The Blue Sky Consulting Group brings a wealth of knowledge to bear in tackling tough questions about the economic effects of policy decisions on individuals, industries, and government. Throughout our work in specific policy areas such as the environment, housing, and health care, we utilize our training in economic theory and econometrics to inform our analysis and conclusions.
In 2011, the Think Long Committee for California and California Forward engaged Blue Sky Consulting Group to develop a sophisticated microsimualtion model capable of estimating the economic incidence of a series of tax policy changes. These policy changes include proposed changes to the Personal Income Tax, Corporation Tax, and the Sales Tax. The model we developed shows how Californians across the income spectrum would be affected by proposed tax policy changes. This work was also supported by The James Irvine Foundation.
In 2011, we conducted an analysis of the fiscal and economic effects of legalizing online poker in California. Although playing poker online is not currently legal in California, pending legislation (as of January 2012) would authorize this activity. Previous research that sought to estimate the impact of online poker relied upon “black box” methodologies or a simplistic allocation of a share of the global market to California. Our analysis is based on a California-specific impact model, which drew from two surveys of Californians’ online poker behavior and preferences that were conducted as part of the project. Our analysis has been utilized by the client to educate members of the legislature and the media about the potential effects of the pending legislation.
In 2008, BSCG conducted an economic analysis of Proposition 2 for the Humane Society of the United States. The successful ballot measure created standards for confined animals, most notably egg-laying hens. After a detailed examination of the economics of the egg industry, we found that production price increases likely would be minimal, that cage-free production likely would expand, and that cage-free egg prices likely would decrease. Our analysis was utilized by the client to educate voters and the media about the potential effects of the measure.
In 2014, BSCG estimated the amount of revenues that would be generated by SB 270 (Padilla). As amended March 27, 2014, the bill would ban the use of disposable plastic bags and require a minimum price of $0.10 for disposable paper bags and reusable bags issued at grocery, pharmacy, and convenience store checkouts in California. Using data from the Department of Resources, Recycling, and Recovery (CalRecycle) on the number of plastic carryout bags used each year and before-and-after data from jurisdictions that have implemented policies similar to SB 270, we estimated statewide disposable bag revenues. Actual revenues will depend on how many times reusable bags are reused, the price differential between reusable and paper bags, and on consumers’ propensity to choose a reusable bag, paper bag, or no bag.
The Consumer Welfare Effect of Payday Lending
Payday loans - short-term, often high interest rate loans - have been the subject of much attention in the media and among policy-makers at all levels of government, but the practice has been the subject of much less attention from researchers and analysts. Blue Sky Consulting Group analyzed the consumer welfare impacts of payday lending in order to shed more light on the topic. Through a novel approach to analyzing previously unutilized national data, we conducted an advanced econometric analysis of the consumer welfare effects of payday lending. This objective, analytically rigorous study injected new insights into this often emotion-laden debate. The groundbreaking results have been submitted for publication to an academic journal.