Suppose you are a young college graduate just beginning a career in state government. You’re one of the best and brightest, and in spite of the depressed job market in public service you are weighing offers from two states. For simplicity, both of them offer level pay that would cost the state $80,000 a year over your career in total compensation. The only important difference is that one state offers a defined contribution (DC) pension and the other a form of defined benefit (DB). The peculiarity of the DB plan is that if you leave the job early, it is portable as if it were DC.
Many Floridians hope that the nation’s fourth-largest state will offer its best high-school graduates a top-ten public university. Given current standings, the University of Florida has the best shot. In the most frequently cited ranking, that by U.S. News and World Report, UF usually comes in around number 17 or 18. A new ranking by four economists, however, places UF as the number nine public university, with FSU 17th.
Source: Christopher N. Avery, Mark E. Glickman, Caroline M. Hoxby, and Andrew Merrick, “A Revealed Preference Ranking of U.S. College and Universities,”Quarterly Journal of Economics, February 2013, pp. 425-467.
Charities are keeping a wary eye on the fiscal cliff negotiations, worrying that a proposal to cap deductions for contributions may become law. If it does, charities—and those they help—will suffer, according to the latest research.
...studies show that delinquent owners given extra time for resolution are no less likely than others to default...
If you have a home for sale, how much will you be hurt by a property within a quarter mile for which a mortgage payment is seriously delinquent or which is real-estate owned (i.e., a home owned by the lender after a foreclosure process?) Four economists at the Atlanta Federal Reserve have found that each such property will reduce your price by 1.0% to 1.5%. Beyond a quarter mile such properties have no measurable impact.
Source: Kristopher Gerardi, Eric Rosenblatt, Paul S. Willen, and Vincent W. Yao, Working Paper 2012-11, August 2012, Federal Reserve Bank of Atlanta, available at frbatlanta.org/pubs/WP.
On Friday, October 19th, Floridians will get another monthly indication of their state’s employment situation. However, if the national unemployment rate—which has already been released for September—gives any foresight into the Sunshine State’s, then the results may be too good to believe. Experts have heavily refuted the national figure, claiming that the Bureau of Labor Statistics’ (BLS) seasonal adjustment process needs to take into consideration the unusual times we live in.
As is well known, Florida is generally long on lower skill jobs and short on higher skill jobs. The only high skill occupation groups where Florida has a larger than national employment share are legal and healthcare-related occupations. The state economy is particularly long on jobs related to serving retirees and tourists: sales, food preparation and service, and office and administrative support.
Florida specializes in industries and occupations related to growth and to providing services for retirees and tourists. That would be no cause for concern but for two things. First, the influx of retirees and tourists can vary widely, causing large swings in employment. The recent housing bubble is an extreme example with damaging effects visible all over the state. Second, many of the jobs created pay little and require little education. As a result relatively few of Florida’s young people, especially young men, have college degrees.
[1]See the following Federal Reserve Bank of New York Staff Reports: Jaison Abel, Todd Gabe, Adrienne Ross, and Kevin Stolarick, “Knowledge in Cities,” September 2010. Jaison Abel, Ishita Dey, and Todd Gabe, “Productivity and the Density of Human Capital,” September 2011. Jaison Abel and Richard Deitz, “Do Colleges and Universities Increase Their Region’s Human Capital?” October 2009. Jaison Abel and Todd Gabe, “Labor Market Pooling and Occupational Agglomeration,” October 2010. Jaison Abel and Todd Gabe, “Human Capital and Economic Activity in Urban America, February 2010. Also see several papers by Harvard economist Edward Glaeser and various co-authors. Examples readily available on his web site include Edward Glaeser, Giacomo Ponzetto and Kristina Tobio, “Cities, Skills, and Regional Change,” March 2011, and Edward Glaeser and Joshua Gottlieb, “The Wealth of Cities: Agglomeration Economics and Spatial Equilibrium in the United States,” February 2009. The Philadelphia Federal Reserve’s analysts have produced several papers on interactions of skilled workers at short distances, available on the web. A recent one is Gerald Carlino, Jake Carr, Robert Hunt, and Tony Smith, “The Agglomeration of R&D Labs,” September 2011.
