March Madness Could Cost Employers $4B in Lost Productivity

The outplacement firm Challenger, Gray & Christmas has put out a report saying that workers distracted by their college basketball March Madness brackets are going to cost businesses billions in revenue. This firm estimates that about 20% of the U.S. work force is involved in an office March Madness pool this year, a number that has grown in recent years. Challenger, Gray & Christmas estimated that the loss in workers productivity due to March Madness related distractions totaled nearly $4 billion dollars in revenue during the opening week. The outplacement firm also estimated that every hour of the workday that gets devoted to March Madness will cost employers $1.3 billion in revenue. Ultimately Challenger, Gray & Christmas recommends that employers embrace the basketball tournament stating "Efforts to suppress the 'madness' would most likely result in long-term damage to employee morale, loyalty and engagement that would far outweigh any short-term benefit to productivity,".

It certainly seems like March Madness has been growing in popularity over the years, but I have never thought of its economic impact in terms of costing business billions in revenue. Previously I had only thought about the tournament from the economic standpoint of the revenue added into the economy or the amount of money wagered on the games. This report is really eye-opening in terms lending some insight into how a big sporting event like the March Madness impact the typical American work day, and how that impact can add up and result in billions of dollars lost.

http://www.nbcnews.com/business/business-news/march-madness-could-cost-employers-4b-lost-productivity-n538021

How does the US gender pay gap compare internationally? Pretty well, study says.

This article considers the pay gap between women and men in the United States compared with other countries around the world. The United States is known for its pay gap, however a new study by Glassdoor has taken into consideration only the unexplained factors of the gender pay gap (the ones that can be presumed to be bias) and ranked the US against other countries. The pay gap can mostly be explained by factors such as the sorting of men and women into different occupations, and worker differences, and surprisingly the United States and other countries are pretty even when only the unexplained aspect is used. The unexplained aspect means that the two workers of different genders are similar in skill but have different wages, suggesting discrimination. Other differences in the pay gap between men and women stem from entry barriers and social pressures that prohibit women from entering certain industries. 

The article states that even though the United States in this study has similar 'unexplained pay gap' to other countries around the world, this does not mean that there isn't a problem. The gender pay gap in the US is significant  and stems from systematic problems in society such as educational access. Based on this, the article poses the question: "Is this better than a small gender gap that cannot be economically explained?"

http://news.yahoo.com/does-us-gender-pay-gap-compare-internationally-pretty-164734793.html

Iran's economy is suffering from corruption

     In the article, "Iran's economy is suffering from corruption" it discussed many of the problems and conditions existing in Iran today. Unemployment rates are at extremes and there are almost 8 million people unemployed. 

       One thing mentioned in the article was "To resolve this problem there is a need for over $220 billion in investment, experts and reviews indicate." Investment would have a big impact in recharging Iran's economy and raising the standard of living but the corruption of the government seems so bad that this will not occur. The article mentioned how there are 3 million retired citizens in Iran and how the government used their retirement savings to support terrorism and nuclear projects. 

       In addition the current regime has shut down industries that play a pivotal role in the countries output. With this corruption there will be little capital flow continuing to cripple Iran's economy. 

http://www.ncr-iran.org/en/news/economy/20063-iran-s-economy-is-suffering-from-corruption

Oil Recovery Hits Saudi Devaluation Bet

This article is about the losses experienced by investors who have bet that Saudi Arabia will abandon its currency peg. Due to oil rebounding to 40$ a barrel forward contracts betting that Saudi Arabia will devalue its riyal would have fallen about 1.8% since their peak in January. Many different U.S. hedge funds were expected to be betting against this currency in February. The Saudi riyal was pegged at the rate of 3.75 per U.S. dollar in 1986 and the kingdom has taken measures intended to deter speculating against the currency. Chief economist Simon Williams for HSBC Holdings Plc doesn’t see the recent losses in oil forcing policy makers to devalue the riyal. Currency forward contracts have also declined for other countries in the Gulf Cooperation Council including the United Arab Emirates and Oman. Saudi Arabia and other countries have sold debt from their reserves to counter recent lower oil revenues. 

http://www.bloomberg.com/news/articles/2016-03-27/traders-out-of-pocket-as-oil-recovery-hits-saudi-devaluation-bet

Growing Up in a Bad Neighborhood Does More Harm Than We Thought

What type of neighborhood and environment you grow up in can play a big role in ones future economic success.  Recent research shows that it may play a much larger role than previously thought. The government did an “moving opportunity experiment” which From 1994 to 1998, invited low-income families living in public housing to enter a lottery that could reshape their lives.  The lottery randomly assigned a kind of experimental treatment to winners, while the losers served as a control group. The winners received housing vouchers that helped them pay the rent if they moved out of public housing. The losers stayed in public housing for as long as they remained eligible. Over the years the families were tracked and the study found that kids who moved when they were young were able to establish higher earnings than those whose families did not win the lottery. A newer study found that although the neighborhood can play a large role, parents attitudes and willingness to keep the bad things away from their kids also played a large role in future income.

http://www.nytimes.com/2016/03/27/upshot/growing-up-in-a-bad-neighborhood-does-more-harm-than-we-thought.html?ref=economy

A Bitter Harvest

This article takes a look at how the coffee industry of Kenya is being affected by regulation within the country and how the industry seems to compare to deregulated Uganda. Coffee was once Kenya's biggest foreign-exchange earner, but that is not the case today. The country's record crop which was in 1988 totaled to 127,000 tonnes. Last season the crop totaled to less than 45,000 tonnes which was only 0.5% of the total coffee production worldwide.
One reason this is happening is that Kenya has a growing middle class. Although this is good the land that is being developed for their housing is often times coffee plantations which clearly would drive down output. Also, 60% of the country's production is due to smallholders which are consistently leaving the industry to grow other crops due to low prices.
However, if we look at neighboring Uganda we see that their coffee production has doubled since 1990. According to the article Uganda is also fetching a much higher price for their production. In Uganda much of the beans are bought directly from the farmers while in Kenya all the beans are taken to a regulated exchange to be sold. The fear surrounding the Kenya exchange is that groups are colluding in form of a cartel in order to drive down the prices of the beans. According to the article it seems that the industry has flourished since being liberalized in 1992 while Kenya's has floundered since regulation has been introduced. No matter what the true cause is, it is troubling to see that Kenya's once powerful industry is performing so poorly today.
http://www.economist.com/news/finance-and-economics/21695564-cautionary-tale-about-overregulated-industry-bitter-harvest

Cyber Crime

http://www.economist.com/news/business-and-finance/21694968-online-thieves-used-fake-emails-steal-money-101m-bank-heist-unseats

This article brings to light the ease at which people can electronically access and anonymously receive money. The Bangladesh Central bank asked the NY branch of the federal reserve to transfer $1 billion to private bank accounts in Sri Lanka and Philippines.

The criminals were able to get $101 million before authorities caught on. This has the potential to change people's faith in banks. If countries can lose their money through cyber crimes, than individuals also face a similar problem.  This could cause consumers to save money as bills rather than in banks. It changes the trust people have in letting banks protect their money.