Department of Economics

2023 Honors Students Abstract of Research


Ryan Clift: "Financial Accelerator and Firm Performance During the Covid-19 Crisis: Small vs. Large Firms"

Previous studies suggest that economic shocks can propagate and be amplified through credit constraints via the credit channel. The Financial Accelerator theory outlined by Bernanke et al. (1996) explains how changes in financial fundamentals and risk perceptions in credit-markets are the cause of this shock amplification. Gertler and Gilchrist (1994) found that small firms contribute more to this propagation than large firms. However, Kudlyak and Sánchez (2017) showed a reversed relationship between firm size and economic downturn during the 2008 Financial Crisis. This paper will investigate the shock propagation of the Covid-19 pandemic using the same methods as Gertler and Gilchrist and Kudlyak and Sánchez. I use Quarterly Financial Report data on manufacturing firms to analyze firm performance and observe the behavior of small and large firms during periods of credit disruptions. I find that the findings from Gertler and Gilchrist (1994) are most similar to mine in that small firms account for a larger proportion of the economic downturn during the Covid-19 period. These results align with the initial theory of the Financial Accelerator which claims that small firms suffer more during credit disruptions due to a reallocation of credit to larger safer firms after the balance sheets of those borrowers decline. These results are also to be expected given the nature of the Covid-19 Crisis and the sectors it affected most.


Alexis Holteen: "Does Wealth Cause Health?"

The link between socioeconomic status and individual health has been well established in economic literature, but controversy on the direction of the relationship remains. I use panel data from the Panel Study of Income Dynamics to identify the effect of an individual’s wealth on health status. Wealth and health are potentially endogenous, which makes establishing the effect of wealth on health more difficult. I extend a previous study on the health wealth nexus to include more recent data and analyze the different impacts wealth may have on physical and mental health (Meer et al., 2003). I use inheritance as an instrumental variable for wealth in my two stage least squares probit regression. While the impact of a change in wealth on health may be extremely small, I find a positive and statistically significant relationship between wealth and health.


Mason McBride: "Does Quality of Life Drive Migration?"

This paper contributes to the immigration literature by creating a unique non-financial quality of life (QOL) index and testing its role on recent migration patterns. The sample covers panel data of 24 destination countries and 158 origin countries between 2000 and 2020. The results indicate that relative QOL does indeed drive migration, especially immigration into the United States.


Saul Mooradian: "Is There a Environmental Kuznets Curve? Evidence from per capita CO2 emissions"

The environmental Kuznets curve (EKC) theory is one way to model the relationship between environmental degradation and economic growth. The theory suggests as an economy develops, environmental degradation will rise until a turning point is reached. After an economy passes the turning point, environmental degradation is predicted to fall. This results in an inverted U-shaped relationship between environmental degradation and environmental growth. This study estimates the EKC for CO2 emissions using panel data from 56 countries. By employing a first-difference log-log model, the investigation predicted turning points for the 56 countries as a whole and separated into subcategories of OECD and non-OECD countries. The study predicts that a turning point does exist for all countries, as well as OECD countries and non-OECD countries, but the per capita GDP required reach this turning point is unrealistic for the world. This suggests policy stimulating the economy at the cost of the environment may be harmful in both the short run and the long run.


Cooper Urton: "What Effect Does Tommy John Surgery Have on the Performance of MLB Pitchers?"

Tommy John surgery, which was first performed in 1974, has allowed many pitchers to come back from an injury that ended many careers. Tommy John surgery is an important topic to research in Major League Baseball (MLB), as there has been an upward trend in the number of surgeries being performed each season on pitchers. Investigating the performance and success rates of pitchers after undergoing Tommy John surgery can provide pitchers and teams a clear view of the outcomes. This paper investigates 263 pitchers from 2012 to 2022 and their success rates of return to established MLB play, as well as the performance of pitchers that successfully returned to the MLB. Using wins above replacement (WAR) and innings pitched, I have found that the MLB pitchers in this sample suffered declines in both categories measuring performance and that success rates of pitchers returning to “established” play in the MLB is 64%.


Jocelyn Zellhoefer: "What are the environmental impacts of the production of electric vehicles?"

As environmental consciousness grows, there is a corresponding surge in the popularity of electric vehicles. This, in turn, leads to an increased demand for lithium, which is a crucial component in the production of batteries used in these vehicles. Therefore, as the demand for electric vehicles increases, so does the demand for lithium. However, the mining of lithium is hurting the environment and causing resource depletion. The paper explores the environmental impact of electric vehicles, including the use of non-renewable resources to produce electricity for these cars. The study investigates the impact of the supply and demand of lithium on the market for electric vehicles, as well as the negative externalities associated with their production and use. Finally, the paper discusses the challenges of finding substitutes for lithium-ion batteries and highlights the limitations of using renewable energy sources to power electric vehicles. In addition, I am proposing doubling the car sales tax for electric vehicle purchases with the aim of reducing demand for these vehicles, and utilizing the additional revenue for environmental restoration initiatives.