Archive of posts filed under the Economics category.

Math Lesson: Analyzing Economic Measures in a Downturn

My latest contribution to the New York Times Learning Network is a math lesson built around gathering, representing, and analyzing economic indicator data.

http://goo.gl/Rcc50

By getting data on Real G.D.P., personal income, corporate profits, and unemployment from official sources like the Bureau of Economic Analysis and the U.S. Department of Labor, students explore positive and negative correlations between the various economic indicators.

In addition, students can explore the relationships between graphs of quantities and their rates of change by creating and comparing graphs of percent change.

www.MrHonner.com

What Costs More in 2011?

This is a nice representation of Consumer Price Index data from the outstanding FlowingData.com:

http://goo.gl/dkthI

Charting the change in prices from March 2010 to March 2011, transportation and education prices went up the most, while communication and apparel dropped a bit.  A nice feature of this infographic is that it includes inflation as a benchmark; it’s easy to see here that even though food prices increased, their increase was consistent with inflation overall.

The creator of this infographic wonders why the government itself doesn’t do what FlowingData.com does:  namely, why doesn’t the Bureau of Labor Statistics create simple, easy-to-understand graphics like this with its data, rather than just publishing a text file full of numbers every month?

That’s a good question, and a good opportunity to get students involved!  Making data easier to understand means making data more useful, so take a look at the Bureau of Labor Statistics (http://www.bls.gov/), the Center for Disease Control (http://www.cdc.gov/), or some other government agency.  Grab some public data, create some visual representations, and make the data understandable!  And use FlowingData’s great work here, and elsewhere, as a guide.

www.MrHonner.com

Analysis of NBA Finances

This is a comprehensive and insightful look into the NBA’s claims of financial distress from Nate Silver:

http://goo.gl/VJeQs

As the NBA prepares to battle the player’s union over revenue, the league has made several public claims about how they have been losing money for years.

Silver takes a deep look into those claims.  He crunches the numbers and compares player revenue as a share of league revenue across the four major sports leagues; he looks at salary growth relative to league growth; and he also discusses some of the dubious accounting tricks teams and leagues use to make profits disappear!

As usual from Nate Silver, this is a very interesting and readable application of mathematics and statistics.  His conclusion is summed up best by a recent message from @fivethirtyeight on Twitter:  “If David Stern really thinks the NBA lost $370 million last season, shouldn’t he have fired himself?” Click here to see more in Sports. www.MrHonner.com NBA Franchise Values Every year, Forbes Magazine rates the value of all the franchises in the NBA. Here is the complete list: http://www.forbes.com/lists/2011/32/basketball-valuations-11_rank.html Surprisingly, the New York Knicks are now the most valuable team in basketball, topping the list at$655 million.  Their 12% increase in value since last year certainly has something to do with the impact of Amar’e Stoudemire, who has raised both the team’s competitiveness and marketability.  The fact that the Knicks carry no debt probably plays a part in their high valuation as well.

It appears as though the Knicks’ signing of Stoudemire last year to a 5-year, $100 million contract was a good move after all, despite my strong belief that it was a mistake. It’s no surprise that LeBron James’ decision had serious financial ramifcations for both teams involved. The value of the Miami Heat rose 17% to$425 million.  That’s an increase of nearly $60 million. The value of the Cleveland Cavaliers dropped 26% to$355 million, a decrease of nearly $130 million. One might wonder where that extra$70 million in value went!

www.MrHonner.com

Efficient Ticket Hypothesis

In a past post, I wondered how a local museum theater could make money showing movies to limited audiences.  Well, here is a step in wrong direction, business-wise, anyway:  the $0.00 ticket. All kidding aside, Free Fridays are a great way to get people into the museums, and it’s probably pretty good for business overall. The MoMA was packed with people, and the gift shop–and it’s$40 photobooks and $23 T-shirts–was equally occupied. An interesting question is then “How much does the museum make on each$0.00 ticket?

An uninteresting question is “why didn’t the security guard just let me in without a ticket, instead of demanding that I go grab two from a big pile on the front desk and then not collect the tickets from me anyway?”

It was enough to make me consider asking for my money back.