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Microeconomics Case Study

Case Title:

Californian Economy: The Challenges Ahead

Publication Year : 2004

Authors: Utkarsh P Singh, G Srikanth

Industry: General Business


Case Code: MBM0003

Teaching Note: Not Available

Structured Assignment: Not Available

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California, once ranked the fifth largest economy in the world, saw an economic downturn during 1999-2002. The state was considered a global powerhouse of software and services industry in the 1990s. But the economic recession worldwide and particularly its effect on the software industry took its toll on the Californian economy. Certain government policies such as worker's compensation law, unemployment benefits, power crises and various anti-business laws impaired the corporate performance. This caused soaring budget deficits, unemployment rates and a sinking consumer sentiment index. Eventually it resulted in a recall election in 2003.

Pedagogical Objectives:

  • To understand the various issues related to the staggering deficit of the state
  • To discuss the challenges that lie ahead for the new administration of California.

Keywords : Economic Crisis Case Study,Californian economy, Budget deficit, Consumer sentiment index, Power crisis in California, Unemployment insurance programme, Workers' compensation, Paid family leave, Arnold Schwarzenegger, Gary Davis, Anti-business laws, Recall elections, Gross domestic product, US unemployment rate, California power exchange, Disability benefits, Economics Case Study

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