Ecu'nomist, Year 22, Issue 3

The ECU’nomist

Year 22 Issue 1

July 2013, YEAR 22 ISSUE 3

To Err is Human The Iron Man: Elon Musk The Devil On My Shoulder

The race to the top Gender income inequality page 20

Student Life Hacks: Treasure of trash Easy language learning Excel tips

Van jongs af aan is hij er te vinden in de Stichtse Taveerne aan de Twijnstraat Utrecht. Frank Nieuwenhuijs staat bijna iedere dag achter de bar in de bruine kroeg die zijn ouders vroeger zijn gestart.

Biljarten is zijn grote hobby en dat is terug te zien. door IRIS VAN DEINSE De kroeg staat vol met speeltafels maar er zijn ook borspellen te vinden. “Ik ben nu eenmaal een spelletjesmens.”

Niet alleen oude biljarters en darters weten de zaak te vinden.

Een paar dagen in de week overspoelen studenten de zaak. “Onze bierprijs is net iets lager dan in andere kroegen in de binnenstad.

Het is juist zo leuk als er verschillende groepen mengen in de zaak.”

Het drinklokaal heeft een vaste klantenkring.

Op de automatische piloot zet Nieuwenhuijs de juiste kop koffie voor een van zijn stamgasten klaar. “Sommige mensen zijn gewoon hele goede vrienden geworden, je weet wat ze drinken. “Klanten die aan tafels zitten hoeven

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Geheime tip: terrasje aan de gracht

nooit te lopen. “Hoe druk het ook is, ik breng de drankjes naar de mensen toe. Dat vinden we belangrijk hier.”

Nieuwenhuijs mag dan dag in dag uit dezelfde klanten zien, achter de bgar staan gaat hem niet vervelen. “Ik houd van ouwenhoeren met alle mensen.”

De zaak is donker en gedecoreerd met ouderwetse prenten van de stad uit Het Utrechtse Archief. “Mijn ouders hebben voor de inrichting gezorgd, zelf ben ik daar niet zo van.” Een paar jaar geleden is de zaak nog helemaal opgeknapt, een speciaal rookhok is ingebouwd. Hip is de inrichting niet te noemen maar dat maakt volgens Nieuwenhuijs niet uit. “Dit slaat bij iedereen wel aan, het is bekend. In de winter komen mensen hier het liefste naartoe. In de zomer wat minder. Dan zoekt iedereen het licht op.”

Toch heeft de kroeg ook een goed bewaard geheim voor tijdens de zomermaanden: het terrasje aan de achterkant van de zaak. “Je kan hier rustig een kop koffie drinken met uitzicht op de Oudegracht. Het is hier nooit druk en het uitzicht is prachtig.”

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4 Letter from the Editor 5 Letter from the Board

Contents

6 Economics & the World 6 To Err is Human 7 The Devil On My Shoulder 9 Iron Man: Elon Musk 11 The Negotiator: Utrecht

9-10

12 The new board 14 Neoliberal Experiments 15 The Spanish-American War 17 Most Satisfied Economic Sector

18 Business & Career

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18 Pretty Face, Pretty Pay 19 Food choices 20 Male-Female Income Disparity 21

Student Life

21 Lifehacks 4 Students

Several times a year, The Ecunomist is published in a circulation of 500 for the members, patrons, Ecunomist and external contacts of ECU’92. The latest edition will also be published online and send by e-mail.

Kai Strohmeyer | Thomas Huigen | Leila Maria Scott | Dea Tusha | Mithra Madhavan | Natalia Neustroeva Julia Bolk | Sander Bouw | Sofia Monshouwer | Javid Allahverdiyev | Marco Engler

Study Association ECU’92 www.ecu92.nl Kriekenpitplein 18, Room 1.21 editorial2@ecu92.nl 3584EC Utrecht T 030-2539680 Printed by Flyeralarm BV

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From the Editor

Dear reader,

You are so great! All this effort, just for reading the ECU’nomist, you shouldn’t have! I have the impression that we take so well to each other. It is too bad that this is the last time I am accorded the honour of prefacing this magazine, now that I’ve gotten used to being the editor in chief, it will be difficult to give up the power. As I feel that I’ve done an acceptable job, perhaps it would be to your benefit that I stay. Alas, being elected as editor in chief is only temporary. Yes, I’m leaving you. I have to, it is a once in a lifetime appointment, something like the pope, or the king, but then for one year only.

The emotional me will miss you, while the conditional-hypereating me is already thinking about what to eat during all the leisure waiting for me. You can read more about who this latter guy is on page 9. Let’s not muse about the future too much, though; I’m sure there will be a worthy successor. Let’s rather enjoy the last moments we have together, and focus on introducing this academic year’s last edition; my job is not over yet.

The first announcement along with my apologies go to my appreciated colleague and dear friend Leila, whose previous article got lost in the layout process for the second magazine. The good news about this: we kept it, so that you can enjoy it in this issue! Read what she has to say about the Spanish-American war on page 15.

Apart from this, I would like to mention enthusiasm for journalistic activity as well. Thomas could not control himself, so that in a craze he wrote two articles this time. One is about why you better find yourself a good surgeon (or paper bag) if you are really ugly (page 18), the other about South African entrepreneur Elon Musk, who went from internet pioneer to space pioneer (page 11).

Of course, also the other articles are worth reading; they cover a range of topics, from Javid’s investigation on gender equality and inequality in wages (page 20) to Dea’s report on a world-changing Excel mistake (page 8). For sure, there is something for you in here, otherwise write it on a blank page and stick it in!

Not only do I leave the position of editor in chief after this issue of the ECU’nomist, but also do I leave the editorial committee behind me. It has been three years of storming my brains, writing articles, of stuffing hundreds of envelopes, and spending hours with InDesign. Moreover, there was a social side to it as well. I will never forget the first year’s tight black committee shirt with the shimmering print and the deep, round neck; of course I’ll keep it, maybe one day, I’ll have the body for it. I will never forget playing pool in the second year, which was actually nothing but watching Puss in Boots in the end, and emptying the cinema’s snack bar. This year’s crazy pub crawl and pub quiz ended up differently than planned as well, but were enjoyable nights.

Last but not least, a committee is about people. I would like to direct my professional thanks to everyone who has worked on making the ECU’nomist real this year. Personally, I would like to thank everyone who has ever been in the committee with me for the committee experience we had together. Thank you! Finally, I would like to wish my successor and the next committee all the strength, eagerness and creativity they need to publish a magazine at least as good as this year’s. Make an effort, I’ll keep an eye on it! Good luck, I believe in you!

Doeg, tschüß and goodbye!

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From the Board

Dear ECU’92 member, The academic year is over and that means it is a good time to look back over the past months. Except from the committees that started after January, all the committees have finished off organizing their activities. And they have done an awesome job!

Do you remember? The study trip, the lecture from Wiebe Draijer, Project siX, and the soccer tournament? These were some of our big successes and we are very proud at all the members that have helped to organize the ECU’92 events. As a big ‘thank you’ we took all the active members to Walibi World where we could not get enough of the rollercoaster rides.

In the general meeting, the candidate board has been established. It is good to know that the association will be in good hands next year, but at the same time we have realized that our board year is almost over.

It has been an exciting and fun year, full of challenges, experiences and in the end, great memories.

We wish you the very best in the upcoming years of your study and hope that you enjoyed the past year just as much as we did.

On behalf of the board, Best,

Anne van Breen Chairman of the ECU’92 Board 2012-2013

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Economics & the World

TO ERR IS HUMAN

By Dea Tusha

A

s fellow students, I believe most of us are aware of the destructive power of one small calculation mistake. It happens time and again in writing papers: you put your heart and soul into what you try to turn into an immaculate piece of art, spend huge amounts of time making sure to have left no loose ends, only to later realize that your work was flawed from the beginning because you added instead of subtracting or something of the sort. Anger and frustration are sure to follow, associated with an immediate feeling of helplessness. But as you come to grips with the fact that what is done cannot be undone and that you cannot defy the laws of mathematics, you breathe deeply, get ready to start again and shake off the unpleasant experience with the oh so helpful adage “It happens to the best of us”.

But as a recent event in the world of academia shows, it really does happen to the best of us too.

In a quite astonishing story worthy of its own Hollywood remake, earlier this year a University of Massachusetts Amherst graduate student made the revelation that an influential paper by two famous economists contained an Excel error. The paper, “Growth in a time of debt” was published in 2010 by Harvard economists Carmen Reinhart and Kenneth Rogoff and studied the effect of increasing debt on economic growth. Their findings, debt levels above 90% of GDP led to a significant slowdown of economic growth, were used as an aiding argument by the proponents of austerity in the controversial debate on finding the way out of the current crisis. Thomas Herndon, a graduate student who chose to replicate the results of this paper as part of an Econometrics assignment, at first found it impossible. After obtaining the Excel sheet from the authors, he discovered that a number of countries

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were accidentally excluded from the key calculation. Herndon and his supervisors also pointed out that some data was missing altogether and they argued against the way the data was averaged. While the averaging method is an open topic for discussion and more complete data has been gathered by now, Reinhart and Rogoff admitted and apologized for the Excel error. However, they still maintained that although the negative effect of debt on growth was gentler than their original estimation, the overall conclusion of the paper, that increasing debt led to lower growth, was still valid.

So far in our studies, it is rarely the case that a similar mistake affects anyone else but ourselves and our grades. But this cannot be said for influential papers such as this one.

In a world where the lingering effects of the crisis remain a hurdle, debate over the right path to recovery has been focusing on the choice between austerity and government stimulus. It was therefore no surprise that many ‘stimulus economists’, who find that the right answer to the crisis lies in increasing government spending to boost the economy, were quick to comment on the mistake. For example, in several of his op-ed columns Paul Krugman pointed at the prominence that the paper had received, and argued that policymakers chose to pay attention to it because that was what they wanted to hear. Indeed the 90% “tipping point” has been mentioned

by Paul Ryan and EU commissioner Olli Rehn to bring forward their case for austerity policies. I shall not focus on the debate itself here, as that is not the focus of this article (and because people much smarter than I have taken it upon themselves to explain the pros and cons of either argument).

To me, after three years of being taught the importance of research, it is just as intriguing to delve into the “why” and “how” researchers choose the topics they want to write about.

a student even discovered an error in a harvard journal There is a tradeoff between being relevant and keeping research independent. On the one hand, it is important for social sciences to remain at the forefront of current issues and to deal with topics that need solutions.

On the other hand, it is rather naïve to believe that research can only be done for the sake of research, and no political agendas are at play. In order to gain public acceptance for one or another policy, politicians may often find it useful to quote scientific sources that will support their arguments.

Research is mainly conducted in universities and research and policy institutes, whose funding comes from many sources, ranging from governments to advocacy groups and business companies. It must therefore be a challenge to keep the research relevant, objective and independent from the direction it may be steered into by these external factors. Bringing forward more information helps to see many sides of a topic, exposing their advantages and disadvantages.

However, the question of how these findings will be used and interpreted does not only remain within the scientific realm, which is something that every researcher needs to consider upon before embarking on this investigative journey.

As for the moral of the story that better resonates with us students at the moment: Make sure to always do your homework. Who knows, next time you may be the one discovering an Excel error.

THE DEVIL ON MY SHOULDER

By Kai Strohmeyer After touching upon the complex issue of food scarcity in some world regions in our previous issue, the last stop in my column on food moves closer to reality: excessive food choice and exceeding quantities on the supply side, and excessive eating and often extensive weight-gain on the consumer side. This article is supposed to give you some insight into the root of all evil, partly our brains, while referring to and reviewing the nonfiction book “The end of overeating” by pediatrician and former Commissioner of the Food and Drug Administration (FDA) David Aaron Kessler.

T he book’s title (“The end of overeating”) may make you think

that you are about to read one of the many guidebooks out there which are targeted at people like those rhinoshaped candidates you associate with TV-programs such as The Biggest Loser. In other words, a book for the (growing) minority of obsessively fat people who increase their risk of a stroke or a heart attack, candy bar by candy bar, fry by fry, coke by coke.

If that’s the case you’re way off the mark!

Forget about body weight when thinking whether or not you are in the target group of this book. I don’t consider myself an abnormally fat person, and yet, after reading it I didn’t only enjoy the information presented but also I found it extremely helpful and relevant for my own life. In short: A guidebook for most of us who struggle day in day out to deal with the food environment we live in.

What you learn about

The book mostly focusses on the science of overeating. Highly palatable foods—very appealing foods, mostly those rich in sugar, fat and salt— are looked at from a behavioural-

psychological and neuroscientific angle, in order to answer the question why they are so tempting and why we keep on eating this kind of food even though (a) we might not even be hungry and (b) we know that it is unhealthy and contains no meaningful nutrients and therefore is nothing but empty calories, raising our energy intake way above the required level. In doing so, Kessler manages the balancing act between using an understandable language and the use of professional terminology, so that I didn’t feel treated as if I was thick, but was given the feeling of being intellectually capable of reading it, and well-educated after reading it. Moreover, he manages the balancing act of presenting basic scientific principles without creating a heavy text; he describes findings by presenting the experiments that lead to them—I started to identify very well with laboratory rats at the end of the book. Besides that, Kessler makes use of many examples from people’s personal experiences with food and includes many interviews he conducted with a wide range of people—insiders from the food industry, random overweight or average-weight people, as well as behavioural economists. If you think just as me that this is an intriguing

topic, it’s reason enough to read the book.

Are you a hyper-eater?

conditioned

If you had the chance to watch me read this book, you would have seen me nod and smile every couple of pages, when I could identify myself with a certain behaviour. I learnt a lot about myself, how cue-urgereward-habit mechanisms in the reward and memory compartments of the brain are at work when I enter a supermarket. Passing by the snacks section reminded me of the potato chips I bought there in the past and the rewarding response which took place in my brain after eating them. A conflict starts in my brain everytime I enter a supermarket. Imagine a mini beer-belly devil and a lean little angel resting on each of my shoulders while I stand in the Albert Heijn chip aisle.

“It’s fine, just today, it’s not like you would eat potato chips all the time.

They won’t kill you. You only had fruit for breakfast and a sandwich for lunch.

And it will save you so much time!

You’re tired, aren’t you? So just get these damn chips, get home, jump on your bed, find a good movie to watch

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and open the bag—dinner’s ready!

You can prepare that salad tomorrow, all that stupid cutting!”, says devil-me in his low, seducing voice.

“You don’t want to gain weight, just think of your belly! And the juicy pimples that will sprout up all over your face the next morning!”, replies angel-me in his shaky high-pitched voice.

Once such a battle has started to bother your brain, it is pretty much decided, since it occupies your mind more and more in the presence of the desired food and brings forward the memories of the experienced reward.

The devil would say something like “You won’t see anyone tomorrow anyway, so there’s no one to impress?”

“Good point there.”, my hand would say, nod agreeingly, and grab a bag from the shelf. And some chocolate peanuts. Go big or go home!

You may be reminded of similar extreme situations from your life or not. However there are also small subconscious indicators of food obsession like: preparing your next fork when still chewing; being obsessed with always finishing your plate; grabbing one of the free bitterballetjes at the social drinks without even wondering whether or not you’re hungry at all; or even just the thought of food—the distraction originating from a plate of cookies on the table, the thought about what to have for lunch when eating breakfast—they are all indicators that you are a conditioned hyper-eater at least to some degree.

So you’re calling me a wimp or what?

There is a reason why Kessler uses the word “conditioned” in the term “conditioned hyper-eater”. The most prominent example of conditioning is Pavlov’s behavioural experiment with dogs. For a sub-group of dogs, a bell was rung, after which food was served to them. After some repetitions, the bell was rung again, but this time no food was served. Interestingly, increased salivation could still be observed, which would not have been the case had the dogs not been conditioned this way, which made them expect food at the sound of a bell.

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This example contains one cue only. Reality is much more complex.

We live in an environment with food advertisements on every corner, at every time, on radio, on TV, online.

Food is available everywhere, most of the day. The industry is not ignorant of the compelling effect food can have on us. Not only is food produced— one can even say designed—in a way that it becomes a mind-blowing experience which engages all senses, but also this euphoric experience we have from this food is amplified through marketing, through creating a positive image of food, through toying with consumers’ emotions.

A highly caloric blend

Reading the book not only informed me, but it also set a thinking process in motion. I would like to share some of the thoughts that crossed my mind.

An obesity epidemic bothers many individuals in Western societies, in making them feel uncomfortable about their bodies (since they don’t comply with the widely advertised beauty ideal of photo-shopped, fat-free models), and in constituting a severe risk to their personal health—diabetes, stroke, heart attack, to mention just the tip of the iceberg. Popular opinion should shift from perceiving overweight people as weak individuals who lack willpower to seeing them in the whole context.

Evolution (or God, you name it!) has produced a human brain which is very susceptible to hyper-palatable food. Nothing in nature contains as much sugar as cotton-candy, and yet many people love it. This doesn’t seem natural, but Kessler compares it to behaviour observed in birds, linked to super-normal stimuli. Konrad Lorenz observed that birds breed eggs resembling their own, but which are too large to be of their own species.

Larger eggs make a hatchling, and therefore the continuity of the species more probable; a bias towards them is therefore sensible. The same can be applied to our bias towards foods high in salt, fat and sugar; eating naturally fatty, sweet and salty foods ensures energy and mineral intake, but the turning point of preferences goes beyond the levels of fat, sugar and salt found in unprocessed food.

Economics & the World

The fatal thing is that intelligence has made mankind a creator in many respects, including food, a lot of which is highly processed nowadays.

Blend human intelligence with human susceptibility for harmful food and a profit-optimizing capitalist system, and it is no surprise that people are presented the choice of all the varieties of marketed food of which they will consume more than their body requires. Obviously, this creates more GDP than the hunt for berries, but also a lot of dissatisfaction as well; mental as well as physical.

Kessler presents no one-size-fitsall solution how everyone affected by conditioned hyper-eating can ignore his/her little devil, but he rather points to the basic principles in arriving at a personalized solution to deal with the food environment we live in.

Until it might be changed through government regulation, he calls for creating awareness around the issue, since we can only change our mind if we know how it works.

Way beyond food

When reading the book I realized how many of the different situations I could identify with. How many people do I know who have excessively more clothes than necessary, because advertising directly, or indirectly through their friends, convinces them that they have to be trendy, that they have to possess every single variety, At the same time, when reading the book, I became aware that sometimes my focus would shift away from the text and towards my iPod on the night table.

“Just a quick check on Facebook.

Twenty seconds max.

Maybe somebody likes the link. Maybe you’ve got a message”, said the little devil, bouncing on my belly.

Kessler writes that you should “Limit your exposure. (…) (Y)ou may be able to turn away from a cue initially, but its presence will be a continued temptation until you give in”. I decided to listen to the latter—I mean, he’s the one who wrote a book!—and deleted the Facebook app. Now only I have to somehow delete that hyper-eater app in my brain.

Economics & the World

IRON MAN: ELON MUSK

W ith the rise of Apple as a popular consumer product, Steve Jobs

has been described as a visionary entrepreneur, making electronic gadgets cool and creating a band of Apple-zombies who consume all their products, rocketing the company up the ranking of most valued company in the world. Apple has no doubt significantly affected the electronics market, but its impact on the world is difficult to gauge. A world without iPads and iPods is perhaps not a scenario some Applites would dare think of. But are these products really that important to the wellbeing of mankind? In other words, is Steve Jobs such a visionary? To be able to answer this, a comparison has to be made with other contemporary visionary thinkers. But do they exist? The answer is a thundering yes!

Elon Musk is a South-African born entrepreneur with a thirst for causing seismic shifts in arenas which he thinks are crucial for humanity. He has gone from one successful startup to the next. Currently he rotates between being CEO at both his startups SpaceX and Tesla Motors, a spaceflight company and an electric car company respectively. If he is not busy with these two companies he is overseeing the progress of SolarCity, his solar energy startup. Hearing someone talk

nonchalantly about humans becoming an interplanetary space faring civilisation initially spark mental-hospital sirens. But these are not the ramblings of some nutcase, rather they are the ambitions of a man who has successfully launched two capsules to the International Space Station (ISS) orbiting earth, with SpaceX becoming the first private company to do so. So when Elon Musk said he’d “like to die on Mars, just not on impact”, there’s no telling what will happen. And when one takes his past successes into account, why wouldn’t he die on Mars?

It’s therefore not surprising that the main character in the movie Iron Man is based on Musk.

The Beginning

To get a better understanding of the man, rewind 18 years, to the dawn of the internet as a global phenomenon. Musk had been doing a Phd in Applied Physics and Material Sciences at Stanford for a whole two days before quitting, reasoning that doing research while the internet was about to take off would leave a knot in his stomach if he were not to cash in. With a talent for computer programming originating from his childhood, he and his brother moved to Silicon Valley where they started Zip2, a small company specialising in bringing media content online. It was commissioned by the likes of the New York Times and other big names, after which Zip2 was sold for $307 million, with Musk tak-

By Thomas Huigen

ing home a couple of million. Instead of retiring young, Musk and his brother co-founded an email payment company which would later become Paypal.

Musk’s goal was not to make enormous profits, but rather to revolutionise the financial world. This never truly materialised as Paypal was bought by eBay for a cool $1.5 billion, with Musk pocketing nearly $165 million.

10 years to Mars

So what do you do next with such an enormous amount of money? Invest nearly all of it in three separate startups in sectors which need fundamental progress, according to Musk.

Having always been fascinated by NASA’s space missions, Musk was disappointed to see that NASA was not planning a mission to Mars, the obvious next step in the evolution of space travel after having landed on the moon. The billions of federal dollars flowing eternally into NASA were coming to an end, so a Mars mission was out of the question for the cash strapped space pioneer. Musk foresaw that the private sector would have to fill this void for humans to become space travelers. He invested $100 million of his own money into his startup SpaceX, which would build and fire rockets to transport satellites and cargo at a much lower cost than competitors and national governments could.

Initially the first 3 launches failed and SpaceX was close to disaster. Luckily the next launches were success-

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Economics & the World

ful and the company hasn’t looked back since. So far 50 rockets have been successfully launched and two capsules have been sent to the ISS, and SpaceX has been contracted by NASA to send an astronaut to the ISS next year. Furthermore SpaceX is frantically researching ways to make rockets reusable, which would further drastically reduce costs, and would make space travel a much cheaper endeavour. The main goal is to send people to Mars, and Musk predicts that this could happen in the next 1020 years.

Vroom Vroom on Mute

Back on earth, Musk also saw a lack of activity in the electric car industry. The image of these cars was golfcart like, with a low range and poor performance, you really had to be an environmentalist at heart to buy one.

Musk wanted to change this perception by developing a fast, long-ranged attractive car, so he cofounded Tesla Motors. Tesla would act as a catalyst for the electric car industry, promoting technologies and enticing the competition to follow their lead in revolutionising the car industry. Not quite the usual cutthroat-competition-talk one expects to hear from a newcomer. Tesla’s first car was the $110 000 Roadster, a very fast electric sports car.

Next was the Model S, a luxury sedan competing with the likes of Mercedes and BMW, which won the 2013 Motor Trend car of the year award, with faster acceleration than the competi-

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tion and hardly any noise. Next year the Model X, a fast stylish SUV, will start full production. The main goal is a large-scale affordable electric sedan. Musk’s main argument for electric cars is that even if electricity originates from coal, the coal power plant is much more efficient than a combustion engine in a gasoline car, so per kilometer the electric car pollutes less, even if it is run on coal electricity. And if electricity is generated from renewable energy, it is quite obvious how attractive an electric car is. So far Musk has invested $74 million of his own money into Tesla, which was necessary to keep it alive after reaching near bankruptcy in 2008 due to the financial crisis. Musk had to borrow money from friends to cover his living expenses, a clear testament to his ambitions, and that being broke wouldn’t stand in his way.

Fun in the Sun

Musk’s third adventure was based on the looming energy crisis the world will face. Fossil fuels are non-renewable and will run-out relatively soon, and they are causing global warming. So why not make use of the most abundant source of energy on earth which is also clean? The sun baths our planet with enough energy to easily meet our needs, as 40 minutes of sunlight on the earth’s surface equates the world’s total annual energy consumption. The lack of large-scale activity in the solar energy market prompted Musk to start SolarCity, a solar en-

ergy utility which leases or sells solar panels to anyone who wants to lower their energy bill. For leasing, the solar panels are set up for free, so all the homeowners or businesses have to do is pay SolarCity for the energy, which is less than the large utility companies charge. The idea is to create a distributed network of solar panels across the US to compete with the large polluting utility companies.

Five completely different yet successful startups clearly show how the entrepreneurial genius of Musk is unmatched. His startups were risky and were only financially viable due to his determination to make them work.

Making money for himself is not a priority, although to attract investment, the companies obviously have to be profitable. Rather, his strategy is analogous to some brilliant comedians.

Humour fabricated to chase laughs is not nearly as creative as when the comedian is creating the humour and setting the tone. This is similar to Musk’s strategy, as he hasn’t created companies to fulfill a current easy demand, but rather he has created a demand for products or services which will enhance humanity, an inherently more difficult task. To compare apples and oranges implies that a comparison is not useful, a relevant idiom when comparing the man behind Apple and the man behind Mars missions, electric cars and solar energy.

The one was a salesman, the other is a pioneer.

Economics & the World

THE NEGOTIATOR: UTRECHT

By Sander Bouw

U trecht. Capital of the smallest province in the Netherlands, home

to FC Utrecht, the Domtower and the beautiful wharfs and cellars. Its population is just over 300,000 and the local university has often been rated the best in the Netherlands. Besides all that, every spot in Utrecht can be reached by a twenty minute bike ride.

We probably all agree that Utrecht is the most beautiful, the most ‘gezellige’ and the best city of our country.

However, apart from all the common knowledge I just cited, there are a few things about this town most people do not know. For example, did you know the former Dutch Queen was here a couple of weeks ago? You might just know that she was on a balcony waving to hundreds of ecstatic people, so it was not very hard to miss. But do you also know WHY the queen of the Kingdom of the Netherlands visited our cosy little place called Utrecht?

To answer this question we will need to go back in time, but as multidisciplinary economists in the making, a little bit of history class should not frighten you. In 1700 AD, the Spanish King Charles II died, without having any children to succeed him. This was enough reason for the French King Louis XIV to start claiming the Spanish throne.

However, some other countries did not really like this idea, especially the British, so a worldwide war broke out.

In 1710, after ten years of violence, Louis XIV realised that he was never going to win this war and the British realised there was never going to be

peace without an honourable way out for the French King.

An unexpected treaty meant the end of the war. Usually wars were ended by victory and defeat, but the British stated that they wanted peace and so they started negotiating with the French. However, the talks could not be held in Britain, because that would be humiliating for Louis XIV, so they went to Utrecht. Leaders from other European countries also showed up in Utrecht and for more than a year the negotiations about peace had been ongoing. Finally, on the 11th of April 1713, the Treaty of Utrecht was officially signed. This way of solving conflicts was revolutionary and was repeated in history afterwards.

Actually, the European Union uses the exact same approach nowadays.

At the time of the negotiations, Utrecht was the place to be. Because the European elites relaxed in Utrecht for one year, money was flowing in all directions and even the poorest workers would end up a lot wealthier. The negotiations boosted Utrecht not only economically but also culturally. Bans on theatre were abolished and every opportunity to throw a party

was grasped. Besides that there was music, fireworks and joyful dinners, so Utrecht was hot and happening back in the day. Perhaps this explains why Utrecht is as hip as it is today, so when you’re going out in ‘de Beurs’ or ‘Tivoli’ next time, please be aware that you owe this all to your French friend Louis.

Now, 300 years later, we celebrate the Treaty of Utrecht’s 300th anniversary and that is exactly why Beatrix visited Utrecht. She officially opened this anniversary by literally illuminating Utrecht’s pride, the Domtower. The coming months there will be a lot of activities in Utrecht regarding the Treaty of Utrecht and as a Utrecht University student (probably) living in Utrecht it might not even be a very bad idea to check some of these out. A lot of museums offer theme expositions and there will be shows and theatre plays. All you need is a little bit of imagination and it will be 1713 all over again.

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Announcement: ECU’92 Board 2013 - 2014 Name: Lisanne Hoekstra Function: Chairman Age: 21 As chairman, Lisanne is responsible for managing and resolving issues within the board as well as the association.

Next to this she will be responsible for the coordination of the Conference committee and the Yearbook committee.

Name: Thijs Folkeringa Function: Secretary Age: 21 Thijs is in charge of the membership records, official reports and contact with other study associations in the upcoming year.

He will also be the committee coordinator of the Studytrip and the Prom.

Name: Job Achterkamp Function: Treasurer Age: 21 What numbers are concerned Job is the man for the job. It is of no surprise he will take of the financial administration and budget of ECU’92.

Next to this Job will be coordinating the DLC committee, the BvvK and the Activities committee.

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Name: Sjoerd Geukers Function: Coordinator Internal Affairs Age: 21 Sjoerd will be concerned with the HRM, promotion and the contact person for (active) members regarding committees.

Specically he will be taking care of the coordination of the Relaxcie, Introduction, Freshmen and Promocie committee.

Name: Marloes Wigger Function: Coordinator External Affairs Age: 20 Marloes will be responsible for sponsoring, LMO and external policy.

Marloes will be involved in coordinating the Career Day, REBO Company Day and the Graduate committee.

Name: Sander Bouw Function: Coordinator Educational Affairs Age: 21 Sander will be the contact person for the contact with USE and our Book supplier. Furthermore he will deal with complement the education at USE whereever necessary.

Sander will also coordinate the Book Foundation ECU, StIB and the Editorial committee.

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Economics & the World

NEOLIBERAL EXPERIMENTS

By Marco Engler

In the last article I described the aftermath of recent and current water supply privatisations. This article takes a step back to investigate and review the much wider and older field of neoliberal experiments.

T he current idea of neoliberalism started after World War II in Chicago

where the university expanded their economic department and become one of the leading universities in this field. I will move chronologically to the biggest implementations starting from Chile, Turkey and the UK between the 1960’s to 1980’s, and go to the time of the transitions in Russia and East Germany to finish with the British Rail privatisation at the beginning of this century.

Neoliberalism started at the University of Chicago with a group of Chilean students, commonly known as “the Chicago Boys”, who started to implement a model of free markets without government interventions.

They were led by the founding fathers of this school of thought, Friedrich von Hayek and Milton Friedman, who heavily influenced economic policies in Chile. Back then, since there was no democracy, neoliberal ideas were implemented in Chile under Pinochet’s government of 1955 and in Turkey under Evren in the 1980’s.

Neoliberalism could rise at these places faster than it could in any democracy due to the typical effects of neoliberalism. In all places where neoliberal policies were implemented, for instance under Ronald Reagan in the United States between 1981 up until 1989, the expenses for the military rose, the social programmes were cut, and poverty increased.

This pattern is also typical for most dictatorships like in Spain under General Franco or in North African countries nowadays.

Margaret Thatcher, the former prime minister of the United Kingdom between 1979 and 1990, was inspired by her mentor Friedrich van

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Hayek. She led the conservative party, fought against unions and brought her idea of neoliberalism to Europe. Her enemies were the mine workers and unions. She started a wave of repressions and probably the most violent attack against unions and workers in the Western World. Furthermore, strike laws were changed, changes which are theoretically valid even today. This means if there are more than four strikers the government can forbid the strike due to “demoralising other workers”. During her leadership of the UK, poverty rose rapidly and working circumstances soured.

(See “How Britain changed under Margaret Thatcher. In 15 charts”: http://www.guardian.co.uk/politics/ datablog/2013/apr/08/britainchanged-margaret-thatcher-charts) After the fall of the Iron Curtain, the World Bank, the IMF, and a group of lawyers and economists of the Harvard University managed the presumably biggest project of neoliberalism of all time. The Soviet Union had fallen leading to the privatisation of the soviet business

units. Companies and whole industrial segments were taken over for more or less than a hundredth of their actual value by investors who plundered the enterprises; they fired workers, sold out the equipment, reduced salaries and received subsidies.

During this time, the suicide rate in Russia doubled, people had to fend for themselves, the rate of child prostitution and HIV infections (the second fastest growing rate worldwide) exploded and life expectancy decreased by a decade.

Hence, millions of people in Russia were hungry and thrown into extreme poverty. The whole nation was decimated and sold out. All of it came along with the limitation of rights.

In 1993, the coup had been staged and Boris Jelzin could accelerate the privatising process. This coup is commonly known as Catastroika.

(First graph: http://www.who.int/ mental_health/media/russ.pdf) At the same time, in Germany the so-called Treuhand started acting and flogged the inventory of

Economics & the World

the German Democratic Republic.

The idea of the Treuhand had come from the people in the GDR with the idea to restructure the companies formerly owned by the socialist party SED. Instead of making companies competitive, the Treuhand sold out everything. It was in charge of approximately 8,000 companies, approximately 40,000 factories and around 4.5 million employees. The West-German occupation policy ended with revenues of 60 billion euros, a loss of 300 billion euros and more than 3 million unemployed workers, a decrease in the GDP by 30 % and an increase in the unemployment rate by 20 %. The Treuhand did not check investors or their offers or plans; in fact, 10 to 15 companies were privatisaed every day. There were companies, for instance, “Fortschritt”, the former world leader in the agricultural sector, whose equipment was sold out for peanuts to West-German companies and whose workers

were fired immediately. The tough plan was to make East German companies competitive; however, they were rather plundered in the end. Auditors estimated that East Germany suffered a backlash in competitiveness of approximately 15 years to West German companies solely due to this procedure.

Curiously enough, people tend to say that the socialist mismanagement did not work out. If so, then the neoliberal mismanagement works even 30 % worse.

Let`s take a look at the United Kingdom. Between 1994 and 1997, the privatising of British Rail had been staged. In the UK, the government had opened the market completely and thousands of companies and subcontractors had flooded the market. Railway stations were privatised and railroad companies had entered the market.

Some years later, the system could not work without regulation

anymore. Ticket prices increased, workers were unemployed due to cost minimizing and the railroad property was tormented due to expensive investments. Moreover, miscommunication between the entanglement of enterprises and subcontractors led to coordination problems. The huge amount of companies had made it impossible to open or close new routs or change schedules. Moreover, the government paid within three years more subsidies than the original selling price. The whole chaos resulted in many victims.

The biggest tragedy was the Potters Bar tragedy in May 2002, which led to 7 deaths due to coordination problems. The result of the complete privatising of British Rail are: 42 people perished and 600 have become injured. In 2002, Network Rail, a not-for-profit oriented company has taken over the whole infrastructure.

THE SPANISH-AMERICAN WAR

By Leila Maria Scott

A s an American abroad, I’ve run into my fair share of stereotyping and

generalisations. Less frequently, I will encounter a person who begins to use their possessive pronouns in a strange way, “…your war…” This never fails to flatter me, but unfortunately, American foreign policy has somehow always managed to escape my control. What I try to explain whenever this happens, is that the latest invasion or “liberation” is simply a continuation of policy and one that I had nothing to do with. An example which many Europeans may be unaware of is the SpanishAmerican war.

This relatively unknown but very significant conflict in the Caribbean would later have a great effect on the foreign policy of the United States and the status quo of the globe in years to come. In 1897, rebellion broke out in

Cuba, a Spanish colony ninety miles off the coast of the United States, and Spain responded by sending soldiers in an attempt to put the rebellion down. The United States declared war on Spain on April 21st of 1898. Historians have oft questioned the motives of American leaders, specifically the decision to declare war on Spain and defend a country which they apparently had nothing to do with. However, appearances may be deceiving.

It is estimated that by the 1880’s, American world trade was 25% Cuban. American businesses had invested $150 million in Cuba and purchased at least 75% of Cuban sugar. President Millard Fillmore had already tried to purchase Cuba in 1852 due to its important world markets and strategic location. U.S. interest in Central America was largely dependent on the Panama Canal, a not-yet constructed canal which would connect the Pacific Ocean and Caribbean Sea by creating a canal

through the isthmus of Panama. Not only would the east and west coasts of the United States be more easily connected, but it would open up a world of trade, especially with China.

The Panama Canal would open new trade and military possibilities, but would also require a sufficient amount of protection if the U.S. hoped to maintain control of it.

Cuban sugar plantations were largely owned by Spanish aristocracy and American businessmen; therefore an official reason for war was the prevention of the disruption of U.S. trade and the destruction of American property. But the most popularly used reason for war with Spain was the sympathy of American citizens for Cuban rebels. The U.S.A. had won independence in 1776 from England; the hearts and minds of the American public were with the independenceseeking colony of Cuba.

A less-discussed but nonetheless important point is the strategic location

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of Cuba and other Spanish colonies in the Caribbean. These small island colonies would allow for useful ports and coaling stations, not to mention the trade possibilities. Coaling stations and rest stops would be important for American ships making trade voyages through the Panama Canal.

The decision to go to war with a foreign power due to a conflict which may appear to have no relevance (besides strategically and financially) is often very hard to justify. Fortunately, the United States government had had their justification since 1823 and it was called the Monroe Doctrine.

The Monroe Doctrine was thought of at the time that the United States was dreaming up a canal which would cut through Central America.

Afraid that Great Britain would try to stop American ambitions, the Monroe Doctrine was put into place and stated that any European intervention in Central America would be considered an unfriendly disposition towards the United States. It basically stated that the U.S.A. would consider itself the big brother of Central America for the unforeseeable future. Despite the rather bold statement of the Monroe Doctrine and the aggressive action it bespoke, the consequences of the Spanish-American War were more predictable than most.

The Spanish-American War was over quickly; in a period of about six months. President Theodore Roosevelt called it, “A splendid little war.” And comparatively speaking, it was; the Spanish-American conflict was resolved quickly and with relatively few casualties; only about 350 American sailors were killed in combat, while many others died from diseases such as yellow fever and malaria. While the loss of life may not be considered significant, the political and social outcomes of this war are undeniably apparent in present day U.S. foreign policy. The Spanish colonies of Cuba, Puerto Rico, and the Philippines were handed over to the U.S. government by Spain. The American demand for Wake, Guam and the Philippenes, also Spanish colonies, was met in return for $20 million paid as compensation.

While the location of the Philippines appeared to be a large bonus, the

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Americans actually inherited a rebelling nation and a bloody struggle for Filipino independence which led to a brutal two-year long war in which more American soldiers died than in Cuba.

Cuba was made into a protectorate of the United States, which allowed American intervention in Cuba to restore order, preserve Cuban independence, and gave them a military base at Guantanamo Bay in perpetuity. These privileges were drafted into the first Cuban constitution in the form of the Platt Amendment.

The rest of the former Spanish colonies were left alone for the most part, besides military bases and trade agreements.

The conflict in Cuba became a model for U.S. foreign policy in later years. Nicaragua, Venezuela, Costa Rica, Panama, the Dominican

Economics & the World

Republic, and Haiti would all eventually feel the over-extended reach of the United States big brother policy. Present day foreign policy can be related back to the SpanishAmerican War; the war on terror is a perfect example. Today the United States has military bases in over 120 countries, among them Bulgaria, Germany, Italy, Greece, Spain, the Netherlands, Portugal, and the United Kingdom. While the Monroe Doctrine promised to babysit and police Central America, many have compared President George W. Bush’s policy and continuing American foreign policy in the same light.

Economics & the World

MOST SATISFIED ECONOMIC SECTOR

By Natalia Neustroeva

for other than what they already are.

There are three classical economic sectors. The primary sector

involves the retrieval and production of raw materials. The secondary sector is responsible for the transformation of raw materials and intermediary goods into finished products. Lastly, the tertiary sector supplies services to consumers and businesses. Typically, third-world countries have the highest portion of the labour force working in the primary sector, while in developed countries tertiary sector jobs are the most common.

Living in a developed country and being enrolled in an Economics course, there is a big chance that the vast majority of you are planning on working full-time in the tertiary economic sector in the future, be it as a banker, manager, financial consultant, or an array of other service-based jobs. In our society, there is a common notion that tertiary sector jobs are more satisfactory than those in the other sectors. A popular reason for this is better career and income opportunities. After all, it is much easier to imagine a salesperson working their way up to a company manager with a nice salary, than a farmer or a factory worker working their way up to…well, it is even quite difficult to think of what those two can strive

With this mindset in mind, as described in his travel-autobiography book “In Praise of Savagery”, Warwick Cairns set out on a tour around some remote parts of Africa. Among rundown huts, little food diversity and quantity, and an overall low standard of living, he was surprised to notice a striking contrast in the form of people’s happiness. Sitting beneath a shade of a scrawny tree, Warwick observed a group of goat-grazers and farmers enjoying an evening meal. Every day, ever since they were old enough to go into the fields, they had been under physical strain and have had little time off. Yet, their minds were at peace. At the end of the day, satisfied with the effort they had put in, they gathered together to enjoy the rest of their evening. They had no worries, and any stress they had encountered was dissolved as they laughed and joked among each other. This left Warwick pondering. Although these people had little material possessions, and nothing to fall back on if their crops failed, they did seem to have something that much of the Western society did not – peace of mind.

Cairn’s observation could be applied more broadly to the three economic sectors. Although primary and secondary economic sectors can

be tough, and challenging in terms of career development, at the end of the day our previously mentioned farmer can go back home, sit back, and relax until the next morning. Meanwhile, the established manager or even a simple clerk will not be so quick to let go of his work-related problems. Returning back to their homes, their minds will still be filled with potential solutions to continuous management problems, competition from their coworkers for a promotion, and a worry that once again they will have a headache due to their inability to calm their thoughts.

I would like to note that I have used the more extreme examples here. Not every tertiary sector worker returns home with all his thoughts arranged neatly on a shelf, and not every service worker suffers from insomnia caused by his work-related worries. However, there is also no hiding from the fact that in the EU, 37.9% of hospitality and financial services workers have been reported to experience some to high amounts of stress related to their job.

So although there is no harm for us to continue striving for a job position in the service sector, it may be a good idea to take something from Cairn’s ponderings: view your job as an important part of your life, but do not let it completely take it over.

(Economic sectors in developed, newly industrialised, and developing countries respectively.)

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Business & Career

Pretty Face, Pretty Pay

Ia friend. was walking through the city with I can objectively state that she was well endowed with physical attractiveness. We were walking side-by-side until we neared a busy alley, forcing us to walk in singlefile to allow passers-by to pass in the opposite direction. As I walked behind her, I noticed numerous pairs of manly eyes steal a glimpse of her as they passed us. Now, a look from the opposite sex can mean a host of different things, but let’s assume that the men thought that she was attractive, a definite possibility. How would this affect someone if this were to occur on a daily basis, over a longperiod of time, assuming that they noticed the looks and assuming that they knew the looks were a result of their physical attractiveness? At first it seemed to me that such a person would experience a heightened sense of self-confidence and pride, as they were revered by the opposite sex. In general, physically attractive people are treated differently in contrast to physically unattractive people: while socialising they are approached faster by people who do not know them; jokes or stories they tell are listened to with more intrigue; and in general the amount of attention they receive is more. Besides this anecdotal evidence, there is also a science to beauty, and with it come economic effects. I will be focussing on facial beauty instead of the broader concept of physical attractiveness, a much harder to define variable.

Beauty Pays

Can facial beauty be measured?

Research has shown that people tend to judge others’ beauty similarly, but not identically. Facial symmetry is attributed as the main factor involved in determining someone’s facial beauty. In the book Beauty Pays, the economist Daniel Hamermesh argues that beauty is a significant factor in many markets, and that ugly people should become a protected group just

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like disabled people. At first this seems a crazy argument, as if ugly people are disabled by their looks. But many different aspects of ugliness warrant this classification. On the whole, an above average-looking worker receives a 10-15% higher wage than a below average-looking worker. And over the lifetime of a good-looking male worker, he will on average earn 180 000 euro more than a bad-looking male worker, everything else equal.

This ‘beauty premium’ is surprisingly more pronounced for males than females, presumably because male labour participation is higher than female’s, meaning there are on average more ugly males working than females. The author goes even further in stating that being an ugly woman tends to increase the chances of doing housework. The reasoning behind this is that ugly women know that their ugliness will hamper their chances of finding work in certain jobs (think of jobs in sales, waitressing and secretaries where beauty might seem like an important determinant), and hence they will choose not to work but will rather stay at home cleaning the house and taking care of the kids.

The data shows that the ugliest 12.5% of women are 10% less likely to work than the 33% most beautiful women.

Bad Karma

Another interesting finding is that marriage market studies show that women tend to trade their goodlooks for a wealthier husband, so good-looking women tend to have significantly wealthier husbands than less good-looking women, an elementary fact known by golddiggers. Beauty also affects one’s job choice. Beauty in the workplace is most likely a significant factor when social interactions are deemed important for the job. Defense lawyers, who spend a lot of time in court dealing with people, are generally deemed more attractive than tax lawyers, who spend most of their time behind a desk stacked with interesting books. This also applies to occupations like salespeople, movie actors or politicians. This means that

By Thomas Huigen

on average, better-looking people will choose occupations which will value their beauty, and uglier people will shy away from these jobs. Interestingly in occupations like university professors, where beauty would intuitively seem not to matter, there is a significant difference between the salaries of professors who are deemed as goodlooking and those who are not, as the good-looking ones tend to earn 6% more than their troll-like peers.

Another interesting result is that ugliness also affects the likelihood of becoming a criminal, as particularly grotesque youths are significantly more likely to have committed a robbery, theft, or assault than other youths. On the whole, ugliness is like an ever-present bad karma. This unfairness means that ugliness, just like disability and race, could become a generally accepted protected category under the larger umbrella of discriminatory law.

The term lookism is becoming more important and it refers to pure discrimination in favour of the goodlooking and against the bad-looking.

Business & Career

In France there is already a lookism anti-discrimination law, as well as in some American municipalities. There has also recently been a trend in lawsuites to include lookism costs into the settlement. For instance in one case, a dog bit a child in the face, who suffered irreparable facial damage.

The parents initially sued the dog’s owners for psychological damages, however due to the increased evidence for lookism, the child’s lawyer asked Daniel Hamermesh to calculate the loss in lifetime earnings associated with the child’s facial disfigurement, which would be included in the law suit. This means that in the future companies like Abercrombie and Fitch, who told their store managers to put the most attractive salespeople in the front of the store, could be sued for discrimination.

Attractive = Intelligent?

Just like height discrimination, beauty discrimination is a primal act, as we are hardwired by evolution to value height and beauty, thereby

subconsciously acting favourably towards those who are tall or beautiful. This is analogous to racial classifications, as being white has been helpful to many white people due to the fact that they are generally treated favourably, in contrast to black people (although this is rather due to a social construct than a biological one like beauty). So even though a white person did not choose to be white, it does not hurt being conscious of the fact that whiteness has given the white person a leg up on other races.

Similarly, being beautiful gives one a leg-up on uglier people. One study shows that the reason for physical attractiveness affecting a worker’s wage is that physically attractive people are more confident and have a better bargaining position to bargain for a higher wage. Furthermore, due to beauty stereotypes, employers wrongly attribute a higher skill to a physically attractive worker. Another study rejects the common myth that beauty is correlated with intelligence and health. However, due to a self-

fulfilling prophecy, teachers who expect good-looking kids to be more intelligent will therefore devote more attention to these kids, who in turn are more cognitively stimulated. In the whole it seems as if beauty influences a worker’s wage through a path dependent process. A more beautiful person will receive more attention in social exchanges, which increases their self-confidence, and will influence their bargaining position to increase their wage. There is also not much that can be done about beauty, as Hamermesh argues that makeup and plastic surgery only enhance beauty by a little, so the return of a small rise in wages is offset by the huge costs spent on these physically altering acts. So if you are beautiful, cash in on the subconscious way you manipulate people in your favour; if you are ugly, apply for a job at Abercrombie and Fitch and sue them if they do not hire you. And if you are a short, black, disabled ugly person, times have never been better.

FOOD CHOICES

By Jana Rautenberg

As an economist you want to use theories to support your arguments, facts to proof your point and statistics to test a hypothesis. But some things cannot be explained by pure logic and rationality. The fact that almost everybody finds it natural to eat certain meats, but would not touch others is rather a psychological phenomenon than an economic one. However, economics play a role if you take a further look at the consequences daily food choices can have, especially concerning meat.

Returning to the custom of eating a pork chop, but not to eat dogmeat balls, it is worth investigating from where this originates. The US-American psychologist Melanie Joy offers an answer: She argues that the perceptions we have about certain animals differ when it comes to eating meat. The habit of eating only selected kinds of animals stems from our ‘invisible believes systems’.

Furthermore, she explains that since it is generally not necessary to eat meat for survival anymore, it is a choice you make. “And choices stem from beliefs”. (http://www.carnism.org) Therefore, Melanie Joy implies that your beliefs about how you consider animals shape the choice you make regarding eating them or not. Thus, it is actually quite irrational behavior if you decide to cancel out meat products from your menu, since it is rather based on beliefs and emotions than on a utility function.

More and more people are making the choice to become a vegetarian or to rarely consume meat. At the same time the market for meat substitutes and vegetarian products is growing rapidly as well. The increasing market facilitates more competition between firms who all want to have a share of the pie. This is not only good news for consumers, who are facing more and better options, but also for companies

who want to distinguish themselves from others. By being aware of sustainable issues such as climate change, which go hand in hand with the food choices we make (mass meat production is the first cause for climate change), companies can make a strong point towards Corporate Social Responsibility (CSR). Increasing CSR provides firms not only with a competitive advantage, but also potentially attracts additional and a wider range of ethical consumers, therefore increasing market shares and in the end profits (Porter & Kramer, 2006). For these economic reasons, companies and supermarkets should not disregard the growing number of vegetarians and conscious eaters, but should instead embrace them.

An example how this could be done is demonstrated by the Dutch Supermarket chain Jumbo, which cooperates for now exclusively with a new meat substitute producer the ‘Vegetarische Slager’ (the vegetarian butcher).

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Business & Career

MALE-FEMALE INCOME DISPARITY

By Javid Allahverdiyev

‘‘Legislation to apply the principle of equal pay for equal work without discrimination because of sex is a matter of simple justice” - Dwight David Eisenhower

Male-female income disparity is

a major obstacle that we have faced for many millennia. Any given raw wage gap can be decomposed into an explained part due to differences in characteristics such as education, hours worked, work experience, and occupation, and an unexplained part which is typically attributed to discrimination. Women tend to avoid jobs in which males historically dominate and where they can be dropped off the work process for a long time (due to pregnancy, maternity leave etc.).

Employers who are interested in longterm contracts usually pay women less, or don’t hire them at all due to these drawbacks. But let’s don’t confuse this with direct workplace discrimination.

In the last decade the gender pay gap has become a major problem. Women all around the world are struggling for equal pay rights. This issue is considered important in many economically developed countries. These countries (especially the USA) have done a lot of research and surveys in order to investigate the problem. Statistics obtained from different countries proves that indeed inequality exists and it varies a lot across the world. Let’s have look at some statistical data. First of all there is inequality in income between women of different ages. Younger women are more closely approaching pay equity than older women. According to data provided by Andrew Beveridge, a professor of Sociology at Queens College, between 2000 and 2005 women between the ages of 20 and 35 earned more than their male counterparts in major US cities. There is also an income difference by industry, where women tend to earn more than men: physical, and social science technicians

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(102.4%), bakers (104.0%), teacher assistants (104.6%), and dining room and cafeteria attendants and bartender helpers (111.1%). On the contrary, jobs where the gaps are the largest are in physicians and surgeons (64.2%), securities, commodities and financial services sales agents (64.5%), financial managers (66.6%), and other business operations specialists (66.9%).

As I mentioned above, a number of factors affect male–female income disparity. Work experience is one of them as it affects an employee’s wage, and his or her chance to get a job. A lot of research has been done on this matter. In particular a report reveals that statistical analysis indicates that women’s gains in work experience during the 1980s account for about one third of the total narrowing of the gender wage gap over that time. Another factor that affects inequality are career interruptions such as childbirth and child raising. Due to this period women usually lose their work experience, and after coming back (if they return at all) they experience a decrease in earnings. These account for a large part of the gap in income. Researchers have found out that the gap in income between men and women is only 2 per cent right after graduation, but it increases to 12 per cent 10 years after graduation. Another interesting finding is that male’s wages decrease in earnings by 23 per cent after a long interruption, while this number is 25 per cent for females.

The small part of the gap is explained by direct discrimination or occupational sexism. It shows itself in lower wages and barriers on the career ladder. What causes occupational sexism? Clearly, gender-based stereo-

types: people more readily provide men with leadership positions than women, some employers wrongly assume that women will perform worse than men in particular fields. These stereotypes mostly dominate in fields where women are underrepresented, such as in technical fields and banking.

A famous term used in describing occupational sexism is the glass ceiling.

The glass ceiling is metaphor for the barriers women face in climbing the corporate ladder.

A number of policies have been enacted so far to prevent discrimination in different countries.They resulted in the abolishment of income discrimination, and had a positive impact on the problem as whole.

Clearly, in modern society women deserve to be equally paid, and should have the same chances of being employed, and promoted. As we have seen, a lot of studies, research and surveys prove that the majority of the gap is explained mainly by differences in career choices, levels of work experience and education. But still the small part of this gap accounts for direct discrimination.

Lifehacks

Students

Student Life

lifehack (lΛıfhak) noun any procedure or action that solves a problem, simplifies a task, etc, in one’s everyday life (Definition by the Oxford Dictionary)

One man’s trash is another man’s treasure.

It might happen faster than you can even notice, and suddenly one day, you sit in your room amidst books and furniture adding up to one little forest, clothes adding up to a herd of cows and a cotton field. You want to throw it away? Be economical! You might want to check Utrecht Free Ads on facebook first, and if nobody wants to buy your stuff, try Gratis ophalen in Utrecht en omgeving. If that doesn’t help, rent a new room: Kamer in Utrecht.

Languages: Free and Flexible...

Have you ever wanted to learn another language but cannot afford an expensive course? There are numerous online services which could be the answer, many of them for free. Check for instance Duolingo.com if you are interested in Spanish, French, German, Portugese or Italian. Another service is Livemocha.com, where you have a greater choice, but need to help other online learners as well.

Bonne chance! ¡Que lo pases bien!

Shortcut to Excel-lence Tired of always having to extensively search for functions on Microsoft Excel? Instead of right clicking your mouse and going on a hunt for the function you need, just press the Alt key and some basic buttons for shortcuts will appear on the top bar.

This also makes using Excel on a laptop easier since the mouse doesn’t need to be used that much.

Have you encountered lifehacks yourself and you want to share them with your fellow economists? Send them to editorial2@ecu92.nl and they might be published the next ECU’nomist!

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Reminder online booksale for literature first period 2013-2014 The online book shop is open again for next year’s second and third year students.

This online sale of the literature for the first period of next year is due on Monday the 12th of August, 23.59. Make sure to buy your books before this deadline.

The online bookshop is accesible via www.ecu92.nl/education/books-shop.

The actual booksale for ordered books will take place on Tuesday the 3rd of September in Spinoza Hall (canteen) from 10 AM to 4 PM. Make sure to bring your confirmation e-mail with you that day! Books can be paid either in cash or by debit (no credit cards!). For those who either did not meet the deadline or just did not order their books, there will be an open sale on Monday the 9th of September also in Spinoza Hall (canteen) from 10 AM to 1 PM. Kind regards, The Board 2012-2013

Epilogue

Colofon The ecunomist is an edition published by the Editorial Committee, on behalf of Study Association ECU’92 Redactieadres Study Assocation ECU’92 Kriekenpitplein 18 3584 EC, Utrecht Telefoon: 030 253 96 80 E-mail adreswijzigingen: secretaris@ecu92.nl E-mail redactie: editorial@ecu92.nl Editor-in-chief Kai Strohmeyer Editors Thomas Huigen Leila Maria Scott Ecunomist Online Sander Bouw Design & Lay-out Mithra Madhavan, Cyriel Nysten Writers Javid Allahverdiyev Marco Engler Sofia Monshouwer Natalia Neustrova Dea Tusha Distribution Partly directed via postal address and partly via distribution available at Spinoza Hall and Adam Smith Building.

IMPORTANT

The ECU’nomist will be published predominantly online in the future. You can already check the current and past editions on www.ecu92.nl/media. In case you still prefer a hardcopy edition, a limited number of prints will be made available at Spinoza Hall and Adam Smith Hall.

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Jouw studievereniging wil het je zo voordelig en makkelijk mogelijk maken.

Dus hebben ze een boekenleverancier die daarbij past.

Jouw studievereniging werkt nauw samen met studystore.

En dat heeft zo z’n voordelen.

Doordat we snugger te werk gaan, kunnen we jouw complete boekenpakket snel aanbieden tegen een scherpe prijs.

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