Economic Inquiry

Articles from Vol. 34, No. 3, July

Appropriable Rents from Yellowstone Park: A Case of Incomplete Contracting
I. INTRODUCTION Though the general populace accepts that national parks are and should be the domain of government, the history of our first national park, Yellowstone, reveals that from the beginning private entrepreneurs were actively involved in...
Armen A. Alchian's Influence on Economics
Editor's Note: I wish to thank Special Symposium Editor John Lott for his dedicated, vigorous and hard work in setting up the symposium and then in shepherding the manuscripts through the referee and editing process. I also wish to thank Coeditor Rodney...
Armen Alchian's Contribution to Macroeconomics
I. INTRODUCTION This essay examines Alchian's contribution to the theory and practice of macroeconomics. We have the task of reviewing Alchian's contributions in an area that represents only a tiny fraction of his body of work. Citations to his work...
Consumption, Wealth, and Finite Horizons: Tests of Ricardian Equivalence
I. INTRODUCTION A continuing debate in macroeconomics concerns the ability of fiscal policy to affect aggregate demand. In other words, if the government reduces taxes and finances a given level of government spending by issuing new bonds, does it generate...
Efficiency Effects of Exclusive Territories: Evidence from the Indiana Beer Market
I. INTRODUCTION Vertically-imposed exclusive territories, whereby a manufacturer allows only a single dealer to market its products within a given geographical area, have been the subject of much debate among economists and the antitrust bar. At the...
Evidence on Electoral Accountability in the U.S. Senate: Are Unfaithful Agents Really Punished?
I. INTRODUCTION Downs [1957] hypothesized that voters would not reelect officials whose behavior in office was unacceptable to them and that the threat of not being reelected would lead officials to follow policies preferred by the voters. That is,...
Evolution and Spontaneous Uniformity: Evidence from the Evolution of the Limited Liability Company
I. INTRODUCTION Among Armen Alchian's many major contributions to economic analysis is his pioneering application of the principles of biological evolution and natural selection to economics. In his 1950 article, "Uncertainty, Evolution, and Economic...
In Celebration of Armen Alchian's 80th Birthday: Living and Breathing Economics
John Lott: When we first attempted to put this program together, I was a bit worried that with a general session, a luncheon and five paper sessions, it might be a little difficult to find enough participants. Well, I can assure you, those concerns were...
Information, Chance, and Evolution: Alchian and the Economics of Self-Organization
I. INTRODUCTION Alchian [1950] invoked the idea that selection could replace or supplement rationality or conscious design in economic theory. Evolution in Alchian's theory is a force that is complementary to and may even substitute for rationality....
International Currency Substitution and Seigniorage in a Simple Model of Money
I. INTRODUCTION Currency substitution describes the change in the holdings of domestic and foreign real balances in response to fluctuations in the relative prices of these currencies. So far, the empirical evidence on the strength of currency substitution...
Modeling Monetary Trends in Italy Using Historical Data: The Demand for Broad Money 1861-1990
I. INTRODUCTION The stability of the demand for money in Italy has been examined by a number of studies in recent years. However, most researchers have utilized short post-World War II samples, due to the lack (until now) of a consistent long-run historical...
Principles of Professional Advancement
You've finished your Ph.D. ordeal, and luckily you're now in your first year as a real member of the faculty. The expected relief from the burden of completing the dissertation is quickly replaced by the burden of publishing. But then you realize it's...
Rationality, Evolution, and Acquisitiveness
A classic article has "staying power" and impact. Alchian's 1950 article "Uncertainty, Evolution, and Economic Theory" has plenty of both, and there is no need to extol its obvious virtues. Yet, I am sure that Alchian would find things to modify in this...
Why Hold-Ups Occur: The Self-Enforcing Range of Contractual Relationships
One of my most enjoyable intellectual experiences was working with Armen Alchian on the Klein, Crawford and Alchian [1978] hold-up paper. In this paper I extend the basic framework presented in that paper, pointing out what I now consider to be its shortcomings...