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Full-Text Articles in Law
Where Did Mill Go Wrong?: Why The Capital Managed Firm Rather Than The Labor Managed Enterprise Is The Predominant Organizational Form In Market Economies, Justin Schwartz
Justin Schwartz
In this Article, I propose a novel law and economics explanation of a deeply puzzling aspect of business organization in market economies. Why are virtually all firms are organized as capital managed and owned (capitalist) enterprises rather than as labor managed and owned cooperatives? Over 150 years ago, J.S. Mill predicted that efficiency and other advantages would eventually make worker cooperatives predominant over capitalist firms. Mill was right about the advantages but wrong about the results. The standard explanation is that capitalist enterprise is more efficient. Empirical research, however, overwhelmingly contradicts this. But employees almost never even attempt to organize …
The Federal Reserve We Need: It’S The Fed We Once Had, Timothy A. Canova
The Federal Reserve We Need: It’S The Fed We Once Had, Timothy A. Canova
Timothy A. Canova
This article considers the empirical record of the 1942-1951 period of Federal Reserve history when the Fed was more politically accountable and more independent of private financial interests. During the 1940s, federal spending was nearly twice as high as today, and federal borrowing was more than three times higher. Yet, from 1942 to 1951, the Federal Reserve was directed by the White House and Treasury to peg interest rates at 3/8 of one percent on short-term Treasury borrowing and 2.0 to 2.5 percent on long-term borrowing. The U.S. economy grew at a real annual rate of 15 to 20 percent …
Government Prediction Markets: Why, Who, And How, Tom W. Bell
Government Prediction Markets: Why, Who, And How, Tom W. Bell
Tom W. Bell
This paper describes how prediction markets can make governments smarter, cheaper, and more responsive to changing conditions. A prediction market resembles a stock exchange where traders buy and sell not shares of companies, but claims about future events. Academic and commercial use of prediction markets suggests that they offer a useful tool for encouraging, collecting, and quantifying widely scattered expertise. Government administrators have begun experimenting with prediction markets, too. Many questions remain, however, about the proper way to implement government prediction markets. This paper opens with a brief survey of the costs and benefits of government prediction markets. It then …