Westmont College Economics and Business 6 Year Program Review Fall 2010 table of contents

Westmont’s chapter of Omicron Delta Epsilon, the national Economics Honor Society, has been active since 2002. Each academic year our Alpha Pi chapter inducts students into ODE. Our induction banquet involves the student president and vice-president in planning of the event and participation in the actual induction. A guest speaker, typically an economist from a Christian college, university, business firm, or government agency will address the students on topics such as ‘the business value of the economic way of thinking’ or ‘the challenges facing a Christian doing graduate work in economics.’ Students are challenged to reflect on the value of active intellectual engagement and critical thinking about current economic policy questions.

Our Economics and Business Speaker Series has presented a variety of speakers who have brought international and domestic economic policymaking experience and/or business and economic research backgrounds to our EB students as they make an in-depth presentation on a current policy issue. Students have the opportunity to dialogue with the speakers both formally on campus and often in an informal setting off-campus over dinner.

The annual Economics Essay contest invites Westmont students to write an original 2,000 word essay addressing a current economic problem such as “the best measures to address the current financial crisis” or “the best policies to rebuild the Haitian economy for the long run.” Essay entries are judged on the basis of organization of ideas, writing skills, depth and breadth of research (with proper citation), and clarity. Two EB faculty members and a third scholar outside the department serve as judges. The winning entries have received $1,000 for first place; $500 for second place; $200 for third place respectively. One of the recent winners has entered a PhD program in economics at UC-Irvine.

The Westmont Business and Investment Club has hosted presentations by guest speakers and EB faculty on topics such as Microfinance opportunities for serving the poor in lesser-developed countries and the best long-term strategies to address the fundamental economic challenges facing a particular developing economy such as Haiti. Students are challenged to a critical examination regarding how they might best carry out their own particular responsibility to address a significant economic problem.

Data for assessing how well we have been achieving our departmental goals for student learning came from departmental discussions of particular direct evidence and benchmarks over the past 12 semesters. We gained additional insight from indirect evidence by reviewing comments from the participants in our survey of the past 48 years of Economics and Business graduates as well as the Seniors 2010 survey (See Records Program Review Reports).

The major tool we used to assess goal #1 is the economics field test which is administered in the Senior Seminar course. This exam represents an attempt to establish a baseline of understanding for the economics portion of the major. The content and style of the test was patterned after the Council for Economic Education’s, TUCE (Test of Understanding in College Economics), a nationally normed test for Principles of Economics courses. Content on the TUCE covers the concepts of scarcity, opportunity cost, choice, supply and demand, utility, elasticity, price ceilings and floors, theory of the firm including revenues, costs, marginal analysis, market structures, wages, rents, interest, profits, income distribution, the microeconomic role of government including public goods, maintaining competition, externalities, taxation, income redistribution, public choice, comparative advantage, trade, and exchange rates. These are all topics that are part of the Principles of Economics sequence and are examined more deeply in the upper division courses. Content coverage on the department was similar to the TUCE with the additional feature of coverage of Econometrics and upper division Microeconomics and Macroeconomics. The department believes that the content distribution for the test was true to the goal of economic literacy for our EB majors. Percentages on the TUCE include those for both their Microeconomics and Macroeconomics tests.

The field test revealed that many of the foundational economic concepts are well understood by the end of the last semester of the senior year. Test scores were 90% or above on the benefits of trade, opportunity cost, markets and equilibrium price, economic incentive, statistical correlation, comparative advantage, basic public choice theory, measurement of net exports, prices and economic incentive, and property rights among others. Excluding two questions that are unreliable, scores ranged from 52% down to 12% on the concepts of external costs, the CPI, demand vs. quantity demanded, nominal GDP, cost calculation, monopolistic competition, calculation of the Keynesian multiplier, and functions of money. Over the breadth of the field test, we were reasonably satisfied with the results given that students did not do any refreshing on the concepts tested. However, we would like to see improvement in the overall performance and particularly on the lower scoring concepts.

On the more advanced portions of the test covering concepts from the Intermediate Microeconomics and Intermediate Macroeconomics courses, test averages were lower than on the overall test. For the Intermediate Microeconomics portion, form A, the average on 13 questions was 54%, and for form B on Intermediate Macroeconomics portion of 13 questions, the average was 46%. Among those questions, concepts for which scores were above 60% included the law of one price, constrained optimization, cost minimization, game theory, indifference curve analysis, the Coase theorem, the Solow growth model, and Monetarism and stable velocity. Items that scored below 50% and which were regarded as reliable covered concepts of consumer surplus, returns to scale, the basis for Keynesian versus Classical policy for unemployment, IS-LM and Keynesian expansionary policy, vertical aggregate supply an Monetarism, New Keynesians and price rigidity, and New Classicals and costless deflation. The Intermediate Macroeconomics questions did not include graphic cues and perhaps would be improved with more supplied graphics.

We are somewhat encouraged by the results from the field test. In regards to test reliability, the department test proved to perform reasonably well. Sixteen students, who had taken the Intermediate Microeconomics course, took form A with its heavier emphasis on microeconomics. Form A had a test reliability of 80 percent, a mean of 63.4 percent, a top score of 90 percent, and a bottom score of 48 percent. Thirty-four students, who had taken the Intermediate Macroeconomics course, took form B with its heavier emphasis on macroeconomics. Form B had a test reliability of 82%, a mean of 62.9 percent, a median of 65%, a top score of 85 percent, and a bottom score of 27 percent. Students were not given any preparation prior to the test.

An item analysis of the test showed that most test items were within a reasonable difficulty range and discriminated between the better and worse performing students. Of the 58 test items, 10 should be reviewed for difficulty or clarity and two should clearly be replaced on future test versions. Items with averages above 90 percent and discrimination below 20 percent should be reviewed and perhaps replaced with items that discriminate more. Other items that were more difficult but did not discriminate above 20 percent should also be reviewed.

Additional assessment of student progress towards goal #1 is provided by review of various written assignments from Fall-2007, Spring-2008, Mayterm-2008, China-2008, and Fall-2008 re: a) outside speakers, b) a provocative/controversial articles in various classes, and/or c) site-visits to a company, agency, or other organization. These were reviewed and discussed among faculty using the 3-part ASE rubric. In addition, the Spring-2008 and Spring-2009 Senior Seminar papers continue to be reviewed using the 3-part rubric, and discussed by faculty as a benchmark for student competency in ASE. Through a written assignment in the Senior Seminar, an initial assessment was made of student attitudes and commitments to a Christian calling to the realm of EB and their understanding of corporate social responsibility. The papers done at the end of the course have been assessed for progress in their societal and intellectual engagement within the ASE rubric.

Further assessment of student progress towards goal #1 has occurred with respect to EB 131. During Fall 2005, 2006, 2007, 2008, and 2009 students have completed a semester-long research project examining the ramifications of a crucial contemporary issue in the field of corporate financial management. Topics have included: Sarbanes-Oxley financial compliance legislation, executive compensation at publicly traded companies, shareholder wealth creation as primary objective of the firm, anti-competitive mergers and acquisitions, tax avoidance strategies, and the subprime lending crisis. The process covers a full 15 weeks and requires students to progressively add 1-2 new articles per week in developing their thesis and cache of reference sources for final the paper. At two key benchmarks in the 4^th and 10^th weeks of the term, students must discuss with the instructor the progress to-date, the direction of their thesis, and at least two key ramifications this finance issue has on society overall. The final paper is 8-12 pages and each student makes a class presentation to interact with student peers on the topic. The final paper receives a grade using the grading criteria indicated in the file “Assessment Data for Program Goals 1-3” in the EB department records folder. The assessment data show that overall, students are gaining a broad societal-based intellectual engagement with a provocative current topic, and the instructor’s continued emphasis on the topic-research process, articles cache, and thesis development has helped the papers improve over the years. The instructor aims to find new ways to further help students master this process and have scores in the .80-.85 range.

Likewise, for EB 191, during Fall 2005, 2006, 2007, 2008, and 2009 students have been introduced to significant contemporary issues for entrepreneurs including: touting of expectations, truth in reporting, investor disclosure, and raising capital. These are discussed throughout the semester alongside the ten 3-person teams completing of their start-up business plans. Students read three books all dealing with different aspects of the entrepreneur and the new venture process. Discussion in class is ongoing throughout the term. The final exam provides the capstone opportunity to demonstrate how to introduce the topics/issues, apply Christian values, and synthesize the topic within contemporary contexts. The exams are evaluated using the grading criteria indicated in the file “Assessment Data for Program Goals 1-3” in the EB department records folder. This demonstrates that overall, students are gaining a broad societal-based intellectual engagement with a provocative current topic, and my continued emphasis on the topic-research process, articles cache, and thesis development has helped the papers improve over the years. The instructor’s goal is to find new ways to further help students master this process and have scores consistently over the .75 mark.

In addition, for EB 192, during Spring 2006, 2007, and 2009 students have been introduced to significant contemporary issues that relate to change and innovation, both within industries and across society in general. A seminar style roundtable is used in class to engage students in discussion on all the readings and case studies. The midterm and final exams are both set-up as a roundtable discussion among students only with the instructor as an observer, grading as the dialogue on each question happens between student peers. As shown in the file “Assessment Data for Program Goals 1-3” in the EB department records folder, grades demonstrate both progress/growth within each term, and in subsequent years. The instructor’s goal is to help students get midterm scores consistently over .75 and final scores above .85 given the smaller class sizes and highly interactive style of class and oral exam sessions.

In departmental meetings over the past few semesters various student research papers were reviewed and discussed with respect to students’ understanding of the RR-oriented issues related to research and technology. Many summary statements in existing student work do reflect on ethical issues about data, analysis, and inferences drawn from research and the use of various technologies.

Numerous examples come from EB-017 Business Research & Forecasting, a course in which an average of 50 students write 1-page synopses for regression analysis on each of six unique data-sets each spring semester. In EB 017 + 018, during Spring 2005, 2006, 2007, 2008, 2009, and 2010 students have been introduced to all aspects of business research and forecasting. The first 8 weeks (EB017) focuses on applied econometrics using multiple regression software to examine a wide range of business/econ case studies. The second 8 weeks (EB018) focuses on applied calculus in business forecasting. Students complete 7 econometrics case studies working with real data from consulting projects I have completed over the last 25 years. Four of these are individual homework assignments involving working with secondary and primary data sets, interpreting regression output, and writing succinct 1-page executive summaries from their own perspectives of the analysis/output. The other three cases are part of the two unit exams and the final exam, and include a take-home prep of the case in one permutation of variables, and then a second version in another permutation of variables for the same case on the exam. As shown in the file “Assessment Data for Program Goals 1-3” in the EB department records folder, students exhibit good progress in this assessment area. The challenge continues to be how to provide more personalized input/guidance to a course that typically has 50-55 students enrolled. While progress from start to finish within, and year-over-year looks promising, the actual 4^th case study R+T mean scores remain on the low end of the range between “0” (mixed demonstration) and “1” (well demonstrated) . The goal is to get these scores into the .70-to-.80 range that shows up in the assessment of upper division courses’ R+T. Perhaps it’s not all bad, in that these students are mostly sophomores and this is their primary introduction to the R+T issues/processes, so that their intra-course growth looks good, and their overall mean scores serve as a baseline point from which they then head into upper division courses where smaller class sizes and more professor attention, plus individual maturing of students, combine to show stronger improvement and higher overall competency scores.

Further assessment of student progress towards goal #2 has been done with respect to EB 131. During Fall 2005, 2006, 2007, 2008, and 2009 students have completed a semester-long research project examining the ramifications of a crucial contemporary issue in the field of corporate financial management. The research process covers a full 15 weeks and requires students to progressively add 1-2 new articles per week in developing their thesis and cache of reference sources for final the paper. The final paper is 8-12 pages and must reflect an original thesis and drawing on a range of sources, including topical books, textbooks, journal articles, and popular press (Wall Street Journal, Business Week, Fortune, Forbes). As shown in the file “Assessment Data for Program Goals 1-3” in the EB department records folder, it can be said that overall, students are gaining an understanding of the research process and methodology as it relates to developing a final product. The instructor’s goal is to find new ways to further help students master the research process and have scores consistently in the .85 range or higher. Assessing their understanding of the “research rationale” (the underlying premise for the proposed paper) has consistently had a majority of students demonstrate a score of 1.0 – that the specifically understand the issues associated with their research and how it relates to other writers/researchers before them. This is accomplished by having 1-on-1 meetings to discuss each project, and regular discussion of this in class. A second part of the evaluation of student work EB 131 involves the completion of an industry-standard 4-page financial ratio analysis of a Fortune-500 publicly traded company. They must work with both primary financial documents [the firm’s files with the SEC (10K and 10Q)] and secondary reports about the firm, its industry, competition, and stock market activities. As shown in the file “Assessment Data for Program Goals 1-3” in the EB department records folder, it can said that overall, students gain a solid understanding of the research process and methodology. The instructor is convinced these R+T scores are stronger than the paper R+T scores because of the more concentrated time period and directed oversight that the instructor can provide during this early section of the course material, and because they have two intermediate benchmarks in the compilation and report writing process.

In EB 191, during Fall 2005, 2006, 2007, 2008, and 2009 students group themselves in 3-person venture teams and complete of their start-up business plans. Teams must meet 20 “research” benchmarks with specific deliverables during the first 14 weeks of the term, leading up to final submission of the bizplan and the accompanying presentation slides. Student work is initially evaluated by the criteria indicated in the file “Assessment Data for Program Goals 1-3” in the EB department records folder. Judges provide very detailed critique, evaluation, and advice on the top four teams, who make a 10-minute slide presentation followed by 20 minutes of Q+A interaction with the panel. The data demonstrates that overall, students are gaining a strong understanding of the issues related to their primary and secondary research about the proposed start-up business venture. The instructor’s goal is to maintain the very close interaction, discussion, team meetings, and oversight of the R+T process so that scores will remain consistently over the .80 level.

Student progress towards goal #2 is also evaluated in EB 192. During Spring 2006, 2007, and 2009 the students put themselves in 2-person teams and complete a professional and very detailed industry analysis (IA) over the course of the term. They have 2 weekly benchmarks with deliverables in the research/compilation process (25 total). The final IAs are presented at our annual Change + Innovation Industry Analysis Symposium, held every April during the week prior to final exams week. Student progress is measured as represented by the example found in the file “Assessment Data for Program Goals 1-3” in the EB department records folder. The instructor’s goal is to continue to work closely in a small seminar format to help scores remain consistently over .80 - given the smaller seminar-class sizes.

In EB 132, during Spring 2006 and 2008 students completed a semester-long research project examining the ramifications of a crucial contemporary issue in the field of investments and portfolio management. The research process covers a full 15 weeks and requires students to progressively add 1-2 new articles per week in developing their thesis and cache of reference sources for final the paper. The final paper is 8-12 pages and must reflect an original thesis and drawing on a range of sources, including topical books, textbooks, journal articles, and popular press (Wall Street Journal, Business Week, Fortune, Forbes). Student progress is measured as represented by the example found in the file “Assessment Data for Program Goals 1-3” in the EB department records folder. These class sizes were both 12 students and provided excellent opportunities to both work with a smaller class size, and work with students in a follow-along second semester course after having the same group of students the prior Fall term for EB-131. The “carry-forward effect” of what they developed about R+T in immediate prior s semester obviously kept their understanding of R+T issues in the forefront of their thinking and research process. This demonstrates that overall, students are gaining an understanding of the research process and methodology as it relates to developing a final product. The problem has been that in Spring 2009 and 2010, two different adjunct faculty taught this course, and neither of them did a very good job of instruction. This is another reason why our department definitely needs to hire a 5^th full-time person to avoid the “adjunct” lapse that occurs when a very busy investment professional teaches the course and cannot put in the kind of time during the term that a full-time professor can.

We anticipate that the “Inferences” sections will become supplemented with the RR in the upcoming semesters. Similar research “synthesis” by students was reviewed and discussed from other research assignments during the past few academic years. As EB faculty we continue to discuss the best places to incorporate the 4-point RR rubric within EB courses.

In regards to the assessment of goal #3, in the past few years a wide range of writing, presentation, and debate assignments were reviewed in light of the “IMAC” 4-point WOC rubric. In addition, general organization and structure of the finished product for student written work was reviewed and discussed. The expected outcomes include both substantive content of student work, and the overall quality of the physical product (paper, presentation with/without slides, debate processes).

EB faculty agreed that we expect students to complete assignments in clearly-defined, reviewable stages (where applicable); minimize the use of “first person” language in writing assignments; and employ creativity in addressing the assignment’s topic/issues.

Numerous written assignments were reviewed and discussed among faculty, noting student work that demonstrated little of these criteria, some of these criteria, and most/all of these facets throughout. Written assignment examples from students over the last few years now serve as the basis for moving forward with student demonstrations of WOC competency. In addition, the Senior Seminar papers will continue to be reviewed as a benchmark for how well graduating students write and present.

In regards to oral communication, faculty agreed that we expect students to have good eye contact and stand still, demonstrating poise and confidence, not use “first person” in their monologue, employ creativity in addressing the assignment’s topics/issues, vary intonation and expression appropriate to the topic-flow, and specifically note from where they are drawing upon outside sources. Oral presentation and debate assignments will continue to be reviewed and discussed among faculty, noting student work that demonstrates little of these criteria, some of these criteria, and most/all of these facets throughout. In certain cases (e.g., new venture business-plan presentations) student presentations will be video-recorded for review by the faculty, and also for review with the students to develop a systematic feedback process.

One example of assessment of student progress towards goal #3 is found in assignments given and graded in EB 131. During Fall 2005, 2006, 2007, 2008, and 2009 students have completed a term paper and class presentation examining the ramifications of a significant contemporary issue in the field of corporate financial management. They also develop a corporate financial ratio analysis and class presentation. Both of these assignments provide opportunities to assess students’ written and oral communication competencies. As shown by the data found in the file “Assessment Data for Program Goals 1-3” in the EB department records folder, for overall student progress, more work and thinking needs to go into how to assist students in their writing, and more importantly, their ability to effectively communicate their work to an audience. The instructor’s goal is to find new ways to further help students master the research process and have both written and oral presentation scores consistently in the .75 range or higher.

In EB 191, during Fall 2005, 2006, 2007, 2008, and 2009 students grouped themselves in 3-person venture teams and complete their start-up business plans. Teams complete a 20-30 page formal written bizplan with an accompanying presentation. The IMAC written scores averaged: .72, .81, .85, .88, and .88 which demonstrates that the close working-process of benchmarks and standardized format of the bizplan and venture synopsis provide a sold framework for students to effectively communicate the start-up venture’s facets. The IMAC presentation scores for the team’s doing in-class (.64, .67, .67, .68, .65) were lower every year compared to the top for student teams who present to outside judges at the formal Annual Bizplan Competition: (.79, .81, .85, .91, .90) – so it appears that the heightened expectations of the larger venue with outside professional judges, combined with these four ventures each year being the best of the ten student venture teams already pre-screened, probably contribute to the significantly better performance and much higher quality of the oral communication demonstrated.

In EB 192, during Spring 2006, 2007, and 2009 the students completed a professional and very detailed 20-30 page formal industry analysis (IA), and then present their report to a public symposium. The IMAC scores for the written analyses during the last three classes we: .71, .74, and .75 – generally a good start in effectively communicating through their written work. The presentation IMAC scores were: .72, .75, and .74 – and appear fairly consistent with the written work. Perhaps the reason is that all teams present at the symposium and the “outside” judges and public venue heighten their preparation and level of work, much like in the bizplan competition. Their midterm and final oral exams are also scored with respect to how effectively each student communicates with other student peers in the roundtable dialogue. Here, the mean scores appear lower, but that is due to a much larger variance given the wider range from low-to-high in these individual levels of effective participation in the oral examination process. Midterm oral exam scores were: .48, .58, and .63 while oral final exam scores were .59, .61, and .65 – so that does show improvement within a given class from the midterm to the final.

In EB 017 + 018, during Spring 2005, 2006, 2007, 2008, 2009, and 2010 students have been introduced to all aspects of business research and forecasting. Students do formal IMAC-Memorandum write-ups of four separate case studies, and must clearly articulate the IMAC series in a concise format that blends quantitative rigor of the econometrics with managerial decision making based upon the conclusion. Student progress is measured as illustrated by the example found in the file “Assessment Data for Program Goals 1-3” in the EB department records folder. The challenge continues to be how to provide more personalized input/guidance to a course that typically has 50-55 students enrolled. The goal is to get these scores into the .70-to-.80 range that shows up in the assessment of upper division courses’ written communication. Given the large size of the class, there is no time for presentations in EB017, EB018.

In EB 132, during Spring 2006 and 2008 students completed a semester-long research project examining the ramifications of a crucial contemporary issue in the field of investments and portfolio management. The final paper is 8-12 pages and students also make a presentation to the class. During the last two courses taught by Newton (2006 and 2008), the “written” IMAC assessment scores had strong mean scores of: .85 and .88 respectively. These class sizes were both 12 students and provided excellent opportunities to both work with a smaller class size, and work with students in a follow-along second semester course after having the same group of students the prior Fall term for EB-131. The “carry-forward effect” of what they developed in their writing in the immediate prior semester obviously helped. The presentation IMAC scores were not as strong: .67 and .71 – again this probably points to the “in-class” factor of presenting to peers in a less formal venue, compared with a public “out-of-class” venue and/or outside judges.

In EB 138, during Fall 2005, 2006, 2007, 2008, and 2009 and Mayterm 2006, 2007, 2008, and 2009 students wrote a detailed position/perspective paper about the applications of managerial decision models to specific functional areas of a business or economic operation. Each student also presents the paper to the student peers. The range of written effectiveness is quite large in both the Fall and Mayterm courses. IMAC-Written score means for Fall courses were: .52, .58, .59, .62, and .66, and then .55, .58, and .57 in the Mayterm sections. The presentation scores appear low and have a smaller variance, as students have generally not done as well presenting complex quantitative analysis and decision insights. The Fall IMAC presentation score means were: .38, .31, .36, .42, and .44 – with the Mayterm presentations at: .36, .34, and .40 – with a low variance. It’s obvious that new strategies must be worked on and adopted to improve students’ effectiveness in both writing about, and presenting, complex quantitative model applications to managerial decision making situations.

In Senior Seminar (EB 195), during Spring 2005, 2006, 2007, 2008, 2009, and 2010 students wrote two position/perspective papers from two sections of their choice in the Dalla Costa book. The majority of students also engaged in a two-team debate (4 students per team) about one of the Dalla Costa sections (teams argue opposing viewpoints). The range of written effectiveness is quite large among our seniors, with IMAC-Written score means of: .44, .48, .51, .52, .46, and .47 over the last 6 years. There is an equally wide gap among the debate-teams presenting orally in front of the class: .42, .41, .46, .49, .52, and .48 – so while not as high on the -1 to-0-to 1 positive side of the “mixed” to “effective” as in smaller upper division classes, the scores are better than “mixed” in students’ demonstrating IMAC in their writing. The goal of course is to get these mean scores into the higher end of the 0-to 1 side, closer to being strong in their demonstrating effective written communication.

Our sense is that our departmental efforts have generated good progress in the area of student writing, but there is still room to improve. Presentation examples from students over the last few years will continue to serve as the basis for existing student demonstrations of competency. In addition, Senior Seminar presentations will continue to be reviewed and discussed as a good benchmark for student competency.