Econ 050

Since the financial crisis in 2008, the notion of a “bail out” has become something of a household term. But what about a bail in? Assistant professor Christiaan van der Kwaak researches the Eurozone, the 19 EU states that use the euro, and he says that there are still some fundamental flaws in the system feeding calls for exiting the union. Something has to give: either more nations will attempt to follow the UK’s lead and walk away from the EU, or reforms will have to be put in place to salvage the system. Van Der Kwaak says that a common EU budget could offer a way out of the current prisoner’s dilemma, but to what extent is the Dutch government prepared to get behind that idea?

Associate professor Jochen Mierau’s background is in economics, but as a founding member of the Aletta Jacobs School of Public Health, he is applying his expertise to a new discipline. Health outcomes vary from one nation to the next, but zooming in on the level of neighbourhoods can shed light on best practices that can be applied on a city or regional level. Mierau says that public health is not a spectator sport, and in our conversation about the increasingly interdisciplinary nature of this academic field, in honour of the school’s namesake, he talks about how health care interventions effectively amount to a form of activism.

Microcredit was a major buzzword in the world of development aid in recent years, being breathlessly praised as a breakthrough panacea. But our guest today, professor Robert Lensink of the Faculty of Economics and Business of the University of Groningen, says that providing small amounts of financial support to individuals and projects can still be an effective tool, like most other trends, some bad actors took advantage of it and exploited the men and women on the receiving end. Microfinance can still be a powerful tool when its recipients are equipped with the right tools to protect themselves, but what is the effectiveness of other forms of intervention? Can aid ever be a true silver bullet, or does the entire system need to change first? Professor Lensink sat down with Econ 050 to discuss about the pros and cons of intervention.

YouTube, Netflix, Google, Facebook: these digital platforms and services have all become seemingly indispensable and inescapable parts of modern life. But how much do users truly value ostensibly free online services? How much would it be worth to you to walk away from them? That often depends strongly on how you use it. Associate professor Felix Eggers found out that for the average person, 50 dollars a month was enough to convince them to unfriend Facebook for a month. Eggers contributed to research looking into the value of not using digital platforms, which is something quite different from the value of using them, and came up with a new way to measure the economic impact of platforms where the users themselves may be the most valuable product of all.

The Netherlands sees itself as an extremely equitable country, which is not entirely without cause: it was one of the first in the world to legalize gay marriage and provides at least some paternal leave. But when it comes to achieving genuine equality in the work place – not just between men and women, but also between majority and minority groups – professor Floor Rink says that this country still has a long way to go. Over the years, her research into organisational behaviour and leadership has examined the role of mentorship, how gender roles from a young age influence hiring practices and how transparency can push companies to put their money where their mouth is when it comes to diversity initiatives. We sat down in the studio to talk about how the glass ceiling forms far earlier for minorities, and how having any hope of getting rid of it will require recognising that it exists in the first place.

For young professionals in particular, starting a new job can feel like grasping in the dark. The uncertainty of trying to figure out your place in a complex work environment can become very stressful very quickly. You may feel like you have to say “yes” to everything that is asked of you, but does being involved in multiple projects at your workplace ultimately improve or worsen your job performance? Can sticking your neck out and volunteering to take on more work end up backfiring? Assistant professor Joost van de Brake looked into all of these questions in his recent research, and sat down with Econ 050 to discuss ways that employers may be able to provide more certainty for their staff in a dynamic work place. 

Being an immigrant, a teenage mother or a child born into poverty can dramatically impact your health throughout your entire life. The Netherlands is perceived internationally as an equitable country with a thriving middle class, and that is mostly true, but income inequality is growing, and more and more people are finding themselves in poverty even as the economy booms. It can take four generations for someone born into low socio-economic status to reach average earning levels, and even if you manage that feat, poverty and hardship in your formative years, or even before you were born, can lead to health problems like cardiovascular issues and depression later in life. Associate professor Viola Angelini’s research examines how life course factors like childhood hardship manifest themselves throughout our lives, even if we manage to be upwardly mobile, so I sat down with her to hear more about how generational poverty actually works.

Financial security is not the only measure of the welfare of a population. Safety, access to housing, medical care and education are just as important to your sense of well-being. But on a regional level, those can be somewhat misleading indicators: it was announced a few months ago that the inhabitants of Drenthe were the happiest and wealthiest in the Netherlands, even though the province has long had fairly limited job opportunities. Part of the reported satisfaction levels came from access to unspoiled nature, but more of was due to the fact that there were a disproportionate number of retirees living there. Recent research has also found that people with a recent migrant background and those without higher education feel that they do not experience the same degree of equality as other Dutch people. So how is globalization influencing people’s satisfaction with life and job opportunities in the north? Professor Marcel Timmer, who will be joining the board of the Netherlands Bureau for Economic Policy Analysis, sat down with Econ 050 to talk about the region’s place in the country and the world.

What is the difference between lobbying and buying influence? Since 2002, it has been legal in the United Kingdom for sitting politicians to hold board positions at private companies and serve on committees or propose legislation that could directly impact those companies. The reasoning given for these political hires is that familiarity with the inner workings of an industry make them a better informed politician, and that the skills that many politicians develop – strong networks, working together with different shareholders – make them a good fit for corporate board membership. But the companies that have a sitting MP on their board are likelier to have higher than average profits, and those that hire ex-politicians don’t experience the same bump. Assistant professor Swarnodeep Homroy looked into just how much a closer professional relationship between politicians and industry can be beneficial for those companies, and whether or not that’s a good idea.

What does it mean to make it in the north? Is it as simple as starting your own business or finding a job, or does it mean feeling truly accepted and supported in your professional and personal endeavours? There are thousands of internationals living in Groningen, Drenthe and Friesland, many of whom came to the region for their careers. But what are the companies and institutions that brought them here in the first place? On the 11th of July, the Make it in the North project will be launching a new professional platform to bring together talented internationals and internationally-minded companies in the region. I sat down with Michiel Kasteleijn from the international Welcome Centre North and Philippe Hondelink, the district secretary for Koninklijk Metaalunie to talk about what make it in the north projects all about what the new platform aims to achieve and what kind of unique challenges and opportunities face foreign professionals in the north.

Natural gas has been the Netherlands’ blessing and Groningen’s curse in recent decades. Even as quotas are reduced ever further, earthquakes induced by natural gas extraction continue to jolt the province on a nearly daily basis. But the country and the world need energy, and professor Ad van Wijk from TU Delft believes he has at least part of the solution: green hydrogen. Professor van Wijk helped to developed an extremely ambitious plan to convert the northern Netherlands into a green hydrogen hub, from production to distribution and transportation – but how plausible are those plans, and how much will they cost? We sat down with professor Van Wijk to hear more about this up-and-coming source of energy and what it could mean for the north.

The measles were effectively eradicated in much of the western world decades ago, yet the potentially fatal disease has made a fierce comeback in America and Europe due to growing anti-vaccination movements. What are the health costs of enforcing sufficient vaccine coverage in a country? How does a country choose which illnesses to vaccinate against – and how does the Netherlands’ vaccination coverage stand up to the rest of the world? Professor of Global Health Economics Maarten Postma joined us in the studio to talk about how the conversation and science around vaccines has changed in recent decades, and about the costs of medical action and inaction when it comes to inoculation.

What will the north look like in the future? Will it become the next Silicon Valley – and is that something we actually want to become? The tech industry is one of the region’s growing strong suits, but what does that really mean for job opportunities today and in the years to come? Nick Stevens, the Chief Digital Officer in Groningen, says that part of figuring out what the future holds for Groningen, Drenthe and Friesland is getting the cities and provinces to look beyond their own borders and recognize themselves as part of a single region. We sat down with him for a wide-ranging interview about the role of local government, businesses and educational institutions in developing and executing a new vision for the north.

For many internationals, food is an integral part of your sense of cultural identity, and moving abroad can often mean finding yourself longing for your favorites from home and missing the social element of a shared meal. But a region’s food scene is also very much an economic and business matter: how do you balance out chains and locally owned establishments? How does having a big student population influence the dining scene in a city? How cost effective is it to own and operate a food truck in a country that isn’t exactly known for excellent weather? Through her culinary blog De Smaak van Stad, freelance journalist Saskia Jonker has gotten a taste for what’s happening in the culinary world across the north, and she sat down with us to share her thoughts on the latest food trends and her personal favorite places to grab a bite in Groningen, Drenthe and Friesland.

Post-doctoral candidate Magda Ulceluse researches the intersection of immigration, employment and income equality. There are more than 9,000 businesses in the north that are owned by first generation immigrants, and work and education are what bring many immigrants here originally, but dual career partners and university graduates also need to find work. Is there any truth to the claims that immigrants steal jobs from the native population? What is the balance of brain drain and brain gain among member states? Ulceluse joined us in the studio to try and sort truth from fiction when it comes to migrants, job creation and economic growth.

What do the modern day Ivory Coast and the 19th century Netherlands have in common? According to research from the Groningen Growth and Development Center, the size of their economies is virtually identical. Professor Robert Inklaar, who is a participant in the Growth and Development Center, says that one of the center’s most powerful tools is the Penn World Table, which gathers data about the economic output and productivity of 180 countries around the world all the way back to the 1950s and even further in some cases. But what are the best ways to compare economic performance? How can intangible digital products and services be accounted for in measuring prosperity? We sat down with professor Inklaar to hear all about the past, present and even future of using data to figure out just how well any given country’s economy is doing.

Imagine you’re on the banks of a river, watching the white water rapids rage past you. You’re surrounded by a group of your closest friends who booked a rafting trip, but you’re scared. You are deathly afraid that the raft will tip over, and you’ve heard horror stories about people drowning in these waters. In theory, you could still refuse to get into the raft, but everyone else is getting in, and you don’t want to disappoint your friends. So, you get in. The raft starts moving along and gradually gains speed. The waters aren’t too wild yet, so you could still get out at this point, but it’s already a dangerous situation. You keep going and going, faster and faster, and then, the raft flips. This is how assistant professor Kristina Linke describes the process of how corporate executives find themselves gradually but inevitably crossing ethical lines professionally. In principle, they can see the danger coming from a mile away, but in practice, it can be just as scary to try and get out before certain disaster strikes. We sat down with assistant professor Linke to hear about just how easy – and common – it is for corporate staff to slide into financial fraud.

If climate change is global, why do so many countries, even those at direct risk of its consequences like the low-lying Netherlands, still seem to see it as a zero sum game? How can politicians, including those in the climate change denying populist party Forum for Democracy who won a large share of the vote this week, and companies be made to look beyond their own national borders and coffers to make change now? Associate professor Pim Heijnen has been researching ways to avoid climate catastrophe through cooperation, so I wanted to hear more from him about why it seems so hard for individual countries to put long term global interests above short term national interests.

Water management may not seem like an especially sexy topic, but in a country where about one-third of the ground is below sea level, it can be a matter of life or death. Water management has been a part of Dutch history since long before the Netherlands was even a single unified country, but most Dutch people don’t exactly know what the government entity that manages the water, the water boards, actually do. Even though the concept of making sure that the country doesn’t end up underwater seems pretty uncontroversial, there is a political side to water boards – should they focus exclusively on keeping water clean and keeping the land dry, or should they also be responsible for recreational use? Should the agricultural sector be charged more than private households for their water use? Corine Houben is a researcher at COELO, the Center for Research of local governments, recently carried out research into the difference in water board taxation rates across the country, so Econ 050 wanted to find out what this vitally important but little understood branch of government really does, and why your vote matters.  

Maite Lameris is a PhD candidate and lecturer at the Faculty of Economics and Business and has been working on research on new ways to see how a person’s political values correspond with how happy they are and how they vote. Lameris and her fellow researchers have also developed four new dimensions for measuring political identity to go beyond the limitations of leftwing versus rightwing.

When the financial crisis hit in 2008, the instinct of thousands of business owners around the globe was to cling to their power even more tightly, cutting across sectors and cultures. But more egalitarian approaches to leadership that share responsibility and power are better for weathering an economic downturn. In their recently published paper, “Tightening the leash after a threat: A multi-level event study on leadership behavior following the financial crisis”, professors Janka Stoker and Harry Garretsen examine how the heads of companies changed their leadership style in the immediate aftermath of the crisis. They are also co-authors of the book, “Taking the Hot Air Out of Leadership”, which goes beyond the pithy quotes and digs deep into what leadership truly means, in good times and bad.

Housing for students in Groningen in particular has gotten a lot of attention in recent years, but issues at the very top of the property ladder are one of the biggest reasons why many people are struggling to find affordable housing even though the Dutch economy is booming. Faculty of Economics and Business professor Dirk Bezemer, who is also a columnist for the progressive Dutch publication De Groene Amsterdammer, has been writing for years about how the housing market and private mortgage debt are intertwined, and he warns that the Netherlands is more susceptible to the next global economic shock than basically anywhere else in Europe because of how much private debt is held by homebuyers.

Given the daily reports about how the effects of climate change are already happening across the planet, it might seem like getting people to buy greener or more sustainable versions of products would be a cinch. But the bottom line for most consumers is still making sure that the product they buy actually works. It’s easier to persuade people to make more virtuous purchases when it comes to healthy foods, but the traditional, non-green versions of more indulgent buys like sports cars and chocolate bars are still more popular. And even if you do buy a vegetarian sausage instead of actual meat, does all that packaging around it cancel out any environmental benefits? Associate marketing professor Jenny van Doorn was kind enough to try and answer a lot of the questions I think many us find ourselves asking in the grocery store about how green our products are and what gets us to put them in our shopping basket.

Since a 3.6 magnitude earthquake in the Groningen town of Huizinge in 2012, the province has been reeling from more man-made quakes induced by natural gas extraction in the region. Is there an end in sight to the earthquakes? What happens after natural gas extraction ends in the north? Professor of regulation of energy markets Machiel Mulder and his colleagues at the Faculty of Economics and Business recently published a policy paper, “Gas production and earthquakes in Groningen: reflection on economic and social consequences”, so in this episode of Econ 050, professor Mulder talks about how he was surprised by the government's decision to shut down gas extraction in Groningen altogether by 2030, the costs involved in stopping, and just how interwoven the Dutch government itself is in the industry.

Assistant professor and Rosalind Franklin Fellow Milena Nikolova has looked into how one partner unexpectedly losing his or her job can impact the happiness not only of the recently let go employee, but also their spouse's well-being. Although income is obviously important, it's not just about money. How can companies soften the blow for family members when carrying out lay offs - and should they?

Trying to divine what the United Kingdom will be like in a post-Brexit world is a daunting task, but Bart Los, a Professor of the Economics of Technological Progress and Structural Change, is working to do just that: crunching the numbers to figure out what the impact of Brexit is likely to be on jobs and the economy not only in Britain, but in neighbouring countries with extensive trading relationships, including the Netherlands. He and his research partners have analysed what industries and regions seem likeliest to take a hit after the UK leaves the EU, and to put it bluntly, it doesn’t look pretty.

Diversity in the workplace is good for business. It brings fresh perspectives and creativity, and helps companies make sure they have the best talent working for them. However, being an international worker can come with disadvantages. Traci White sat down with postdoctoral researcher Burcu Subasi to hear how her research reveals that being in a minority at work can hold you back.

From your friendly facewash to your trusty toilet cleaner, companies love giving products personalities to encourage us to buy them. It's a phenomenon called anthropomorphism and it's rooted in human psychology. To hear about how it works, Traci White caught up with Jing Wan, an assistant professor at the Faculty of Economics and Business of the University of Groningen who researches this very topic. Find out why brands want to be your buddy too!

US President Donald Trump came to power on a platform of challenging unfair trade deals and taking on China. But what does a trade war actually mean, and who wins when tempers flare and tariffs spike? To find out, Traci White sat down with Tristan Kohl, assistant professor and trade economist at the Faculty of Economics and Business of the University of Groningen. He explained the evidence indicating the ultimate losers are consumers in the United States.