Economic Inquiry

Articles from Vol. 31, No. 4, October

Altruism, Deficit Policies, and the Wealth of Future Generations
I. INTRODUCTION There is now a substantial body of evidence suggesting that altruistic financial bequests are zero for the vast majority of households.(1) Other studies seem to indicate that the financial bequests which are made, are not likely to be...
An Estimate of the Rent Generated by a Premium College Football Player
I. INTRODUCTION The National Collegiate Athletic Association (NCAA) has cartelized college athletics. It limits television appearances for college teams, it bans payments to players other than a minimum outside income they earn, and it reduces players'...
Antitrust Policy and Mergers: The Wealth Effect of Supreme Court Decisions
I. INTRODUCTION Since its inception in 1890, antitrust has been one of the most controversial areas of law. Some view antitrust enforcement as efficiency enhancing, leading to a greater degree of market competition than would otherwise be attainable.(1)...
Common Law, Statute Law, and the Theory of Legislative Choice: An Inquiry into the Goal of the Sherman Act
I. INTRODUCTION The Sherman Antitrust Act is now more than a century old, yet debate still continues about its original goals. Previous authors, focusing on the substance of the 1890 debate, have reached various conclusions about these goals, each of...
Consumers Are Not Ricardian: Evidence from Nineteen Countries
I. INTRODUCTION In conventional macroeconomic analysis, government debt affects the economy because households view it as net wealth. The larger the government debt is, the wealthier households feel and the more they consume. In principle, however,...
Corporate Tax Incidence and Inefficiency When Corporate and Noncorporate Goods Are Close Substitutes
I. INTRODUCTION In 1992, the Treasury Department released a study of corporate tax integration stressing the potential welfare gains of reducing or eliminating the differentials between taxation of capital in the corporate and noncorporate sector. While...
Discount Window Borrowing and Federal Reserve Operating Regimes
I. INTRODUCTION The borrowing behavior of banks at the Federal Reserve's discount window is a component of most models of the monetary sector, including the model used by the Federal Reserve.(1) As several researchers have noted,(2) however, the policy...
Does Monitoring Increase Work Effort? the Rivalry with Trust and Loyalty
I. EFFECTS OF MONITORING Economic theory, in particular principal-agency theory, assumes that in work relations individuals pursue their own interest and expend work effort to the point where net utility is maximized. Whereas the income earned provides...
Fiscal Policy and Trade Adjustment: Are the Deficits Really Twins?
I. INTRODUCTION The unprecedented increase of both the fiscal and trade deficits in the United States during the 1980s led many observers to posit a causal linkage. A sizable contingent of economists believe that the "twin deficits" concept aptly characterizes...
Nash Equilibrium and Buyer Rationing Rules: Experimental Evidence
I. INTRODUCTION This paper presents the results of laboratory experiments comparing the effect of two buyer rationing rules on capacity-constrained duopoly markets (Bertrand-Edgeworth games). This setting offers an excellent opportunity to compare the...
The Productivity Slowdown and the Savings Shortfall: A Challenge to the Permanent Income Hypothesis
I. INTRODUCTION The permanent income hypothesis has been extensively tested over the years. Most of these tests reject the permanent income hypothesis at conventional significance levels, but the implied deviations are small in economic terms. In this...
Toward an Economic Theory of Fashion
Strong as is the desire for variety, it is weak compared with the desire for distinction: a feeling which if we consider its universality, and its constancy, that it affects all men at all times, that it comes with us from the cradle and never leaves...