Kansas State University

News from the department of economics

Dr. Wayne Nafziger publishes the fifth edition of his textbook, Economic Development.

E. Wayne Nafziger, University Distinguished Professor of Economic, Kansas State University, has just published the fifth edition of a textbook, Economic Development, with Cambridge University Press. Nafziger has authored 14 books (two with coauthors), coedited six books, and published numerous journal articles in economic growth and income distribution. The focus of Nafziger’s publications is on the low- and middle-income economies of Asia, Africa, Latin America, and East-Central Europe, where 85 percent of the world’s population lives, as well as analyses of the lessons of Japan’s long-term growth from the 1860s through the 1980s and recent advances by South Korea and Singapore, for contemporary developing countries.

His articles have appeared in the American Economic Review, Economic Development and Cultural Change, World Development, Journal of Development Studies, Journal of Conflict Resolution, Economics of Peace and Security Journal, Defence and Peace Economics, Journal of Economic Issues, and other journals.

Nafziger’s text explains the reasons for the fast growth of Pacific Rim countries such as China and Indonesia, and other economies such as Brazil, Poland, and (recently) India, and the increasing degradation of large parts of sub-Saharan Africa. His comprehensive and clearly written text discusses poverty, income inequality, hunger, unemployment, stabilization and liberalization, the environment and carbon-dioxide emissions, the development of human capital, and the widening gap between rich (including middle-income) and poor countries.

According to Nafziger, the field of development economics has changed dramatically since his first edition in 1984: countries such as India, Pakistan, Taiwan, and the Philippines considered as poor then are classified as middle-income countries today. Moreover, the development literature now includes topics such as randomized experiments to assess aid, an exploration of whether information technology and mobile phones can provide poor countries with a shortcut to prosperity, and a discussion of how worldwide financial crises, debt, and trade and capital markets affect developing countries.

The book has been praised by other scholars in the field. John Weeks, School of Oriental and African Studies, University of London, states: “Now in its fifth edition, Nafziger’s Economic Development had gone from the best in the field to the classic in the field, the most comprehensive statement and analysis of major issues of development. It is essential for students in both economics and development studies, and an invaluable aid to instructors. Indeed, every person who wishes to be well-informed about the inequalities among countries should read the third chapter, “Economic Development in Historical Perspective.” Lloyd J. Dumas, University of Texas at Dallas indicates that “The latest edition of this first-rate text updates the copious illustrative data contained in its clear and extraordinarily comprehensive treatment of the character and problems of development. . . .It is filled with valuable references to the literature and helpful websites that serve as a guide for deeper investigation of the key issues.”

For Howard Stein, University of Michigan, Ann Arbor, “Professor Nafziger’s Economic Development is one of few texts that draw on theory, history, policy, and institutional analysis of the complexity of the development process and why the goals of development continue to remain so elusive for so many.” Christopher Cramer, SOAS, University of London, says that “rather than applying a body of theory to the problems of developing economies, this is a textbook that begins from the diverse, uneven reality of developing countries and explores how economics have been applied, what debates have emerged, and what policy relevance these debates have. Clearly written and briskly paced, its particular value emerges by using the text in combination with the Internet resources and bibliographic support the book provides.” John Loxley, University of Manitoba, thinks Economic Development is the most comprehensive text available on the subject, . . . written in a clear, lively, and readable fashion that makes it very accessible to students. It deals impressively with theory, policy, and institutional issues in the best traditions of political economy and draws intelligently on concrete country studies.”

Anwar Shaikh, New School for Social Research, New York, writes that Nafziger’s book is “An excellent and wide-ranging textbook on development. The author’s expertise and fair-mindedness are evident.”

Nafziger has been a faculty member in economics at Kansas State University since 1966. He received his bachelor’s degree from Goshen College, his master’s from the University of Michigan, and his Ph.D. from the University of Illinois in 1967. He was Visiting Fulbright Professor at Andhra University, India in 1970-71; Fellow at the East-West Center, Honolulu in 1972-73; Visiting Scholar, University of Cambridge; and Visiting Scholar, Nigerian Institute for Social and Economic Research, Ibadan, 1976; Visiting Professor, International University of Japan, Graduate School of International Relations, Yamato-machi, in 1983; Hewlett Fellow at the Carter Center, Atlanta, in 1991; Indo-American Foundation and National Science Foundation researcher at Andhra University in 1993; Senior Research Fellow at the UNU/World Institute for Development Economics Research, Helsinki, 1996-1998; and American Institute for Indian Studies and Institute for Social and Economic Change, Bangalore Researcher on “Bangalore Software Entrepreneurs under Reform,” 2007. He was Editor of the Journal of African Development in 2008-11.  He has supervised 22 completed Ph.D. dissertations (3 co-major chair). Nafziger has been Co-Principal Investigator, African Studies Center and other centers at KSU.

He was married for 41 years to Elfrieda Toews, who died in 2007. He has two sons, Brian, a U.S. State Department foreign service officer, serving in Moscow, Russia, and Kevin, Southwest Bureau Chief for Pearson’s MergerMarkets, in Phoenix.

Instructors wishing to consider the 5th edition of Economic Development, 2012, may contact Cambridge University Press for a complimentary copy, and nafwayne@ksu.edu for test banks and supplements.

Drs. Gormely and Akkina set to retire as the semester winds down.

The Department will lose 86 years of combined teaching experience as Dr. Patrick Gormely and Dr. Krishna Akkina retire at the end of this spring.

Dr. Patrick Gormely has given 45 years of dedicated service to Kansas State University.  Over his years at Kansas State University, Patrick has served on numerous departmental committees, as Director of Graduate Studies, and as Acting Head of the Department ofEconomics.  He served two terms on the KSU Faculty Senate and many years on the Board of Directors of the KSU Teachers and Employees Association. 

Patrick joined the KSU economics department in fall 1967 upon receiving his PhD in economics from Duke University.  He received his bachelor’s degree from Catholic University in Washington, D.C. in 1963.  Patrick’s major areas of concentration are in development economics and international economics.  Unusually versatile and widely read, he has also taught such courses at KSU as principles of economics, intermediate macroeconomics, intermediate macroeconomics, and history of economic thought–a field of inquiry that few members of the new generation of economists are equipped to teach. 

Patrick was major professor to 5 PhD and 26 MA students and served on many other masters theses and doctoral dissertation committees over the years.  His research has been published in such journals as Demography, American Journal of Agricultural Economics, Economic and Social Review, and Journal of Economic and Social Measurement, among others.  In two periods of leave from KSU, Patrick served for two years in Nigeria with the U.S. Agency for International Development (USAID) and as a research associate at the Economic and Social Research Institute in Ireland.  He also taught at Quad-i-Azam University in Pakistan and served as a consultant to USAID in Korea, Uganda, Brazil, Turkey, Colombia, Peru, Ecuador, and El Salvador. 

In retirement, Patrick plans to pursue active hobbies such as photography and reading, along with enjoying more travel with his wife, Susan.  His colleagues will miss his good humor, many contributions to the department, and his intense interest in ongoing economic issues, analysis, and policy debates.

Dr. Krishna Akkina has given 41 years of dedicated service to Kansas State University.  Krishna arrived at Kansas State University in September 1971 and received his PhD from the University of Minnesota the following spring.  He received his Bachelor of Arts degree from Andhra University in 1963 with dual majors in economics and mathematics.  Before attending Minnesota for his doctoral degree, Krishna also earned a master’s degree from Delhi University in 1965.

Highly trained in econometrics at the Delhi School and Minnesota, Krishna taught graduate courses at KSU in international economics and macroeconomics as well as numerous undergraduate courses.  His areas of interest also include energy economics, development economics, and statistics.  During his career, Krishna published more than 20 articles in refereed journals, including the nation’s most prestigious econometrics journal.  His research appeared in such respected journals as Econometrica, The Indian Journal of Economics, and The Southern Economic Journal, among others.  Over the years, he presented his research at more than 25 conferences.  

Krishna served as a visiting associate professor at Indira Gandhi Institute of Development Research in Bombay, India and also spent a year as a visiting scholar at the University of Southern California in Los Angeles.  In addition to serving on many departmental committees, Krishna was mentor to numerous graduate students and provided important counsel in the area of applied econometrics to his colleagues.  He served as major professor for numerous MA and doctoral students in the KSU graduate program, and co-authored many journal articles with these students.

In retirement, Krishna and his wife Savithri plan to spend more time traveling, visiting their son, reading, and pursuing other hobbies.  His colleagues in economics will miss Krishna and are grateful for the excellent service and wise counsel he has provided over the years.  This citation recognizes Krishna for his dedication and service to the Department of Economics.

Recent book by Lloyd Thomas to be translated and published in Chinese.

Lloyd  Thomas has been notified that his book, The Financial Crisis and Federal Reserve Policy, published by Palgrave-Macmillan in 2011, will be translated and published in Chinese in fall 2012.  Thomas indicates that he was inspired to write this book during his sabbatical leave in 2009-2010.

"It had become clear to me that the financial crisis that began in 2007 was the most important economic event of my lifetime--indeed, the biggest economic catastrophe since the Great Depression of the early 1930s.  It's consequences are still plaguing the United States and wreaking havoc on such European nations as Greece, Ireland, Italy, Portugal, and Spain.  Being a professional economist, I decided to devote the major portion of my sabbatical leave at Indiana University to studying the causes and consequences of the Great Crisis, and thinking about potential measures that might minimize the likelihood of additional severe crises in the next few decades.  I wrote a prospectus and five sample chapters of the proposed book during the fall 2009 term and sent them to several publishing houses that had expressed preliminary interest in the project.  After receiving reviews and offers from several publishers, I decided to sign with Palgrave-Macmillan, a publishing firm derived originally from the venerable and  respected  British publisher,  Macmillan.   Being largely free of committee work and teaching responsibilities during my sabbatical, feeling a sense of urgency,  and typically working seven days a week, I was able to complete the 12-chapter manuscript in late July, 2010."   

The book was published in March 2011, and has received  favorable reviews by professional economists.  Among these are the following:

"I've read many books on the Financial Crisis.  Lloyd B. Thomas's book, quite simply, is the best.  It doesn't  simply describe what happened, it explains what happened.  And it explains what needs to be done to prevent it from happening again." --- Laurence Seidman, Chaplin Tyler Professor of Economics, University of Delaware

"Thomas provides a comprehensive and dispassionate analysis of the Great Crisis of 2007-2009.  Exceptionally well written and researched, the book has much to offer professional economists, financial experts and policy makers...This book is destined to be one of the most thoughtful, independent, and insightful analyses of the Great Crisis." ---Bruce Jaffee,  Professor and Executive Director, Institute for International Business, Indiana University.

"Timely, informative, insightful, beautifully written, and readable both by informed professionals and economists.  Thomas presents a very interesting treatment of the Federal Reserve's role in the current economic crisis with comparative historical background on the Fed's behavior during the Great Depression.  A wonderful book." ---Michael J. Greenwood, Professor of Economics, University of Colorado.

While there was a lot of hard work and a severe,  self-imposed  time constraint involved in writing the book, Thomas indicates that he is glad that he undertook the project.  "I learned a lot," he indicated.

Jim Haymaker receives the College of Arts and Sciences Merit Award

Jim Haymaker was recently awarded the College of Arts and Sciences Merit Award in the area of Entrepreneurship for his role in developing and implementing a paradigm shift at Cargill Incorporated known as “Strategic Intent."

Jim graduated from K-State in 1969 with a bachelor's degree in French and Spanish and a bachelor's degree in economics.  He earned an M.B.A. in Finance/International Business from the University of Chicago in 1971 and studied French Civilization at the Sorbonne University of Paris.  He also studied at the University of Louvain in Belgium in 1972, where he received a license in Applied Economics. 

After this impressive education, Jim embarked on a highly successful career with Cargill, beginning as a financial analyst in 1973. He went on to hold a number of leadership positions. From 2000 to his recent retirement, Jim served as Corporate Vice President of Strategy and Business Development for Cargill. 

Jim  used his entrepreneurial skills throughout his career to help Cargill grow and prosper.  One of his successful contributions to the company occurred after he was asked in 1998 by the CEO of Cargill to lead and facilitate the development of  Strategic Intent  for the company. This program would chart Cargill's course over the subsequent decade. Strategic Intent was about reinventing the entire firm and it's business model to be more agile, entrepreneurial, and focused on the customer. 

Strategic Intent was a big success. Under the program Cargill took sales from $55 billion to $125 billion and increased it's market capitalization five fold by 2010. By 2005 Cargill had more than tripled its earnings, increased revenue by 50%, and had  44% more employees.  This success, and the creativity underlying it, has attracted considerable attention. A Harvard Business School case study of Cargill's success states that:  "Cargill's Strategic Intent of becoming the premier provider of innovative customer solutions in food and agriculture represented radical change. The collective result of these moves enabled Cargill to adopt a desperately needed new focus on the customer and their needs." Jim has described the process as "slightly easier than parallel parking an aircraft carrier."

Jim took a leadership role in both developing and implementing this strategic shift. In doing so, he demonstrated that the principles of entrepreneurship could thrive in the corporate structure and that the large company could be nimble in a changing environment.  Jim's accomplishments in entrepreneurship have been widely recognized. He has spoken to the senior leadership at General Electric and Bayer on the topic of global entrepreneurship and has spoken several times to classes at the Harvard Business School and the Kennedy School of Government on the topic of Strategic Intent.  He has also taught courses related to customer solutions at both the Visiting Executive Program at Dartmouth Tuck Business School and the Booth University of Chicago Business School. He is widely recognized as a strategist, an expert on mergers and acquisitions, and a leading innovator in entrepreneurship within the global firm. We are proud to have Jim as an economics graduate. 

Some of our alumni might be thinking that the Haymaker name sounds familiar.  Haymaker Hall was named after Jim's grandfather Henley, a popular professor of  botany, biology, and plant pathology from 1917-1963. 

2011 Student Price Index again shows rising costs

The K-State Economics Club demonstrated recently that the cost of living for the average K-State student continues to rise more rapidly than the cost of living for the average American. The 2011 Student Price Index (SPI) increased by 5.2 percent from 2010 while the Consumer Price Index (CPI) increased by just 3.5 percent. Since 2002, the SPI has increased by more than 75% compared to 25% for the CPI.

The SPI is calculated each year by the K-State Economics Club. The measure attracts considerable attention and has been covered by USA Today, CNN, the Kansas City Star, the Manhattan Mercury, and KMAN.

Vice President Kyle Landau coordinated the efforts this year. Club members visited local restaurants, grocery stores, gas stations, bars, bookstores, and movie theatres to gather information regarding annual pricing. “As we all should know, twenty dollars will not buy us nearly as much as it could have 10 years ago. The price of nearly everything has increased substantially over the last decade,” stated Landau.

 

After analyzing the SPI statistics, club president Katie Gustafson observed “It is a bit disheartening that students are again impacted by inflation more than the average consumer. As students, we are very aware of the price of gasoline as that takes up a signification portion of our budget. I feel we notice that increased cost more than the average consumer. Prices of goods we must buy such as tuition and housing increased by almost eight percent last year. At least the price of groceries has remained relatively low.”

 

Club member Mark Silverwood helped gather data for this year’s SPI. “There was some good news in this year’s SPI. This year the tuition increase was somewhat in line with changes in other student prices,” Silverwood observed. “And when we consider the problems with food production in some parts of the world, the fact that the price of groceries was up less than three percent from 2010 and are almost the same as 2009 is encouraging. I know some students were pleased with the fact that the price of beer actually decreased.”

Increases in the prices of gasoline (up 37.4 percent) tuition (up four percent) and textbooks (up ten percent), greatly contributed to the Student Price Index's twelve-month growth. Other staples in the index include beer, pizza , ICAT tickets and movie ticket prices. All of these were unchanged from last year or down slightly. The average housing cost for a K-State student increased by three and a half percent.

Department welcomes three new faculty members

We are very pleased to have three new faculty members join the department this year.  Peri da Silva, Leilei Shen, and  Anson Ho arrived in July and August and seemed unfazed by the heat wave. All are now settled in and hard at work on their teaching and their research projects.

Peri da Silva earned his Ph.D. from the University of Illinois and Urbana-Champaign in 2005. He earned his M.S. degree form Getulio Vargas Foundation in Rio de Janeiro and his Bachelor of Science Degree from Federal University of Rio de Janeiro. He comes to us via the University of North Dakota where he was an associate professor of economics. Peri is an international trade economist with research interests in the political economy of trade, theory of preferential trade, and ways to distribute the gains generated from trade liberalization. His work has been published in World Bank Economic Review, Economic Theory, Journal of Development Economics and other distinguished journals. Peri is also a fellow of the Centro Studi Luca d'Agliano at the University of Milan.

Leilei Shen recently finished her Ph.D. at the University of Toronto and earlier earned her M.A. degree from University of British Columbia and her B.A. from York University. She has interests in international economics, development economics, and microeconomics. Much of Leilei's research considers how the productivity of firms and industries changes in response to trade liberalization. Other work investigates the relationship between aging, social capital, and healthcare utilization in Canada. Her work in this area appears in the journal Health Economics, Policy and Law. A third line of research looks at how the level of development of the financial sector in a country influences the structure of industry.

Anson Ho recently finished his Ph.D. at the University of Iowa. Originally from Hong Kong, he received his B.A. in economics and B.S. in finance from Indiana University. Anson’s current research interests lie in taxation, development and firm dynamics. In the area of taxation, he has done research which considers the macroeconomic effects of tax-deferred saving accounts. In the area of development, Anson and his co-authors consider the evolution of productivity and firm-level distortions in Ecuador during their economic crisis in the late 1990s. At Iowa, Anson also was a research assistant with the Iowa Electronic Health Markets research team. This team explores the use of prediction markets in forecasting health-related events,  such as the spread of 2009 H1N1 Influenza.

Students present original research at Economics Scholars Program

We are very proud that several of our excellent economics students had the opportunity to share their research on key economic issues before some noted economists. The students were invited to present at the annual Economics Scholars Program, hosted by Austin College and the Dallas Federal Reserve Bank, April 1, in Dallas. Forty-two papers were presented at the event, and the keynote address was delivered by a senior economist at the Dallas Federal Reserve Bank.

Through the Economics Scholars Program, students present their independent research to their peers, faculty members and some economists from the Dallas Fed. We are grateful that funds for the students' travel were awarded by the Fred C. and Mary R. Koch Foundation. To qualify for the travel funds, students' papers had to be approved by K-State economics faculty.

Sarah Brink, presented "Critique of the American Recovery and Reinvestment Act of 2009," Eduardo Alvarado presented "Cigarette Taxes and Cross Border Effects: An analysis of Retail Data by County," and Erin Closterman presented "The Fiscal Crisis Facing State and Local Governments."

Tracy Turner, associate professor of economics, advised Alvarado. Both Closterman and Brink's papers were based on senior seminar work with Lloyd Thomas, professor of economics. In addition to the student presentations, Alvarado, Brink and Evan Talbott, served as discussants at the event, reading and critically evaluating other undergraduate research. Closterman also was chair for the Economics of Entertainment session of the program.

Daniel Kuester, our director of undergraduate studies, accompanied the four economics majors on the trip. "I can't say enough about what a first-class event this was. Our students did an excellent job of presenting and discussing papers, and their sessions were extremely well attended," Kuester said. "At Ed's talk, there were no empty seats. His findings that a change in the Kansas cigarette tax had larger impacts on sales in Johnson County than Douglas County has meaningful policy implications. Erin's discussion on the crisis facing many different states as federal funding is expiring is also very topical. Both Ed and Erin were poised and well prepared for the questions they received. Sarah's poster session appeared to be the most well attended of the afternoon, and Evan did a nice job as a discussant. I was proud of all four students. We appreciate the support from the Fred C. and Mary R. Koch Foundation, which made this trip possible."

Mike Goss named alumni fellow

We are pleased to announce that  Mike Goss was named a 2011 Alumni Fellow in the College of Arts and Sciences. This is a highly prestigious honor, recognizing alumni who have distinguished themselves in their careers. Only two alumni from the college are honored in this way each year. Mike is a native of Great Bend Kansas and a 1981 K-State grad. At K-state he was both a varsity tennis player and economics major. From K-State he went on earn an MBA from Harvard Business school with distinction and to build a distinguished career in business. He was senior associate with Bain Capital from 1987 to 1989. He then served as Executive Vice President, Chief Financial Officer and member of the board of directors at Playtex Products. More recently, Mike was Vice President and Chief Financial Officer of Digitas Inc., a worldwide internet professional services firm. After helping to take that firm public, Mike rejoined Bain Capital as Managing Director and Chief Financial Officer in 2001. Since then Mike has had a leadership role in this private equity firms as it has grown to manage more than 64 billion dollars in assets.

Throughout this distinguished career, Mike has been a strong supporter of K-State, the College of Arts and Sciences and the Department of Economics. We are very proud to count Mike among our alumni and are very pleased that he was honored in this way. One purpose of the Alumni Fellow Program is to bring prominent leaders like Mike back to campus to share their experiences with students. For Mike, this was a continuation of sharing generously in this way with our students over the years. He has given a number of talks to our students over the years which have always been highly engaging. As part of his Alumni Fellow visit Mike gave a talk to students on private equity that was greatly appreciated by all in attendance.

 

Tim Kehoe gives Joe Tiao Lecture

The high point of seminar activity each year is the Joe Tiao Lecture Series. This series enables the department to bring internationally acclaimed economists to campus. Each Tiao Lecturer presents two lectures at K-State: a public lecture on an economics issue of current interest and a more technical seminar in the economics department. This year's speaker was Dr. Tim Kehoe from the University of Minnesota. Dr. Kehoe has been a professor at the University of Minnesota since 1987 and is currently the Distinguished McKnight University Professor in the Department of Economics. He is also a research associate at the National Bureau of Economic Research and an adviser at the Federal Reserve Bank of Minneapolis. His research focuses on the theory and application of general equilibrium models. He has been an advisor to the government of Spain on the impact of joining the European Community, to the government of Mexico on the impact of joining NAFTA, and Panama regarding foreign trade and investment reform. He gave an excellent public talk entitled “What have we learned from studying great depressions” with over 150 people in attendance.