Economic Inquiry

Articles from Vol. 38, No. 4, October

Alternative Measures of the Marginal Cost of Funds
LIQUN LIU [*] This article reconciles the use of two different marginal cost-of-funds (MCF) measures by resorting to alternative marginal benefit measures. It demonstrates how the alternative MCF measures can be properly applied to two classic problems...
ASCAP versus Bmi (versus Cbs): Modeling Competition between and Bundling by Performance Rights Organizations
ANDREW N. KLEIT [*] Bundling has been a long-standing issue in industrial organization. In recent years, bundling has gained renewed controversy as it has been employed by computer software manufacturers. This article examines BMI v. CBS (1979),...
A Theory of Quality-Related Differences in Retail Margins: Why There Is a "Premium" on Premium Gasoline
JOHN R. UMBECK [*] This paper develops a theory of vertical and horizontal product differentiation to explain observed price-cost margin differentials for goods that differ in quality. The difference in price-cost margins between the high- and low-quality...
Competition and Privatization Amidst Weak Institutions: Evidence from Mongolia
PETER MURRELL [*] Mongolia's mass privatization program was implanted in a country that lacked the very basic institutions of capitalism. This paper examines the effects of competition and ownership on the efficiency of the newly privatized enterprises,...
Gender and Industry Differences in Employment Cyclicality: Evidence over the Postwar Period
DONGGYUN SHIN [*] This paper explains how cyclical patterns of employment vary between genders and across industries and how these two factors are related by gender differences in the industry distribution of workers. Evidence shows that men's employment...
Gender and Racial Earnings Differentials in Academic Labor Markets
This study estimates earnings differentials across racial and gender groups among college faculty, and decomposes these differentials into the components attributable to differences in individual and institutional characteristics and that which remains...
Inflation and the Misallocation of Resources
GIL MEHREZ [*] This paper analyzes the effects of inflation on the resource allocation between the financial sector and the manufacturing sector. We develop a model with heterogeneous workers who can be employed either in the manufacturing sector,...
Productivity of Highly Skilled Immigrants: Economists in the Postwar Period
LARRY D. SINGELL, JR [*] Prior work finds declining immigrant quality in the postwar period that is linked to source-country and skill-composition changes associated with the 1965 Immigration Act. This paper uses a unique panel of foreign- and native-born...
Rebates, Inventories, and Intertemporal Price Discrimination
RICHARD P. SABA [*] We demonstrate that universally redeemed rebates can increase manufacturer profits by reducing the incentives of downstream retailers to hoard inventories when optimal wholesale prices vary predictably over time. By bypassing...
Testing Structural Hypotheses on Cointegration Relations with Small Samples
SU ZHOU [*] This study examines the finite-sample bias of Johansen's [1991] likelihood ratio tests for structural hypotheses on cointegration relations among economic variables through the Monte Carlo experiments. It is found that the Johansen tests...
The Demand for Leisure Time in the Presence of Constrained Work Hours
W. DOUGLASS SHAW [*] This article presents a labor supply model designed to address situations of overemployment or underemployment in the labor market. Previous labor supply models have taken the possibility of work hour constraints into consideration...
The Suppression of State Banknotes: A Reconsideration
GEORGE SELGIN [*] It is generally believed that Congress, in imposing a prohibitive 10% tax on state banknotes in 1865, made the public better off by doing away with inferior brands of currency while simultaneously helping finance the Civil War...