measuring success

We are hours into the new year and I find myself contemplating and gauging the success of 2014 for myself, as some of you may also be doing, at this time.

Some of us may not have had the banner year we were hoping for. For one reason of the other, certain things may not have worked out. Hell, everything may have even failed, at least in “our heads”. That’s definitely NOT to say the year wasn’t a success.

Success is very relative to each individual. Our perceptions/definitions of success are constantly evolving with time and new experiences. Being successful generates a positive state of mind that one may not necessarily be fully aware of unless said one really takes the time to step back and reflect. Let me make this clearer.

2014 for me was probably my most defining year. It really shook and challenged some of my most fundamental beliefs and aspirations on many different levels. The struggle didn’t just start and end with graduating college and finding a job but really struggling with being able to take calculated risks with my future. Risks that could potentially promise me the moon and stars if paid off. To add to this struggle, I’d have people telling me that I was making excuses for myself and taking the easy way out by not taking those risks. Funnily enough, looking at some of their life decisions it is clear that they are hugely averse towards taking risks themselves. All said and done, they followed the well treaded path and emerged successful in their own right. Do I therefore follow a path similar to theirs or do I take the road less traveled? Thinking back, this and many other micro struggles really put life into perspective for me. I may not have made a lot of headway in terms of pursuing my dream but all this time has given me the strength to make informed decisions. I now know exactly what I’m going to do given the options and the time I have. It also goes without say that I grew up a hell of a lot in a very short timeframe. This, to me is progress/success.

This sort of success, if I may, should never be discounted and regarded as being inconsequential. It may be intangible but is still highly crucial and consequential in driving progress. It is VERY important, just as we affirm tangible changes in our lives, to affirm intangible changes like this and continue working at our goals with just as much focus, if not more.

Bottomline, try rehashing everything negative that had happened in the past year and find any growth/realization, however infinitesimal. I promise you’ll find it. That previously disregarded bit of success could in fact be the small key opening a little door towards enabling you to achieve the many tangible successes and affirmations we so desperately desire.

Happy New Year everyone! x

Aside

The hardest thing about graduating is coming to terms with the realization that our paths may never cross again. We have such limited time on this planet that it seems wasteful not to be able to spend every precious moment with each other.

Saving LaGuardia

By Vishnu R | October 13, 2012 – 6:55 pm |

*This was something I wrote for an Economics Blog. Thought I’d just keep this blog alive by sharing it here. Feel free to trash/comment on anything I say.

 About this time a month ago, I was making my way to Ann Arbor for school all the way from an Island in another part of the world. I vividly remember taking a cab from JFK to LaGuardia (LGA) to catch the 4pm flight to Detroit and was somehow not looking forward to it at all. Having transited through LGA a couple of times before, I wasn’t entirely sure if I’d reach Detroit at the promised 6pm arrival time, simply because of the possible delays I’d experience at LGA.

As one of the busiest airports in terms of passenger traffic, LGA is the biggest single aviation market in the world.  With “just two intersecting runways and overcrowded terminals, taxiways and gates.” (WSJ) LGA’s efforts to ease flight delays and regulate air traffic for the last decade have yielded no effective long-term solutions. It is still facing the same problems it faced since before 911.

Delta Airlines Inc. hopes to capitalize on this by making it more attractive for passengers to travel. According to the WSJ, “After acquiring a large block of landing slots and gates from US Airways Group Inc.” Delta has “added more than 100 additional flights a day at La Guardia” (WSJ). The basic idea is that, with careful planning and scheduling of flights within the ‘Delta Hub’, expanding its terminals and its expertise in handling overcrowded hubs, Delta hopes to become the first choice of travel in LGA by winning over the confidence of people in it ability to manage flights efficiently. And with flights spread out in JFK as well, this would ultimately enable Delta to claim a greater portion of New York’s aviation market share.

Delta therefore becomes the more attractive flying option for connecting passengers and passengers flying out of New York because of its management efficiency. There would be decreased waiting times and delays. Delta is also able to profit from this by ‘thinking at the margin’.  It is able to fill more empty seats on planes with connecting passengers and sell tickets to them and standby travelers at a lower price thus profiting marginally from defraying the marginal costs of perhaps what the passenger consumes on the plane for instance.

Of course, it can be easily foreseen that Delta’s rise will be matched by competition from its contemporaries. Other airlines operating in LGA would be collectively seen as second choice after Delta assuming that ticket prices remain roughly the same.  This pressures airlines to end up increasing the frequency of their flights to cater to more consumers or lowering their ticket prices. Lowering ticket prices might increase the demand for these second choice airlines, but this does nothing to solve congestion and delays. Passengers would eventually realize that they’re better off sticking to Delta by paying just a little more on their tickets.  Also, airlines would not be able to increase the frequency of their flights easily without paying more.

This new development could go either way. It could be beneficial or it could just perpetuate the problem. At the end of the day, congestion could either worsen with airlines paying more to increase the frequency of their flights to compete with Delta or Delta could eventually become the airline of choice with its new acquisitions from US Airways Inc.  Sometime in 2000, Congress lifted restrictions on the system by allowing an unlimited number of new flights to underserved markets like Buffalo and Savannah, GA. It could be assumed that at this point, it would’ve cost less to increase the number of flights to these locations. Because of this, airlines proposed adding 600 new flights a day. However, according to a NEWSDAY article published on the 9th of April 2001, “About 300 new flights were added, and the resulting jam pushed LaGuardia past Chicago’s O’Hare as the nation’s worst airport for delays.” If this were to happen today, once again the Port Authority would have to intervene when the congestion situation gets worse and this would be detrimental to the reputation of the airport and the airlines concerned.

Delta’s plans of building a hub and increase the number of flights could either work or fail. If it fails, like the WSJ says, it could be ‘expensive and embarrassing.’ Whatever the case, it is a step in the positive direction to help relieve LaGuardia of its congestion woes. Only time will tell whether or not it’ll work.

References

http://online.wsj.com/article/SB10000872396390443749204578048374059969436.html

http://web.mit.edu/airlines/news/news_archives_documents/laguardia-quandary.pdf

Brief Principles of Macroeconomics 6th Edition – N. George Mankiw.

 

Pre-Gaming, Binge Drinking and a Doomed Economy

*This was something I wrote for an Economics Blog. Thought I’d just keep this blog alive by sharing it here. Feel free to trash/comment on anything I say.

Earlier in the year, David Cameron (PM of the UK) announced price revisions for alcohol purchases in the UK to deal with errant and irresponsible drinkers.  His office cites that “irresponsible drinking costs the U.K. £21 billion a year. There were almost a million alcohol-related violent crimes and 1.2 million alcohol-related hospital admissions in the country last year.” (WSJ).

Of course, we know that a high amount of alcohol consumption is a negative externality and adversely affects the economy. Productivity and efficiency drops. People would not report to work on time and even if they do report to work after a night of debauchery, their productivity levels would not be optimal. They’d also take days off from work to recover from their alcohol-related problems, especially for those hospitalized. Employers would find the costs incurred from this to be high. They may be forced to downsize or rehire. Unemployment would thus rise. With a rise in unemployment, so would crime. Apart from the usual larcenies to fund day-to-day living necessities, other forms of crime would involve alcohol related crime due to alcohol addiction. Addicts who’ve lost their jobs and sources of income would probably steal in order to gain access to alcohol just to satisfy their cravings. This would be an after effect of bankruptcy perhaps. If the British government doesn’t intervene, this could bear terrible long-term consequences. Long run output and demand would get affected because of this and growth, as a consequence of that.

To tackle all of this, the government had decided to impose a price floor on alcohol drink purchases in the UK. As we’re all aware, price floors deter alcohol suppliers from lowering prices any lower than they’re supposed to. A price floor would be effective in this case if it were above the equilibrium price. As shown in Figure 1,

it would be illegal for alcohol suppliers to set their prices any lower than the price floor. The government pegs it at a level where supply exceeds demand, at a position higher than the equilibrium position where supply is meeting demand. This deters more people from buying alcohol and “”pre-gaming,” or loading up on cheap store-bought booze” (WSJ) before getting fully sloshed at a pub or nightclub. In addition, it also reduces violence and crime rates.

When you read the article by the Economist, you can’t help but wonder what all the hoopla is about. After all, “Since 2004 alcohol consumption has dropped by one-eighth, to 8.3 litres per person per year, according to an official survey.” (Economist). The Economist goes on to argue that David Cameron’s proposed intervention measures are based off of outdated data.

Even if it were indeed based off of outdated data, imposing the aforementioned price floor measure would supposedly do little to really hurt the alcohol trade. According to the article, companies are looking to boosting their profit margins as opposed to achieving greater sales. This could be due to the fact that alcohol doesn’t go bad easily. It can be preserved for long periods of time (for a year or more). So there isn’t any wastage costs incurred by alcohol companies. Therefore, even if short run demand drops, retailers are able to make better profits from the sale of alcohol, exceeding usual profit margins.

Just going off of The Economist article, it seems unnecessary for the government to intervene, but based on statistical evidence alone, in the first paragraph, it makes it imperative for the government to step in. While alcohol consumption may have dropped over the years, it still seems like a big problem in the UK based on just the hard facts and it thus makes full sense for an external corrective force to step in to correct this externality.

References

http://online.wsj.com/article/SB10001424052702304724404577297814271968518.html

http://www.economist.com/node/21564220

Image Courtesy:

http://ingrimayne.com/econ/AllocatingRationing/PriceAsRationer.html

The Detroit-Ontario Bridge Project

*This was something I wrote for an Economics Blog. Thought I’d just keep this blog alive by sharing it here. Feel free to trash/comment on anything I say.

Trade has always been the trademark of the free world economy. It brings about a more efficient allocation of resources within individual economies based on their respective comparative advantages. It is an excellent means of fostering good long-term diplomatic and harmonious relations between nations. Having said that, it is as important to engage in Trade as it is finding new means of facilitating it in a more efficient and effective manner. The new Detroit-Ontario Bridge venture known as the New International Trade Crossing (NITC) hopes to achieve this goal.

This new bridge will be fully financed by the Canadian government as the Michigan Republican Legislature has blocked proposals for public funding from its side. They feel that the bridge would be “a potential white elephant whose costs will be borne not by bridge users but by taxpayers.” (WSJ) If taxes increase people would not be happy, especially since they’d be paying unnecessarily for another bridge across the same 2 states. Also for the “economically hard-hit Del Ray neighborhood in Detroit, projected as the site of the bridge’s U.S. landing point.” (WSJ) this would be a double whammy, since the people in that neighborhood would have to pay for the bridge as well as contend with the din created by 24/7 incoming and outgoing traffic.

Previously, the Ambassador Bridge, owned by Billionaire Manuel Maroun was the only connecting pathway between Detroit and Windsor. This 4-lane bridge alone “is the busiest commercial crossing in North America, and congestion at peak times is a problem.” (The Economist) Also, lorries that enter Windsor, end up mixing with traffic in Central Windsor and cause congestion problems there as well. Traffic Congestion is an example of a negative externality that could negatively impact trade and investment. This is especially so for the car industry as highlighted in the articles. According to The Economist, “Complex cross-border supply chains mean that some components of a car may cross the border up to seven times”. If there were huge traffic delays every time parts were being transported, this would collectively long time for cars to be made. As such, this could negatively impact the economy in that the countries might lose their comparative advantages in producing cars. Other countries would import less from them, and this would negatively impact GDP and Economic Growth in the long run.

The bridge promises to help ease traffic flow as the NITC intends to have 6 lanes “with special lanes for preapproved traders”. This would help reduce labor costs as well as manufacturing time. As reported by Canadian policy makers in the WSJ article, “Canadian exporters have complained for years the congested border crossing connecting Windsor and Detroit costs the economy the equivalent of nearly US$16 billion a year in delivery delays and increased compliance burdens.” Hence it would be in the interests of both states to come together and make this happen. Also, traffic on the bridge would not be directed into Central Windsor. It would be directed “into motorways on either side of the border.”. This would help ease congestion within Central Windsor as well.

Apart from being a great way to boost GDP and ease traffic flows, the bridge would help create more jobs thus reducing unemployment and boost investor sentiments. According to The Economist it would help create 6800 permanent jobs to help manage the bridge and an additional 6600 new jobs over 4 years to assist in road repair works in Detroit that would be funded by the American Federal Government should the project be given the green light. This causes long run output to rise and as a result the natural rate of employment for both economies. As the result, the long run aggregate supply shifts to the right. Also, observing the ease at which materials and labor inputs are transported across borders, investors gain greater confidence in the efficiency of the economy and the general allocation of resources.

The Bridge project is something that should definitely happen just because it adds to the GDP of both countries, eases traffic congestion, provides employment and boosts long run investor sentiments. $550 million is a small price to pay for an increase in annual GDP to the effect of “US$16 billion” (WSJ).

References

http://online.wsj.com/article/SB10001424052702303822204577468383034028286.html

http://www.economist.com/node/21563756