MONICA LEWIS
ECONOMICS POLICY
COMPETITION
2015-16
Presented by:
ASU Economics Department
MONICA LEWIS ECONOMICS POLICY COMPETITION
PROJECT PACKET
2015-2016
Table of Contents
Section I: Cover Letter……………………………………………………………………………………………….….page 2
Section II: Problem Statement and Suggested Methodology………………………………….……..page 4
Section III: Rules, Guidelines, and FAQs…………………………………………………………………………page 7
Section IV: Timeline…………………………………………………………………………………………………….page 10
Section V: Tools…………………………………………………………………………………………………………..page 11
Appendix A1: A Starter Kit of Sources…………………………………………………………..……….…….page 12
1
MONICA LEWIS ECONOMICS POLICY COMPETITION
PROJECT PACKET
2015-2016
I. Cover Letter
Welcome to the fourth annual Monica Lewis Economics Policy Competition at Armstrong State
University for the 2015-2016 academic year! Hosted by the economics department, this
university-wide student-based competition puts YOU, the student, in the driver’s seat in
assessing, analyzing, and formulating a pertinent public policy proposal in an area of national
and global interest. This year, the issue surrounds climate change policy targeting the private
sector - a topic with profound economic consequences for today, tomorrow and decades to
come.
Your team will have the opportunity to collect from a $7,500 cash prize pool that will be
awarded by a panel of faculty and community judges. Mr. and Mrs. Dale Lewis are providing the
motivation and financial support. Mr. Dale Lewis is former director of strategic analysis for CSX
Corporation, a notable Armstrong alumnus, an economics graduate, and a member of the
economics department’s advisory board.
This year’s topic revolves around the current debate over climate change policy targeting the
private sector.
2
MONICA LEWIS ECONOMICS POLICY COMPETITION
PROJECT PACKET
2015-2016
http://climate.nasa.gov/evidence/
There is significant evidence that recent climate change is due to human activities. However,
the long term impacts of this change and our ability to avoid or mitigate these impacts is, at the
least, arguable. The evidence for human-induced climate change includes: Sea level rise; global
temperature rise; warming oceans; shrinking ice sheets; declining Artic sea ice; glacial retreat;
extreme events; ocean acidification; and decreased snow cover.
(http://climate.nasa.gov/evidence/).
Here are a few suggestions from the U.S. Environmental Protection Agency for reducing
emissions.
Examples of Reduction Opportunities for Carbon Dioxide
Strategy
Examples of How Emissions Can be Reduced
Energy Efficiency
Improving the insulation of buildings, traveling in more fuel-efficient vehicles, and using m
efficient electrical appliances are all ways to reduce energy consumption, and thus
CO2 emissions.



Energy
Conservation
See EPA's ENERGY STAR?? program for more information on energy-efficient
appliances.
See EPA's and DOE's fueleconomy.gov site for more information on fuel-efficient
vehicles.
Learn about EPA's motor vehicle standards that improve vehicle efficiency and save
drivers money.
Reducing personal energy use by turning off lights and electronics when not in use reduc
electricity demand. Reducing distance traveled in vehicles reduces petroleum consumpti
Both are ways to reduce energy CO2 emissions through conservation.
Learn more about What You Can Do at Home, at School, in the Office, and on the Road to
save energy and reduce your carbon footprint.
Fuel Switching
Producing more energy from renewable sources and using fuels with lower carbon conte
are ways to reduce carbon emissions.
Carbon Capture
and Sequestration
Carbon dioxide capture and sequestration is a set of technologies that can potentially gre
reduce CO2 emissions from new and existing coal- and gas-fired power plants, industrial
processes, and other stationary sources of CO2. Learn more.
3
MONICA LEWIS ECONOMICS POLICY COMPETITION
PROJECT PACKET
2015-2016
http://www3.epa.gov/climatechange/ghgemissions/gases/co2.html
Few, however, take the necessary steps to unravel the complexity of the issue while exposing
only the most relevant of relationships. Your team will go beyond the rhetoric to study the
underlying relationships between climate change policy, environmental impacts, economic
objectives and temporal considerations. Analysis should focus on policy recommendation by
providing compelling arguments in conjunction with corroborating analysis which strengthens
and/or weakens particular views of this topic. In doing so, you will be part of Armstrong’s
commitment to student-driven success and help to incentivize other areas to pursue critical and
analytical thinking on a larger stage.
Universities and colleges across the nation house a tremendous amount of resources from
human capital to technology, all packaged in an environment full of creativity, initiative, and
vision. Student-led projects have influenced many areas of research. With such promise,
campuses have capitalized on these resources by endorsing competitions like the Monica Lewis
economics policy contest to spur new thinking and shape policy for the future. This is your
chance to be part of Armstrong’s vision of new thinking for the future. Don’t miss out!
To distill the project, here are a few questions which should begin to guide your approach to
the competition:





What is an efficient mechanism to control carbon output?
What are the policy options for reducing pollution and what are the pros and cons of
these approaches? e.g. Greenhouse gas emissions
Does efficiency adequately account for the divergence between social and private costs?
How can policy design account for intertemporal issues of fairness and discount rates?
Which emission or pollutant should be of primary concern to policymakers? Why?
II. Problem Statement and Suggested Methodology
The problem with climate change policy is primarily due to the inability of current policy to
properly incentivize firms and individuals to internalize the costs of climate change. The United
States is impacted by the actions of other countries and those who incur costs may not be the
same parties which receive the benefits. Some of the primary contributors to climate change
include burning of fossil fuels, changes in land use, agricultural activities, fossil fuel extraction,
deforestation, desertification, urbanization, industrialization, just to name a few. The difficulty
is determining what to regulate and how to balance the tradeoff between consumption and
pollution.
4
MONICA LEWIS ECONOMICS POLICY COMPETITION
PROJECT PACKET
2015-2016
The methodology for addressing this topic is presented as a series of questions rather than as a
formula. To be successful, your team must address the philosophical and practical issues in a
comprehensive analysis.
The philosophical ideal
What are the economic and social priorities inherent in our current climate change policy
domestically and internationally? Are there opportunities we are missing as a society due to
these priorities and the manner in which we conduct climate change policy? Are there
unintended consequences of current policies that need to be addressed? Do relative
differences in contemporaneous versus future costs and benefits of climate change policy drive
policy recommendations?
Criticism of current policy and recommendations for policy change must be defended with an
assessment of facts that is both qualitative and quantitative. What are the current facts? Which
facts motivate the changes you recommend?
Some questions related to the philosophical ideal:

How much carbon output happens today? What are the sources of this output (natural
and man-made)? How is the carbon output geographically distributed?

What specific impacts are believed to occur due to today’s level of carbon output?
(Consider both negative and positive impacts. Clothing is cheap today because
transport costs from China are low. What happens in a future, post-carbon world?)

Carbon Output Level Desired: What should the future levels of carbon output be? What
are the sources? How is it geographically distributed?

If carbon output is diminished, does this mean a reduction in human activity? (i.e. less
freight transportation, less motor vehicle use, less electrical generation, reduction in
other activities?)

How high would a carbon tax have to be in order to cause a reduction in carbonemitting activities, or to cause an improvement in carbon-efficiency technologies?

How can we show that this tax policy would have a net positive impact on individual
cost-of-living, individual health and jobs available so that individuals can support their
families?

How would we devise a transition plan to get from where we are today to a better
future?
5
MONICA LEWIS ECONOMICS POLICY COMPETITION
PROJECT PACKET
2015-2016
What is the current state of climate change? What are the current identified impacts? What is
the future state of global warming that is desirable? Does this preferred state vary across the
developed versus developing world? What role does your policy proposal serve to impose a
cost/price to incentivize change? What role will equity play in determining the future state?
What issues must be addressed when considering the transition between current and future
states? Ultimately, what form should climate change policy take? Stated explicitly, what should
be the goals of climate change policy? Note that there is to be no reference to any political
party, their interests, motives, or actions in your team’s project.
Practical issues
In order to attain the desired economic and social goals, we must recognize the unintended
consequences inherent in any policy. The practicality of any climate change reform proposal
requires that the team address matters of feasibility. How do we address climate change policy
in a way that meets your team’s new policy goals? How do we make it work? What actions
must the government take to implement the policies?
Some questions related to practicality:
What are the important components of policy to correct for the divergence between private
and social costs?
How should the new policies be implemented and enforced? Should the policy include any selfcorrecting mechanisms?
How important is it for U.S. policy to complement policies abroad?
Is it possible for U.S. policies to be impactful without support from the international community
at large?
Which contributors to climate change should be the primary focus of policies?
Is the cost effective policy necessarily the most impactful?
How can policy initiatives address the common disconnect between short-term and long-term
implications and effects?
What are the potential unintended consequences of different policy mechanisms?
Are there morality issues when giving individuals and/or firms the ability to purchase the right
to pollute?
6
MONICA LEWIS ECONOMICS POLICY COMPETITION
PROJECT PACKET
2015-2016
Defend your policy recommendation
What long-run value do we expect from your policy proposal? How do we overcome the shortrun problems in transition? What will the components of your proposal cost and why is that
money worth spending? To defend your policy recommendations you will need to explain why
your policy goals and implementation are superior to the alternatives. An assessment of
winners and losers due to this policy change is suggested. Note, again, that there is to be no
reference to any political party, their interests, motives, or actions in your team’s project.
An effective defense of your team’s climate change policy reform proposal would partially rely
on the quantitative analytical tools outlined in Section V. Beware deceptive sources. Many
politically motivated groups disguise themselves as objective research organizations. Consult
with Drs. Mangee and Barber on objectivity of sources.
III. Rules, Guidelines, and FAQs
(a) Teams and Document Submission

Each team must consist of three members. These members must be undergraduate
students at Armstrong State University taking at least 9 credit hours in Spring 2016 as
per the registrar’s records. Teams may be comprised of any composition of majors.

Students may take ECON 3950 for 3 credits as part of the project. This course will meet
infrequently, but is meant to help “guide” students towards successful completion of
the project. To register for this course you must first email Dr. Mangee
([email protected]) with your 907# detailing your request to enroll in
3950. You will be able to register after he lifts the capacity restriction. Additionally, you
may audit ECON 3950.

Teams must submit all materials by the specified dates discussed in part IV of this
document. No late submissions will be accepted. Documents may be submitted
electronically as a PDF or Microsoft Word document to Dr. Mangee
[email protected]. Identify your submission in the subject line. Physical
documents should be delivered either to Dr. Mangee (208G Hawes Hall) or the
departmental secretary (208 Hawes Hall). Submissions should not be left in Dr.
Mangee’s mailbox. If neither Dr. Mangee nor the departmental secretary is present,
submissions can be left under Dr. Mangee’s door.

The winning team will be required to deliver their final presentation at the Student
Research Symposium, April 20-21, 2016.
7
MONICA LEWIS ECONOMICS POLICY COMPETITION
PROJECT PACKET
2015-2016

The judges will award cash prizes to team finalists from a $7,500 prize pool. Awards will
be dispersed after presentation at the Student Research Symposium.

Teams may not collaborate with faculty members, but are encouraged to use all
academic resources available to them. Drs. Mangee and Barber are, however, available
for project inquiries and general guidance.
(b) Document Format and Guidelines

All references must be appropriately cited as per APA guidelines. Plagiarism will result in
immediate disqualification from the competition.

All documents submitted will be stripped of author identification to allow for a blind
review process by the judging committee. Please include team member authorship on
the cover page only.

The preliminary analysis document, due February 5th, 2016 (see part IV for a list of
important dates) should be approximately 3-5 pages, double spaced, including graphs
and references. This can and should include a summary of background research
conducted, preliminary findings, and a plan for further research. As these submissions
will be delivered by Dr. Mangee to the judging committee with all author identification
removed, please include authorship only on the cover page.

The final analysis document, due March 25th, 2016 must:
o be single spaced with 12 point font and normal (1 inch) margins
o have a title page, containing the title of the project, team member authorship,
and an abstract of approximately 100 words
o authorship should appear on cover page only
o include a table of contents
o be approximately 15-20 pages in length, including charts, graphs, and references
o include original quantitative analysis (see section V for guidance on quantitative
tools)
o have references cited in APA format
Any further questions concerning contest rules should be submitted to Dr. Mangee,
[email protected], who will relay them to the judging committee for a ruling.
(c) FAQs:
I am pursuing an undergraduate degree but am taking a graduate course. Am I eligible to
participate?
8
MONICA LEWIS ECONOMICS POLICY COMPETITION
PROJECT PACKET
2015-2016
Yes, but you must be officially classified as an undergraduate student as per the
registrar’s office.
I am dual enrolled with another university. Am I eligible to participate?
Yes, as long as you are pursuing a degree at Armstrong and are taking at least 6 credit
hours of coursework at ASU in each semester of the 2015-2016 academic year.
One of my teammates has withdrawn from the competition. Are the remaining members
permitted to continue? If so, how would this affect the distribution of prize money?
Yes. Please note that one team member replacement is allowable up until January 22,
2016. In the event that an incomplete team wins the final prize, the award will be
proportional.
A member of my team started the term with 9 (or more) credit hours but has subsequently
dropped below 9 credit hours. Does this affect our team’s eligibility?
Yes, it does. All active team participants must be enrolled in a minimum of 9 credit
hours for the duration of their participation in the competition. Any team member
below 9 hours is disqualified, though the remaining team members may continue.
I have read the above rules and FAQs carefully, yet I still have a question. What should I do?
Any further questions regarding rules and eligibility should be sent to Dr. Mangee
[email protected], who will submit them to the judging committee for a
ruling.
9
MONICA LEWIS ECONOMICS POLICY COMPETITION
PROJECT PACKET
2015-2016
IV. Timeline
November 6, 2015 at 12:00 p.m.: Kickoff event in Solms 110
December 4, 2015 by 5p.m.: Deadline for team roster submission
Team rosters are due at this time to Dr. Mangee, [email protected].
The team roster should include the name, contact information, and student ID number
of each member. Also note that a single team member substitution (or addition, in the
case of incomplete teams) is allowable until January 22nd.
February 5, 2016 by 5p.m.: Preliminary analysis document due
At this point, teams are required to submit a brief document outlining their progress
thus far to Dr. Mangee (Hawes Hall 208G). See Section III for more details. The judging
panel will blind review each submission and those that have displayed sufficient
progress will be invited to continue. Teams will be notified within ten days of the
judges’ decisions. Also note that no further team member substitutions will be allowed
past this day.
March 25, 2016 by 5p.m.: Final report document due
Teams must submit their final written report to Dr. Mangee (Hawes Hall 208G). See
Section III for guidelines.
April 1, 2016 by 5p.m.: The Monica Lewis Economic Policy Completion judging committee
selects the finalists
The judging committee will notify the finalist teams that they have been invited to
present their work and policy recommendation to the committee on April 28, 2014.
April 15, 2016 at noon*(tentative): Presentations by the finalist teams and announcement of
the 2015-16 Monica Lewis Economics Policy Competition winner.
Finalist teams will present their work and policy recommendation in the form of a brief
(15-20 minute, 10 slide) presentation. The judging committee will deliberate and the
recipient of the 2015-16 Monica Lewis Economic Policy Prize will be announced.
April 20-21, 2016: Student Research Symposium and presentation of award
The winning team will deliver their presentation again at the Student Research
Symposium. The award will be presented thereafter.
10
MONICA LEWIS ECONOMICS POLICY COMPETITION
PROJECT PACKET
2015-2016
V. Tools
Analytical Tools
In order to present a compelling, coherent and substantive project and accompanying analysis
students should be familiar with the calculation and interpretation of the following concepts:








Marginal Social Cost and Marginal Social Benefit
Marginal Private Cost and Marginal Private Benefit
Deadweight loss under various policy approaches (command and control, taxation,
marketable/tradeable permits, etc.)
Efficient Allocation and Intertemporal Fairness
Property Rights, Externalities, Public Goods and Coase Theorem
Willingness to Pay vs. Willingness to Accept
Various methods for valuing the environment (Contingent Valuation, Hedonic Pricing, Discount
Rates, Experimental Approaches, Auctions)
Market Structures (Monopoly, Oligopoly, Monopsony, Competitive)
Graphing in Excel and Word
Once your data is in Excel, here are the steps to generate a graph from data taken over time
(time series) and transfer it to Word.
(i) In your Excel Spreadsheet, highlight the dates (including the word “Date” at the top
of the column of dates) and the data series (including the title of the data series itself,
say “Value”)
(ii) Select Insert from the Toolbar
(iii) Select Line
(iv) Select 2D Line
(v) Make sure to label the data series and graph
(vi) Copy the graph in Excel and paste it into your desired location in Word
One may also wish to generate a scatter plot which provides a graphical measure of correlation.
Although less technical and precise than the form coefficient of correlation or covariance
discussed in A1, the scatter plot can still provide some insight concerning the relationship
between two variables. To generate a scatter plot for two variables “X” and “Y”,
(i) in your Excel spreadsheet, highlight the two data series (including the titles of “X” and
“Y”
(ii) Select Insert from the Toolbar
(iii) Select Scatter and choose the first option in the dropdown menu
11
MONICA LEWIS ECONOMICS POLICY COMPETITION
PROJECT PACKET
2015-2016
Interpreting the scatter plot is straightforward. If a visual inspection of an upward sloping
relationship of the clustering of scatter plots suggests a positive relationship between variables
“X” and “Y” and vice versa. If the clustering of the scatter plots suggests no discernible
relationship, say the scatter points are sporadically placed across the graph, there may be no
relation between the variables. As always, drawing strong conclusions from just one analysis is
discouraged and other sensitivity diagnostics should be included for a more complete picture.
Appendix
A1: A Starter Kit of Sources
This is a starter kit of resources. This list is not sufficient for your research. Beware lobbyists
disguised as research centers. I take about 30 minutes investigating a research center before I
trust their data. It takes even longer to trust their analyses. I trust these data sources.
Remember to distinguish between commentary and research.
http://data.worldbank.org/topic/climate-change
http://climate.nasa.gov/evidence/
https://www.ncdc.noaa.gov/indicators/
https://www.data.gov/climate/
https://www.climate.gov/
http://www.ipcc-data.org/
http://www.nature.com/news/climate-change-hiatus-disappears-with-new-data-1.17700
http://www3.epa.gov/climatechange/
http://www.wclimate.com/world-climate-summit-2015/
http://www.green-alliance.org.uk/resources/Paris%202015getting%20a%20global%20agreement%20on%20climate%20change.pdf
https://www.ipcc.ch/pdf/assessment-report/ar4/wg1/ar4-wg1-spm.pdf
12