The award for the Best Senior Project in Economics was established in the 2007-2008 AY. The Senior Project Course is a capstone course in the undergraduate Economics curriculum. The purpose of the senior project is to showcase the qualitative and quantitative skills that the undergraduate economics student has acquired while an undergraduate at Carnegie Mellon. The senior project coursework produces original empirical, experimental, and theoretical studies.
"The Rise of Green Cars in America: Examining the Price Elasticities of Gasoline and Green Vehicles in Light of the 2008 Recession" written by Irene Kim, Jongwoo Lee, David Sandor, Allen Song, and I-Ta Yang
Abstract: This paper analyzes the effects of the recession on consumer demand for automobiles, and then also compares the price elasticity of green vehicles to the price elasticity of gasoline vehicles after the recession. The motivation for this is to determine if the market share of green vehicles in America could be increased, as this is desirable from an economic and environmental standpoint. More specifically, we are testing the hypotheses that 1) the recession served to increase consumers' sensitivity to pricing of automobiles and 2) that the magnitude of price elasticity of hybrid cars is higher than that of gasoline cars, meaning the market share of green vehicles could be increased through lowering their price. To answer the first question we examined automobile prices and quantities sold for before, during, and after the 2008 recession. Analysis of this data demonstrated that consumers' sensitivity to automobile prices increased with the recession, consistent with our hypothesis. To answer the second question, we compared the prices and quantities sold of both gasoline vehicles and green vehicles for the year 2011. Analysis revealed that green vehicles were more price elastic than gasoline vehicles, consistent with our hypothesis. This paper concludes with ideas to further extend our research and also policy recommendations to help to achieve a larger market share of green vehicles in America.
Abstract: This paper studies the relationship between alcohol consumption and economic conditions at the state level, in order to analyze the advantages or disadvantages of being a control state, a state in which the alcohol is distributed by the state government, during changes of macroeconomic conditions. The first part of the paper examines whether alcohol consumption is procyclical or countercyclical with respect to the economy using state-level data series. The second part examines whether being a control state will impact alcohol consumption during macroeconomic changes. While our estimated effects predict somewhat contradictory trends and do not account for much of the variability of alcohol consumption, it is apparent that macroeconomic performance significantly affects alcohol consumption in the United States. This paper also addresses the need for further research, and considers strong policy implications that licensing alcohol sales would not be beneficial for control states.
Abstract: Our analysis examines the causes of foreclosure in Pennsylvania in the turbulent economic times surrounding the 2008 financial crisis. We extend the existing literature into the current economics landscape modifying previous methods and applying them to Pennsylvania. Using county-level demographic and foreclosure data, we use linear regression models to determine what factors affect foreclosure rates. The best predictor of foreclosure rate is high cost loan rate. Using new models, we find that race, education level, and geographic region are all significant determinants of the high cost loan rate.
Abstract: Pittsburgh, Pennsylvania is the only large metropolitan area in the United States that has implemented (and rescinded) a land value tax. This paper studies the effects of the land value tax on Pittsburgh's downtown health and urban sprawl. Building data and population density are the primary measures used to observe changes in downtown health and urban sprawl, respectively. While the data is ultimately inconclusive on the effect of the land value tax on Pittsburgh's downtown health and degree of urban sprawl, the data indicates the existence of a "timing effect" of the land value tax. This paper also addresses the need for further research, and considers important public policy implications.
Abstract: This study is designed to determine the expected economic effect of a smoking ban on bars and restaurants in Pittsburgh. In addition, the study explores the current effects of smoking ban in states that have already banned smoking. The former was achieved by a survey of Pittsburgh area bars and restaurants. The results show a discrepancy between bar owner’s beliefs and historical data. The latter was formed by data collected from states that have enacted their smoking bans. Further, we have found that enacting a smoking ban has had a significant effect on stopping people from smoking in relevant areas.
Awarded in 2008
Abstract: This study is designed to determine the revenue, both private and public, that will be generated by “The Pennsylvania Race Horse Development and Gaming Act,” which, upon its passage in 2004, legalized electronic gaming devices (EGDs) in Pennsylvania. In addition, the study explored the affects of any potential plan that would legalize table games in Pennsylvania. This was achieved by creating two regression models that were based on data collected from a host of states that have legalized EGDs and table games. The tax portion of the 2004 law was applied to the prediction to determine the public revenue brought in through the legalization of the EGDs. The results show that the revenue brought in by the new law will exceed the expectations of the state. However, the results also show that a proposal to legalize table games would not be as successful.
Awarded in 2008
Abstract: In 2005, CMU had the third largest international student population (2071 international students) in Pennsylvania, and was ranked 37th in the nation. 591 of those students were undergraduate scholars, constituting about 20% of the CMU undergraduate population. Increasing diversity has been the one of the top priorities of CMU’s strategic plan; CMU President Jared L. Cohon has personally taken up the responsibility in leading the effort in this area.
Diversity hereby does not only refer to the variety, but also encompasses how well different people mix together as one body. Our main question is how much do international students contribute to diversity in campus? How well do international students socialize with different nationalities and different ethnicities? To answer these questions two surveys were produced: one for international students and the other for American Students. Both surveys were done on surveymonkey.com.
A diversity metric that measures cross-nationality cross-ethnicity socialization and interaction is used to quantify diversity. The metrics includes factors such as “Number of hours spent with American friends weekly”, “number of American friends out of 6 closest friends”, etc. A regression model is then devised using the diversity scales as the dependent variable. Finally the regressions were analyzed to rank the ethnicities, majors, genders etc according to their sociability and thus diversity in the university. This was done by using hypothesis testing. Indeed, our results highlight the most and least diverse groups on campus as well as social barriers and social catalysts. The information gained from this project will hopefully help the university community better plan for activities promoting diversity in CMU and thus offer a better learning environment for the multi-cultural community.