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April 21, 2016

Tax compression is a minus for teaching math in Oregon

joe_stone2016Oregon’s complex property tax system sometimes adds up to problems for eighth-graders who rely heavily on teachers for shaping their skills as they enter advanced math courses.

A study led by two University of Oregon undergraduate economics students has found that math scores go down by 5 percent in the first year of Oregon’s two-year budget cycle when tax-compression rules are triggered in local school districts. The problem is the unpredictability of funding that disrupts planning and teacher assignments.

“I was stunned,” said co-author Joe Stone, professor emeritus in the Department of Economics, who supervised the research of Matthew Davis and Andrea Vedder in an honors economics course. “Because there is so much going on, how could you pull out this one thing from something that can barely be explained — tax compression? It is about timing of knowing how much money you have to work with.”

Their paper in the winter 2016 issue of the Journal of Education Finance emerged from research based mostly on data collected from 2006 to 2012 by the Oregon Department of Education.

Tax compression is complicated. It is tied to voter-approved measures in the 1990s. Measure 5 put a cap of $5 per $1,000 on property taxes based on real market value for education. Measure 50 set a 3 percent annual limit on the growth rate of properties’ assessed values, which for many homes eventually created a gap between the taxable assessed value and true market value.

An example of a district facing tax compression, Stone said, is when voters approve a new tax levy for education. If local taxes are already at one of the caps, local schools do not receive full funding from the levy. In short, only tax revenue up to one-half of one percent of a property’s assessed value is collected and distributed to schools, no matter how high of a levy the voters approve or how much the property might be worth on the market.

“There are multiple limits that apply in different circumstances,” Stone said. “Basically, taxes are compressed when a local district is affected by one of those limits, revenues are curtailed and school districts receive less money than the public generally perceives.”

Davis and Vedder initially found a correlation between tax compression and math test scores. Districts with the most-compressed taxes had the lowest scores. Stone challenged his students to dig deeper and find out why, since the preliminary analysis had shown that compression, overall, didn’t affect district budgets over a whole cycle.

Davis and Vedder found the cause: School districts dealing with tax compression in the first year of a budget cycle don’t know how much funding they will receive from the state until the school year is well underway.

State budgets are approved usually in early summer. Districts dealing with compression receive updates from July to well into October, but they don’t know their funding totals until calculations are completed.

“This is not much help in planning your school year,” Stone said, because allocations of district resources are made before school begins. His students found examples of district decision-making tied to these notifications.

In one urban school district, uncertainty prompted the reassignment of hundreds of teachers to outside of their subject areas to meet other needs under an expected budget. When their allocation arrived, administrators learned they had a better budget than projected.

“In essence,” Stone said, “the students found that school districts that are confident are better able to move forward with their planning, but those that are not confident must make decisions based on what information they have been given. It’s the first year when this is important. By the second year, budgets are better settled.”

Davis and Vedder have graduated. Davis is director of civic engagement for the League of Conservation Voters in Washington, D.C., and Vedder is a contracts assistant for Writers House, a New York City-based literary agency.

—By Jim Barlow, University Communications
Around the O original post here

November 25, 2015

UO Econ Major Kevin Frazier Named Rhodes Scholar Finalist

Kevin Frazier PictureUniversity of Oregon senior economics major and honors student Kevin Frazier has been named a finalist for the renowned Rhodes Scholarship, awarded to students for exceptional academic achievements, strength of character and commitment to the common good.

Sixteen regions in the United States have each selected 12-16 applicants as finalists. Only two from each region will be chosen as Rhodes Scholars come Saturday, Nov. 21.

That’s when Frazier, a student in the Clark Honors College, and the other candidates for this region gather in Seattle for final interviews. The two scholars will be announced that evening.

The application process has been a couple years in the making for Frazier, a senior majoring in economics. It requires eight letters of recommendation — four from the UO and four from the community — along with a 1,000-word personal statement of interest and a professional resumé.

Of course, it’s all worth it if he gets the chance to study at the University of Oxford in the United Kingdom, pursuing a three-pronged degree of philosophy, politics and economics.

“I’m really excited about that because you get to hone your skills in three very different fields, and because I eventually want to be making policy that is not partisan-oriented, but pragmatic,” Frazier said. “Then you add the fact that you’re on a campus with some of the oldest libraries in history and it’s just a hub of really smart people that want to learn about the world.”

Since 1904, 32 Americans have been selected each year for the Rhodes, which provides a full-ride scholarship for the student to pursue one or more degrees at Oxford. Applicants come from all 50 states and represent more than 300 colleges and universities, joining other Rhodes recipients from around the world.

Frazier’s recognition as a Rhodes finalist has caused him to reflect back on his experiences at the UO, which include a host of academic achievements, being named a finalist for the Truman scholarship and his involvement with the Wayne Morse Scholars program and the UO College Democrats.

“It’s just a realization that I’ve been so fortunate to have so many people behind me and so many resources — it’s an affirmation of what it means to get to explore so many different policy areas here at the UO and the accumulation of all my experiences,” he said. “I feel like it’s all leading to this opportunity to become the transformational, pragmatic leader that Oxford is known for.”

Author: Around the O Website

April 6, 2015

Spring edition of the Econ eNews now available

We’re announcing our 2015 Koplin and Grace Miller Scholarship recipients, showcasing innovative classroom instructors, and highlighting some alumni success stories in this edition of the eNews.

Read the full issue here.

April 1, 2015

Classroom demonstrations bring economics to life

Innovative instructors, including Professor Chris Ellis, design classroom activities to better illustrate important principles.

Professor Chris Ellis gets the students’ attention. “Up for bid now is one Revolutionary’s Kit,” he calls out, pulling an assortment of squirt guns and a Guy Fawkes mask from a grocery sack and passing them around the classroom. “This is a second-price, sealed-bid auction,” he says. “Start working on your bidding strategy with your group.”

Each group receives 100 virtual credits to bid. Students gather for discussion, and after a few minutes, a flurry of papers are shuffled to the front of the room. Ellis reads the bids aloud, and determines the winner.

He asks the winning group to explain the reasoning behind their bidding strategy, which leads into a classroom discussion about the central characteristic behind second-price, or Vickrey, auctions—the tendency for the bidder to bid the true valuation for the item.

Classroom demonstrations such as these are commonplace in Ellis’ Games People Play (EC 327) course, where students learn how to logically think through strategic situations in which the outcome of their choices are dependent on their actions and the actions of other participants. These types of circumstances arise frequently in situations related to politics, war, and business negotiations.

In this class session, Ellis invites the student teams to bid on a selection of gag gifts (and even a five-dollar bill) as a way of illustrating the different strategies buyers and sellers may use to gain an advantage in a bidding contest.

Professor Ellis finds these activities help his students grasp these economics concepts more effectively. “They’re entertaining and interactive, so it keeps them engaged and learning,” he says. “It allows students to explore these ideas in their own way rather than having them fed to them in a lecture format.

“Plus, it’s always a lot of fun.”

 

February 25, 2015

Tim Duy calculates UO’s economic “footprint”

duy_100x100The University of Oregon is a multi-billion dollar contributor to the state economy that planted a $2.3 billion footprint on Oregon’s fiscal landscape last year, according to a new study by UO economics professor Tim Duy.

In addition, nearly $1.3 billion constituted new economic activity that wouldn’t have happened without the university. Add to that more than 10,000 people who are employed by the UO, including student workers, regular employees and Graduate Teaching Fellows (GTFs).

Read the full article that appeared in Around the O.

February 19, 2015

Professor’s blog makes top of Chicago Tribune “sites you should read” list

thomaProfessor Mark Thoma’s well-regarded blog, Economist’s View, has topped another list, this time getting the first-place mention in the February 18, 2015 post from Noah Smith of Bloomberg News, writing for the Chicago Tribune’s online edition.

His article, “Economics blog sites you should read,” lists Economist’s View top among the “Gatekeepers” category, calling it “the backbone of the econ blogosphere.”

“This is your one- stop shop if you’re starting out,” Smith continues.

Smith focuses his article on independent bloggers who don’t represent a major media platform.

Mark Thoma joined the UO’s Department of Economics in 1987

 

 

January 21, 2015

SAIL Program honored at UO MLK Awards Luncheon—new photos!

The Summer Academy to Inspire Learning (SAIL), an innovative youth program established by the Department of Economics, will be honored Wednesday, January 21 at the UO’s annual MLK Awards luncheon.

The SAIL program received an Equity and Inclusion Innovation Award, given to programs across campus for policies, procedures and structures that further equity and inclusion efforts across campus. SAIL was among four programs to receive this year’s award.

SAIL celebrates its 10th year of providing low-income high school students with enrichment programs in a summer-camp setting on the UO campus, helping them to envision a future that includes higher education. The program was developed by economics faculty members Bruce Blonigen and William Harbaugh. SAIL Director Lara Fernandez will be on hand to accept the Equity and Inclusion Innovation Award at the event.

Read the full article and list of recipients in Around the O.

 

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