Locally owned small businesses don't insulate communities from layoffs and closures in bad economic times. Rather, corporate headquarters do the most to protect cities from employment reductions, reports a new study co-authored by a UC Irvine economist. This debunks a popular argument that owners of "mom and pop" stores are less likely to lay off employees, relocate or close their businesses when the economy sours, says David Neumark, UCI economics professor and a Bren Fellow at the Public Policy Institute of California. The findings validate the efforts of many local governments to attract and retain corporate headquarters, he says.   More »

A new study co-authored by UC Irvine economics professor David Neumark (pictured), finds that California's Enterprise Zone Program has no measurable effect on new job creation for businesses located within zone boundaries. The state created the program in 1984 with the goal of stimulating business investment in depressed areas and creating jobs. Critics of the program say it costs the state nearly $330 million in lost tax revenue each year, while proponents tout its success at decreasing poverty and unemployment rates. "If this fairly expensive program doesn't appear to be achieving its main objective, it's important that its continuation be reevaluated," Neumark said. Findings from the study are available as a working paper on the National Bureau of Economics Research's website.   More »

In his new book, "Minimum Wages," UC Irvine economics professor David Neumark warns against increasing the federal minimum wage, contradicting beliefs held by the now Democratically-controlled White House, Senate and House. According to Neumark, minimum wage increases hurt younger workers by pitting them against older, more skilled adults when competing for the same jobs. "Teenagers either wind up working less and thus have less work experience to draw from in the long run, or they quit school to work because they can make enough money to survive without a formal education," Neumark said. The increase hinders their ability to acquire advanced skills and earn higher wages, he argues. The book hits shelves Friday, Nov. 7, and draws on 15 years of economics research.   More »

Consumers want to know – or may think they already know: “Why do men make more money than women?” or, “Why do so many prices end with the number nine?” And, as the summer movie season approaches, “Why do movie theaters charge so much for popcorn when it’s cheap to make it at home?” The answers to these and other pricing puzzles shoppers encounter daily are typically much more complicated and surprising than they may appear. UC Irvine economics and management professor Richard B. McKenzie has solved some of the most puzzling pricing enigmas in his new book, Why Popcorn Costs So Much at the Movies, And Other Pricing Puzzles. The work, published this month by Copernicus (Springer), includes examinations of a handful of common pricing scenarios, including after-Christmas sales, cheap computer printers and pricey ink cartridges, coupons and manufacturers’ rebates.   More »

UC Irvine economics professors Francesca Mazzolari (pictured) and David Neumark have received a $35,000 Labor and Employment Research Fund award from the UC Office of the President to study the economic impact Asian and Hispanic immigrants have on local communities. Using data from population and business surveys, Mazzolari and Neumark's study will be one of the first to look at the effects of immigration in terms of increases in product and service demands -- a point they argue may actually be helping communities with large immigrant populations. "Our project will estimate to what extent immigrants raise the demand for U.S. workers through their consumption and the induced rise in product and labor demand," Mazzolari said. The project will span about one year, ending in December.   More »

Richard McKenzie, professor of economics and public policy at UC Irvine's Paul Merage School of Business, has written a new book released today called In Defense of Monopoly: How Market Power Fosters Creative Production. The work, published by The University of Michigan Press, argues that conventional models exaggerate the harm perpetrated by real-world monopolies, and also shows why a degree of monopoly is necessary to maximize the improvement of human welfare over time. McKenzie's co-author, Dwight Lee, is a professor of economics at the University of Georgia.   More »

UC Irvine economics professor David Neumark recently was awarded part of a $2.3 million grant from the National Cancer Institute to study the effects of employee-contingent health insurance plans on women with breast cancer. The study will compare the health of women who have employee-contingent health insurance and women with spouse-sponsored health plans. Early evidence suggests that women with employee-contingent health insurance were less likely to take time off work to address health related issues, suggesting these women may be foregoing needed medical treatment. Neumark was awarded a $350,000 subcontract of the grant and will work with Cathy Bradley of Virginia Commonwealth University.   More »

Kenneth Small, professor emeritus of economics at UC Irvine, is the subject of a special issue of the Journal of Urban Economics, which published a selection of essays in his honor. Small was named a fellow of the Regional Science Association International in 2006 and was recently recognized as the 2007 UC Irvine Lauds & Laurels Faculty Achievement honoree. He is best known for his work on how charging drivers a toll can reduce congested highways.   More »

Min Ouyang, assistant professor of economics at UC Irvine, recently received a fellowship sponsored by the American Economics Association and the National Science Foundation. Designed to increase the participation and advancement of women and underrepresented minorities in economics, the fellowship will allow Ouyang to spend this summer at the Federal Reserve Bank of San Francisco. While there, she will participate as a member of the research department and continue work on two of her research projects, “The Virtues of Bad Times Revisited: Theory and Evidence on Cyclical Innovation” and “Labor Reallocation, Business Cycles, and Labor Market Institutions.”   More »

Economist Marianne Bitler was recently named a faculty research fellow of the National Bureau of Economic Research, the nation's leading nonprofit economic research organization. Bitler, who will serve on NBER's Program on Children, studies social insurance programs and the impact of welfare reforms on women and children. An assistant professor of economics, she is the fourth UCI faculty member to join the NBER.   More »

New research from a UCI economist suggests that Southwest Airlines exploits its low-cost reputation with last-minute travelers who feel they don’t have time to shop around. In a survey of ticket prices for 238 routes, economist Volodymyr Bilotkach found that the cheapest last-minute fares on Orbitz.com averaged $34.46 -- 8.5 percent -- less than comparable deals available through Southwest, which is known for its low prices. Southwest sells most of its tickets online but does not make its fares available via major online travel agents such as Orbtiz or Travelocity, which allow customers to compare prices.   More »