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Facebook is not the only one studying your behavior

Mon, 2014-06-30 09:35

As the furor over Facebook's experimentation with users' emotions spreads across the web, the most common defense of the social media company's actions is that every other web company is doing the same thing, or something close to it. Google, Amazon, Yahoo, Twitter -- they're all gathering data on how people use their services and how small changes can change people's behavior.

“Name a company that involves a large user base and you will find a research division looking to see how people use their site – Google does it, Twitter, MySpace always did it.  Think about Nielsen; we’ve lived our  lives knowing that Nielsen looks at how people interact with television shows and what they like or don’t like,” says Karen North, professor of digital and social media at USC’s Annenberg School of Communication.

With this pervasiveness of data and behavior studies at different companies, we decided to take a look at the research divisions at some of the biggest web services - and what kinds of work they're actually doing.

Google

Not suprisingly, Google's research division is expansive and varied, with areas of concentration ranging from its all-important search and ad algorithms, to speech and language processing to cyber-security and privacy. Google shares some similiarities with Facebook, in that they are known for keeping close tabs on their users' data for the purposes of advertising. Their research into web behavior seems to support this comparison. But in terms of manipulating user's content, Google seems to stick to small experiments or changes based on user preferences.

“Google is famous for doing widespread social research on how their website is doing," says Carl D. Howe, vice president of research and data sciences at the Yankee Group. "Now this is not emotional research, it’s ‘Do users prefer a one pixel wide blue bar or two pixel blue bar?’ These are called a/b tests and they run hundreds of them every day and they measure the click throughs as a result.”

One interesting aspect of Google's research is that they keep tabs on their advertisers' actions as well as those of their users, with a research division dedicated to measuring the behavior of search-ad customers and online economics.

Yahoo

Similar to Google, Yahoo runs a number of research divisions focused on data management and advertising. Like Facebook, Yahoo has studied how different types of content can provoke different behaviors from users, like one study that found that people engage more with photos that have faces in them on social media. Yahoo also researches how different personalization options can drive user behavior, and how they can serve up content to take advantage of it.

Twitter

Twitter is still figuring out how to sell advertising on its service, so it's no surprise its research division is fairly small compared to other web giants. Most of its research is published in the form of blog posts, and focuses on strategies for advertisers to reach users with targeted content or tweeting around large events. Trying to manipulate Twitter is still a risky proposition, so much of the research remains somewhat vague in comparison to the sophisticated findings coming from companies like Google.

Your Wallet: Reading the fine print

Mon, 2014-06-30 09:06
Fine print is everywhere these days: You can find some sort of clause when it comes to educationelectronics, vacations, loans, and hospital stays.

We're looking for stories, big and small, of when the fine print tripped you up. Let us know in the comments or email us:

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In 2010, CreditCards.com held a survey of over 1,200 credit card agreements and found that they are unreadable to 4 out of 5 Americans. According to credit expert John Ulzheimer, “the big print giveth and the fine print taketh away.”

BNP Paribas has to pay $8.9 billion in violations

Mon, 2014-06-30 05:37

BNP Paribas, the big french bank, came up the biggest loser today.

Late this afternoon we learned that BNP will pay a "Global money penalty" of $8.9 billion in a guilty plea to settle charges by U.S. authorities for violating American sanctions on Sudan and Iran, among others.

We hate Facebook for reminding us it's so powerful

Mon, 2014-06-30 03:00

Over the weekend, your Facebook feed may have exploded with anger— at Facebook. Researchers from the company, in collaboration with academic social scientists, published the results from a study in which the company manipulated the news feeds of hundreds of thousands of users. Some users saw news feeds full of negative material, others saw material that was positive. The idea was to see how those two conditions made people feel.

Well, the answer was that people felt really, really mad.  

“This study has been characterized as Facebook deliberately trying to depress people,” says Michelle N. Meyer, a bioethicist at the Icahn School of Medicine. “Which, put that way, strikes people as potentially dangerous— and rude. People don’t like to feel like they’re being jerked around.”

Getting manipulated isn’t especially new, she says.  “We’re manipulated all the time. Every day. You know, your mother wants you to eat brussels sprouts.”

However, it may be rude of Facebook to rub users’ faces in its ability to manipulate what they see.

That highlights an uncomfortable reality, says Harvard Law Professor Jonathan Zittrain, who studies the internet and society.

“We are relying more and more on just a handful of intermediaries to offer us a view of the world,” he says. “And the view that they offer is produced by a secret sauce that nobody reviews.”   

PODCAST: The house doesn't win

Mon, 2014-06-30 03:00

First up, more on the expected nomination of Robert McDonald to head the VA, and his troubled history as the former head of Procter & Gamble. Plus, as another casino closes in Atlantic City, a look at the larger negative effects of the boom in the casino business in the Northeast. Also, with political giving getting bigger all the time, a new kind of financial planner has popped up -- Wealthy, politically-minded families are hiring people to manage their financial gifts to campaigning politicians.

Financial planning for political donors

Mon, 2014-06-30 02:00

The boom in political giving has given rise not only to countless television advertisements and myriad political action committees, but also to something of a new type of job: financial planner for wealthy political donors.

“They [wealthy donors] have other activities in their lives," says Bob Biersack, a fellow with the Center for Responsive Politics. "So they don’t follow the ins and outs of politics – who’s up, who’s down."

Enter what’s known as a donor-side consultant, like Ella Arnold, who works with five Bay-Area families. These are very wealthy families whom she declined to identify.

Arnold and her company, Buell Private Political Management, are in touch with clients every day, “managing their political giving and making sure they stay within federal and state limits – contribution limits,” she says.

Some of those limits disappeared recently, when the Supreme Court handed down its decision in a case called McCutcheon versus FEC. Arnold says that actually made her kind of consulting more attractive to big donors. That class of political activist recognizes that candidates can now hit them up for more cash.

They’re thinking, “now that I can give all this extra money,” Arnold says, “I want to make sure that I’m sticking to a budget.”

Arnold meets with politicians. If she thinks one has a platform one of her clients might support, she’ll set up a meeting. And if everything goes well, maybe a fundraiser. She calls the role something akin to being a “wedding planner.”

“Donors, particularly businessmen, are typically risk averse, and the rule of do no harm to either their own good name or their business is their first and primary consideration,” says Dora Kingsley Vertenten, a professor at USC, who used to do this kind of work.

Arnold calls it a growth industry, especially in San Francisco and Silicon Valley; home to a lot of very rich people, many of whom are young, and are new to politics.

“I don’t think that there is a place where it is happening as fast as it is in the Bay Area, given the tech industry and all for that,” she says.

Financial companies play venture capitalist

Mon, 2014-06-30 02:00

A recent demo gathering in New York featured several startups showing off their software projects. It was from the FinTech Innovations lab, which looks at innovations in the financial tech industry. The audience was comprised of some of the biggest banks and their affiliated financial companies in the world. 

For more on the FinTech Innovations lab, click the media player above to hear Marketplace reporter Tracy Samuelson in conversation with Marketplace Tech host Ben Johnson.

Financial technology is a category defined as any kind of technology meant to serve banks, insurance companies, and other financial services industries. It's a growing market -- Investment in the sector has tripled since 2008.

Companies at the gathering show off products like Kasisto, which uses the technology underlying the iPhone’s Siri to allow a user to ask mobile banking apps specific questions about their banking information.

The banks, as the future customers of these companies, have an incentive to help improve these products, and create their own venture funds to invest in these companies. 

Casino saturation hits Atlantic City

Mon, 2014-06-30 02:00

The Showboat casino in Atlantic City is closing. It’s the second casino to close there this year. It turns out, a recent boom in Northeast casinos means the house doesn’t always win.

Since 2001, gaming revenue in the Northeast has increased 71 percent, the most of any region says David Schwartz, who directs the Center for Gaming Research at the University of Nevada-Las Vegas.

But regional growth isn’t good for old gambling hubs like New Jersey.

“You’ve had casinos open up in Pennsylvania in particular, which is where a lot of the customers for Atlantic City were coming from,” Schwartz says. “And now they have the same games they can play, it’s a shorter drive, it’s less gas money. So many of them are just playing there.”

Schwartz says gaming revenue in New Jersey has fallen 42 percent since 2007.

It’s not just the casinos that effects. Dave Fitzgerald, who directs the Ocean County, N.J., transportation department, says taxes on casino revenue help fund a program that gives people rides to dialysis appointments. But the decline in casino revenue means the program can’t take new clients.

“Back in ’08 we were transporting approximately 280 dialysis clients,” Fitzgerald says. “We’re now down to less than 30 dialysis clients. So it has severely impacted the level of services that we’ve been able to provide.”

The problem isn’t going away anytime soon. A third Jersey casino has filed for bankruptcy and is looking for a buyer.

Canadian professors’ protest of president’s fat salary

Mon, 2014-06-30 02:00
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The economics behind a celebrity's book

Mon, 2014-06-30 02:00

Sales of Hillary Clinton’s most recent book, “Hard Choices,” slipped significantly after its first week on sale. 

Clinton was reportedly paid a multi-million dollar advance by her publisher Simon & Schuster, raising questions from some about whether the publisher’s bet will pay off.

“I do think it’s doing well,” Kate McKean, vice president at Howard Morhaim Literary Agency, says of the book. “She’s not going anywhere, so this book could potentially sell, and probably will sell for years and years.”

Still, even with books by celebrities that seem destined to be best sellers, publishers are taking a gamble, says Brian DeFiore, a New York-based literary agent.

“How much do we believe in this person?," DeFiore says. "How much do we believe the public wants to hear from this person and hear more about this person? And then, how much will that person’s voice resonate for years to come?”

Something else publishers taking into account: global sales. And given Clinton’s fame, DeFiore says it’s book that should sell around the world.

Obama's VA pick resigned under pressure from P&G

Mon, 2014-06-30 01:00

President Barack Obama is expected to nominate the former head of Procter & Gamble as secretary of Veterans Affairs, following Eric Shinseki’s resignation last month. A West Point graduate, Robert McDonald spent 33 years with the company that sells Crest toothpaste, Duracell batteries, and Charmin toilet paper

After his time in the army, McDonald spent his entire career at Procter & Gamble, where he oversaw 120,000 employees.

His four years running the company were difficult ones. When McDonald took over in 2009, P&G was deep into a strategy that emphasized charging premium prices for brand name products —  a strategy that became less effective after the financial crash of 2008. McDonald’s retirement from P&G last year was under pressure.

The new assignment could bring new challenges. Even though Procter & Gamble is the world’s biggest consumer-products company, it’s actually smaller than the VA. The company reports sales of $84 billion — a bit more than half of the VA’s $154 billion budget. The VA also has more than twice as many employees as P&G.

Transgender female workers face added discrimination

Mon, 2014-06-30 01:00

For transgender people, work isn’t always an easy place to be – They often face discrimination, and are twice as likely to be unemployed as the rest of the population. Many who do work are under-employed. But transgender experiences at the office can tell us a lot about the status of men and women at work.

Sociologist Kristen Schilt has spent years talking to transgender men and women about their work lives. One guy she interviewed is named Thomas. He’s a lawyer. He’d begun working at his law firm as Susan. Everyone in his firm knew about his transition, but clients and others outside the firm were told Susan had been let go.

Schilt says some time after his transition, his boss told Thomas that a lawyer at another firm said, “He was so glad they had fired Susan, who he had found to be very incompetent, but that he really loved this new guy, Thomas.”

That lawyer had no idea Thomas and Susan were the same person. But they were the same person, with the exact same abilities – Thomas just looked like a man.

Schilt says two-thirds of the transgender men she interviewed found workplace life easier once they left their female days behind. They’d say things like, “I don’t have to back up the claims I’m making. People listen to me more.” They reported having more authority than they’d ever had in their old work lives.

Chris Edwards has experienced that first hand. He’s a transgender man who works in advertising. He now perceives his workplace differently, too.

“As a creative director, and as a male creative director, I started to notice differences with the way women were treated,” he says. “But when I was a woman I didn’t really notice.”

Now he’s quite conscious of the pay gap at his firm. And he says it’s always a woman who’s expected to take the notes in meetings – no matter how senior she is.

Lisa Scheps knows all about that difference in status. When she was living publicly as a man, Scheps ran a business with three male partners. At 40, she told them she was going to start living openly as a female. She wasn’t prepared for their responses.

“One person said to me, ‘How do you expect to deal with business when all you’re going to be thinking about is nail polish?’,” says Scheps.

Her partners pushed her out of the company. Scheps has been an entrepreneur all her life. She thought she’d just start something else as a female business owner.

“My 40 years as man in the business world, I did not know failure,” she says. “Success came very easily to me.”

Not any more. Scheps, who is the co-founder of the Transgender Education Network of Texas, says administrative work is pretty much all she’s been able to find. Her income has fallen dramatically. 

“It’s a very different world that I have discovered for women in the United States versus men in the Unites States,” she says. “It’s just that much harder, you just have to be that much better.”

Like everyone else who’s underemployed, Scheps says she just wants a job that matches her experience.

Ashley Milne-Tyte is the host of a podcast on women and the workplace called The Broad Experience.

Are European banks feeling more heat than U.S. ones?

Fri, 2014-06-27 13:26

According to the New York Times and other reports, next week the European bank BNP Paribas will pay almost $9 billion in penalties to U.S. regulators and plead guilty to criminal charges. That follows other recent actions against bankers at Credit Suisse. But why are actions like these seemingly so infrequent?

"It's not that the regulators are only focusing on the European banks. I think you could make the a strong case that the penalties that they're seeking are may be a little bit disproportionate to the crimes, at least if you compare them to how much as a share of profits the American banks are having to pay," says Cardiff Garcia with the blog FT Alphaville. "But I don't think it's that the regulators are singling out the Europeans. I think this is more just that the regulators sense a few issues where they can take some scalps and so they're going for it."

"It's kind of the shareholders, in many cases, that have been held to account and not so much the actual people who are making the bad-guy decisions," adds Catherine Rampell, a columnist and blogger for the Washington Post. "And I think that has a lot of people very angry and understandably so."

Bank penalties weren't the only thing being discussed on Wall Street this week, even though the business world slowed down as we approach the July 4 holiday. A terrible GDP report out this week had many wondering about economic growth in the U.S., especially earlier this year.

"Certainly things looked a lot worse in the end than they started in the beginning," says Rampell. "It could turn out that the quarter was better actually than we thought.... and there are a lot of other data points in the U.S. economy that demonstrate that actually we're doing better than the GDP number, at face value, suggests."

And what about all the American attention paid to the 2014 World Cup and the U.S. men's national soccer team?

" We're all just exciteable enough to get into it while the U.S. is winning, and yet the minute we lose or we get knocked out," Garcia says, "we'll just say, oh well, whatever, it's just soccer anyways."

Are European banks feeling more heat than U.S. ones?

Fri, 2014-06-27 13:26

According to the New York Times and other reports, next week the European bank BNP Paribas will pay almost $9 billion in penalties to U.S. regulators and plead guilty to criminal charges. That follows other recent actions against bankers at Credit Suisse. But why are actions like these seemingly so infrequent?

"It's not that the regulators are only focusing on the European banks. I think you could make the a strong case that the penalties that they're seeking are may be a little bit disproportionate to the crimes, at least if you compare them to how much as a share of profits the American banks are having to pay," says Cardiff Garcia with the blog FT Alphaville. "But I don't think it's that the regulators are singling out the Europeans. I think this is more just that the regulators sense a few issues where they can take some scalps and so they're going for it."

"It's kind of the shareholders, in many cases, that have been held to account and not so much the actual people who are making the bad-guy decisions," adds Catherine Rampell, a columnist and blogger for the Washington Post. "And I think that has a lot of people very angry and understandably so."

Bank penalties weren't the only thing being discussed on Wall Street this week, even though the business world slowed down as we approach the July 4 holiday. A terrible GDP report out this week had many wondering about economic growth in the U.S., especially earlier this year.

"Certainly things looked a lot worse in the end than they started in the beginning," says Rampell. "It could turn out that the quarter was better actually than we thought.... and there are a lot of other data points in the U.S. economy that demonstrate that actually we're doing better than the GDP number, at face value, suggests."

And what about all the American attention paid to the 2014 World Cup and the U.S. men's national soccer team?

" We're all just exciteable enough to get into it while the U.S. is winning, and yet the minute we lose or we get knocked out," Garcia says, "we'll just say, oh well, whatever, it's just soccer anyways."

'TV Everywhere' is sometimes TV nowhere

Fri, 2014-06-27 13:26

At its peak during Thursday’s US-Germany World Cup game, ESPN was serving up a record 1.7 million streams of its channel over the internet. It was not without hiccups. 

A number of users had issues logging into the service. 

When I tried today — not a peak time for viewership — I, too, got an “authentication error” on my first attempt. 

All this logging in to prove we pay for cable is part of something the industry calls “TV Everywhere." It’s used by HBO GO, CNN, and others. 

It’s designed to give consumers what we want — the ability to watch live TV on computers, tablets, and smartphones — but also keeps us paying the cable company. 

But it’s rarely an easy experience.  

“it’s a huge issue,” says Daniel Frankel, editor of Fierce Cable, and online trade publication. “The problem is that it’s just not fully baked yet. It’s such a hugely complex initiative involving so many rights deals and so many technology deals, it’s bound to not work seamlessly for the consumer.” 

It’s a far cry from services like Netflix, Hulu, even the now illegal Aereo that all let you log in once and keep using the service. 

“The key to TV Everywhere’s future is removing authentication altogether,” says Michael Greeson, President of The Diffusion Group, which consults for the industry.  

TV Everywhere has been slow to catch on. After five years, most cable subscribers don’t know it exists. And, he says the industry has been so afraid of people stealing its content that it’s made it too hard to use. 

Similarly, the music industry initially put far more restrictions on downloads than it does today. Many predict the cable industry will relax its rules. 

ESPN says its working with cable companies to simplify things. Its own president, earlier this year, called today’s TV Everywhere setup, “clunky.”

'TV Everywhere' is sometimes TV nowhere

Fri, 2014-06-27 13:26

At its peak during Thursday’s US-Germany World Cup game, ESPN was serving up a record 1.7 million streams of its channel over the internet. It was not without hiccups. 

A number of users had issues logging into the service. 

When I tried today — not a peak time for viewership — I, too, got an “authentication error” on my first attempt. 

All this logging in to prove we pay for cable is part of something the industry calls “TV Everywhere." It’s used by HBO GO, CNN, and others. 

It’s designed to give consumers what we want — the ability to watch live TV on computers, tablets, and smartphones — but also keeps us paying the cable company. 

But it’s rarely an easy experience.  

“it’s a huge issue,” says Daniel Frankel, editor of Fierce Cable, and online trade publication. “The problem is that it’s just not fully baked yet. It’s such a hugely complex initiative involving so many rights deals and so many technology deals, it’s bound to not work seamlessly for the consumer.” 

It’s a far cry from services like Netflix, Hulu, even the now illegal Aereo that all let you log in once and keep using the service. 

“The key to TV Everywhere’s future is removing authentication altogether,” says Michael Greeson, President of The Diffusion Group, which consults for the industry.  

TV Everywhere has been slow to catch on. After five years, most cable subscribers don’t know it exists. And, he says the industry has been so afraid of people stealing its content that it’s made it too hard to use. 

Similarly, the music industry initially put far more restrictions on downloads than it does today. Many predict the cable industry will relax its rules. 

ESPN says its working with cable companies to simplify things. Its own president, earlier this year, called today’s TV Everywhere setup, “clunky.”

Ukraine signs historic deal with the EU

Fri, 2014-06-27 13:19

A HIGHLY SYMBOLIC AGREEMENT...

It was last November that Ukraine’s then president Viktor Yanukovych sparked what would become an international crisis when he pulled out of a trade deal with Europe. Seven months, one toppled presidency, and a Russian invasion later, that trade agreement has been signed.  

Current Ukrainian President Petro Poroshenko and the EU signed the deal today.

For many Ukrainians, such as Yulia Drozd, this was a potent confirmation of their European identity and destiny. 

“This is just a sign that the USSR period came to an end in Ukraine and this is a point of no return, you know, this is a joy, just a complete joy,” says Drozd, speaking from a café near Kiev’s main square.

While Drozd believes the accord will lead to economic improvement, “not really many people understand association with the EU from the economic point of view.”

..WITH SIGNIFICANT ECONOMIC IMPLICATIONS

But there are far reaching changes now set in motion as European tariffs on 98 percent of Ukrainian goods go down.   

“The calculations are that this would increase Ukraine’s exports altogether by 50 percent over five years or so and increase gross domestic product in the same period by 12 percent,” according to Anders Åslund, senior fellow at the Peterson Institute for International Economics.

He says the most obvious industry to benefit will be agriculture , which constitutes a third of Ukrainian exports already. The agreement is gradual in its exposure of Ukraine’s agricultural sector to foreign competition. Manufacturing investment from Europe and the U.S. for the purposes of exporting to Europe are also possible.

There are sectors that appear likely to suffer moving forward. “The less modern sectors,” says Åslund, among them steel and heavy machinery. These industries are centered in the Russia-leaning east of the country, and were focused on export to Russia. They have been the target of Russian import restrictions since the crisis began.    

A FOCUS ON GOVERNMENT REFORM AND ANTI-CORRUPTION

The European association agreement also contains a list of reforms that Ukraine must undertake to fight endemic corruption and raise standards. “There are literally hundreds of laws that Ukraine has committed itself to adopt,” says Åslund. “And this means that the whole state apparatus in Ukraine which is in very bad shape, will be reformed using technical assistance from the European Union.”

“To give you an example, sixty state agencies of EU countries have made  contracts with corresponding state agencies in Ukraine that these EU agencies will reform these Ukrainian state agencies.”

Alexander Kliment, director of Russia research at Eurasia Group, says these things will lay a foundation for future growth. “The reforms involved in making the Ukrainian economy more efficient and less corrupt are by themselves big advantages.”

COSTS

“The gamble is that over the longer term meeting higher standards, European standards, will open larger markets and create more economic growth, but in the short term there are costs,” says Kliment.

As Ukraine brings regulatory codes ranging from phytosanitary requirements to standards for agricultural products and foodstuffs into harmony with European codes, Ukrainian businesses will have to adapt. “Ukrainian companies are used to meeting one set of standards in Ukraine will now have to invest to meet another set of higher standards,” and this will require investment.

Russia, fearful that its normally open borders with Ukraine would be flooded with European goods, has restricted many goods from crossing its borders since the current crisis began. 

MANAGING EXPECTATIONS

The time frame along which the economic effects of the agreement unfold presents one of the greatest challenges to it. Ukrainian politicians, says Kliment, will have a difficult task of managing people's high expectations. “The benefits of this agreement are over the medium to long term, and people’s frustrations with agreements of this kind can come in the immediate to short term.”

Ukraine signs historic deal with the EU

Fri, 2014-06-27 13:19

A HIGHLY SYMBOLIC AGREEMENT...

It was last November that Ukraine’s then president Viktor Yanukovych sparked what would become an international crisis when he pulled out of a trade deal with Europe. Seven months, one toppled presidency, and a Russian invasion later, that trade agreement has been signed.  

Current Ukrainian President Petro Poroshenko and the EU signed the deal today.

For many Ukrainians, such as Yulia Drozd, this was a potent confirmation of their European identity and destiny. 

“This is just a sign that the USSR period came to an end in Ukraine and this is a point of no return, you know, this is a joy, just a complete joy,” says Drozd, speaking from a café near Kiev’s main square.

While Drozd believes the accord will lead to economic improvement, “not really many people understand association with the EU from the economic point of view.”

..WITH SIGNIFICANT ECONOMIC IMPLICATIONS

But there are far reaching changes now set in motion as European tariffs on 98 percent of Ukrainian goods go down.   

“The calculations are that this would increase Ukraine’s exports altogether by 50 percent over five years or so and increase gross domestic product in the same period by 12 percent,” according to Anders Åslund, senior fellow at the Peterson Institute for International Economics.

He says the most obvious industry to benefit will be agriculture , which constitutes a third of Ukrainian exports already. The agreement is gradual in its exposure of Ukraine’s agricultural sector to foreign competition. Manufacturing investment from Europe and the U.S. for the purposes of exporting to Europe are also possible.

There are sectors that appear likely to suffer moving forward. “The less modern sectors,” says Åslund, among them steel and heavy machinery. These industries are centered in the Russia-leaning east of the country, and were focused on export to Russia. They have been the target of Russian import restrictions since the crisis began.    

A FOCUS ON GOVERNMENT REFORM AND ANTI-CORRUPTION

The European association agreement also contains a list of reforms that Ukraine must undertake to fight endemic corruption and raise standards. “There are literally hundreds of laws that Ukraine has committed itself to adopt,” says Åslund. “And this means that the whole state apparatus in Ukraine which is in very bad shape, will be reformed using technical assistance from the European Union.”

“To give you an example, sixty state agencies of EU countries have made  contracts with corresponding state agencies in Ukraine that these EU agencies will reform these Ukrainian state agencies.”

Alexander Kliment, director of Russia research at Eurasia Group, says these things will lay a foundation for future growth. “The reforms involved in making the Ukrainian economy more efficient and less corrupt are by themselves big advantages.”

COSTS

“The gamble is that over the longer term meeting higher standards, European standards, will open larger markets and create more economic growth, but in the short term there are costs,” says Kliment.

As Ukraine brings regulatory codes ranging from phytosanitary requirements to standards for agricultural products and foodstuffs into harmony with European codes, Ukrainian businesses will have to adapt. “Ukrainian companies are used to meeting one set of standards in Ukraine will now have to invest to meet another set of higher standards,” and this will require investment.

Russia, fearful that its normally open borders with Ukraine would be flooded with European goods, has restricted many goods from crossing its borders since the current crisis began. 

MANAGING EXPECTATIONS

The time frame along which the economic effects of the agreement unfold presents one of the greatest challenges to it. Ukrainian politicians, says Kliment, will have a difficult task of managing people's high expectations. “The benefits of this agreement are over the medium to long term, and people’s frustrations with agreements of this kind can come in the immediate to short term.”

Trade deal aligns Ukraine with Europe

Fri, 2014-06-27 13:19

A HIGHLY SYMBOLIC AGREEMENT...

It was last November that Ukraine’s then president Viktor Yanukovych sparked what would become an international crisis when he pulled out of a trade deal with Europe. Seven months, one toppled presidency, and a Russian invasion later, that trade agreement has been signed.  

Current Ukrainian President Petro Poroshenko and the EU signed the deal today.

For many Ukrainians, such as Yulia Drozd, this was a potent confirmation of their European identity and destiny. 

“This is just a sign that the USSR period came to an end in Ukraine and this is a point of no return, you know, this is a joy, just a complete joy,” says Drozd, speaking from a café near Kiev’s main square.

While Drozd believes the accord will lead to economic improvement, “not really many people understand association with the EU from the economic point of view.”

..WITH SIGNIFICANT ECONOMIC IMPLICATIONS

But there are far reaching changes now set in motion as European tariffs on 98 percent of Ukrainian goods go down.   

“The calculations are that this would increase Ukraine’s exports altogether by 50 percent over five years or so and increase gross domestic product in the same period by 12 percent,” according to Anders Åslund, senior fellow at the Peterson Institute for International Economics.

He says the most obvious industry to benefit will be agriculture , which constitutes a third of Ukrainian exports already. The agreement is gradual in its exposure of Ukraine’s agricultural sector to foreign competition. Manufacturing investment from Europe and the U.S. for the purposes of exporting to Europe are also possible.

There are sectors that appear likely to suffer moving forward. “The less modern sectors,” says Åslund, among them steel and heavy machinery. These industries are centered in the Russia-leaning east of the country, and were focused on export to Russia. They have been the target of Russian import restrictions since the crisis began.    

A FOCUS ON GOVERNMENT REFORM AND ANTI-CORRUPTION

The European association agreement also contains a list of reforms that Ukraine must undertake to fight endemic corruption and raise standards. “There are literally hundreds of laws that Ukraine has committed itself to adopt,” says Åslund. “And this means that the whole state apparatus in Ukraine which is in very bad shape, will be reformed using technical assistance from the European Union.”

“To give you an example, sixty state agencies of EU countries have made  contracts with corresponding state agencies in Ukraine that these EU agencies will reform these Ukrainian state agencies.”

Alexander Kliment, director of Russia research at Eurasia Group, says these things will lay a foundation for future growth. “The reforms involved in making the Ukrainian economy more efficient and less corrupt are by themselves big advantages.”

COSTS

“The gamble is that over the longer term meeting higher standards, European standards, will open larger markets and create more economic growth, but in the short term there are costs,” says Kliment.

As Ukraine brings regulatory codes ranging from phytosanitary requirements to standards for agricultural products and foodstuffs into harmony with European codes, Ukrainian businesses will have to adapt. “Ukrainian companies are used to meeting one set of standards in Ukraine will now have to invest to meet another set of higher standards,” and this will require investment.

Russia, fearful that its normally open borders with Ukraine would be flooded with European goods, has restricted many goods from crossing its borders since the current crisis began. 

MANAGING EXPECTATIONS

The time frame along which the economic effects of the agreement unfold presents one of the greatest challenges to it. Ukrainian politicians, says Kliment, will have a difficult task of managing people's high expectations. “The benefits of this agreement are over the medium to long term, and people’s frustrations with agreements of this kind can come in the immediate to short term.”

U.S. lags behind the rest of the world in paid leave

Fri, 2014-06-27 13:17

Today, the Obama administration hosted the White House Summit on Working Families. It rolled out some new policy proposals, and focused attention on maternity and paternity leave, where the U.S. is an outlier in global rankings.

There were panels and plenaries, on topics like caregiving and compensation. Victoria Budson runs the Women and Public Policy Program at Harvard University, and she says the U.S. has some dubious distinctions. For one, it is “the only industrialized nation in the world that has no mandatory paid leave.”

About ten percent of Americans in the private sector can get some paid leave when they have kids.

“You know, this is a real black eye for the United States,” says Pamela Stone, a sociologist at Hunter College. She says today’s summit was designed to get more Americans to take notice.

“Something like this is really important for raising the visibility of an issue, but also legitimating an issue,” Stone says. “Telling people out there, this is an issue for you.”

The president brought the legitimacy, but the White House must have figured some star power could boost the summit’s visibility -- or get more Americans to watch the event’s live stream. So, organizers invited actress Christina Hendricks to participate.

Hendricks said she was proud to be representing, as she put it, “a working woman in two decades” -- Hendricks, the actress, and the character she plays on “Mad Men.”

“One who is fighting in the past for equality and one who is very, very excited to finally see that dream realized,” she said.

The upshot of today’s summit, however, is that dream has not been fully realized. According to Linda Houser, a professor of social work at Widener University, these issues have become increasingly visible.

“I mean, there are very few people that, in the course of their lives, don’t either care for a child or an adult,” she says.

But despite that, policies haven’t kept up.

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