Economics Commons^™

The Posner Argument For Transferring Health Spending From Old Women To Old Men, Eric Bennett Rasmusen

Eric Bennett Rasmusen

Richard Posner suggests several arguments for increasing health care spending on males and reducing it on females in his book Aging and Old Age. I offer a new formalization of his verbal argument.

The Simple Analytics Of Performance-Based Ratemaking: A Guide For The Pbr Regulator, Peter Navarro

PETER NAVARRO

No abstract provided.

Economics In A Family Way, Ted Bergstrom

Ted C Bergstrom

This paper is an advertisement for some facts and ideas that I think likely to lead to a richer theory of the economics of the family. The discussion references many papers from anthropology and biology. Because of the intimate connection between the family and reproduction, it should not be surprising that there is much to be learned about the economics of the family from the study of evolutionary biology. Given the increased prevalence in recent decades of unwed parenthood, divorce with sequential monogamy, and ``non-traditional'' family arrangements, it seems that anthropological studies of alternative family structures would help us to …

Stigma And Self-Fulfilling Expectations Of Criminality, Eric Bennett Rasmusen

Eric Bennett Rasmusen

In modelling crime, economists have focussed on the expected cost of government sanctions to the criminal, but private sanctions--- notably economic or social stigma--- may be just as important. In the model here, workers decide whether to commit crimes and employers decide how much to pay ex- convicts. In one equilibrium, individuals refrain from crime and economic stigma--- the wage loss from conviction--- is high. In a second, pareto- inferior equilibrium, individuals commit crimes and stigma is low, because employers realize that nonconviction does not imply noncriminality. The model may help to explain large shifts in crime, such as that …

Economic Development And The Distribution Of Land Rents In Singapore: A Georgist Implementation, Sock-Yong Phang

PHANG Sock Yong

Independent Singapore, which has a tradition of free trade, has implemented large doses of Henry George's prescriptions. It has successfully captured land rents for redistribution through its land acquisition, public housing and other programs. These policies have been instrumental in the successful economic development of the island city state. Industrial estates on state-owned land were leased to foreign multinationals for export-oriented manufacturing which created the bulk of jobs in the sector. Commercial developments are built by the program. Affordable 99-year leasehold housing, built by the state, provided added economic incentives for employment, and helped keep inflation and wages down. Private …

Review Of Competition, Commitment, And Welfare By Kotaro Suzumura, Eric Bennett Rasmusen

Eric Bennett Rasmusen

A short review of a book on oligopoly theory.

Economics Of Time And Ignorance: 1996 Intro Survey, Mario Rizzo

Mario Rizzo

This is a review of the developments in Austrian-subjectivist economics during the period 1985-1996 from the perspective of the themes developed in the first-edition of "The Economics of Time and Ignorance." It is also a concise statement of a modern understanding of the classic ideas of Austrian economics with a view to seeing their connection to a broader set of perspectives in economics. (The version available here is the final draft of the text available in the book published by Routledge. This is available from Routledge as an e-book or from various Amazon.com sellers.)

Household Responses To Pricing Garbage By The Bag, Don Fullerton, Thomas C. Kinnaman

Don Fullerton

This paper employs individual household data to estimate the effect of per-unit pricing on the weight of garbage, the number of containers, the weight per can, and the amount of recycling. We also provide two indirect measures of illegal dumping. The data are based on a natural experiment that provides a unique opportunity to study human behavior in response to a change in price. On July 1, 1992, the City of Charlottesville, Virginia, implemented a program to charge $0.80 per 32-gallon bag or can of residential garbage collected at the curb. Before and after the implementation of this program, we …

Household Responses To Pricing Garbage By The Bag, Don Fullerton, Thomas C. Kinnaman

Thomas C. Kinnaman

This paper employs individual household data to estimate the effect of per-unit pricing on the weight of garbage, the number of containers, the weight per can, and the amount of recycling. We also provide two indirect measures of illegal dumping. The data are based on a natural experiment that provides a unique opportunity to study human behavior in response to a change in price. On July 1, 1992, the City of Charlottesville, Virginia, implemented a program to charge $0.80 per 32-gallon bag or can of residential garbage collected at the curb. Before and after the implementation of this program, we …

Income Prospects And Age At Marriage, Ted Bergstrom, Bob Schoeni

Ted C Bergstrom

In an earlier paper Courtship as a Waiting Game, Mark Bagnoli and I proposed a theory that explained why it is the case that in almost every society and at almost all recorded times, the average age at marriage of men exceeds that of women. An additional prediction of this model was that men who married later in life would turn out to have higher incomes when they reach maturity than those who marry young. The current paper reviews this theory and tests it with U.S. data. Consistent with our theory, we find that there is a strong positive relationship …

Un Modelo De Equilibrio General Dinámico Del Impuesto Al Activo, Rodrigo Garcia-Verdu

Rodrigo Garcia-Verdu

Using Informational Labeling To Influence The Market For Quality In Food Products, Julie Caswell

Julie Caswell

In the United States, the federal government is increasingly using requirements for informational labeling on food products to influence 1) consumers' knowledge and purchasing patterns and 2) manufacturers' product offerings and marketing practices. We discuss the economic rationale behind these regulations and issues related to judging their success or failure.

Holdups, Standard Breach Remedies, And Optimal Investment, Aaron S. Edlin, Stefan J. Reichelstein

Aaron Edlin

In bilateral trading problems, the parties may be hesitant to make relationship-specific investments without adequate contractual protection. We postulate that the parties can sign noncontingent contracts prior to investing, and can freely renegotiate them after information about the desirability of trade is revealed. We find that such contracts can induce one party to invest efficiently when courts impose either a breach remedy of specific performance or expectation damages. Moreover, specific performance can induce both parties to invest efficiently if a separability condition holds. Expectation damages, on the other hand, is poorly suited to solve bilateral investment problems.

An Appraisal Of Local Exchange And Trading Systems In The United Kingdom, Colin C. Williams

Colin C Williams

Cadillac Contracts And Up-Front Payments: Efficient Investment Under Expectation Damages, Aaron S. Edlin

Aaron Edlin

Specification Testing In Panel Data With Instrumental Variables, Gilbert E. Metcalf

Gilbert E. Metcalf

I show that specification tests for correlated fixed effects developed by Hausman and Taylor extend in an analogous way to panel data sets with endogenous regressors. Given panel data, different sets of instrumental variables can be used to construct the test. For a simple class of models, the test in many cases is asymptotically more efficient if an incomplete set of instruments is used. However, in small samples one may do better using the complete set of instruments. Monte Carlo results demonstrate the likely gains for different assumptions about the degree of between and within variance in the data.

The Genetic-Causal Tradition And Modern Economic Theory, Mario Rizzo

Mario Rizzo

This paper is an analysis of a specific tradition of causal thinking in economics: the genetic-causal tradition. This was most self-consciously developed in the work of the Austrian School, but spilled over into other approaches. Genetic-causal explanations place emphasis, inter alia, on processes in time, emanating from changes in agents' desires and beliefs. The authors present a brief history of this approach, outline its major characteristics, differentiate genetic-causal explanation from other kinds of explanation, and illustrate the approach in mid and late-twentieth century economic theory

How Charitable Organizations Influence Federal Tax Policy: "Rent-Seeking" Charities Or Virtuous Politicians?, Nancy J. Knauer

Nancy J. Knauer

Tax-exempt charitable organizations exert considerable influence over Congress, the Department of the Treasury, and the Internal Revenue Service in matters dealing with exemption from federal income tax and the tax deductibility of charitable contributions. This Article uses both public choice and public interest analysis to help identify various features of the charitable community and explain how exempt organizations weild political influence despite the restrictions placed on their activities under the tax code. Arguing that the influence of charitable organizations over tax policy can be explained from either a public choice or public interest vantage point, the Article concluds that the …

Product Differentiation, Uncertainty And The Stability Of Collusion, Michael Raith

Michael Raith

The conventional view that product heterogeneity limits the scope for collusion among oligopolists has been challenged in recent theoretical work. This paper provides an argument in support of the conventional view by emphasising the role of uncertainty. I introduce the idea that, with stochastic demand, an increase in the heterogeneity of products leads to a decrease in the correlation of the firms’ demand shocks. With imperfect monitoring, this makes collusion more difficult to sustain, as discriminating between random demand shocks and marginal deviations from the cartel strategy becomes more difficult. These effects are illustrated within a Hotelling-type duopoly model.

Spatial Retail Markets With Commuting Consumers, Michael Raith

Michael Raith

In this paper we analyse a model of spatial competition with commuting consumers due to Claycombe (1991, International Journal of Industrial Organization 9, 303-313). We show that results different from Claycombe's are obtained if a rigorous game-theoretic analysis is applied to the model. Our results provide a theoretical basis for a later study carried out by Claycombe and Mahan (1993, International Journal of Industrial Organization 11,283-291) and lead to predictions which are in line with the empirical results of that later study. For small commuting distances (relative to the distance between firms), there exists a symmetric equilibrium in which the …

A General Model Of Information Sharing In Oligopoly, Michael Raith

Michael Raith

Under which conditions do oligopolists have an incentive to share private information about a stochastic demand or stochastic costs? We present a general model which encompasses virtually all models of the existing literature on information sharing as special cases. Within this unifying framework we show that in contrast to the apparent inconclusiveness of previous results some simple principles determining the incentives to share information can be obtained. Existing results are generalized, some previous interpretations are questioned, and new explanations offered, leading to a single general theory for a large class of models. Journal of Economic Literature Classification Numbers C72, C73, …

Deficit Reduction Through Diversity: How Affirmative Action At The Fcc Increased Auction Competition, Peter Cramton, Ian Ayres

Peter Cramton

In recent auctions for paging licenses, the Federal Communications Commission has granted businesses owned by minorities and women substantial bidding credits. In this article, Professors Ayres and Cramton analyze a particular auction and argue that the affirmative action bidding preferences, by increasing competition among auction participants, increased the government’s revenue by $45 million. Subsidizing the participation of new bidders can induce established bidders to bid more aggressively. The authors conclude that this revenue-enhancing effect does not provide a sufficient constitutional justification for affirmative action—but when such justification is independently present, affirmative actions can cost the government much less than is …

Business Cycle And Structural Time Series: Warnings And Hints, Riccardo Fiorito

riccardo fiorito

Structural time-series model can help reconcile business cycle analysis with basic economic theory assumptions

Some Syntactic, Semantic And Prosodic Characteristics In British English Conversation, Philadelphia University

Philadelphia University, Jordan

No abstract provided.

Slope Versus Elasticity And The Burden Of Taxation, Philip E. Graves, Robert L. Sexton, Dwight R. Lee

PHILIP E GRAVES

There is no abstract for this brief paper.

Trends In Food Quality Regulation: Implications For Processed Food Trade And Foreign Direct Investment, Julie Caswell

Julie Caswell

Foreign direct investment (FDI) has been increasing at a faster rate than direct exports of processed foods over the past decades. To what extent does national-level food quality regulation influence these trends? Although unquantified as to its impact, such national-level regulation is frequently cited as a potential source of nontariff barriers to trade for food products. FDI may allow food processors to avoid rules intended to disadvantage imported products by siting production within particular markets. It may also allow more precise and rapid adaptation to domestic quality regulations. We discuss what is known about the effect of national-level regulation on …

Rising Temperatures: Rising Tides, Prof. Elizabeth Burleson

Prof. Elizabeth Burleson

Transboundary environmental problems do not distinguish between political boundaries. Global warming is expected to cause thermal expansion of water and melt glaciers. Both are predicted to lead to a rise in sea level. We must enlarge our paradigms to encompass a global reality and reliance upon global participation.

Clower On Effective Demand, Peter Skott, Amitava Krishna Dutt

Peter Skott

This note examine's Clower's recent criticisms of Keynes' theory of effective demand and argues that Keynes added much to Marshallian theory when he extended to the aggregate level, that his theory does have implications for unemployment without requiring wage rigidity, that his theory does not depend on the non-clearance of the good market, and the main difference between Keynes and the Keynesians concerns the consequences of wage-price flexibility.

The Crisis Of Egalitarian Policy And The Promises Of Asset-Based Redistribution, Peter Skott

Peter Skott

This paper analyses the links between egalitarian policy and unemployment and the possible use of asset-based redistribution to overcome the crisis of egalitarian policy. Contrary to left- Keynesian belief, egalitarian policies in the postwar period were not the means to ensure high aggregate demand and full employment. The main direction of causation went the other way: full employment generated increasing egalitarian demands while high unemployment after the golden age paved the way for increasing inequality. The breakdown of the golden ages is itself explained by a gradual deterioration of the business climate which undermined the full employment policy. In addition, …

Keynesian Theory And The Aggregate-Supply/Aggregate-Demand Framework: A Defense, Peter Skott, Amitava Krishna Dutt

Peter Skott

This paper defends the Aggregate-Supply/Aggregate-Demand framework against recent criticisms by Barro and others. Using four models - a neoclassical-synthesis Keynesian, a monetarists mark 1, a rational expectation/new classical, and a Kaleckian/post-Keynesian - based on this framework, it is shown that it provides an internally-consistent and potentially useful teaching tool, that Keynesian versions of it do follow some of Keynes's ideas, that a Kaleckian/post-Keynesian version is consistent with empirical data, and that the criticisms by Barro and others are unwarranted.