<p> August 22, 2016 THE HELLER SCHOOL FOR SOCIAL POLICY AND MANAGEMENT BRANDEIS UNIVERSITY HS245f ECONOMICS I Fall Semester 2016, Module I</p><p>CONTACT INFORMATION FOR INSTRUCTOR & TEACHING ASSISTANT (TA) Instructor & TA Location Email & telephone Ricardo Godoy Heller 153 [email protected]; 6-2784 Stephanie Hurley (TA) Heller 153 [email protected]</p><p>DAY, TIME, AND VENUE OF COURSE Activity Daya Time Venue Class Mondays 2:00-4:50pm G4 Office hoursb Godoy Wednesdays 12:00- Heller 153 [Except 9/20] 1:45pm Hurley c Usually 12:00- Venue will be communicated by the TA Thursdays 1:45pm a See schedule at the end of the syllabus for changes in the day of class or review session b or by appointment. c Review sessions will be held during office hours. </p><p>CONTENT AND GENERAL APPROACH Content. The semester-long course of introduction to economics is split into two linked modules: Module I covers basic economic principles and Module II applies the principles to the nonprofit world and the public sector. Module I is sub-divided into two logical, sequential, and linked phases: (a) the theory of the market or when markets work (supply-demand framework, elasticities, and efficiency) and (b) market failures or when markets do not work (externalities, public goods, and government policies). This syllabus is for Module I. General approach. In the course we try to infuse principles of basic microeconomics to understand foundational topics of interest to people working in nonprofits and the public sector. These principles include concepts such as demand/supply, public goods, marginal costs, myopia or impulsivity, and causal effects. For instance, analysis of past funding levels by government agencies or by private foundations in relation to the number of applications received from nonprofits allows one to assess areas likely to face hot, moribund, or flat demand and what goods or services to supply with the highest likelihood of funding success. Understanding where markets fail helps to identify public goods and services where nonprofits are likely to have the largest room for maneuver. Principles of marginal costs and myopia matter in the design of effective nonprofit interventions, and attention to causal effects matters when evaluating whether nonprofit interventions produce meaningful impacts.</p><p>MBA PROGRAM LEARNING GOALS  Financial Literacy: Students will develop a financial literacy skill to identify, organize, and analyze quantitative and qualitative information to solve business problems.  Communication skills: Students will be able to effectively convey knowledge and express perspectives related to management and policy issues using oral, written, visual, and multimedia forms of communication.  Collaboration skills: Students will develop practical skills to support effective collaboration and conflict management within and across programs, organizations, </p><p>1 cultures, and sectors and among multiple stakeholders as a means to advance a social mission and promote programmatic/organizational/systematic efficiency.</p><p>COURSE LEARNING GOALS.  Familiarity with the core principles of microeconomics  Learn how to apply these principles to nonprofits and the public sector  Read and interpret basic economic data, and  Understand when you can and cannot draw causal inferences from economic data</p><p>READINGS, PROBLEM SETS, AND CLASS NOTES Readings. We will use the following textbook for both module 1 and module 2: Dean Karlan and Jonathan Morduch (K-M), 2014, Economics. New York: McGraw Hill. The book only comes in hardcover. The bookstore will have copies to buy or rent, you can purchase E- texts online, you can explore renting the textbook through Amazon, or you can try to buy a used edition online. Problem sets. Each chapter assigned will have a problem set, which may or may not come from the textbook. The problem sets are meant to reinforce the material covered in the lecture and readings and will not be graded, but suggested solutions will be posted in the course website (Latte). Class notes. The purpose of the class notes is to clarify, expand, or apply concepts from the textbooks, and will come in two forms: [a] Some notes will be made available before the class starts so students can follow the notes as the class unfolds and [b] other notes will be made available after the class. The latter notes will try to answer questions that students found unclear after the readings, problem sets, or lecture. </p><p>TEACHING ASSISTANT & REVIEW SESSIONS Except for September 1st, when the TA will be away, the TA will hold review sessions on most Thursdays. You are not required to attend review sessions. If you have questions you would like the TA to address, send the TA an email by Tuesday at 5pm (or about two days before the review session) so that the TA and/or the instructor have time to prepare a response by the time of the next review session. During the review sessions the TA will do one or more of the following tasks: (i) Try to answer questions that were sent to the TA before the review session (ii) Go over material covered in class, assigned problem sets, or questions from the quiz that remain unclear, and (iii) Go over new material to strengthen concepts covered in class. </p><p>MATH REQUIREMENTS The course will require some skills in basic math, including the ability to read and interpret graphs and tables. If you have been out of touch with math, review some of the following topics before the course:  Graphing a linear equation with a constant  Interpreting a slope and a constant  Solving a system of two linear equations with two unknowns  Calculating percentage change and slopes The textbook covers these topics in Appendices A-C for chapters 2-4 and Appendix E for chapter 5. I have prepared two sets of math review notes that expand on these Appendices. The first set of notes will be made available to the class before the first class and expands on the Appendices A-C; the second set of notes will be handed out as we get closer to class #4.</p><p>2 [i]. First set of notes covers math concepts necessary for chapters 2-4, but the math concepts reappear throughout the semester. Please try to read this material before class #1. About one week before class starts we will post in our course website a practice problem set that will help you assess your own mastery of some of the math topics in Appendixes A-C. You will not need to turn in an answer to the practice math problem set, but you should use the problem to brush up on your math skills for the course. If you have trouble with the problem set, see the TA or instructor during the first two weeks of the course to discuss what we can do to bring up your math skills to the MBA level. We will reserve part of the first class to go over the math review problem set, and suggested solutions will be posted in our website after the first class. [ii]. The second set of notes cover math concepts necessary for chapter 5, will be handed out on class 3 so that it can be done before class 4 when we will cover chapter 5.</p><p>GRADING POLICIES Assessment criteria % of final grade [a] Quizzes 60% [b] Class project 25% [c] Attendance 15%* [*] 15% is equivalent to a half-letter grade (e.g., from B to B+) once the overall final ranking from [a]+[b] is computed. </p><p>[a] Quizzes (60%). There will be six quizzes at the start of classes 2-7 (Table 1). Each quiz will last 20-30 minutes. All the material, such as class notes, problem sets, and readings up to and including the material to be covered on the day of the quiz, can be included in the quiz. For example, quiz #1 on September 8 will cover all the lecture material + readings for class #1 plus the readings for class #2 (even though we will not have gone over the readings for class #2), but not the problem for class #2. All subsequent quizzes will be cumulative; you should expect questions from earlier quizzes to re-appear in later quizzes. </p><p>Students’ numerical scores from a quiz will be ranked and assigned the following letter grades: Top 16% of scores = A [There is no A+] Next lowest 16%= A- Next lowest 16%=B+ Next lowest 16%=B Next lowest 16%=B- Bottom 16% of scores=C+</p><p>Your quiz grade will be determined by your class rank, not by the absolute score you receive on t he quiz. When computing the final grade, we will drop the quiz with the lowest score, add up the numerical scores of the remaining quizzes, and then we will assign a new rank based on the overa ll score for the module based on your best quizzes. Do not worry if you miss a quiz because the q uiz you miss will be the one that we drop when computing the final grade. If you miss more than one quiz you will receive a zero in that quiz. There will be no make-up quizzes. </p><p>Quizzes will be closed books – no cell telephones, calculators, notes, or computers are allowed.  You cannot speak with anyone during the quiz other than the proctor  If the question requires computation, make sure to set up the problem – you will receive full credit if you set up the problem correctly even if your calculation is wrong  If you disagree with how we graded a question, do the following:</p><p>3 o Let the TA know about your disagreement within six days after you receive the graded quiz. For example, if we return the quiz on a Tuesday, you should notify us of a disagreement by next Monday at the latest. o Disputes beyond the deadline will not be accepted. o You should submit the reasons for your disagreement in writing, staple your written explanation to your quiz, and hand both to the TA within six days after you receive the graded quiz.  Any evidence of cheating during the exam will be sent immediately to the Department of Student Rights and Community Standards of Brandeis (see section on “Academic Integrity” below)  Suggested solutions to the quiz will be posted in the course website when we return the quiz. </p><p>[b] Class project (25%). See instructions at the end of the syllabus.</p><p>[c] Attendance (15%). If you attend all classes, your combined final grade based on the quizzes plus the class project will be increased by half a letter grade (e.g., from B+ to A-). If your final grade based on quizzes and attendance is an A, your overall final grade for the course will not change. We will monitor attendance in two ways: (a) whether you take each of the six quizzes and (b) an evaluation of each class that all students must complete at the end of each class (see section entitled "Feedback to and from students"). Whereas missing one quiz will disqualify you from perfect attendance, having to leave before the class ends will not – provided you let the instructor know before the class meets that you need to leave early. </p><p>CLASSROOM POLICIES  Before class, read the assigned material and complete all assigned problem sets. If you get stuck on a problem, try it anyways, and we can address questions during class or during the TA sessions.  Concert rules apply: You can’t leave the classroom unless there is an emergency, and must remain quiet during class, unless asking or answering questions  Airline take-off/landing rules apply as well: all cell telephones and other electronic equipment other than your personal computer must be turned off during class.  Personal computers or tablets can be used to take notes during class, but should not be used for any other purposes, as a courtesy to your classmates.  Asking questions during class: Feel free to ask any question related to the class during class time. The only bad question is the question that is not asked. That said, o Be sensitive to the needs of other students and do not monopolize class time o If you do not get around to asking your questions, you can . See the instructor during the break or at the end of the class . Consult the TA or the instructor during office hours . Or include the questions in the feedback form at the end of each class (see next section)</p><p>FEEDBACK TO AND FROM STUDENTS Feedback to students: You will receive the suggested solutions for all quizzes and problem sets every week, so you should be able to monitor your performance as the course unfolds. If topics remain unclear after the class or quiz, or after you have read the suggested solutions, contact the TA or the instructor. Feedback from students: </p><p>4 [a]Weekly. During the last five minutes of each class students will complete a brief, anonymous feedback form online. At that point you will be able to indicate the specific topics that remain unclear, or give any other feedback related to the class (e.g., temperature, noise). We will try to respond as quickly as possible either by putting the answers on the course website or by taking up the topics in the next class. [b] Mid-point. Between classes 4 and 5 (Sept 19-Sept 26) you will be asked to complete a mid-term evaluation in Latte. This evaluation will allow you to step back and reflect on broader aspects that work and that do not work for the entire course up until that point. We value your feedback and will take all comments into consideration for the second half of the course.</p><p>ACADEMIC INTEGRITY: Academic integrity is central to the mission of educational excellence at Brandeis University. Each student is expected to turn in work completed independently, except when assignments specifically authorize collaborative effort. It is not acceptable to use the words or ideas of another person - be it a world-class philosophers or your classmate – without proper acknowledgement of that source. This means that you must use footnotes and quotation marks to indicate the sources of any phrases, sentences, paragraphs or ideas found in published volumes, on the internet, or created by another student. Violations of university policies on academic integrity, described in Section 3 of Rights and Responsibilities, may result in failure in the course or on the assignment, and could end in suspension from the University. If you are in doubt about the instructions for any assignment in this course, you must ask for clarification.</p><p>DISABILITIES If you have a documented disability on record at Brandeis University and require accommodations, please bring it to the instructor’s attention prior to the second meeting of the class. If you have any questions about this process, contact Mary Brooks, Disabilities Coordinator for The Heller School at x 62816, or at [email protected].</p><p>5 Table 1. Schedule and list of topics Class # Date Topics Quiz Homework to be # completed BEFORE class Module 1, part 1: The theory of the market, or when markets work 1 Monday 8/29 Introduction to the n/a  K-M: Chapters 1-2, Appendices A-C course, math review,  Article: “Financing, Not Fundraising: [review session the power of economics Calculate Opportunity Costs” by Neil Thursday 9/1; 1- Edgington 1:45pm; G4]  Problem set #1: Math review [i]</p><p>Monday 9/5 (no class) [Review session Wednesday 9/7] 2 Thursday 9/8 Markets Q1  K-M: Chapter 3, Appendices A-C  Article: “Business of Giving: Nonprofits Have the Demand, Not the Supply” by C. Warren Moses  Problem set #2  Final project: 1 paragraph due, identifying topic and data source a 3 Monday 9/12 Elasticity Q2  K-M: Chapter 4+ Mini lesson on deflators  [review session  Article: “Pricing Preventative Health Thursday 9/15] Products” by J-Pal  Problem set #3+math review ii] for chapter 5 4 Monday 9/19 Efficiency Q3  K-M: Chapter 5  Problem set #4 [review session  Final project: 1 pager due, and draft of graphs Thursday 9/22] and statistics b</p><p>5 Monday 9/26 Costs of production & Q4  K-M: Chapters 12-13 perfect competition  Article: “The Nonprofit Starvation Cycle” by [review session Ann Goggins Gregory & Don Howard Thursday 9/29]  Article: “Why Don’t Suburbanites Want Charter Schools?” by Laura McKenna  Problem set #5 Monday 10/3 (no class) [Review session Thursday 10/6] Module 1, part 2: Market failures or when markets do not work 6 Monday 10/10 Market failures I: Q5  K-M: Chapter 6 Government  Article: “Is It Time to End the Tax Deduction [review session interventions for Charitable Contributions?” by Rob Thursday 10/13] Meiksins  Problem set #6 10/17 (no class) [Review session Friday 10/21] 7 Tuesday 10/25 Market failures II: Q6  K-M: Chapters 18-19 Externalities, public  Article: “Seriously, Is This the Best We Can goods & common Do?” by Bruce Mohl resources  Problem set #7  Final project: 4 pages due electronically by start of class</p><p>6 a One page with the title of the project, the names of up to three students in the project, the title of the project, and description of the data (e.g., # of years, type of data, and websites where data was found). Due in electronic form by the start of the class. b This should be a draft of the report described in "What to turn in" in the next page. Due in electronic form by the start of the class.</p><p>7 FINAL CLASS PROJECT TO BE DONE THROUGHOUT MODULE I</p><p>Due: Tuesday, October 25, 2016 - submit electronically by the start of class</p><p>Learning objectives:  Identify the areas where nonprofits are likely to face the weakest and the strongest demand in the near future  Compute real, inflation-adjusted data from nominal data  Estimate secular or long-term trends in o Nominal and real, inflation-adjusted investments in nonprofits o Employment in nonprofits  Compute elasticities of employment with respect to investment</p><p>Motivation and description: Students in the MBA program often have nonprofits as a final employment goal, but what does past economic data on nonprofits tell us about future employment prospects in nonprofits? The past can serve as an imperfect guide to the future, and some of the tools learned in the course can help you gauge future trends in employment. The purpose of this exercise is to download annual investment and employment data from nonprofits and -- using some of the principles of demand and supply and elasticities learned in the courses -- estimate past trends and, in so doing, gauge areas of likely future growth in nonprofits. There is no one cookie-cutter way to approach this problem, so you will have to use your imagination.</p><p>Example: Suppose you are interested in employment in nonprofits working on maternal and child health. Such nonprofits most likely must secure funding from organizations like the National Institute of Health, the Gates Foundation, USAID, etc. This assignment would ask you to download annual data for one or more of the following variables as far back as you can go: (a) Annual funding levels by one or more organizations that invest in nonprofits working in maternal and child health (b) Number of applications received or/and grants awarded in these areas by the funding organizations (c) Employment by or the number of nonprofits working in this area.</p><p>The purpose of the assignment is to gauge employment prospect in nonprofits working in maternal/child care. Therefore, with the above information you could do one or more of the following: (i) Plot annual levels of employment over time by one or more nonprofits working in the area along the Y axis, and estimate annual growth rates (data from item c above plotted over time). This might be apt if, say, you are interested in assessing regular employment in one or more nonprofits that work on maternal and child health (e.g., Partners for Health, Gates Foundation) (ii) But suppose you wanted to assess what it might be like to work as a fundraiser in an nonprofits that concentrates on maternal and child health. Then you would want to plot in one graph data from (a) and (b) above along the Y axis and time periods along the X axis. Funding levels by the organizations that you would be approaching, and the number of applications received by these organizations or the number of grants awarded by these organizations would serve as a first step in showing you how competitive the field might be.</p><p>Remember that this is an example, the more important point of which is to get you to collect economic data and analyze data to learn about what the future might hold in employment. There might be other ways of reaching this goal, provided that they are empirical, focus on economic </p><p>8 data, and relate to employment prospects. Although we have used maternal and child health as an example, you could focus on nonprofits working in other topics, such as prisons, education, disadvantaged youth, etc. </p><p>Where can we find data for the project? [1] Within Brandeis: [a] During the first review session (Thursday August 1st, 1-1:45pm) Jason Bernard, Associate director of Academic Technology, International Business School, Brandeis [[email protected]] will speak about how to find data on nonprofits; the class will meet in G4. This session is not mandatory, but recommended to ensure you do not fall behind in the tasks for the final project. [b] Set up an appointment with Ms Margarita Corral at the Brandeis Library ([email protected]). Beyond helping you find data for this project, she often holds workshops early in the Fall semester on basic computer programs (e.g., Excel) and can assist you finding quantitative data for other projects. [c] Check the business and economic page of the Brandeis library: http://guides.library.brandeis.edu/business [2] Federal and state agencies (e.g., Department of Education, Department of Health and Human services, National Institute of Health) that finance the work of the non-profit sector are a good place to start to look for project disbursements. [3] Another place are nonprofits that finance projects (e.g., foundations like Gates, McArthur). </p><p>What to turn in:  Page 1 – title of project and name of students in team, in alphabetical order [no more than 3 students/team]. Next to the name of the student include one sentence on what the student did for the project (e.g., "Larson was in charge of identifying data sources"; "Smith was in charge of the graphical analysis", etc.)  Page 2 – graph(s). As noted in sections i-ii above, graphs will vary depending on your focus, but should include time trends of such things as investments by funding organizations or various indicators of nonprofit activity (e.g., # of applications, # of people employed by nonprofits, # of grants awarded). The title of graphs should be very descriptive, and the labels should be clear (e.g., indicate units). An example of a well titled graph might be "Annual (2002-2015) funding levels in real terms by the Gates Foundation in project of preventive care for maternal and child (<age 5y) health". The graphs on this page should be able to stand on its own -- that is, the reader should be able to make sense of the table without any additional information. If necessary, include notes at the bottom of the graph to clarify points that might be ambiguous. For example, if you are showing funding levels in real terms, indicate the deflator used.  Page 3 – doubled spaced description of findings and conclusions, 11 font, 1-inch margins. Based on the data I would expect you to compute growth rates (%/year) for the outcomes you selected (e.g., number of applications, inflation adjusted investments over the time period for which you have data). Since you only have one page to describe your findings, focus on the most important points and try to draw conclusions about the strength of demand for work by nonprofits in the topic chosen.  Page 4 – indicate website where you downloaded your sources. No bibliographic references are necessary, but if you consult sources, then cite them on pages 2-3 using the style of the journals Nature or Science because they take up less space. Learn to use EndNote X7 if you do not already know it since it will automatically insert citations in the style of your choice in your manuscripts. A fictitious example follows:</p><p>9 "Poverty in the USA is widespread, with 23% of the population under the poverty line1-2."</p><p>References cited 1 Smith, A. et al. Poverty in America, 2015. Am. J. Poverty 100,821-825 (2016) 2 Patel, G. The great gap. PLos One 11, e0147854 (2015)."</p><p>Grading criteria: To receive full credit groups must do the following  Submit two intermediate progress reports (see Table 1); the second intermediate progress report is a draft of the final report.  Submit the final 4-page report.</p><p>Scoring criteria: All groups will have a perfect score at the start of the course. The class projects will be graded as follow: A=10, A-=9, B+=8, B=7, B-=6, ≤C+=5. One point will be deducted for each of the following items:</p><p> Submit two intermediate reports and final report on time [i.e., in electronic form by the start of classes 2, 4, and 7; see Table 1]. If you submit one item late, you will have a point deducted. Recall that all intermediate reports and the final report are due before the start of class.  Overall format (e.g., font size, page limit)  Spelling and grammar (use spell and grammar check before turning in assignments)  Failure to cite if you draw on information from other sources  Title and label of graphs (see instructions above)  Incorrect reading of graph [e.g., if the Y axis is # of people employed in the organization and the X axis contains years, and you say that "employment declined by **%/year" (incorrect) as opposed to "employment declined by ** people/year" (correct)]  Faulty logic or incorrect inferences: By this we mean drawing conclusions that are not supported by the data. If the data shows ambiguous results, then acknowledge this fact. Anything else?</p><p>10</p>