For a long time, the television industry used to be a rather dead one. A consumer electronics store would sell you a humongous set, after which you’d get access to a fixed number of channels through a subscription offered by a local cable company. Understandably, this was a huge thing at the time. Just think about it: moving images on a screen — in colour! Mind is blown, right? Or perhaps to be more accurate: mind used to be blown, because this stuff seems all too trivial in today’s crazy world, which couldn’t go one day without monitors. And the technological developments just keep coming, because as if digital TV weren’t enough already, we now have something new on the horizon again: smart TV. Now, I don’t think anyone with a black-and-white set could possibly have foreseen what would come of these funny-looking rectangles merely half a century later, but here we are anyway… Rhetorical questions Let’s get straight to the point here: who still watches televised films anymore? Who still waits until a predetermined date and time for their favourite series to air? I hope you like rhetorical questions, because that’s exactly what these happen to be. With services like Netflix and HBO on the rise, traditional TV has gradually been losing power to these more flexible ways of consuming TV — much in the same way that streaming services have done in the music industry. Will the TV industry suffer the same fate, becoming increasingly fragmented over time, or will it keep itself together? And what do these changes mean for the cable companies? Cable companies, whose main source of income is obviously the subscription fees that they charge, might find themselves in serious trouble because of this development — especially in the long run. As consumers continue to demand more flexibility in the way that they consume TV, their disregard of many of the channels on offer will soon come to the industry’s attention — as well as their own. As soon as people come to realise that it doesn’t make much sense to be paying for 100 channels if they only ever watch about 10 of those, they’ll demand change. So in order to keep these consumers on board, cable companies will have to find a way to continue to appeal to them. That won’t be easy, for the pull from the aforementioned services is getting stronger and stronger with each passing day. Back to basics So what might watching TV look like in the future? For one thing, it’s gonna be a much more flexible experience. Whether you like it or not, the days of that big rectangular box sitting in the corner of the living room, with a family happily watching a game show together, appear to be over. In the future, practically any device that can connect to the internet will be a TV, and we can already start to see traditional TV subscriptions declining in the United States. Personally, I think that there is little hope for the cable companies, and to be perfectly honest, I don’t feel very sorry for them. Think about it: what do cable companies actually do? While it’s true that they were the ones who provided households with the infrastructure that was required to even watch TV in the first place, today they’re just an intermediary, merely bundling TV channels into a package that they then sell to consumers. With the rise of the internet, there’s clearly no need for such an intermediary anymore. The truth is that, beyond the infrastructure, cable companies are providing little (if any) value today. That doesn’t mean that they’ll be gone with the wind, as some have begun to offer new services (such as home security), but the cable business as we know it today will soon be a thing of the past.

The attention on how social medias and search engines shape our perspective on different critical topics has come back to the spotlight after the “shocking” US election result. I use the word “shocking” in this context because if you were like me, regularly following the news and information provided by the mainstream medias and seemingly credible election result forecasting websites (e.g. FiveThirtyEight); you may be convinced that the chance of Donald Trump winning the election is as small as for Chicago Cubs to finally win the MLB World Series. That’s why after the election, there are discussions that instead of the mainstream media, social medias like Facebook and search engines like Google play an important role in influencing the voters’ decision and influence the election outcome. According to the studies conducted by Pew Research Centre in 2016, around 62% of the people in America use social medias as the platform to get news. This phenomenon indicates that audiences are nowadays able to obtain news from a much broader range of sources instead of only the information that are edited by the mass media. And similarly, as long as you are connected to the internet, you can setup your own media business with almost no entry barrier. The reason is that most of the income for the news industry comes from advertising revenue, and now as more people preferred to get news online, anyone who is capable of putting up attractive content can also make money out of it. At the same time, they can spread the message with very few restrictions. The advantages are that the distribution of news is no longer the privilege of the news media, but on the other hand, this also implies the trending of ‘false’ news and hoaxes become more likely to occur. Misinformation and lacking good flow of information can be problematic and give rise to damaging outcomes on the society. More specifically, given the example of an election, if the electorate is unable to get a good flow of information, it is not possible to have a functioning democracy. It is that serious. To properly analyse the impact of narrowing view and misinformation, let’s start from social medias — as aforementioned, the majority of the audience now consume news by scrolling through their news feed. Social medias were created initially to connect people, but as they become almost inseparable from people’s daily life, they have a greater responsibility on the service they provide and the resulting impact on the society. Companies like Facebook earn their profit mostly through revenue from advertisements – the more user engagement, the more potential profit they can generate. Furthermore, as most print medias are transforming themselves towards digital media companies, their revenue relies on digital ads more than ever, and they have to compete within an environment dominated by large companies like Facebook and Google. It is inevitable for them to promote and gain visibility via the help of social medias and leading search engines. Therefore, if Facebook and Google aim at maximising their profit with little attention on designing algorithms which take ethics into consideration, the negative impacts are immense. For instance, your Facebook news feeds are not presented to you in chronological order. Instead, it is ranked from the feeds that contain the information that you may find more interesting or relevant to you. So, similarly, you are much more likely to reach the news that matches your view and political stance, and the rest of them will just not make it into your news feeds without notifying you. Depending on who you are friends with, your past likes, shares and comments behaviour, Facebook tailored-made the information that is presented to you. This phenomenon is called the “filter bubble”, when the algorithm selectively cut out some information you may enjoy less, and create your own online universe consisting of news from a particular point of view and opinions from like-minded people. We then gradually develop tunnel vision and live in our online comfort zones since it rarely exposes us to opposing news and views. Apart from that, you have to be aware of the fact that there is no “standard” Google, which means that the search result of the exact same term on Google is different for every user. According to your current location, previous searches and clicked links, the algorithm will generate personalised search results for you. The most dangerous part is that not only people’s view are unconsciously narrowed but also the mechanisms of screening out fake news and hoaxes are not coded in the algorithm, thus allowing misinformation to spread around the internet. Furthermore, fake news usually use clickbait to attract views, and many people cannot resist the temptation to click on a news with a title that aroused their curiosity. The more views it has, the more advertisement revenue is generated, and the more likely it will appear on your news feeds or the first few pages of search results. We are now more isolated from the news and information that we need to know but were edited out by the algorithm. You can argue that before people started to consume news online, people already had the tendency to choose specific a media or newspaper because it is close to their political ideology. But in the past a human was involved in the process of deciding which news and information to expose to their audience, so although the news was probably biased but not entirely fake. The challenge for now is for social media to acknowledge that since they are the platform where people consume news, misinformation has to be dealt with seriously. At the same time, be cautious on defining whether it is a fake news or just an opinion which is not commonly accepted. In addition, we need to alleviate the filter bubble problem, thus, more transparency is required. For instance, Facebook should inform their users that everyone’s news feeds have been programmed by an algorithm, and this depends mainly on which factors. Instead of relying on Facebook and Google to adjust their algorithm or vet news, we can take some actions as well. Firstly, use social medias wisely, be conscious of how they decided on what you can see and what kind of information have possibly been edited out. Secondly, we should always be skeptical about the news, no matter on which platform they are presented and whether they are from mainstream or alternative medias. Besides the capability of recognising whether a news is fake or not, there are also many forms of media bias that you should look out for. Thirdly, try to balance out your news sources, be aware of the fact that not everyone thinks the same way as you, and for most of the time, these sources exist for a reason. Mix media with liberal and conservative biases together to make up your daily news consumption. (As far as I am concerned, empirically, there is no neutral media) Most importantly, be open-minded about different points of view, be open to discussion and be willing to communicate your beliefs with others. One day, people will probably look back in disbelief that we let the internet tear us apart to such an extreme and even threaten democracy. It is important that we act now. The choice is between democracy and the bottom line of social media, and we know very well which one is better.

As of September 1st 2017, UvA Economics and Business (FEB) will split up the bachelor’s in Economics & Business into two separate bachelor’s programmes: Business Administration and Economics & Business Economics. Both new bachelor’s degrees will focus on the international position of the University of Amsterdam and will therefore be in English. There will no longer be a Dutch and international stream, since they will be put together. However, Dutch students will still have the opportunity to follow their tutorials in Dutch, at least during the first year. There is definitely a lot of change to come, but what is the main reason for this division, what are the changes, and how is it going to be implemented? Reasons for the change Economics & Business is currently one of the largest bachelor’s degrees provided by the University of Amsterdam. Approximately 12.8% of all bachelor’s students enrolled in the academic year 2015-2016 chose this bachelor’s programme. The programme is rather broad since during the first year courses from four different disciplines – business administration, economics, business economics, and for the Dutch stream also fiscal economics – are provided. This broad first year used to be a unique selling point for the UvA, since no other university within the Netherlands offers a programme that includes all four disciplines during the first year. In the second year, students choose a specialisation, such as Business Administration, Accountancy & Control, Finance & Organisation, Economics & Finance, Economics, or they can continue with the Dutch bachelor’s in Fiscal Economics. Students therefore get the chance to base their choice for either of the specialisations on the experience they derived from the courses, instead of making that decision beforehand. This is especially useful to doubting students who cannot yet tell the difference between business economics and business administration, or do not know whether they prefer economics over business administration. On the other hand, students who do know which specialisation they would like to do may not be attracted by the diversity of the first year. For example, a student who wants to study business administration does not necessarily need the mathematics and quantitative statistics courses offered during the current first year of the bachelor’s for a successful continuation. The fact that the first year now offers too little of each specialisation is one of the reasons for the division. Besides that, the University of Amsterdam, and mainly UvA Economics and Business, is becoming more and more internationally oriented. Last September, the faculty has been accredited a ‘Triple Crown’ status by the Association of MBAs (AMBA). This is a credible sign that the UvA is doing a great job on both a national and an international level. International acknowledgement is of great importance, especially in the field of economics and business. Due to globalisation, companies and economies have become more focused on international trade, and, therefore, it is important to study these concepts with an open mind and from an international perspective. The changes in the bachelor’s programme are meant to create this kind of mindset and perspective. Hopefully, the new programmes will attract more international students, so that the combination of internationally oriented courses and an international community will match reality better. The changes The division of the bachelor’s will lead to new curricula. The bachelor’s in Economics & Business Economics will resemble the current bachelor the most, although some slight differences will appear. First of all, the courses Marketing & Strategy and Organisation & Management will no longer be part of the programme, since these two courses are part of Business Administration. These courses will be replaced by Principles of Economics and Business, and Economics of Market and Organisations – which currently is in the second year of the bachelor’s programme. After the first year, the Fiscal Economics track parts from the bachelor’s, which was already the case in the original situation. During the first semester of the second year, the courses provided will cover in-depth knowledge of statistics, econometrics, and the concept of money. During the second semester, it is time to choose a major: Economics or Business Economics, which is quite comparable to the current situation. During the first semester of the last year of the bachelor’s, every student is free to do whatever he or she feels like: study abroad, do an internship, do a minor, or choose electives that are related to the study field. The second semester of this third year will contain courses within the specialisation that was chosen in the second year, whereafter writing the thesis will be the final job to complete the bachelor’s. The bachelor’s programme in Business Administration is quite different. Courses that will be provided during the first year are Principles of Economics and Business, Strategy & Organisation, Economics, Business Research Methods, Qualitative Data Analysis, Organisational Behaviour, Financial Accounting, and Business Operations and Processes. During the second year, all departments of business are discussed (e.g. marketing, accounting, finance, innovation), and some supporting courses are provided. This year will give business students a solid base of business administration and the organisation of companies as such. The third year is all about tailoring your own programme, for example, by focusing on obtaining some practical experience, but it’s actually quite the same as the third year of the other bachelor’s; students are free to go abroad, do an internship, or choose a minor. However, during the second semester of the third year, students are to choose a specialisation, which is either Management, Accountancy & Control, Finance, or Entrepreneurship & Digital Business. After the specialisation, the thesis follows. A significant advantage to this new bachelor’s programme is that it will become possible for business students to get a master’s degree in Finance, Accountancy & Control, and Business Administration. Students who have chosen the Business Administration track in the current bachelor’s, for example, are not able to do so, since certain courses that are not provided during this track of the bachelor’s are required for enrolment in these master’s programmes. Another difference with the current programme is the main language. At this moment, the programme is divided into two different streams: the Dutch and international stream. In the Dutch stream, most lectures and tutorials are obviously in Dutch. In the new programme, there will eventually be no distinction between the two. All lectures will be in English and are for both international and Dutch students to attend. During the first year, it will still be possible for Dutch students to attend tutorials in Dutch if they please, but later on all tutorials will be in English only. This is done to improve the cohesion among students, and will lead to a more diverse community, which – as we have all learned during the Organisation & Management course – will increase creativity, motivation, and performance. Implementation The new programmes will be implemented stepwise starting the coming academic year. Year 1 will be implemented in 2017-2018 and replace the old programme’s year 1. Year 2 will follow in 2018-2019, and year 3 in 2019-2020. Students who have already started the Economics & Business bachelor’s can obviously finish the original bachelor’s, but they might face some difficulties if they do not pass their courses on the first attempt. Some courses from the current bachelor’s are to disappear and have to be replaced by a similar course. The details for students who in the future might face these kind of problems and transition arrangements are to be announced no later than March 1st, 2017.

One thing about mankind that has always surprised me with is its ability to create complex social structures, capable of equally distributing duties and responsibilities for the sake of efficiency. This is something we observe in other animal species, such as ants and bees, whose colonies are so efficient and enduring exactly because each member of the community has a specific role, which it fulfills with absolute dedication. To be fair, if you consider that unemployment is not a thing in animal colonies, you might argue that they are even more efficient than human societies in certain aspects: everyone has a purpose, and everyone contributes to the common good, which is already more than most people get. However, as far as the sophistication and refinement of social roles and responsibilities goes, we humans took this organization to the next level. Think about state organization, with powers split into three branches following Montesquieu’s prescriptions: a Parliament to create laws, a government to enforce them, and a court to punish whoever violates them. And the Parliament, which elects the government, is in turn elected by the citizens and is supposed to represent them. And then federal states or regions, provinces, municipalities, districts: a perfect chain of command, the result of centuries of tyrannies, civil wars, revolutions and dictatorships. This concept of dividing authority and responsibility to avoid the suppression of freedom is so embedded in our mind that we decided to implement it even in non-political environments, such as business, the military, and even education. The University of Amsterdam has a fairly complex structure, for an educational facility: there is the Rector, who together with the Board of Executives makes the most important policy decisions for the whole university; then come the Deans, one for each Faculty, which together with the Faculty Boards make decisions at the Faculty level; then come the Workers’ and Student Councils (both on the Central and the Faculty level), which offer advice and input as to how to improve workers’ and students’ conditions within the university. Then there also is a Senate, formed by representatives from each body, which like other kinds of Senate has the function of creating proposals, which are then passed on to the Rector or the Deans for approval, depending on the issue. But why does a university need such an articulate administration? Well, the thing is a public university receives funds from the state, but it can also receive external funds through partnerships and all sorts of deals. As it often happens when money enters into play, university governance is needed to prevent the university from becoming a business at an expense of the actual education of students. What form such a governance should have, though, is a matter of wide discussion. And just like a country’s government may call its citizens in a referendum when neither the majority nor the opposition can find an agreement, so may a university appeal to its own public – the students and employees. From November 23rd, the Decentralization and Democratization committee of the University of Amsterdam will launch a referendum to substantially re-shape the athenaeum in a way that better represents its public. There will be three referendary queries submitted to the vote. The first query involves a charter of values to be implemented by the University, should the motion be approved. The core points of the charter are: connection between university and society, dynamic growth, critical scientific method, universitary community, decentralization, autonomy, participation, reliable administration. The second motion concerns the approval of a new-style Senate with a redistribution of seats to include more members of workers’ and students’ organizations. In particular, student representatives will have 20 seats under the new Senate. The third and final query is not a simple yes-or-no issue: it requires to choose between four possible governance models for the University. Each model has been assigned a different color. The Blue model, for example, simply signifies the current system, with the Executive or Faculty Boards making policy, depending on the jurisdiction, and Student and Workers’ Councils and the Senate serving as advisory institutions. The Orange model is a slight variation of the Blue model, which increases the possibilities and power for external participation  in policy-making by increasing the rights of the advisory Councils, for example by granting them right of consent or veto power. The Yellow model, instead, applies a major change by assigning policy-making powers to new Councils made equally of students and employees. Finally, the Green model advocates a system where Education and Research Committees , committees formed of professors and other UvA employees that develop new courses and programs for education and research, enjoy a relative autonomy from the central or faculty administration and can self-organize as far as the study and research of their field is concerned. Every UvA student and employee can vote in this referendum, casting one vote for each motion, until the 11th of December, when the polls will close. But how? On the starting day, you will receive a link via the University newsletter in your student e-mail, which will allow you to submit your vote online. Nice and easy. But will you actually vote? You see, you might feel this kind of issue is not important enough, but then what happens when something bigger comes up, something that can affect your community, your country, maybe the world? We need to start small, before we can think about changing the world. Making choices for the community we belong to is formative, it makes us more aware and responsible citizens. Yes, voting may take time and effort, but this is the thing: caring about things takes effort. It is easy and alluring to remain apathetic to our surroundings, but then do we really have a right to complain when society fails us? We can’t really expect or feel entitled to anything unless we take action. And voting is really the easiest way. So vote, now that you have an opportunity to really make a difference, to show the students that will come after us that we cared about them too. Make it count. You can vote by using a link that you should have received in an email. If you haven’t received any email, go to this page to find out if you’re eligible and what to do next. For more information on the referendum visit this page.

UvA Recap – by Daphne Sweers Facilitated by the University of Amsterdam, the Democratisation and Decentralisation Committee will have an advisory referendum on its proposals from 23th of November until the 11th of December. Many of you will recall the protests in 2015 and eventually the occupation of the Maagdenhuis, which reflected a high degree of discontent concerning the level of democracy and decentralisation of the University of Amsterdam. As a result, the Democratisation and Decentralisation committee was established to examine and develop new organisational models to combat this discontent and, of course, to stimulate democracy and decentralisation. In the referendum, you can vote on three different aspects: The level of desirability of a ‘new style’ senate The level of desirability of a charter displaying the core values of the university Four different governance models, each in their own way overcoming the aspects that caused the protest: The green self-organising university, where the involvement of staff and students will be according to levels of self-government. The yellow participatory university, where boards consisting of staff and students can determine the policy of the university. Involvement thus is according to a representative democracy. The orange dual university, where the current governance model is adapted by extending and reinforcing the role of the current representative bodies to increase the involvement of the entire community. The blue existing university, which is most similar to the current governance model. However, small adjustments in the governance structure and culture will be made. As mentioned, you will be able to cast your vote in the weeks to come so make your vote count! If you want more information on the referendum, on Wednesday the 23rd of November we will publish an extensive article about it, prepared for you by Raffaele Di Carlo. Business Recap – by Nando Slijkerman Trump, Trump, Trump – what was more important than the presidential elections this month? The elections had an unexpected impact on the financial markets. After Trump’s election S&P 500 dropped below sea level but later that day it surprisingly rose and eventually closed with a positive index value. A possible explanation might be that investors were waiting for the dip in order to enter the money-train and speculated on an increase a couple days later. After it was known that Trump would be the new president of the States, Heijmans (small-cap Dutch local infrastructure company) rose 11%. Maybe investors believe that Heijmans is going to build the wall between Mexico and the USA… Let’s look at the numbers of November. S&P 500 rose 2.37%, AEX increased by 0.15%, and the DAX increased by 1.22%. Deutsche Bank seems to be the biggest creditor of Trump, and Ahold Delhaize begins its merger with growth which resulted in a relative sales growth of 2.6%. Operational profit increased by 1.0% to 425 million Euros in the third quarter. Brent Oil dropped 9.4% to $46.63 barrel. ABN AMRO advisers falsified signatures. Unbeknownst to the clients they have copied signatures to close a mortgage file. In some way, this did not influence the stock price because ABN AMRO rose 4.3% this month without extreme volatility. All in all, a positive month on the markets. Black Friday – by Brunno Fontanetti Black Friday or, as every non-American likes to call it, the day when most funny YouTube videos of the year are made, is getting closer as the year almost reaches its end. The holiday was actually created by stores that realized this day was usually the break even point of the year. Since accountants wrote losses with red ink and positive balances in black, the break-even point day became the Black Friday. However, nowadays, the holiday has a different significance: from huge lines in the entrance of stores, to poor families getting store loans at strikingly high interest rates, Black Friday shows capitalism at its worst. The day has caused quite a lot of issues in the US. Last year, for example, Walmart had workers walking out the store in the middle of Thanksgiving, protesting very long shifts, and bad financial compensation for working on a holiday. Moreover, since 2008, in the US alone, more than 5 people have died and dozens got injured during the holiday, leading to a simple question: is it worth sacrificing everything in order to consume? Economics Recap – by Yana Chernysh Since Brexit UK rates have been changing crucially. In November Consumer Price index (CPI) in the UK has fallen to 0.9% despite the prediction of growth by the economists, who predicted it to rise to 1.1%. Moreover, the pound has fallen 16% against the dollar and 11% against the euro since June. However, the economists do predict the growth of CPI coming soon. Another prediction made for the next months is a high and constant growth of the interest rates. Eurozone new system of budget oversight has been published. Several countries (Italy, Spain, Portugal, Belgium, Cyprus, Lithuania, Slovenia, and Finland) were warned by the EU that their spendings may violate the rules assigned by this system and are advised to ensure that they will meet the EU targets. In the assessments, stricter fiscal rules for countries were introduced as well, in order to keep public debt under control. This was made as a response to the recent sovereign-debt crisis. Crude oil price is still dropping (now being 46$ per barrel), because of the oversupply of oil. An IEA energy group predicts the boom and bust cycle for the oil industry. Investment in new oil supplies is at its lowest since 1950, which can mean that industries project approvals will remain low for a third year in a row. This, in turn, will lead to a big difference in supply-demand function, with no incentives to be matched anytime soon without starting a new boom and bust cycle. 2 Million Dollar Bribe in Russia – by Yana Chernysh A huge scandal took place in Russia. On the 14th of November, Russian Economic Development Minister Alexei Ulyukayev was accused of accepting a 2 million dollar bribe, for giving assessment and benefits to one of the Rostneft deals. It is said that he threatened the company in order to receive the money. The deal was connected with the support of privatization and Rosneft buying around 50% of shares of Bashneft, both being huge oil companies in Russia. Ulyukayev has been in politics for 25 years and became the Economics Development Minister in 2013. He himself was referring to corruption as a serious issue for the economy and the whole country and demanded actions in order to lower the level of corruption in Russia. It is the first time in Russian history when a federal minister is being arrested for corruption. Although Ulyukayev was caught red-handed while receiving a bribe, Russian government says that this case needs very serious proof. Ulyukayev can face a prison sentence of 8 to 15 years, if the investigation renders him guilty, as well as a fine and a ban on holding some public positions. India’s Currency Ban: the Nation’s Biggest Strike Against Black Economy in Four Decades – by Tsz-Tian Lu After a surprising announcement on the night of 8th November, India’s most commonly used notes, 500 (about 7 euros) and 1000 Indian rupee bank notes, became worthless just overnight. From 10th November until 30th December, the new 500 and 2000 rupee denomination notes are replacing those removed from the circulation. Following a tax evasion amnesty early this year, which successfully disclosed billion unaccounted assets and income, this strike is by far the India’s prime minister Narendra Modi’s biggest measure to fight against black money. According to the official data, more than 334 billion U.S. dollars earned through illegal activities were ‘evaporated’ from the economy from 2002 to 2011. Thus, the main targets of the sudden action are to crackdown undeclared cash, eliminate fake currency notes and curb corruption. If the targets are successfully hit, the government estimates that billions of cash will be brought back to the financial system, and it will be much tougher for the financing of terrorists since their income severely depends on illegal transactions. Moreover, in the short-term, a deflationary impact in general is expected as cash transaction come down, thus resulting in moderate real estate prices. Although part of the intentions behind this action is to relieve poverty, some argue that this is actually hurting the poor. India is an extremely cash-driven economy, where 98% of the consumer transactions depends on cash. Furthermore, 500 and 1000 rupee bank notes together count for more than 86% of the cash in the circulation. Now, with almost 86% of cash invalid, the central bank cannot meet the pace that people are requesting to exchange their banknotes, and it even turns out that the new ones are incompatible with the existing ATM machines. People who live in the rural areas find it very difficult to exchange their cash and, sadly, there are cases of people committing suicide or dying from heart attacks because they misunderstood the information and thinking that all their money is useless. The inconveniences and sad news show that the government is not thoughtful enough on its planning. “Cooperate with me and help me for 50 days, I will give you the India you desired.” says Modi. Well, time will tell whether his decision was right. Failed Merger Between PostNL & BPost – by Michel Mijlof The biggest postal companies of the Netherlands and Belgium, namely PostNL and BPost are facing a possible merger. PostNL is traded on the AEX index while BPost is traded on the BEL-20 index. In the last month, BPost offered a bid of €2,825 and 0,1202 stocks per PostNL share. This would amount to approximately €2,5 billion. If PostNL accepts this proposal, they will go further into the merger negotiations. However, PostNL rejected the proposal of BPost.  Reasons are that PostNL has confidence in themselves for the future. Moreover, the bid of BPost is too low and too risky for the current shareholders of PostNL. Another – non-financial – reason is that the Belgian government owns 51% of BPost and, if the merger succeeded, this would decrease to 40% of the merged company. The Dutch Minister of Economic Affairs, Henk Kamp, is also questioning this takeover and is asking the Dutch government to stop this merger from taking place. All these news about the merger have had a great impact on the stock price. To illustrate, PostNL stock price went up from €4,292 to €4,885 and back down to €4,440 within 3 weeks. Politics Recap: What Has Happened Around the World When We Were Focused on the U.S. Elections? – by Magdalena Wiśniewska On November the 1st, Iraqi forces have entered the City of Mosul occupied by the ISIS forces. It caused thousand of Iraqis to flee their homes. The mission to reclaim the city is predicted to last for weeks, if not months. On the 3rd, approval of Brexit by the Parliament was adjudicated by the High Court, granting a delay in the execution of the process. The Prime Minister, Theresa May, might be forced to cooperate with the Parliament and to prepare and present a plan concerning the future of the Great Britain after leaving the EU. The matter is not yet fully resolved, however, as she has appealed the decision. On November 7th, China has banned two candidates, who are in favour and advocate for Hong Kong independence of China, from gaining seats in the legislature. This shows Chinese limits on tolerance and the limit of the ‘high degree of autonomy’ that China promised Hong Kong. South Korea’s Park Geun-hye, who was accused of influence-peddling scandal, has offered to give away her power, as Park’s support has fallen sharp to barely 5%. You can read more about South Korean situation in Dave’s article. Ushering the Third Republic – by Raffaele Di Carlo 2016 seems to be the year of controversial politics and even more controversial referenda. While British politics are still struggling to recover from the results of the Brexit referendum, which hints at a possible future schism between the United Kingdom and the European Union, and the United States deal with the results of their latest presidential elections, yet another country calls its citizens to the polls. The country is Italy, which might be off to a historical constitutional reform, should the referendum scheduled for December 4th succeed. One of the core points of Prime Minister Matteo Renzi’s agenda since the start of his mandate was to streamline the legislative process in order to make the country more stable and responsive: the current system of interaction between the Chamber of Representatives and the Senate is seen as too cumbersome and time-consuming. He also took on the very sensitive issue of reducing the maintenance cost of the political system. In an attempt to tackle both issues at once, the reform plans to reduce the number of Senators by more than a half, while shifting the Senate’s jurisdiction on regional and territorial affairs and letting the Chamber handle the common administration. The proposal has raised much concern, especially by the Five Star Movement, which claims the reform is nothing but an authoritarian turn of the government and that only the two-chambers system ensures a democratic legislation. Certainly, the outcome of the referendum in December will decree whether the country can be ruled by the current administration or not, as a failure might represent a significant loss of confidence in the government. New Zealand Startled by Another Earthquake – by Leonie Ernst On the 14th of November, the people of New Zealand were startled by a severe earthquake with a magnitude of 7.8 on the Richter scale. Since the country is located on the border of two tectonic plates, earthquakes are quite common. The country therefore regularly suffers some light earthquakes, which are mostly not noticeable. However, this time the magnitude of the earthquake was the largest in decades. The earthquake caused a landslide, whereby the two islands have come to lie about two metres closer to each other. The damage caused by this drastical landslide runs into billions of dollars. According to prime minister John Key, it will take months before the country will be totally recovered from the shock. Especially railways were hit by the earthquake. Fortunately, the earthquake was heaviest in a sparsely populated area – 100 kilometres north of Christchurch – so not many injuries were caused by the earthquake. After the heavy shock, some lighter shocks followed. The tectonic plates are still moving and causing some of these light shocks, but these do not have negative consequences for the people. Due to the healthy financial situation of New Zealand, all the damage will be recovered as soon as possible. 2016 BRICS Summit – by Hải Đăng Vũ BRICS (initials for Brazil, Russia, India, China and South Africa) is an annual event, where some of the most prominent and authoritative representatives of the global economic and political forefronts meet together to coordinate a comprehensive agenda relating to economic expansion, political integration and sustainable development. This eighth gathering was organized in the city of Goa, India. Slightly in contrast to the preceding years, when conversations were geared towards a convergence of establishing a mutual strategy for member countries, the primary theme of this year’s meeting was revolved around the combat of terrorism, mostly due to the India – Pakistan territorial dispute earlier this year. It was also widely recognized that  China was believed to implicitly endorse Pakistan terrorist groups to expand more of its influence in the region. During the meeting, India called Pakistan a “mothership” of terrorism and severely criticized China as a platform of “artificial and self-serving grounds”. Asides from comments on war on terrorism, the summit also focused on more relevant issues, particularly on reinforcing common economic growth within member countries, with respect to the fact that economies of all BRICS countries have underperformed throughout the entire year. Formal agreements on the utilization of technology, energy usage and health-improving measures were also agreed upon by members as well. In order to increase its international recognition, the summit of this year also exhibits its first trade fair, film festival and football tournament. 2016 US Elections – by Artur Rymer In case you have been cut off from the world for the last two weeks, United States of America has a president-elect – Donald Trump. Following one of the most… exciting election seasons in the US history, despite most predictions and polls, Donald Trump was able to win at least 290 electoral votes, more than 270 needed to secure the presidency. However, the candidate who has received the most votes across the country was Hillary Clinton (you can read more about that and the Electoral College in Michael’s piece below). Other than the presidential elections, American also elected all 435 members for the House of Representatives and 34 of 100 members of the Senate. Republican Party was able to secure majorities in both, meaning that, together with Donald Trump, they will soon fully control both the legislative and the executive branches of the US government and, with the imminent appointment of at least one Supreme Court judge, they will influence the judicial branch for the years to come. Additionally, several states had additional votes on laws related to legalisation of medical or even recreational use of marijuana (8 states approved it, 1 state rejected it), the minimum wage (4 states approved increasing it, 1 state rejected reducing it), state healthcare systems, introducing new gun ownership restrictions (3 states approved it, 1 state rejected it) and abolishing death penalty (3 states rejected it). Electoral College Debate Erupts… Again – by Michael van Rhee Donald Trump’s surprise victory in the US presidential elections stirred up a wide range of emotions in the United States as well as the rest of the world. Numerous protest marches were seen all across the country, and an age-old debate — the one about the Electoral College’s role in the elections — was brought up yet again. Originally created to give more weight to votes from the smaller states, the Electoral College has been at the heart of debate since the start of this millennium, when Al-Gore lost to George Bush despite winning the popular vote in the year 2000. Similarly, Hillary Clinton fell short of the presidency by just a few hundred thousand votes in swing states, despite receiving 1.5 million more votes nationally. The fact that Trump still won the elections has caused outrage among Democrats. There’s a fair point to be made here, because the winner-takes-all principle that applies to the elections can be thought of as undemocratic in itself. After all, if you’re a Democrat living in redneck-dominated Texas, your vote is essentially lost in the process of applying that same principle. The same goes for Republicans living in, say, California, which has been a Democratic state in the last several elections. Abolishing this principle would also get rid of ‘swing states’ altogether, thus making the elections a lot fairer. It can ultimately only be a good thing, but if there’s one thing that’s predictable about the US, it’s that it keeps surprising you. Sigh, let’s see how this one unfolds.

“First, negative affect may shape people’s decisions by coloring the content of their thoughts. It is well established that under negative mood people’’s perceptions, thoughts, and judgments are often distorted toward greater negativity—an effect known as mood congruency (…). Second, negative affective states may alter the process through which people make decisions. It is widely held that negative affective states such as anxiety and sadness interfere with people’s ability to process information (…). As a result, anxious or sad individuals are posited to process information less systematically in judgment and decision making (…). Third, negative affective states may influence decisions by shaping decision markers’ motives.” The fragment above was taken from a psychological study conducted by Drs. Rajagopal Raghunathan and Michel Tuan Pham. In their study “Motivational Influences of Anxiety and Sadness on Decision Making“, they analyze how negative emotions can affect judgement, motivation and even logic behind decision making. As can been seen in the fragment above, Raghunathan’s and Tuan Pham’s main conclusion is not surprising: fear doesn’t’ go well with logical decision making. Now, you might be wondering what that has to do with the election of Trump. Well, you may even have an idea where I’’m going with this, but to better clarify this feedback-type relationship between Trump and fear we have to go back a couple of years, to a time when America was great and George W. Bush was the president of the US.After the 9/11 attacks, Bush decided it was time to intervene with more power against the terrorist threat and this intervention, as anything made by our fellow Americans, had a catchy and marketable name: the War Against Terror. From day one, the US was fighting a new war, a war against those who proclaimed they are against freedom of speech, a war against those who attacked their country and a war against 186,432 innocents killed in Iraq so far. After that moment, Bush gave the expression ‘enemy of the state”’ a color, a religion and a place of birth. And, of course, the market wouldn’t’ lose the opportunity to make some money out of this.The mainstream media gradually realized that selling any program with violent, real-time fights against the bad guys was a success: police chasing black people around and the military actions in Iraq and Syria are examples of that. Without forgetting the video of Osama Bin Laden’s’ assassination, which might have more views on Youtube then Gangnam Style by now. The point is, selling that America was fighting the bad guys and giving those bad guys a face seemed at the time to be a profitable, harmless idea. But it’’s hard to believe that no one realized the damage it could cause to our society. Let’’s look at what our friend Alpert, a professor from the University of South Carolina, who collects data on these type of TV shows, says about the sensationalism of the pursuits: “police pursuits are like Nascar – hundreds of thousands of people watch it, waiting for the next crash”. It’s kind of hard to read that without giving a small laugh, am I right?In one of his brightest documentaries, “Bowling for Columbine”, the director and activist Michael Moore shows a diverse number of statistics that depict how bad police reality shows and sensationalist TV programs can be to the population. One astonishing statistic is: where criminality was reaching its lowest, gun ownership was rising in accelerated pace. People were more afraid, not because the world wasn’t’ safe, but because they were told all the time, by all the possible types of media, that there was a crime here or an assassination attempt there, or “WOW there is a police chase going on only 1 block away from your house!”.The War on Terror brought fear closer to the population. And Donald Trump is a result of that fear. In the fragment at the beginning of this article you can see the description of three ways in which fear affects decision making: judgment, motivation and action. All these three combined lead to decisions that are made only to satisfy fear. Now, I know most people who were against Trump are still grieving with his victory, and most are still in the anger stage, blaming all those that voted on him and supported him. But taking all this story into consideration, can you really blame those voters? Aren’t’ they just making their decisions based on this constant fear we all have to live up everyday? And don’’t get me wrong, I am not saying those who didn’’t vote for him are brave, logical thinking, non-emotional people. No, they are partly responsible for it, and also because of a fear, albeit a different one.Recently, British comedian Tom Walker made a video as his left-wing TV show host persona, Jonathan Pie, talking about how the left wing’’s attitude in the last couple of years (and I have to put myself into that bunch) had a direct effect on this result: “The left is responsible for this result because the left have now decided that any other opinion, any other way of looking at the world is unacceptable. We don’’t debate anymore because the left won the cultural wars. So if you’’re on the right, you’’re a freak. You’’re evil. You’’re racist. You’’re stupid. You are a basket of deplorables. How do you think people are going to vote if you talk to them like that?“” Personally, I can’not deny that my attitude in the last few years has’ been exactly like that. In the midst of constant discussions with my mum I was ending up saying that her ideas were nonsense because, well, it was the right wing, the precursor of fascism, national-socialism, Nazism, greed, ambition, capital, interest and all there is bad in the world. Is that not’ a depicted fear as well? A sensationalist way of looking backwards in history to what really happened? Doesn’t’ matter who started it, but it’’s a fact that debating or discussing anything between the left and the right wing in the last years has been just like Trump’s hair: is there for us to see it, but deep down everyone knows its fake.Another psychological study from James E Maddox and Ronald W Rogers talks about fear appeal. Fear appeal is a psychological term used to describe the use of stimuli to arouse fear. In their study, called “Protection Motivation and Self-Efficacy: A Revised Theory of Fear Appeals and Attitude Change“, Drs. Maddox and Rogers show that when choosing a partner, people in state of fear tend to choose a person with better social skills rather than technique skills. Now, we all know Hillary was better prepared, technically speaking, to take the seat in the Oval Office, but let’’s be fair: her social skills are as good as her trying to quote a Jay-Z song, and if you didn’t’ see that, oh pretty please, see it.Not only in psychological studies are there proofs that this election was decided by emotionally driven voters – all the states that were voting in favor of progressive lawmaking had astonishing results. Regarding the legalization of marijuana, only one state rejected it; a raise of the minimum wage was also only rejected by one state. If only these votes were taken into analysis, we would be talking about how forward looking the American society is turning out to be; looking at different alternatives and more intense debates in areas in which traditional solutions are simply not working. But instead, we are discussing how conservative, old fashioned and protectionist they are and with that we are separating ourselves even more. Trump was a result of fear and of lack of discussion, so why not using him as a way to learn and improve? Go and read his program, aim to be in favor or against his measures. Chill on your couch while laughing about his hair movements. Do whatever you want, but simply do no’t fight anger with more anger and sensationalism, because that WILL be worthless.It’s a fact that 2016 is a year that will be in history books. The new uprising of nationalism has begun, with different motives, enemies and, of course, bloody solutions to solve everything with one war. At moments like this, countries tend to split and intensify the never ending discussion between left and right, red or blue and so on. Above everything else, there has to be an understanding that anger will only lead to more anger, and if the example of Donald Trump isn’t’ enough for you to realize the consequences of an anger/fear driven society, well, then you might need some personal freedom sessions in the American embassy. And before you, Europeans, start making fun of Americans, remember: the next Trump might be right next door, either enjoying a croissant in a cafe close to the Eiffel Tower or eating fish’n chips right outside the English Parliament.

Protests of environmental activists against a corporation trying to build something is not a new thing. It happens more and more often in the modern world, along with people’s increasing concern about the future of the planet and their descendants. One of such protests is currently happening in North Dakota, US, where an oil pipeline is being built across the Missouri river. What concerns the activists? What is the view from the government side? And what is the future of this conflict? These are the questions I will try to answer in this article. What is this all about? The Dakota Access oil pipeline is being built by the Dallas-based Energy Transfer Partners, having an expected total length of 1170 miles (1883 kilometers).The project was approved and became public in July 2014. The pipeline is going to go through North Dakota, South Dakota, Iowa, and Illinois. It is aimed to connect Bakken oil fields with the oil tank farm near Patoka, Illinois. The main purpose of this pipeline is to substitute rail delivery as it is not considered to be reliable. Also, it can help the US to attain energy independence and create more work places. This 3.7 billion project drew the main attention of the protesters in August 2016, when the number of Native American tribes opposed the building of the pipeline. Demonstrators, named ReZpect our Water, brought a petition to Washington, DC, attracting some international consideration. The main threats of the construction that are being named are: the disturbance of land, oil leaks to the river and cultural threat to the homeland of Native Americans. Protesters. What dangers do they see and what do they want? Being very close to the river, the building of the pipeline can bring some serious consequences, which are seen as the main ecological threat in the eyes of activists. The oil spill will lead to dramatic contamination of the river, which is a major water source for people who live in cities downstream. That being said, the pollution of the Missouri river will become a serious ecological problem. The question the activists are asking is: Don’t you drink water too? They aim to stop the construction of the pipeline completely or reroute it so it does not go through the adjacent to the Missouri river territories. Another concern the activists see is the violation of human and native rights. It is stated that the building of the pipeline will damage and even ruin completely the sacred sites, where the ancestors of the Native American tribes living there are buried. That is the reason why among the protesters fighting for the abandonment of the project you can see representatives of several biggest tribes. Police, government and law – what is their answer to the protesters? As stated above, the building of the pipeline will create a great number of work places. That is the reason why the labor unions remain divided between two opposite opinions. Some of them do support the protests, whereas some of the largest ones are demanding the president “to stand up for Americans workers”, meaning that the pipeline should be built. If looking at the problem from the legal side, it can be found that the land that the tribes want to protect and name their homeland is owned by the company building the pipeline. Therefore, the tribes do not really have a right to prevent the building according to this reasoning. As well as this, the protesters can be (and already were) arrested for trespassing. At first, the government was concerned about the cultural value of land and revoked the construction permit in June 2016. However, in August 2016 the pipeline received federal approval, followed by a petition in support of the full review of environmental effects being made by the pipeline, which was signed by more than 30 thousand people. The next point to be considered is the ecological side of the protests, mainly the possibility of an oil spill. In this case, there is no single clear opinion either. On one hand, the pipeline is a safer option of transportation oil and gas, than the one using trucks and trains. Moreover, pipelines would have safeguards against leaks. On the other hand, the aging of the pipeline and lacking of federal control can increase the chances of an oil or gas spill. Being such an expensive project, the pipeline will not be changed when needed. As the research states, most of the US pipelines are already more than 50 years old and the need for implementing new ones is crucial. Fundings are also becoming an issue for Energy Transfer Partners, as the Norwegian Bank DNB is considering withdrawing its funds from the company, which stands for 10% of the whole funding, due to the concerns about the human rights violations. What’s next? The pipeline is supposed to be delivered by 1st of January 2017. Is it going to be possible and what are the steps taken in order to solve the conflict? First of all, the construction of the pipeline has not been stopped despite the protests, so the company is eager to finish the work on time. Secondly, the activists and the Native American tribe in response has called on the United Nations Human Rights Council for help in response. One of the solutions of solving the problem is rerouting the pipeline, which was supported by Barak Obama, who said that the ways of rerouting the pipeline could be found and the process should begin. However, the US Department of Justice did not comment on this suggestion and said that they still need to wait for the permission from the US Army Corps of Engineers, who are reviewing the possibility of rerouting at the time being and has not given the permission for building near the Missouri river to the company. A suggestion of rerouting was also supported by Virginia senator Tim Kaine. Senator of Vermont Bernie Sanders, on the opposite, is supporting complete termination of the project. Although I do think that the protesters have a point, especially in terms of ecological threats, the possibility of rerouting does not seem to be a solution that is going to be implemented. First of all, because it will take much more time and financing for the company to do this. And, as long as they have all necessary permissions, they won’t be willing to postpone the delivery date and spend more money on this project. Secondly, other “easier” solutions can be found. For example having the pipes reviewed more carefully and having the contract for the pipes being renewed at the certain point of usage. Anyway, the protesters themselves cannot prevent the building of the pipeline. They need serious support from the government, law or any other higher standing establishments in order to have a legal reason for stopping this project. A lot of news are appearing every day saying who supports which side, who is fighting and all the new facts concerning this topic. However, the decision has not been found yet and the company is continuing to build the pipeline with or without the permission. I hope that the concerns of the protesters will be taken into consideration and the solution that satisfies everyone will be found.

How Close Can You Go #3 – Lukas Daalder, Chief Investment Officer Robeco Investment Solutions A new month means a new interview. As you may have read on my personal editor profile, my interests lie within anything with respect to investments, especially investment banking. By interviewing Lukas Daalder, Chief Investment Officer of Robeco Investment Solutions, I am in the perfect place. Robeco is an international asset manager offering an extensive range of active investments, from equities to bonds. Research lies at the heart of everything they do, with a ‘pioneering but cautious’ approach that has been in their DNA since our foundation in Rotterdam in 1929. Robeco believes strongly in sustainability investing, quantitative techniques and constant innovation. Today, Robeco is a subsidiary of Robeco Group, which is the centre of asset management expertise for ORIX Corporation, Robeco Group’s majority shareholder based in Tokyo, Japan. Lukas studied monetary economics, macroeconomics, and international relations at the University of Amsterdam. During his study, he interned at the Dutch Central Bank, worked as Research Assistant at the Faculty of Economics and Econometrics at the University of Amsterdam, and was even an editor of Rostra! After graduating, he started working as Economist at Rabobank Group. He analysed the country risk of the sub-Sahara. Why this region? Because he knew nothing about it, and that was what interested him. Lukas went to the dealing room where he worked together with Bernard Walschots (now, Chief Executive Officer of Rabobank Pension Fund) as Senior Strategists. Analysing capital markets, looking for which bond is more profitable than another, and communicating this data to the traders was the daily job. He also gave Presentations for the national and international institutional clients of Rabobank, such as Central Banks, to discuss their vision on markets. During the mid-nineties, Lukas concluded that equities were far more interesting than bonds, and decided to make a move to a small broker in Amsterdam where he fulfilled the function as Equity Strategist. After working here for three years, equity markets decreased and Lukas moved to Bank Oyens & van Eeghen as Head of Research. Because of his extensive knowledge of dividend risk, Lukas was asked to work in the dealing room for International Marketmakers Combination, also known as IMC. After performing research in the dividend risk of IMC, he performed some market making activities as well. Lehman Brothers, which was the main business partner for the market Lukas worked in, declared bankruptcy, and therefor Lukas became unemployed for the first time in his life. That is where his career at Robeco started, and several years later, Lukas became Chief Investment Officer. After a small summary of Lukas Daalder, I asked him about the environment in the dealing room of IMC to compare this with my previous interview with Mark Schilstra. “It was a kind of survival of the fittest. Back then, they were hiring like twelve people a year, and of these twelve people, you knew for sure that after one year, you were left with only six, and after two years, you were left with only three. If you were good enough, you could stay, if not, you were fired. Sometimes you realised that you have not seen someone for a couple of weeks. That was because someone just disappeared. If you were fired, you could not walk back to your computer and finish the day because of all the access to the investment systems. It was a strange world.” It is very well known that, especially in these years, the compensation schemes were good, very good. How about it? “What was typical about IMC, was that every employee had the same fixed salary, even your manager. Everything was based upon the performance bonus you received. If you performed good, you were compensated more than enough. The good side of this is that the firm could survive years of economic uncertainty because of the low fixed wages. During this period, HFT trading came from the ground and was implemented in IMC. Investment strategies were born and the computer did the job.” You were saying that the people of IMC were very good. That may be because of the recruitment process. What are the people you are looking for at Robeco? “First of all, I think it is really hard to understand the person you are dealing with on the basis of looking into his CV. What I am looking for is people that have several interests. That could be people who have a successful history in sports, people who speak five languages, or other extraordinary interests. For example, I have someone in my team that knows everything about birds. Ask them anything about it, and he will know the answer. I think that is special and diverse. Last year, I did a guest lecture at the Erasmus University. After the lecture the professor mentioned that the exam was in two weeks. Two students raised their hands and asked if the exam could be on another day because their CFA exam was also planned on that day. I mean, it is impressive that you are also studying for your CFA exam beside your normal study, but I also think that you have to live. You are studying Economics, which is more than enough to prepare yourself for your career in my opinion, and then you are also doing a CFA. In that case, I would choose someone who have a more diverse background with a similar workload over such a person who is studying all day, graduating cum laude, but have not seen anything else of the world beside his or her own university. Of course, these backgrounds could also be in your work field, like economics for example, but students should not be ‘locked up’ in their own study.” Okay, we are now at the point that you are hired as a young professional. What is next? More precisely, why did you became Chief Investment Officer and someone else not? “Well firstly, you need to have a different perspective of why you are working here. Theoretically, I am an employee of Robeco, but for me, I am an employee of myself. Before I start, I set specific goals, the quality of my work for example, and these goals are mainly much more ambitious than the goals that I have been set by Robeco itself. Secondly, during the years, I have gained some reputation. I have set up my own blog where I daily post ‘the best of the web’.  This consist of graphs, tables, and all other financial data with is topical at that moment. Think about bond markets, elections, or economic development. Earlier, I mailed these kind of data to my colleagues so everyone was prepared to discuss this, but after all I noticed that many more people were interested in it, so I started this blog. In this way, people start to remember your name, and get an impression of you as a person. This was never the purpose of doing this, but it is one of the main reasons why I am in this position today. After a couple of years, I organised an open drink to discuss these actualities with people that were interested in my content. Eventually, even journalists of RTL Z and the Dutch Financial Times joined my drink, where I am also a columnist nowadays.” So, you have a lot of things going on in your life. Your own blog, Chief Investment Officer of one of the biggest asset managers in the Netherlands and also a columnist for RTL Z and the Dutch FD. What are your days like? “I wake up at 5.30 AM, then I search all over the internet for interesting topics and publish this at my blog. I catch the train at 6.30 AM and start working at 7:15 till 5 PM, but continue to work in the train on the way back. So, I am working for about thirteen hours and I am home for the remaining hours in the day. I also like running (I run for about thirty or forty kilometer a week) and also spending time with my children is very important for me. Also, some weeks exists of traveling. For example, last week I went to Australia for a business trip. That is nice, but also very exhausting. During my flight to Australia, it was my birthday. Then you are toasting with yourself in a plane ten thousand feet high. That is the other side of these trips.” Tip from the editor: Not to do any advertising, but I think it is, for us as economics students, very interesting to subscribe to Lukas Daalder’s blog. I did it myself, and every morning, I read these updates with a big interest. You could subscribe yourself for free by going to lukasdaalder.com

*Headnotes: The names are understood as “Last name” “First name”. “Korea”, without any further remarks, will be referring to Republic of Korea, or more commonly known as South Korea. Not until this time last week did the media begin to shift their coverage to Asia, amid one of the most tumultuous and chaotic US presidential election ever. The turbulence of the political world has not stopped yet. This time though, it shifted to the East. South Korea now is the center of attention, where the incumbent president of South Korea, Ms. Park Geun-Hye, is under immense pressure by the public to resign, surrounded by concerns that state affairs under her presidency have been largely dictated by one of her friend, Choi Soon-sil. The motto, in which Park visualize Korea under her presidency, “A New Era of Hope”, is doomed to fail. Park Geun-hye The current president (now referred to as “Park”) had a powerful political background. Her father, Park Chung-hye, was the president of the Third Republic of Korea (current Korea is known as the “Sixth Republic”, after several successful coups d’état attempts targeted at then-leaders with various constitutional reforms). During this politically tempestuous period, multiple assassination attempts were carried out. He was assassinated by one of the member of the National Intelligence Service, after allegations of giving preferential treatments for large corporations (known as “chaebols”) and abuse of power. Her mother was also killed in an earlier assassination attempt which also targeted her father. Following her father’s footsteps, Park Geun-hye entered politics as the legislative member of one county and quickly progressed to the chairwoman of the Grand National Party (GNP) in 2004 and led the party to great success. She later stepped down and rejoined the party in 2011 amid rumors that she would be going for her presidency in 2012. She was inaugurated as President of South Korea in early 2013 after a democratic election process. Choi Soon-sil/Choi Tae-min Choi Tae-min (died 1994) was a Christian pastor, who previously followed Buddhism as well. During the the latter stage of his career, he managed to set up a religious group, which combined the practices of shamanism and the teachings of the two religions he practiced before. He was also closely observed by the Korean government (you could find a US Embassy document about him on WikiLeaks) carefully at the time, as he was famously known as a cult leader. During the 1970s, a close acquaintance of Choi Tae-min, Tahk (an expert on cults) was informed by the intelligence agency that Choi Tae-min was classified as a dangerous man. Choi Soon-sil, his daughter, also labelled as a “shaman”, was the closest child to the current president at that time (now referred as “Choi”), and succeeded father as a secretive adviser to the president. How did this relationship develop? After Park’s mother death, Choi Tae-min sent a letter to Park claiming that he was a messenger of the spiritual world. He strongly asserted with Park that whenever she wanted to listen to her mother, it was possible to do it through his supernatural power. After their first meetings, Park completely trusted him and estranged herself from family members, despite efforts of her late father trying to prevent the unhealthy relationship. There were also rumors that the late Choi and Park, during her early years, allegedly spent hours in a closed room for spiritual training. Park’s siblings at the time also expressed their worries towards her political agenda, which might have been largely swayed by Choi’s own personal interest. How did we end up here? There were indications that the connection between Park and Choi’s family exposed before the incident. In 2007, a South Korean magazine published a report made by the Korean Intelligence Agency in the 1970s, which claimed that Choi Tae-min had approached Park to offer help. In the president election, which occured in the same year, Park was endorsed as a potential candidate to lead her party GNP. Her opponent, Lee Myung-bak, publicly pronounced her shadow relationship with Choi. However, no one paid attention since the accusations at the time were merely baseless. All of the media attention started in 2014 when Chung Yoon-hoi, who was married to Choi, was suspected of committing wrongdoings. He was a successful businessman, but was promoted on no basis to be chief of staff of Park when she was a lawmaker. His later interventions to national affairs were found by a policeman, as he later attempted to smug these confidential documents to the public. However, the prosecution towards Chung was unsuccessful, so he was not convicted to any criminal punishment. Choi’s hidden power were put in critical observation as few investigations were conducted into the financial transparency of her two charitable foundations, Mir and K-sport. It was believed that 80 billion Korean Won (equivalent to 62.5 million euro) were being donated to these two accounts by top companies. Part of the money raised from these two foundations was later transferred to a hidden offshore company in Germany, which was believed to be one of the Choi’s controlled entity. Furthermore, revelations were that the approval by the Ministry of Culture and Sports for the establishment of Mir was conducted in less than a week, while most businesses would take a month. Her daughter, a 2014 Asian Games gold medalist, was also under close investigation, as there were reports indicating that she was received preferential treatment, referring to her admission to an extremely renowned university in Korea. Further allegations suggested that her high school records were questionable and she also got her attendance replaced illegally when she was in middle school. The involvement of Choi’s in national affairs was far beyond politics. One of the most famous entertainment companies in Korea, YG Entertainment (remember “Gangnam Style”?), was also under scrutiny amid accusations towards a potential connection to the Choi’s family. However, the most important (chain of) findings related to this turmoil was that several weeks ago, JTBC, a Korean television broadcast company, found a tablet PC of Choi (which she intended to get rid of), which contains hundreds of classified documents. They managed to find out that the files on the tablet consist of every level of involvement in Korean political agenda: plans for president speeches, dress codes for formal events, the timing and reactions to North Korea’s happenings, and military confidential materials, during the time when Park was running for the presidency and later when she has already been in office. The disclosure about that many of the edited president’s speeches made by Choi was indeed the biggest revelation: it seems that all of the edited parts were at least indirectly related to the creation of lucrative wealth created for Choi’s family. The extent to which the consequences caused by these corrections of the speech are undetermined, but investigators are currently working on the evidence to release an official report as soon as possible. Two weeks ago, President Park stepped out into the public, speaking about the incident. She apologized for having had an intimate relationship with Choi, but insisted on the conversations between herself and Choi were merely asking for advice, without acknowledging Choi’s (direct) involvement in state affairs. Choi returned to Korea in the beginning of last week and was held in custody by the police, as an official trial will soon be held. So, for Korea, what’s next? Multiple demonstrations and riots were held publically in Korea, under close investigation by the police forces. Last Saturday, a record attendance of 200,000 people gathered at the central area of Seoul to show their displeasure of Park still being a president and calling Park for resignation. Approval ratings of Park plummeted to only 5 percent in the latest poll (from 30 percent before the scandal); while in the southwestern region, statistics showed 0 percent of support for the president. Park also dismissed most of her staff earlier last week, but this tactic proved unhelpful. The leading party is now to be blamed as well for not disclosing its shadow relationship between Park and Choi, having acknowledged the existence of it for decades. There are only 15 months left on her official term so it is more likely that she would be still holding her position until the end of the term without electing a replacement. Nevertheless, there are potential severe consequences for the political system of Korea. Firstly, the current majority party, GNP, is due to falter after this incident and hence will not receive any kind of support from the people for the next election. Secondly, the accident actually deterred a chance of having a woman in office again in Korea, or at least in the near future – through this coverage Park has shown signs of weakness and unreliability when she was in office. This cultural aspect is actually taken really seriously, especially in a male-dominant society such as South Korea. Thirdly, North Korea, its neighboring country, will be exposed to more confidential information of South Korea because of these revelations and there will evidently some permanent repercussions for the diplomatic relationship between two countries. Its leader, Kim Jong-un, reacted happily to the incident, with a promise of pushing for more military activities to re-ignite tensions across borders. New discoveries of Choi’s involvement in domestic political matters are constantly updated and broadcast on television so locals can keep posted with new developments. As a result, watching nightly news at 9 has become a national must-do activity of every Korean citizen. Soon enough, the truth will be unveiled and justice will be served for the Koreans.

Much has been said about the American presidential elections. Too much, I would argue. In an endless number of accounts opinion-makers have expressed their concerns over the vulgar tone of the presidential debates, the complete failure to discuss policy-issues during these debates and the fact that the candidates have pushed the frontiers of the politically permissible well beyond reality. However justified these concerns may be, if anything, their continuous repetition only helps to exacerbate public indignation. However, if we realize that Hillary Clinton and Donald Trump – and the public perception professionals, who shape the strategy of their multimillion dollar campaigns – simply try to win votes, the presidential election gives us, aside from our daily dose of cynicism, new insights in American voters and American society. That is, assuming that both contenders know what they are doing, the most effective way to convince American voters, apparently, involves precisely the practices that have been subject to so much critique. In a sense, the theatrical performance of Trump and Clinton mirrors the state of American and – to a lesser extent – western man. This article faces this ‘mirror’ and, in so doing, uncovers what the U.S. presidential campaign says about us. Please take a deep breath before stepping in front of this mirror, because looking in a mirror, as you may know, can be a rather deceptive experience. Form over content Both contenders have made little effort to convince voters on rational grounds. Any serious discussion  of policy plans, for instance, has been virtually absent during the presidential debates. Apparently, people are not very susceptible to reason when deciding who to vote for. Instead, Clinton and Trump excel in making grotesque statements aimed at appealing to the entire array of human emotions, as exemplified by Trump’s promise to construct a wall along the Mexican border or his “If I were president, you’d be in jail”-statement. Many people see Clinton as a more sophisticated candidate, but, although the tone of her discourse is less polarizing, she too appeals to basic emotions like fear and hope. A good example of this can be found in Hillary’s spectacular stage performance at a concert of Jay-Z and Beyonce. All in all, both candidates wrap their content in different packages, but neither of them is very clear about the content these packages contain. In fact, we are witnessing the victory of form over content. Candidates don’t try to sell us their ideology, but take us on a ride in an emotional rollercoaster. Just to sketch how far campaign managers are prepared to go, take notice of the following: A few minutes before the start of the 2nd presidential debate, Clinton’s campaign team prevented four women, three of whom accuse Bill Clinton of sexual abuse, from taking place in Trump’s family box. This frustrated the plan of Trump’s campaign managers, who wanted the accusers to enter the debate hall at the same time as Bill Clinton, or, even better, to have the accusers shake hands with him. Another thing that stands out is the fact that the presidential candidates use very simple language. Tellingly, Abraham Lincoln’s grammar use was similar to that of a 12th-grader, whilst Trump’s grammar use fits that of a 5th-grader. Based on the information above, we cannot but conclude that modern man is simple-minded, perhaps more so than its predecessors. What you like(d) is what you’ll get But how can this be? Aren’t we much smarter than previous generations because of our superior technologies? No. Precisely these technologies play an important role in making our minds more simple. On our smart phones, for instance, we consume massive amounts of information throughout the day. In deciding on which link to click, the quality of the content is often not a leading criterion. We prefer to keep our brain entertained with funny, shocking or erotic content. Maybe we are so used to being entertained that we prefer US presidential candidates who entertain us over the ones who bore us with their complicated – though more truthful – stories. Furthermore, most things you see on the internet depend on your past online activity: the likes you gave, the videos you watched and the links you shared. Although the precise functioning of the algorithms that create these personalized internet experiences is unknown, it seems clear that personal internet experiences mostly present you with information that is similar to the information you liked in the past. Nothing wrong with that, you might think. But when people only have access to the same kind of information, they hardly encounter information that challenges their view on the world. In other words, personalized internet experiences continuously reassure people of the veracity of their preexisting beliefs. In order to investigate how these so called filter bubbles might look like, the Wall Street Journal created the Red feed/Blue feed application. The Blue feed shows the internet experience of a fictitious liberal Facebook user, whereas the Red feed does so for a conservative Facebook user. The huge differences between both feeds show that personalized internet experiences are capable of creating parallel virtual realities. Conclusion Today – election day – millions of Americans will participate in, what they believe to be, the most important presidential election ever. Tragically, the theatrical election campaign has not provided voters with the necessary information for making a sound decision. Before everyone starts to point accusing fingers at ‘those naughty politicians’, we should be aware of the fact that – in the end – we are the ones who determine the success of political strategies. This introspective approach reveals that we prefer oversimplified stories of right and wrong over stories that do justice to the complexity of modern life. Perhaps, we should do something about that.

Bombarded on the media everywhere in the world is the coverage of the United States presidency: the seemingly endless battle between Secretary Hillary Clinton and the renowned businessman, TV personality Donald Trump is coming to a close. Our previous two issues published last week also did provide an insightful look-in to these primary candidates (here is Trump, and here is Hillary). Throughout the US, vote-casting has also been around for several days, for people who simply unable to show up or to working governmental officials on Election Day; and an estimated 37 million people have already voiced their support for their deserving candidates, as of November 4. However, for the majority of the residents of the United States, tomorrow is the judgment day. For non-US speculators like I am, the run-up to the election has not been far from watching a reality show: you do not really like it; but hey, you have come this far.  It has been 5 months since Trump declared presumptive presidential candidacy for the Republicans, with Hillary following one month later for the Democrats, after a clear-cut, albeit controversial victory against Senator Bernie Sanders. However, their campaigns, both starting in summer 2015, have been going on very different tracks. Three presidential debates. Hundreds of campaign rallies. More than half a billion dollar of donations were sent to candidates. Now, with Rostra, let’s have some final thoughts before the National Election Day, when the faith of Americans in the next 4 years will be decided. Independent Parties Candidates While the two nominees are fighting for the most powerful position in the political world, many people labeled them as the two worst ever US presidential candidates, evidently shown by their countless scandalous events. And of course, there are some alternatives that voters could look out for: independent candidates. Even when two main candidates showed considerably less favorability compared to nominees from previous elections, third-party candidates somehow failed to be properly appreciated and were extremely overlooked by the press. In spite of being given an opportunity to brand themselves as better candidates, they have not been performing well enough to deserve great recognition either. The two most frequently mentioned political candidates on this spectrum, based on polling results, are Gary Johnson and Jill Stein. a) Gary Johnson Although firstly pursuing Bachelors in Political Sciences as his main major, his successful start-up business made him turned into a successful businessman. At 41, he also decided to join politics and successfully campaigned himself to be the Governor of New Mexico, as a Republican. Johnson gave up business ownership and wholeheartedly devoted his effort to politics when he sold his corporation soon after. After stepping down from Governor Position after the second term in 2003, he was less active within political scenes, but still strongly endorsed Republican candidates for presidency. In 2009, he established “The Gary Johnson Initiative”, which was intended to support small government acts, most notably the combat against drug abuse. At the time, political analysts believed that the initiative would serve as a means for his potential run of 2012 presidential candidacy. He indeed announced his attention in late 2011 to run as a Republican candidate, but largely failed to impress voters with his proposals. As a result, in order to enhance his popularity, he decided to run for the Libertarian Party and was announced the representative for the Party in both 2012 and 2016. In his second attempt at the presidential candidacy, he introduced his policies and beliefs with virtually no difference compared to what was held in his 2012 run. Previously a Republican Governor himself, he can be characterized as fairly conservative and a strong advocate of no-intervention system. He strictly asserted his intentions of downsizing the government and believed that the economy can be self-regulated. On tax matters, his ideas do conform to the proposals by Republican candidates – he suggested abolishing the IRS and eliminate regression tax system, which shall be replaced by his “federal consumption tax”, rather than taxation on personal income and corporation. Healthcare-wise, he also raises skeptics the economic inefficiency towards state-controlled healthcare regulations (such as mandatory vaccination), and the continuation of government-funded Medicaid and Obamacare. On the other hand, his positions on some other political issues are somewhat aligned with Democrats’ belief. For example, he agrees on current problems such as climate change and the legalization of marijuana. Cross-border trades and international economic agreements are also other proposals that he agrees with. On regulations, he strongly opposes the prohibition of personal arms. Regarding immigration issues, he wants to speed up the process of documenting immigrants. Finally, though conservative, he is in support of same-sex marriage constitutional rights and abortion laws. The famous incident that caused a significant U-turn to his current presidential campaign was his careless comments on his foreign policy, where he was asked on his solutions on how to deal with Syrian crisis if he is to be elected. How disappointing the response was, as he did not even recognize the city of Aleppo, where the heart of the Syrian refugee crisis is. The inability to acknowledge a central location of US military operation deterred his performance en route to the presidency, and coupled with the uprising concentration on Clinton and Trump, have made him less of a viable option towards more serious matters. b) Jill Stein ­Born and raised in “The Windy City”, Chicago, Stein did not come from a political background. She graduated from Harvard in 1973 in sociology, psychology and anthropology. She was academically gifted and pursued teaching and practicing medicine for the majority of her career. She decided to lead the “Filthy Five” campaign in 1998 as her first experience in activism, which crusaded against the emissions of contaminants from coal plants in Massachusetts. She continued her campaigns by initiating numerous non-profit organizations which primarily focused on the battle against pollution, improvement of health and the establishment of sustainable environment programs. Besides her commitment to activism, she also published articles and made public appearances, taking part in open discussions with subjects related to public health and pediatrics. Stein decided to enter the field of politics, while campaigning for the finance reform of “Cleans Election Law” in Massachusetts, and revoked by the Democratic Party. She opted to join as an independent party candidate under the Green Party. In 2011, she actively campaigned for the “Occupy Wall Street” movement. Her most successful political career achievement came when she was announced as the representative of Green Party in 2012 presidential election, but her effort hardly paid off while only officially getting 0.36% of domestic support (equivalent to only below 500,000 voters). Her political ideology revolves rather much on liberal concepts, and comparatively much more to Gary Johnson. While having similarities in the approach the government should take such as the liberalization of LGBT rights, immigration and climate change, she took some different attitude towards other issues. Regarding her economic proposals, she was strongly against the coalition of corporations on Wall Street and planned to heavily place tax burdens on financial instruments and transactions. Meanwhile, on her policy plan, she pushed for the creation of sustainable infrastructure and called for efforts for building more environmental-friendly measures. However, she strongly opposed US military presence overseas and intended to reduce government expenditure on such non-developmental sectors. The combination of this policy measures are directly aiming towards to a structural change in employment, which would partly bring citizens from working in defense and military into a more value-enhancing sustainable sector, so as to improve employment within the country. She is also a voiced advocator of continuing Medicare and Obamacare, while promoted governments to tackle on contraceptive and reproductive care as well. Jill Stein, as likable as it might seem, failed to deliver when it matters most. When she was asked about the concerning issues surrounding education, most notably student debts, she evidently showed lack of understanding for fundamental economics. She argued that the adoption of a quantitative easing (QE) program, which is the initiatives of what the government did for bankrupt corporations on the aftermaths of financial crisis, should be used to bailout students from debts. It is even more absurd to think that this proposed educational reform was described by her as “simple”, and QE was considered “a magic trick”. Furthermore, she also got involved into of some her minor scandals such as her reluctance to release tax returns for consecutive years, even when she both actively fighting for presidency. Her foreign policy beliefs did not help her to gain any kind of domestic support either. She openly criticized US military involvement of the Syrian crisis and continuously denounced human rights issues within the country. That concludes our introduction of all candidates, covering the total of 3 issues. I do realize myself that I am/we are aware of honorable mentions as well, such as Darrell Castle from Constitution or Evan McMullin from Independent. Much to our acknowledgement, these other 20 candidates, combined, will only contribute marginally to the outcome of the official election (3 percent, rounded, on NBC poll conducted in October). Although as much as we dislike to admit it, the real battle would still be Trump vs. Clinton; however Johnson vs. Stein (albeit not that clear) might be worth watching as well, and it will be fascinating to see how the rise of independent parties will contribute to the succeeding elections. POLLING RESULTS As of the time of this article, most US pollsters have finished conducting polls of election, but are they definite indicators for the prediction of the winner? Well, if you do some online research, there are also some devoted studies on the predictive ability of polls. However, as useful of a source of information to voters and speculators as they are, it is good to remind that polls are no indications of assuring who will win the next presidential election (although, as we have learned in Statistics, within an x percent of confidence, there is enough statistical evidence to infer that *insert name here* will win). Barack Obama, in 2008, also warned us to never trust the poll – and he actually showed why, by having won over Clinton for the Democratic nomination when myriads of polling results indicated otherwise. According to the New York Times, as we approach the Election Day, it is much more evident that we are witnessing the convergence of votes towards the two main candidates. The majority of the polls, even those of heavily-biased Republican media outlets such as Fox News and Rasmussen, widely displayed Clinton’s dominance in terms of winning the number of polls. Surprisingly, she actually has barely lost the advantage since August! Nonetheless, with the sudden release of leaked emails that are related to Clinton merely days before the election, there is no guarantee that how much of an effect this might have on the overall results, especially when the details of those confidential messages are not even released yet. It does indeed seem that Hillary does not own as a significant lead as she used to on the weeks of Presidential Debates. On the polls that were conducted after the email scandal, the margin between two candidates has contracted; some polls even showed equal support for both candidates from participants. (Screenshot taken from the New York Times) The reliability of polling has been put into question many times, but over the course of the history, most pollsters have been very accurate with their collected results. However, data from polls are not always perfect, and how evident it was in predicting the outcome of Brexit! Michael van Rhee, one of our longest-serving member of Rostra, has an extensive article on the history and power of polling, so be sure to have a look as well. UVA ON US ELECTIONS Ah well, although we are thousands miles away from the dreamland America, the Dutch media also apportioned a huge amount of their broadcast time talking about the US election. Updates, reactions, documentaries, and even parodies, have been featured throughout the course of this presidential campaign. Our university was also delighted to welcome two US correspondents, Eelco Bosch van Rosenthal and Tom-Jan Meeus, to join a “Room for Discussion” session to provide a final look and an in-depth picture on how Americans would think about the election. The main spotlight, as they claimed, would not be only completely on who will take presidency, but rather which party will hold the majority of Congress and Senate seats as well; especially as we have witnessed many proposls of the Obama administration being discarded by a Republican-dominated Congress. Nobody could quantify how much of a negative effect that is to America; but the problem could have been easily mitigated had not there been disagreements between the Houses. The guests agreed that, this US election, in principle, is completely different compared to most previous ones. The momentum of this election was largely based on negativity and hostility, and the selection of candidates is to simply answer “who is the lesser of two evils”. Since Ronald Reagan’s presidency, the middle class, representing a huge proportion of voters, has been “dismantled”, and largely influenced by special group interests. So it is totally understandable that there is anger, there is frustration, and there is also dissatisfaction; but what America needs less of right now is actually two candidates whom represent that. Trump, a businessman, if elected, will not receive any kind of support from either Democrats or Republicans, as to the execution to some of his foolish proposals. Clinton, even if she wins, will be always overshadowed by her email scandals, so there is no guarantee that her policies would win some credibility from the opposition. Regardless of who wins the election, America (and the world) will be traveling on a very, very bumpy road, carrying for the next 4 years. Although none of our guests carried out the predictions, I do believe that only judging by strategic moves made by both parties, the Democratic nominee is holding a good advantage. Firstly, talking about demographics, it has been significantly shifted towards the last couple of decades. Statistically speaking, Tom-Jan Meeus mentioned that only 70% of voters in 2008 were white, compared to 84% seen in 1992. The Democrats since then have done a terrific job in taking advantage of the decrease (in terms of percentages) of white voters – more Asian-, Latino-, and African-Americans are actively involved in having their own say. However, if you look more carefully into these demographics, those people are the most conservative and fundamentalist of them all (Hollywood star Tom Hanks did a great skit on showing how similar Republicans are to African-Americans), so Republicans should be held accountable for not capturing these populations by simply self-destroying themselves by their comments on race- and religious-related issues. To conclude, we have our very own Dutch way of conducting a poll as well. Good night America, because you are going to need it.

I love going to the movies. Of course, I am not the only one. But as an economist, I might look at things through slightly different lenses than most people. Take the Pathé Unlimited card that is offered by Pathé, the largest cinema chain in the Netherlands. The card costs € 19 and provides access to as many movies as the owner likes within the time span of a month. Because Pathé sells single movie tickets for about € 10.50, the card sounds like a wonderful deal. But, as an economist, my instinctive response is: is it really? A cost-benefit analysis might reveal that the card is not such a great deal after all. The benefits might not be as high as they look from the onset. To make the card more attractive than buying loose tickets, you should watch at least two movies a month. In other words, the card is only worth its price if every two week a movie of sufficient quality is released in a Pathé theater. At the risk of starting a philosophical discussion about what ‘quality’ really is, I wonder whether Pathé releases a movie every two weeks that are more tasteful than Bridget Jones’s Baby, Jack Reacher: Never Go Back, and De Club van Sinterklaas & Geblaf op de Pakjesboot. Then the costs. Even though you do not have to pay for going to the movies once you have a Pathé Unlimited card, you do pay in terms of time. While being in the cinema, you are giving up some alternative use of time: You can also spend that time visiting your mum, visiting Facebook, visiting a dentist, or reading in Robert M. Pirsig’s Zen and the Art of Motorcycle Maintenance about what actually defines ‘quality’. For most people, such ‘opportunity costs’ are non-zero. The only exception is my nephew Paul. At least he thinks he is. When nephew Paul owned a Pathé Unlimited card, he went to over 100 movies in a year, virtually watching all movies that were released. Now, imagine that your cost-benefit analysis reveals that buying the Pathé Unlimited card is right up your alley. Are your really better off than in a world without it? I am not sure. In fact, I have had personal experience with such a world when I did my undergraduate studies in the 1990s. Well, it is clear that I am getting old, and I am probably glorifying the past, but as far as I remember, single theater tickets were not sold for 10.50 euros back then but for 10.50 guilders (about € 4.75). For sure, I am not so old that inflation can fully explain the price jump. So, what has been going on? My hunch is that Pathé is using the Pathé Unlimited card as a quite profitable ‘screening’ device to price discriminate between poor and rich people. How would that work? Imagine Pathé has two kinds of potential clients: ‘poor’ people with loads of spare time and low opportunity costs (like most students) and ‘rich’ people with hardly any spare time and high opportunity costs (like me). Suppose the two groups are equally large. Poor people are willing to go to the movies at most four times a month. They are willing to pay € 4.75 per movie. Rich people can arrange one evening off each month and then are willing to pay € 10.50 for a ticket. You can verify that if Pathé only sold single tickets, it would charge a price of € 4.75. Pathé would sell four tickets to each poor person and one to each rich person. Its profits would be € 23.75 (times the number of clients in either group). Offering the Pathé Unlimited card for a price of € 19 and single tickets for € 10.50, Pathé is able to discriminate between poor people who buy the Unlimited card and rich people who buy single tickets. By doing so, Pathé increases its profits to € 29.50. Consumers are worse off in a world with an Unlimited card than in a world having only single tickets: while poor consumers obtain zero surplus in both worlds, the rich are better of in the latter world. To be completely fair, some people, conveniently ignored in my analysis, might actually be better off. Recall my nephew Paul. Imagine that he is willing to pay € 3 per movie for up to ten movies a month. If the group of people like nephew Paul is small (I sometimes hope it is), Pathé will stick to the above pricing strategies in both worlds. Nephew Paul would not even bother going to the movies in the old world because he is not willing to pay price of € 4.75 per ticket. However, he is quite happy now he can buy the card as he is willing to pay € 30 for it, which is quite a bit more than the price of € 19. What lessons might you draw from the above? As far as I am concerned, the main lesson is that learning economics helps students to become more skilled decision makers. Or, as economists David Laibson and John List put it in the 2015 issue of the Papers & Proceedings of the American Economic Review: “Economics courses have the tangible benefit of increasing the optimality of the students’ own decisions.” Trained economists will think twice when buying the Pathé Unlimited card and will ask themselves: are my opportunity costs really low enough to justify me watching movies like Bridget Jones’s Baby, Jack Reacher: Never Go Back, and De Club van Sinterklaas & Geblaf op de Pakjesboot? Indeed, a course in economics might be a fruitful investment for nephew Paul. Moreover, businesses like Pathé also benefit from economic insights. For sure, the marketeers at Pathé have understood that the Pathé Unlimited card can serve as a profitable screening device to skim off surplus of both poor and rich people.