Jonathan Graves

Instructor (tenure-track)

I teach intermediate and senior undergraduate courses here at the VSE, focusing on how we can use economic intuition, modelling, and data analysis to understand the world around us. My research areas include undergraduate research pedagogies, including interdisciplinary and community-engaging learning, applied microeconomics, and industrial organization.

I am Canadian by birth, and received my PhD from the University of British Columbia. I have previously studied at the University of Victoria, and worked as an analyst in the private sector.

My research areas are in empirical industrial organization where I focus on firm and consumer decision-making. I am interested in using innovative data and techniques to try and discover new facts about how consumers and firms relate to one another in markets. I am always interested in new opportunities for partnerships with private section firms trying to understand their consumers better, and in working with other researchers interested in similar questions

In progress

Abstract: This paper examines the role of sales (temporary price reductions) in the pricing of perishable products. When products can be stored, periodic sales are commonly explained using inventories: the ability to store lets consumers wait for better prices, and so they have a more elastic demand. When consumers differ in their ability to wait (e.g. different inventories or demands), firms periodically reduce prices in order to keep the regular price high, targeting the low prices to just the most elastic consumers. However, this explanation is not reasonable for perishable goods, since they cannot be stored. Using a large retail dataset, I show that a cyclic pattern of sales is a major feature of how perishable products are priced, which cannot be explained by product expiration. To explain this, I develop a dynamic model of loss leadership. In my model, consumers purchase baskets of goods which contain different mixtures of perishable and storable products. Shopping costs induce consumers to buy their entire basket at a single store. Because these baskets differ, firms can use them to discriminate between different groups of consumers. Specifically, firms want to attract perishable-buying consumers when they are also purchasing relatively many storable goods. In order to do this, they seek to offer these consumers a better total price for their whole basket. It is optimal to do this by lowering just the price of the perishable good, since this targets the price reduction to the group the firm wishes to attract, keeping the total basket price high for other consumers. Firms time these price reductions to allow the target group of consumers to run down their inventory, which entails trading off present and future profit in an inter-temporal optimization problem. The link between storable good inventories and perishable products creates, in equilibrium, periodic sales on the perishable good. I test my model by linking the retail data to consumer choice data, a process which requires the development of a data-driven method of classifying prices into sales. The results validate the central prediction of the loss leadership model: when consumers buy perishables on sale they also buy more of other products, particularly storable ones, relative to their purchasing in non-sale periods. These findings highlight the role multi-product competition has on pricing dynamics, and rationalize an empirical finding which is difficult to explain with most models of sales.

Working Papers

Abstract: This paper studies large contributions and their impact on the outcomes of crowdfunding projects. I first examine the driving forces behind large contributions, finding that they display an apparent preference for being effective in helping projects succeed; indeed, a substantial proportion of large contributions occur simultaneously with projects reaching their goal, often being pivotal in the success of a project. These findings agree with a consumer choice explanation of how large conributions are made, matching predictions from a theoretical model. I futher examine the role large contributions play in project success. Using an instrumental variables approach, I find that the ability of a project to attract large contributors is important: a project is approximately 40-60% more likely to succeed if they can attract a large contributor. Large contributions also appear to be disproportionately effective relative to their size, indicating they not only provide support in the amount needed, but also when it is needed. This inverts the standard logic of crowdfunding: the crowd may be important, but the success of many projects is driven by large contributors.

 

Winter 2018

ECON226 Making Sense of Economic Data Sections

Formulation of a testable hypothesis, identification of relevant data, use of appropriate statistical tools. May not be taken for credit by students with fourth-year standing in ECON or COMM. Not available for credit to students already having credit for either of ECON 325 or ECON 326 (or equivalent).

Winter 2018

ECON221 Introduction to Strategic Thinking Sections

An introduction to how people interact in strategic situations drawn from political science, history, psychology, law, biology, military history, economics, business, and anthropology. The focus will be on developing intuition. May not be taken for credit by students with fourth-year standing. Credit will be granted for only one of ECON 221 or ISCI 344.

Winter 2018

ECON406 Topics in Microeconomics Sections

Selected topics in advanced microeconomic analysis.

Winter 2018

ECON492F Directed Reading - DIRECTED READING Sections

Winter 2018

ECON490 Seminar in Applied Economics Sections

Selected problems and issues in the theory and practice of Economics. Each section will focus on a different field. Restricted to Economics Majors, and Combined Majors in Economics their final academic session.

My Teaching

I am passionate about helping students realize how exciting and dynamic the world of economics can be. My classes focus on conveying the unique advantages and benefits an economic perspective can bring to the analysis of any situation: from the business world to their everyday lives. I use a variety of tools to give students hands-on experience formulating economic arguments and critically evaluating problems including: seminars, in-class discussions, "blended" learning sessions, practical lab experience, 1-on-1 guidance, and lectures. My goal has always been to make students into better critical thinkers, economists, and citizens. You can find my teaching statement here.

Courses Taught

This course takes an economic perspective on the world of business and decision making. What can we say about the optimal way businesses organize themselves and their operations? Rather than focusing only on theory, this course approaches this from a hands-on perspective: what kinds of microeconomic tools can assist economists (and businesses) in understanding how companies operate?

The objective of this course is to give students a relevant set of tools to successfully bring an economic viewpoint to work in a business or other large organization. We begin by focusing on causality and evaluation: how can we tell if a policy is working? How can we tell if event A caused event B? Once we have the basics down, we explore the wide, practical scope of this kind of economic analysis, looking at "in-the-news" stories and topics of popular interest and debate.

From here, we use relevant theory to help students understand how and why businesses adopt certain structures. Theory is paired with relevant empirical analysis, giving students a framework to understand and critically evaluate performance and other relevant topics. Emphasis is on understanding the incentives behind decisions, and the ways to visualize those incentives in the data available. The capstone of the course is a major project, in which students demonstrate their mastery of the tools learned, and show their own creativity and insight.

This section will focus on a simple problem: how do we take an issue and use our economic tools to analyze it?  This may seem elementary, but it can be surprisingly challenging!  We will look at this problem in the context of applied economic research.  We will do four things in this course:

1)                   Explore the tools, models, and skills necessary for answering questions in applied economics.

2)                   Discover how to formulate a good question about a topic that inspires you.

3)                   Learn how to answer your question in a convincing way.

4)                   Practice communicating your results through writing and speaking.

The focus will be on taking an idea you care about and building a research topic around it; a process your instructor will guide you through in 1-on-1 meetings.  The best ideas come about because you are passionate about them!  The course format will be a mixture of lectures, small-group discussions, computer labs, and presentations.  We will review some necessary background in lecture, and learn some new and commonly used models.  We will get hands-on practice with real data through computer labs, and learn how to use statistical software.  We will also learn how to communicate our results clearly both in written form, and in presentations.  Evaluation will be primarily based on (i) in-class participation, (ii) oral presentations, and (iii) your research paper. Emphasis in-class will be on microeconomic applications, but students with broader interests are also encouraged to attend.

What does it mean to think strategically?  This question is fundamental to economics and the social sciences in general, since it is a critical part of decision making.  In this course, we will build a framework to analyse questions of strategy.  This framework, known as strategic games, helps us study situations where individuals interact understanding that their wellbeing depends on not just their own actions, but the actions of other individuals.  This theory has immense scope and power, and we will apply it to situations and examples from history, anthropology, sociology, biology, sports, and everyday life.

The most powerful aspect of this theory is how it provides a structured way to think about complicated interactions.  We can answer questions like “Why did the USA and USSR build so many nuclear weapons?” or “Why do animals sometimes fight for territory, and other times not?”   Most importantly, we can explore the beautiful and complex relationship between self-interest, altruism, and cooperation, and learn about the evolution of cooperative behaviour and social norms.

This course is designed to have broad appeal and scope: it is for individuals interested in economics, but not just for economists.  We will eschew a mathematically-based approach in favour of intuition and logical argument.  Developing this intuition (and way of thinking) is a primary goal of this course.  More mathematically inclined students will not be bored; there is much here to challenge and excite even advanced students!  Biologists may be particularly interested in our study of how evolution and strategy describes animal interactions.  Sociologists and anthropologists may be interested in the role of signals in human behaviour and the creation of social norms.  Historians and politicians may be excited by the analysis of war, conflict, and cooperation between competing states.  Economists, naturally, will be interested in how this topic forms the basis for microeconomic thinking and modelling.  Whatever you imagine yourself to be, there’s likely to be something you’ll find fascinating and exciting in this course.

So, I encourage you to sit down, read on, and join us as we begin a grand intellectual adventure spanning not only the world of strategy, but the history of economics and the modern world.  We will meet unique and interesting characters, explore strange and puzzling situations, and change the way we think about the world.  The only things you need are an open mind, a love of learning, and a willingness to think about ideas!

What are data?  How do we use them?  This question is fundamental to both how economic decisions are made and how we study those decisions.  In this course, we will begin to examine the way decisions around us create data, and how we can use that data to uncover the motivations and incentives which shape the world around us.  Together, we will build up a set of tools and apply them to real-world questions and examples from economics, but also history, sociology, political science and everyday life.

The focus when it comes to economic data is not on the mathematical structure, but rather what the data mean – a question which is extremely interesting, and relies much more on intuition than calculation.  A major focus on this course will be hands-on work; practical problems, with real questions which you will be asked to answer.  The goal is to get you comfortable asking your own questions and figuring out ways to answer them using the tools we develop.

This course is designed to have broad appeal and scope: it is for individuals interested in economics, but not just for economists.  Mathematics and statistics are not a focus of the course, but more mathematically inclined students will not be bored; there is much here to challenge and excite even advanced students.  Building your quantitative numeracy is the key goal here – and demonstrating some of the interesting, and exciting, ways that economic ideas can be applied.  We’ve not going to be satisfied to merely present theories – we’re going to look at how we can test them, and how to interpret the results of those tests.

The only things you really need to succeed in this course are an open mind, a love of learning, and a willingness to think about questions!