Economic Inquiry

Articles from Vol. 42, No. 2, April

Are Political Freedoms Converging?
I. INTRODUCTION This article examines the Freedom House (2002) index of political rights and civil liberties in 136 countries to test if political freedoms are converging. Recently, Helliwell (1994), Barro (1996; 1999), and Minier (2001) find evidence...
Bidder Preferences among Auction Institutions
I. INTRODUCTION Auctions have become a pervasive method of exchange in the online world as each day thousands of auctions take place online and this trade volume totals to billions of dollars worth of goods per year. (1) This large volume of auction...
Exit Discrimination in the NBA: A Duration Analysis of Career Length
I. INTRODUCTION In the National Basketball Association (NBA), as in most professional sports leagues, player turnover is high from season to season due to declining skills as players age. In our analysis, we ask: Are there any factors that determine...
Growth Effects of Shifting from a Graduated-Rate Tax System to a Flat Tax
I. INTRODUCTION Recently, the debate concerning fundamental U.S. tax reform has led to a number of proposals that involve a shift toward a consumption-based system. (1) One such proposal is the so-called flat tax of Hall and Rabushka (1995). The...
Impacts of Long-Range Increases in the Fuel Economy (CAFE) Standard
I. INTRODUCTION AND BACKGROUND In 1975 the U.S. government enacted legislation regulating the fuel efficiency of new motor vehicles. The apparent objective of this law is to reduce American dependence on foreign oil. After large increases in the...
Monetary Fundamentals and Exchange Rate Dynamics under Different Nominal Regimes
I. INTRODUCTION A large body of literature has examined the relationship between the nominal exchange rate and the fundamentals suggested by conventional theories of exchange rate determination using data for the modern floating exchange rate period....
Price Competition in Pharmaceuticals: The Case of Anti-Infectives
I. INTRODUCTION A fundamental question in industrial organization regards the relationship between price and the number of sellers (N). The interest in this issue has been rekindled by substantial recent work. (1) This article uses an extensive...
Recreation Demand Choices and Revealed Values of Leisure Time
I. INTRODUCTION At least since the work of Becker (1965), it has been recognized widely that time may play an important role in consumer demand. One of the areas where this may be most significant empirically is in the valuation of natural resource...
Sample Selection in Models of Academic Performance
I. INTRODUCTION Virtually all graduate programs in the United States require applicants to submit scores on standardized tests, such as the Graduate Record Examination (GRE) or the Graduate Management Admissions Test (GMAT). The usefulness of these...
The Demand for Credit Cards: Evidence from the Survey of Consumer Finances
I. INTRODUCTION The credit card market has expanded rapidly over the past 20 years. In 1983, 65% of households held at least one card; by 1998, about 74% did so. The size of real balances on these cards more than tripled in this period. Analysts...
The Self-Serving Bias and Beliefs about Rationality
I. INTRODUCTION Now Haman had just entered the outer court of the king's palace to speak to the king about having Mordecai hanged on the gallows that he had prepared for him. So the king's servants told him, "Haman is there, standing...
Threshold Effects in the U.S. Budget Deficit
I. INTRODUCTION There has been an ongoing debate on whether the U.S. fiscal policy is sustainable in the long run. In addressing this issue, a number of studies have examined whether the U.S. public finances are compatible with the government's...
Trade and Wage Inequality in Developing Countries
I. INTRODUCTION The impact of trade on the skilled-unskilled wage gap has attracted a lot of research interest in the developed world, primarily due to the observed pattern of increasing inequality over the past decade. The importance of two competing...