors).
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