WBEZ | economics http://www.wbez.org/tags/economics Latest from WBEZ Chicago Public Radio en Why we sign up for gym memberships but never go to the gym http://www.wbez.org/news/culture/why-we-sign-gym-memberships-never-go-gym-111312 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/gym.jpg" alt="" /><p><p><strong>Gyms have built their business model around us not showing up.&nbsp;</strong></p><p>Gyms have way more members than they can actually accommodate. Low-priced gyms are the most extreme example of this. Planet Fitness, which charges between $10 and $20 per month, has, on average, 6,500 members per gym.</p><p>Most of its gyms can hold around 300 people. Planet Fitness can do this because it knows that members won&#39;t show up. After all, if everyone who had a gym membership showed up at the gym, it would be Thunderdome.</p><p>If you are not going to the gym, you are actually the gym&#39;s best customer.</p><p><strong>So gyms try to attract people who won&#39;t come.&nbsp;</strong></p><p>If you haven&#39;t been a &quot;gym person&quot; in the past, chances are good that paying for a gym membership won&#39;t change that. Gyms know this and do what they can to attract people who haven&#39;t traditionally been gym rats.</p><p>Instead of displaying challenging equipment like weight benches and climbing machines in plain view, gyms will often hide weight rooms and other equipment in the back. Many gyms now have lobbies that are designed to look like hotels and fancy restaurants.</p><p>&quot;For the longest time, the design was around the sweat,&quot; says Rudy Fabiano, an architect who designs gyms all over the world. &quot;Twenty-five years ago ... clubs could be very intimidating. Remember there were the baggy pants that everybody had and the bodybuilders would bring their own jug of water?&quot;</p><p>Once gyms started looking more like hotels, coffee shops and restaurants, people who weren&#39;t bodybuilders started feeling comfortable in gyms. The casual gymgoer was born.</p><p><strong>Our brains want to be locked into annual contracts with gyms.</strong></p><p>Normally, we hate being locked into long contracts (cellphones, cable packages), but gym memberships are an exception.</p><p>&quot;Joining a gym is an interesting form of what behavioral economists call pre-commitment,&quot; says Kevin Volpp, director of the Center for Health Incentives and Behavioral Economics at the Wharton School.</p><p>Volpp says we actually like the idea of being locked into a gym contract ... at first, anyway.</p><p>&quot;They&#39;re picturing the &#39;new me&#39; who&#39;s actually going to go to the gym three times a week and become a physical fitness machine.&quot;</p><p>We convince ourselves that since we have committed to putting down money for a year, we will make ourselves go to the gym. And then, of course, we don&#39;t.</p><p><strong>Just when we try to get out, they feed us, massage us and ply us with alcohol. </strong></p><p>Gyms have big issues with retention, and most lose around half their members every year.</p><p>Once we realize that we haven&#39;t been going to the gym, even $20 per month can feel like too much.</p><p>To try to combat this, gyms look for ways to offer value to customers who aren&#39;t necessarily into working out. Planet Fitness has bagel breakfasts once a month and pizza dinners. Those are its busiest times. It also has massage chairs.</p><p>Other gyms have mixers and movie nights and spa treatments.</p><p><strong>Without slackers like us, gyms would be a lot more expensive.&nbsp;</strong></p><p>The reason gyms can charge so little is that most members don&#39;t go.</p><p>People who don&#39;t go are subsidizing the membership of people who do. So, if you don&#39;t work out, you are making gyms affordable for everyone.</p><p>If you are one of the brave few who actually do go to the gym, you are getting an amazing deal.</p><p>&mdash; <em><a href="http://www.npr.org/blogs/money/2014/12/30/373996649/why-we-sign-up-for-gym-memberships-but-don-t-go-to-the-gym">via NPR</a></em></p></p> Tue, 30 Dec 2014 16:28:00 -0600 http://www.wbez.org/news/culture/why-we-sign-gym-memberships-never-go-gym-111312 What Christmas does (or doesn’t do) for the economy http://www.wbez.org/news/what-christmas-does-or-doesn%E2%80%99t-do-economy-111275 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/1128_holiday-shopping-624x415.jpg" alt="" /><p><p>Is Christmas good for the economy? That&rsquo;s the conventional thinking, but some economists believe that if Christmas didn&rsquo;t exist, all of the shopping we do would actually be distributed more evenly throughout the year, and there might not be so much &ldquo;deadweight loss,&rdquo; i.e., that ugly sweater from your aunt that gets put in the back of the closet.</p><p><a href="http://www.theatlantic.com/business/archive/2011/12/is-christmas-bad-for-the-economy/249618/">Derek Thompson</a>&nbsp;has looked at some of the research and joins&nbsp;<a href="http://hereandnow.wbur.org/" target="_blank">Here &amp; Now&rsquo;</a>s Jeremy Hobson to explain.</p><p>&mdash; <a href="http://hereandnow.wbur.org/2014/12/19/christmas-retail-economics"><em>via Here and Now</em></a></p></p> Fri, 19 Dec 2014 14:08:00 -0600 http://www.wbez.org/news/what-christmas-does-or-doesn%E2%80%99t-do-economy-111275 Before we start our homework http://www.wbez.org/series/curious-city/we-start-our-homework-107717 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/susie thumbnail.jpg" alt="" /><p><p><em>Editor&#39;s note: This post asked how we may best focus Dabney Lyles&#39; question. To those who helped by leaving comments below, on our <a href="https://www.facebook.com/curiouscityproject">Facebook page</a>, or via <a href="https://twitter.com/WBEZCuriousCity">Twitter</a>: Thanks so much! Your efforts really paid off. Susie An and Logan Jaffe&#39;s<a href="http://www.wbez.org/series/curious-city/university-down-block-108021"> finished the investigation</a></em>.&nbsp;</p><p>Recall that Dabney Lyles, a DePaul graduate student living in downtown Chicago, asked a question that won a Curious City voting round:</p><p style="text-align: center;"><em>What effect do Chicago&rsquo;s colleges and universities have on the local economy?</em></p><p>After a quick convo, Dabney and I decided to get some help from our fellow Curious Citizens. (That would be, um, you.) After all, there are dozens of colleges and universities in the area, and there are just as many angles to explore. So before we sharpen the pencils and start our homework, we&rsquo;d like clarification on the assignment.</p><p>First, just a little background from Dabney. What got her interested in the first place was a trip to Salvador, Brazil, where she studied the city&rsquo;s technology cluster. She noticed that universities played a major role in research, but they also provided students to be recruited for internships and jobs. Salvador&rsquo;s economic initiative seemed focused on bolstering young talent for the local workforce. Dabney wondered how that plays out in her own city of Chicago.</p><p>And I had some experience to kick in, too. I went to the University of Illinois Urbana-Champaign where few students would remain in town after graduation and where some businesses would limit their hours when school was out. In other words, it was a real campus town. Chicago has so many schools but they&rsquo;re secondary to the city itself. I wouldn&rsquo;t mind looking into how money is married between a stand-alone city economy and its many colleges.</p><p>So, here&rsquo;s the short list of angles for you to comment on:</p><ul><li>How much do businesses cater to the many students in the area?</li><li>Do municipal or local investments in university projects pay off?</li><li>Just where does all that tuition money go?</li><li>How might a university benefit or hinder the economic growth of its neighborhood?</li></ul><p>Any suggestion or lead, though, would be great, as the Curious City crew has plenty of grade anxiety! Drop your suggestion in the comments below, or hit Curious City on <a href="https://www.twitter.com/WBEZCuriousCity">Twitter&nbsp;</a> or <a href="https://www.facebook.com/curiouscityproject">Facebook</a>.</p><p><a name="Timeline"></a><iframe frameborder="0" height="620" src="http://embed.verite.co/timeline/?source=0Am-AbC8HDbXMdGtwa0I3NjJZZ2t4T0J6WUFTRjBoWlE&amp;font=Bevan-PotanoSans&amp;maptype=toner&amp;lang=en&amp;height=620" width="100%"></iframe></p></p> Fri, 14 Jun 2013 19:43:00 -0500 http://www.wbez.org/series/curious-city/we-start-our-homework-107717 Reporter's Notebook: If Illinois legalizes marijuana, how could that affect the economics of the drug trade among gangs? http://www.wbez.org/series/curious-city/reporters-notebook-if-illinois-legalizes-marijuana-how-could-affect-economics <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/pot leaf.jpg" alt="" /><p><p><iframe frameborder="0" height="650" src="http://embed.verite.co/timeline/?source=0An_OJm0YASWadHhMMWQ4VHJmck5yMEdBNTlNRi1nZGc&amp;font=PTSerif-PTSans&amp;maptype=toner&amp;lang=en&amp;height=650" width="100%"></iframe></p><p><a href="http://www.wbez.org/series/curious-city/about-curious-city-98756">Curious City</a>&nbsp;is a news-gathering experiment designed to satisfy the public&#39;s curiosity.&nbsp;People&nbsp;<a href="http://curiouscity.wbez.org/#!/ask">submit questions</a>,&nbsp;<a href="http://curiouscity.wbez.org/#!/ask">vote&nbsp;</a>for their favorites, and WBEZ reports out the winning questions in real time, on&nbsp;<a href="http://www.facebook.com/curiouscityproject">Facebook</a>,&nbsp;<a href="http://twitter.com/#!/WBEZCuriousCity">Twitter&nbsp;</a>and the timeline above.</p><p>Siva Iyer from Elmhurt&nbsp;asked:&nbsp;If Illinois legalizes marijuana, how could that affect the economics of the drug trade among gangs? WBEZ reporter Natalie Moore investigates.&nbsp;</p><p>Where do you think we should start this investigation? How would you answer this? Comment below!</p></p> Fri, 29 Mar 2013 15:06:00 -0500 http://www.wbez.org/series/curious-city/reporters-notebook-if-illinois-legalizes-marijuana-how-could-affect-economics Paul Krugman on How to Fix the Economy http://www.wbez.org/series/chicago-amplified/paul-krugman-how-fix-economy-105594 <p><p>The success of President Obama&rsquo;s next term in office hinges on American economic revival&mdash;strengthening the labor market and addressing the persistent fiscal problems that threaten to move the country back into recession. Unemployment may be trending down, but it remains at levels that would have been inconceivable not long ago&mdash;at levels that <strong>Paul Krugman</strong> argues are unconscionable and unnecessary today.</p><div>In a partisan age with a gridlocked Congress, how can American leadership address the forces that are impeding economic growth? What kinds of policies are needed to restore full employment? Paul Krugman will presented in front of a sold-out audience and outlined recommendations for US economic recovery and described the fundamental steps on how to fix the economy.</div><p><iframe frameborder="no" height="166" scrolling="no" src="https://w.soundcloud.com/player/?url=http%3A%2F%2Fapi.soundcloud.com%2Ftracks%2F79840710" width="100%"></iframe></p><div>&nbsp;</div><div><div class="image-insert-image "><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/CCGA-webstory_5.jpg" title="" /></div><div class="image-insert-image ">Recorded Thursday, January 30, 2013 at&nbsp;The Fairmont Chicago</div></div><p>&nbsp;</p></p> Wed, 30 Jan 2013 15:59:00 -0600 http://www.wbez.org/series/chicago-amplified/paul-krugman-how-fix-economy-105594 'The Most Expensive Game in Town': A look at the rising cost of youth sports http://www.wbez.org/blog/bez/2012-03-29/most-expensive-game-town-look-rising-cost-youth-sports-97740 <img typeof="foaf:Image" src="http://llnw.wbez.org/blog/photo/2012-March/2012-03-29/youth soccer flickr.jpg" alt="" /><p><p style="text-align: center;"><img alt="" class="caption" height="333" src="http://llnw.wbez.org/blog/insert-image/2012-March/2012-03-29/youth%20soccer%20flickr.jpg" title="(Flickr/Erica Hampton)" width="500"></p><p>Kids cost a pretty penny these days. According to the <a href="http://www.cnpp.usda.gov/expendituresonchildrenbyfamilies.htm" target="_blank">U.S. Department of Agriculture</a>, it costs a middle-income, two-parent family $226,920, on average, to raise a child from birth to age 18—that’s almost 14 grand every year! That figure primarily accounts for general expenses like food, shelter, health and child care, transportation and education. The price tag for parents of the nearly 50 million kids who play organized sports each year is even steeper.</p><div class="inset"><div class="insetContent"><p><span style="font-size:10px;">Listen to Lester Munson and Mark Hyman on the Afternoon Shift</span></p><p>&nbsp;</p><p>&nbsp;</p><div class="mediaelement-audio"><audio class="mediaelement-formatter-identified-1333561907-0" src="http://llnw.wbez.org/sites/default/files/Lester Munson.mp3">&nbsp;</audio></div></div></div><br><p>In his new book, <em>The Most Expensive Game in Town: The Rising Cost of Youth Sports and the Toll on Today's Families</em>, sports journalist <a href="http://www.markhyman.com/" target="_blank">Mark Hyman</a> examines the cost of youth sports—from uniforms to equipment, league fees, travel, tournament fees and clinics. In the book, he tells the story of one father of three, Fran Dicari, who blogs about his expenses under the moniker “<a href="http://www.statsdad.com/p/youth-sports-costs.html" target="_blank">Stats Dad</a>.” Last year, Dicari spent over $11,000 on league fees, physical therapy, personal coaches, AAU fees, baseball cleats, basketball sneakers, turf cleats, golf shoes, baseball gloves, golf gloves, airline tickets, shirts, shorts and oh so much more.</p><p>Hometown hockey hero and current color commentator for the Chicago Blackhawks Eddie Olczyk also recognized the rising cost of recreation. And so the Chicago Blackhawks and the Blackhawks Charities created <a href="http://blackhawks.nhl.com/club/page.htm?id=74491" target="_blank">The Eddie Olczyk Award</a> to support young hockey players and teams in Illinois who may not have the means to play at a competitive level. Olczyk joined Hyman, ESPN.com senior writer Lester Munson and Steve Edwards on <em>The Afternoon Shift </em>to discuss the high price of play.</p><p>&nbsp;</p></p> Thu, 29 Mar 2012 17:23:00 -0500 http://www.wbez.org/blog/bez/2012-03-29/most-expensive-game-town-look-rising-cost-youth-sports-97740 Clever Apes #28: The critter economy http://www.wbez.org/blog/clever-apes/2012-03-20/clever-apes-28-critter-economy-97474 <img typeof="foaf:Image" src="http://llnw.wbez.org/blog/photo/2012-March/2012-03-20/THUMBNAIL_Gorrilla.png" alt="" /><p><p><img alt="Dario Maestripieri studies how humans behave compared with primates." class="caption" src="http://llnw.wbez.org/blog/insert-image/2012-March/2012-03-20/DARIO pic for post.png" style="width: 600px; height: 484px;" title="Dario Maestripieri studies how humans behave compared with primates. (WBEZ/Gabriel Spitzer)"></p><p>It seems like economics is a purely human invention, far removed from the jungle. But scientists say our ancestors were spending and investing for millions of years. So our behavior when we manage our portfolio or climb the corporate ladder resembles nothing so much as the interactions of apes or monkeys. In the latest installment of Clever Apes, we consider how our financial activity has deep parallels in the primate world. And furthermore, many of our most important financial decisions come from even more primitive impulses, deep in our lizard brains.</p><p>The University of Chicago’s <a href="http://primate.uchicago.edu/dario.htm">Dario Maestripieri </a>is a professor of comparative human development, evolutionary biology, neurobiology and psychiatry and behavioral neuroscience. (I usually abbreviate titles, but his makes me happy). He studies the intersections among our minds, our primate cousins, and evolution. In his new book <a href="http://www.amazon.com/Games-Primates-Play-Investigation-Relationships/dp/046502078X">Games Primates Play</a>, he details how the mechanisms of economics have their origins in our deep past.</p><p>Apes and monkeys play the market by choosing whom to groom and whom to attack, whom to sleep with and what food is worth risking a fight for. As Yale psychologist Laurie Santos explains, the psychology that governs those decisions didn’t begin with humans. So we see monkeys making the same kinds of classic mistakes that humans make, like “loss aversion,” where we work harder to avoid losses than to achieve equivalent gains. (<a href="http://www.ted.com/talks/laurie_santos.html">check out her TED talk </a>for a great explanation.)</p><p><img alt="(WBEZ/Gabriel Spitzer)" class="caption" src="http://llnw.wbez.org/blog/insert-image/2012-March/2012-03-20/THUMBNAIL_Gorrilla.png" style="width: 250px; height: 188px; margin: 10px; float: right;" title="(WBEZ/Gabriel Spitzer)">We’re also subject to the same quirks of biology as many non-human primates. Biologists have found that <a href="http://www.biologicalpsychiatryjournal.com/article/S0006-3223%2895%2900675-3/abstract">monkeys with high levels of testosterone and lower levels of the brain chemical serotonin </a>tend to take more risks: taking longer leaps between trees, challenging unfamiliar males, and so on. Maestripieri and his colleagues set up a <a href="http://insight.kellogg.northwestern.edu/index.php/Kellogg/article/the_biochemistry_of_financial_risk">similar experiment with business school students. </a>There too, those with higher levels of testosterone were more likely to make long-shot investments or go into a riskier profession.</p><p>Finally, we check in with neuroeconomist <a href="http://www.kellogg.northwestern.edu/faculty/kuhnen/htm/">Camelia Kuhnen </a>of Northwestern University. She finds that our investment decisions are heavily influenced by some of the most ancient parts of our brains. She and a colleague did an experiment where they <a href="http://www.kellogg.northwestern.edu/faculty/kuhnen/htm/RESEARCH/KWKW_2008.pdf">activated the brain’s reward center </a>using something that had nothing to do with money – in this case, it was sexy pictures. In males, anyway, this led them to make riskier bets in an investment game. Just the whiff of reward was enough to make these guys high-rollers … something we can thank our reptilian ancestors for.</p></p> Tue, 20 Mar 2012 20:25:00 -0500 http://www.wbez.org/blog/clever-apes/2012-03-20/clever-apes-28-critter-economy-97474 A behavioral economist on what works, and what falls flat, in global poverty relief http://www.wbez.org/episode-segments/2012-01-31/behavioral-economist-what-works-and-what-falls-flat-global-poverty-relie <img typeof="foaf:Image" src="http://llnw.wbez.org/segment/photo/2012-January/2012-01-31/Maternal Health_Haiti.JPG" alt="" /><p><p>When it comes to global poverty, there’s often a gap between the billions we pour in and the outcomes that actually result. A behavioral economist at Yale University, <a href="http://karlan.yale.edu/" target="_blank">Dean Karlan</a> is trying to uncover the reasons behind this gap.</p><p>Dean is co-author of a new book called <a href="http://www.poverty-action.org/book/index.html" target="_blank"><em>More than Good Intentions: How a New Economics if Helping to Solve Global Poverty</em></a>. It's a <em>Freakanomics</em>-style guide to development projects that work and projects that just don’t make the cut.</p><p>Dean tells <em>Worldview</em> what the world needs to do to make sure every dollar that's donated makes a difference in reducing global poverty.</p><p>&nbsp;</p><p><em>Dean Karlan is speaking this evening at the Buffet Center at Northwestern University, at 5PM. Read more about the event <a href="http://planitpurple.northwestern.edu/event/426611" target="_blank">here</a>.</em></p><p>&nbsp;</p><p>&nbsp;</p><p>&nbsp;</p></p> Tue, 31 Jan 2012 16:40:00 -0600 http://www.wbez.org/episode-segments/2012-01-31/behavioral-economist-what-works-and-what-falls-flat-global-poverty-relie Worldview 1.31.12 http://www.wbez.org/worldview/2012-01-31 <img typeof="foaf:Image" src="http://llnw.wbez.org/episode/images/2012-january/2012-01-31/africa1.jpg" alt="" /><p><p>Eugene Peba is a member of the Ogoni Tribe, an indigenous group in southeast Nigeria that's been persecuted for decades. Eugene fled his home country for the U.S., but now faces deportation. He tells <em>Worldview</em> why he may have to leave the United States.&nbsp; Also, when it comes to foreign aid, there's often a gap between the billions poured in to help people in need and the outcomes that result. Dean Karlan, a behavioral economist who teaches at Yale University, is trying to figure out what's behind this gap. Dean is the co-author of <em>More than Good Intentions: How a New Economics is Helping to Solve Global Poverty</em>. <em>Worldview</em> talks to Dean about his book, a <em>Freakanomics</em>-style guide which talks about development initiatives that work and don't work.</p></p> Tue, 31 Jan 2012 15:41:00 -0600 http://www.wbez.org/worldview/2012-01-31 Haiti two years after the earthquake http://www.wbez.org/episode-segments/2012-01-26/haiti-two-years-after-earthquake-95854 <img typeof="foaf:Image" src="http://llnw.wbez.org/segment/photo/2012-January/2012-01-26/haiti2.jpg" alt="" /><p><p>Two years ago this month, Haiti was hit by an earthquake that the United Nations called &ldquo;the largest urban disaster in modern history.&rdquo;</p><p>Since then, the U.N. estimates that more than two billion dollars in aid has gone into the country. But despite the money, efforts to rebuild have been painfully slow.</p><p>Haitian economist <a href="http://snl.depaul.edu/People/Faculty/lcomeau.asp" target="_blank">Ludovic Comeau</a> helps <em>Worldview</em> take stock of the complicated process of rebuilding Haiti. Ludovic is a professor of economics at DePaul University and the president of <a href="http://www.haiti-grahn.net/public/?lang=en" target="_blank">GRAHN-USA</a>, a think tank dedicated to rebuilding the Caribbean nation.</p><p>&nbsp;</p><p>&nbsp;</p><p style="margin-left: 1in;">&nbsp;</p><p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p><p style="margin-left: 1in;">&nbsp;</p><p>&nbsp;</p></p> Thu, 26 Jan 2012 16:58:00 -0600 http://www.wbez.org/episode-segments/2012-01-26/haiti-two-years-after-earthquake-95854