UC Riverside ends controversial research center relationship with Beacon Economics
UC Riverside has shut down its economics research center after some University of California faculty urged an investigation into an arrangement with private consulting firm Beacon Economics to run the center, using what the faculty members described as corporate funding for reports “attacking proposals to improve the lives of working Californians.”
In a letter delivered in February to UC Regents, signed by more than 100 faculty members and graduate students, the group contended that the center lacked funding transparency and proper academic oversight.
The website for the research center was taken down in late February, after The Times revealed financial details of the arrangement with Beacon Economics as well as concern by faculty. UC Riverside spokesperson John Warren said in an emailed statement that Beacon Economics will no longer operate the research center.
Warren said that UC Riverside, however, still plans to pursue a contract with Beacon to host the annual Inland Empire Economic Forecast Conference, which “has been popular and valued by the community.”
Beacon Economics founder Christopher Thornberg, who was director of the Center for Economic Forecasting and Development, did not respond to a request for comment.
The faculty letter took issue with Thornberg’s listed title of adjunct professor on the research center’s website. Thornberg did not teach classes or appear in school faculty or other directories.
UC faculty urge the university to investigate its relationship with a campus research center run by consulting firm Beacon Economics that has targeted state labor policies.
Thornberg and Victoria Bond, a spokesperson for Beacon Economics, had previously defended the center’s research, dismissing criticism as partisan, ideological attacks without scholarly merit. They said Thornberg’s title of adjunct professor and his oversight of the center were subject to the same type of academic review and adhered to the same standards that apply to all UC centers.
“This petition is packed full of completely false allegations about my center, about our relationship with the university and about me,” Thornberg said. Faculty members were mobilized by the Service Employees International Union, which represents fast-food workers and others, because the union disagrees with the empirical results of his research, he said.
The university had previously told The Times that it intended to renew Beacon Economics’ contract, which expired in December 2022. Under the contract, UC Riverside’s business school paid Beacon Economics $140,800 annually to produce a set of regional economic white papers and run the conference, branded as an event by the research center.
In addition, Beacon Economics paid UC Riverside 10% royalty fees to publish reports bearing the research center’s branding, The Times reported in February after reviewing UC Riverside documents obtained through a public records request by the SEIU. It was the first time that financial details of the arrangement were revealed.
Major industry groups — including the International Franchise Assn. and a coalition of gig companies such as Uber, Lyft, DoorDash and Instacart — were clients in recent years, paying tens of thousands of dollars for reports from the research center. Beacon Economics took in close to $680,000 in 2022 for work it generated bearing UC Riverside branding, according to the documents.
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“The School of Business is considering options for continuing the center independent of Beacon,” Warren said.
Warren said he expects the university’s plans regarding the research center to solidify in the coming months. He declined to provide additional details on the decision.
The decision ends the research center’s run with Beacon Economics that began in 2015, when the campus’ business school launched the center with the goal of increasing its stature in the Inland Empire.
The research center’s website now redirects to a webpage for the Inland Empire Economic Forecast Conference in October 2022.
Email exchanges between Thornberg and UC Riverside Business School Dean Yunzeng Wang in December and January obtained through a March public records request show Beacon Economics was seeking additional annual compensation of $120,000 in its new contract.
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Negotiations in January appeared to land on a temporary financial arrangement under which the firm would absorb UC Riverside’s cut of its quarterly revenue. Any expenditures that exceeded the center’s income would be deducted from its future revenue, ensuring that UC Riverside would not operate the center at a loss.
Discussions on the length of the contract continued, with Beacon Economics seeking a three-to-six-month term, while UC Riverside sought a long-term contract.
UC Riverside typically profited from its arrangement with Beacon Economics, netting an average of $29,000 a year, Thornberg said in one of the emails.
The university’s association with Beacon Economics had “defaced” its academic credibility and the decision to sever the relationship was “long overdue,” said Dylan Rodriguez, a media studies professor at UC Riverside and former chair of UC Riverside’s Faculty Senate who helped to circulate the faculty letter.
“Beacon’s sloppy propaganda, passing as scholarly reports, has widely circulated under the badge of the University of California,” Rodriguez said in an email. “UCR should not be applauded for ending the relationship with Beacon, it should be asked whether and how it will attempt to address and repair the damage that [the] relationship has already caused to [the] university’s research reputation as well as the working people of California.”
Retired regional economist John Husing said in an interview that UC Riverside has been largely absent from discussions on the Inland Empire’s economy.
In a recent email reviewed by The Times that Husing wrote to UC Riverside leadership criticizing the research center arrangement, he described Beacon Economics as a Los Angeles firm well known among Inland Empire economists for having an “aggressive social, political and financial agenda” that was using UC Riverside’s name to promote its high-priced consulting work.
“The so-called ‘Center’ is supposed to show the university performing research on the Inland Empire economy, a worthy objective,” he wrote. “In fact, they have never done any.”
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