by Matthew Waller
The economy, it’s been said, runs on credit. Or perhaps you prefer this opinion: The economy runs on trust.
In some ways, both statements are true. But economies ran rather successfully for millennia without credit. And while economies might run better on trust, they also can run without it, at least in the short-term.
So how about this: The economy runs on decisions. Good decisions result in a good economy. Poor decisions result in a poor economy. Either way, the economy runs on decisions. Politicians, policymakers, business leaders, academics, advisors, consumers… we all make decisions that contribute to the relative health of our economy. And that’s why, as any toddler will tell you, we all need to make good choices.
One of the most important factors in making good decisions, of course, is access to and insights into accurate, relevant information. If the economy runs on decisions, then information is the key ingredient in the fuel. And the Center for Business and Economic Research (CBER) has been providing that type of fuel for 75 years.
CBER, one of nine strategic outreach centers at the Sam M. Walton College of Business, provides applied economic and business research to federal, state and local governments, as well as to businesses that operate or seek to operate in Arkansas. It helps improve economic opportunities for all Arkansans by conducting policy research in the public interest. As the most authoritative source of economic analysis in the state, it is a strong catalyst for economic performance.
Mervin Jebaraj, who has worked at CBER since 2007 and served as its director since April 2017, has been instrumental in creating and executing economic studies for clients such as the Arkansas Economic Development Commission, the Northwest Arkansas Council, the Walton Family Foundation, Arvest Bank and the University of Arkansas. Students contribute by interning with CBER, where they learn the latest data collection techniques, analysis techniques and economic interpretation.
Part of the mission of the Walton College is to “advance and disseminate business knowledge,” and CBER does this in a number of ways. For instance, CBER’s annual business forecast luncheon brings national and international experts to Arkansas to discuss the economic outlook for the state, the nation and the world. The 2019 luncheon will mark the 25th anniversary of the event, and it once again figures to draw a capacity crowd of around 1,100 people.
Last year, Milken Institute Chairman Michael Milken was the keynote, and Ross DeVol, a Walton Fellow and former chief research officer for the Milken Institute, moderated a question-and-answer session with Milken following his speech. Jebaraj also presented the economic outlook for the state and highlighted challenges and opportunities for Arkansas and Northwest Arkansas.
This year’s luncheon will feature Carolyn Evans, chief economist at Intel; Ross DeVol, world-renowned economist, Walton Fellow and former chief research officer at the Milken Institute; and Jebaraj. The event will be moderated by Amy Tu, executive vice president, general counsel for Tyson and head of Tyson Ventures. And it once again will provide an opportunity to discuss the annual state of the Northwest Arkansas Region Report, which is commissioned by the Northwest Arkansas Council. The report provides insights to business leaders who need to make strategic investment decisions, as well as to government officials for policy and infrastructure decisions, and it serves as a tool for evaluating economic performance.
In recent years, the economic news has generally been positive for Northwest Arkansas, where the median household income rose by an impressive 8 percent from 2016 to 2017. In fact, as you can see from last year’s report, 10 of the 11 economic indicators were moving in the right direction. The exception was the average annual domestic airfare, which increased almost 6 percent. It’s not too surprising that a region with this kind of positive economic growth would see airfares increasing.
CBER began creating the State of the Northwest Arkansas Region Report in 2011, so it has nearly a decade of year-by-year data to use for comparisons and trend analysis. And in July 2018, the Northwest Arkansas Council created a new blueprint for development that outlines the peer regions and a strategic action agenda for 2018 to 2021. In this plan, the region’s performance is benchmarked with other contemporary, high-performing regions, namely Austin, Des Moines, Madison, Durham-Chapel Hill, Raleigh and Provo-Orem. The State of the Region Report compares Northwest Arkansas with these geographies in the areas of gross domestic product, employment, unemployment, establishment growth, median household income, average annual wages, poverty, educational attainment, research and development, homeownership costs, commuting time and average domestic airfares.
Northwest Arkansas has shown strong increases in important indicators such as gross domestic product, business establishment growth, average annual wages and university research and development expenditures. Improvements in metrics such as poverty rate and higher education attainment, however, were more limited.
Jebaraj and his team also collect data for statewide economic reports that help guide decision-making. For instance, CBER partnered with the Urban League of Arkansas to identify critical areas of need in the African-American and Latino communities in Arkansas and to develop programs and policies to address those needs. Researchers from CBER identified six key indicators for the study: a population, educational attainment for the population over the age of 25, median income, poverty rates, rental costs and health insurance rates. Data for each of these indicators was collected using the U.S. Census Bureau’s American Community Survey five-year estimates. The data for each of the six indicators was collected for whites, African Americans and Latinos living in 10 municipalities of interest identified by the Urban League of Arkansas: Bentonville, Blytheville, El Dorado, Fort Smith, Helena-West Helena, Jonesboro, Little Rock, Pine Bluff, Texarkana and West Memphis.
CBER has taken on all sorts of other research challenges, from a report on the economic impact of former University of Arkansas Athletics Director Frank Broyles to the economic impact of the oil and gas industry in Arkansas. CBER also provides up-to-date economic data on the nation, the state and the state’s five major metropolitan regions: Northwest Arkansas, Central Arkansas, Fort Smith, Jonesboro and Pine Bluff.
The Center for Business and Economic Research plays a vital role in helping the Walton College achieve its mission and vision. And in doing that, it plays a vital role in giving leaders the information they need to make decisions that can contribute to a brighter economic future for the entire state.