ECONOMIC DEVELOPMENT AND STRIKES: PROBLEMS IN TESTING THE HAAS AND STACK MODEL

Haas and Stack (1983) make a bold attempt to establish an empirical relationship between strike volume (working-days lost due to industrial disputes) and economic development using parametric statistical techniques in the from of ordinary least squares regression. They conclude that "the effect of economic development on strikes follows a parabolic curve"(p. 56). While the authors express the customary caution about the reliability of their data, they ignore various problems with their data, i.e., method and technique which may invalidate the conclusions of the study. These problems are dealt with in this article.     

TAXONOMY AND THE EFFECTS OF FISCAL AND MONETARY POLICY

This paper reviews the development of monetarist theory and the circumstances under which emphasis shifted to "fiscalism," discusses Bent Hansen's view that the controversy is largely a sham dispute, and suggests two types of research needed to assess, historically and theoretically, the relative practical importance of the two approaches to reduction or elimination of economic instability.     

THE DEMAND FOR EXCESS RESERVES, LIABILITY MANAGEMENT, AND THE MONEY SUPPLY PROCESS

Commercial bank behavior is not adequately dealt with in existing macro models of the financial sector. The central role of a demand for excess reserves (or free reserves) function in models of the money supply process is particularly suspect. In this paper, it is argued that changes in commercial bank behavior induced by alterations in economic and financial conditions and various banking regulations, along with the central bank's approach to policy, have combined to alter the excess reserve function and the relationship between bank reserves and the money supply. Empirical work presented suggests that the "demand" for excess reserves has indeed undergone structural change. Thus, the study indicates that conventional approaches to commercial bank behavior and the demand for excess reserves need to be reworked.     

COMMON LAW, STATUTE LAW, AND THE THEORY OF LEGISLATIVE CHOICE: AN INQUIRY INTO THE GOAL OF THE SHERMAN ACT

Although the Sherman Antitrust Act is more than a century old, debate continues over its goals. In contrast to what many have argued, I contend that the Act's main goal is to maximize economic efficiency, rather than the welfare of consumers. The Sherman Act is a modest extension of the common law, which the "Law and Economics" literature indicates moves towards economic efficiency. Further, unlike the Interstate Commerce Act of 1887, Sherman Act decisions are made by courts, not a regulatory agency. Thus, the theory of legislature choice also implies that the goal of the Act is to maximize economic efficiency.     

DEMOGRAPHICS, PRODUCTIVITY GROWTH AND THE MACROECONOMIC EQUILIBRIUM

This paper investigates the economic effects of demographics and productivity growth in an intertemporal optimizing model with age-based heterogeneity and induced retirement. Our analysis reveals that the projected "population aging" is likely to increase the growth rate of output and to improve the welfare of the economy, especially if there are no distortional policies which prevent retirement decisions from adjusting endogenously to the demographic changes. The economy also displays different patterns of dynamic adjustment in the quantity and price variables depending upon whether retirement is endogenous.     

AGE AND CZECHS' ATTITUDES TOWARD THE POSTCOMMUNIST ECONOMIC REFORMS

The connection between age and attitudes toward social change has been a long-standing research interest in the United States. Hypotheses derived from this tradition are tested in the Czech Republic, a country undergoing a societal transformation since 1989. We have utilized eleven national surveys from 1990–1998, allowing an examination not only of the association between age and opinions about the Czech postcommunist reforms but also of the change in these relations during the survey period. Specifically, we first examine how respondents' age is related to their recent economic experiences and the interaction between age and the phase of the reforms on these experiences, net of demographic controls. The association between age and respondents' anxiety about the Czech reforms is the second focus, with tests for the interaction between age and time on this anxiety; controls include economic experiences. Then we examine the relation between age and respondents' support for the economic reforms, again with tests for the interaction between age and time, while controlling for anxiety as well. Older Czechs were generally more conservative about the reforms, net of their economic experiences and anxiety about them, and these age differences did not change with the phases of the reforms.     

BELIEVABILITY AND THE PRESS

This study looks at believability ratings assigned to 39 newsorganizations and news personalities by a nationally representativesample of 2,104 adult men and women. The data provide threemajor findings about the believability of the American press,all of which, at least in part, tend to be at odds with muchof the conventional wisdom and some of the contemporary researchdealing with the credibility of the news media. First, the overwhelmingmajority of the general public believes most of what it hears,sees, or reads in the nation's press. Second, perceived "believability"of the news media is not closely related to those politicaland demographic variables that typically divide public opinionin America. Third, the public does "group" the news media interms of "believability," but the groupings do not equate withthe dichotomy usually drawn between television and print journalism.     

THE CONCEPT OF NEIGHBORHOOD IN HEALTH AND MORTALITY RESEARCH

Neo-liberal economic principles are viewed positively by many people in government, the media, and academia, as they are thought to increase rates of economic growth and thereby produce outcomes beneficial to society as a whole. This project endeavors to test the second part of that notion, hypothesizing that excessive reliance on open markets is positively associated with social “costs,” which may be interpreted as a quantitatively diminished standard of living. Specifically, by limiting our focus to the relatively small sample of advanced capitalist democracies, it is expected that among these wealthy countries those with relatively low levels of adherence to market principles perform better on a number of important social indicators than those which favor minimal governmental activism. Regression analysis is employed to test the relationship between laissez-faire economic policy and 6 social maladies in 18 countries. Results show that a neo-liberal economic orientation does indeed lead to suboptimal social outcomes among advanced capitalist democracies.     

CRIMINAL OPPORTUNITY THEORY AND THE RELATIONSHIP BETWEEN POVERTY AND PROPERTY CRIME

Criminal opportunity theory suggests that community economic deprivation has two countervailing effects on property crime: it causes strain and disorganization which may encourage some individuals to offend, but it also simultaneously lessens opportunities to engage in property crime by reducing the supply of worthwhile targets in an area. The present study examines the relationship between economic deprivation and rates of burglary and motor vehicle theft for census tracts in two large American cities (Austin and Seattle). Regression analyses support the opportunity saturation hypothesis derived from criminal opportunity theory. This hypothesis suggests that the relationship between levels of deprivation and property crime is curvilinear where the positive effect of deprivation on property crime is stronger at low levels of neighborhood poverty than it is at high levels. Research and policy implications are discussed.     

TIME PREFERENCE AND THE DISTRIBUTIONS OF WEALTH AND INCOME

This paper examines the connection between time preference heterogeneity and economic inequality in a deterministic environment. Specifically, we extend the standard neoclassical growth model to allow for (1) heterogeneity in consumers' discount rates, (2) direct preferences for wealth, and (3) human capital formation. The second feature prevents the wealth distribution from collapsing into a degenerate distribution. The third feature generates a strong positive correlation between earnings and capital income across consumers. A calibrated version of the model is able to generate patterns of wealth and income inequality that are very similar to those observed in the United States. (JEL D31, E21, O15)     

THE CALCULUS OF VOTING RECONSIDERED

A rational economic hypothesis of the citizen's decision tovote or not vote in U. S. presidential elections has been citedas an example of the replacement of social-psychologically oriented"empirical generalizations" by axiomatically based deductivepropositions in political science. However, close scrutiny showsthat the rational (or political) economic paradigm is no moreaccurate a theory than previously popular systems analysis orfunctional paradigms. The claimed verification of the originalhypothesis was based on an apparently imprecise, adhoc, ordinalprocedure that could not distinguish between the intimatelyrelated rational economic and social-psychological hypotheses.A more powerful technique resolves the issue in favor of thelatter model for the data used by the original authors.     

ECONOMIC GROWTH AND THE SEPARATION OF CHURCH AND STATE: THE FRENCH CASE

This article provides a test of the secularization hypothesis, which argues that economic growth, industrialization, increased literacy, and low fertility decrease religiosity. It focuses on the elections of the secular politicians who voted in favor of the separation between Church and State in the French Parliament in 1905. If the secularization hypothesis is correct, these secular politicians should have been elected in the most developed areas of France at the turn of the twentieth century. Contrary to the predictions of the secularization hypothesis, we find that the support for secular politicians originated in the rural areas of France. (JEL Z12, D72, N43)     

THE NEW ECONOMY AND THE AMERICAN DREAM:

Recent decades have seen major changes in economic conditions in the United States, including large-scale layoffs and downsizing, erosion of job quality for some workers, and increased reliance on nonstandard workers. Researchers have investigated the objective contours of this new economy, but few have investigated the consequences of these changes for popular attitudes about economic opportunity. Using data from the 1998 Indiana Survey of Workers in a Polarized Economy (N = 853), I investigate this new economic landscape and its effects on people's views about economic opportunity. I find that job deterioration and experiences with layoffs and job threats are creating pessimism about the American Dream among Indiana workers.     

THE STATE STREET MILE: AGE AND GENDER DIFFERENCES IN COMPETITION AVERSION IN THE FIELD

Gender differences in “competitiveness,” previously documented in laboratory experiments, are hypothesized to play a role in a wide array of economic outcomes. This paper provides evidence of competition aversion in a natural setting somewhere between the simplicity of a laboratory experiment and the full complexity and ambiguity of a labor market. The “State Street Mile” race offers both male and female participants a choice between two different levels of competition. Large, systematic age and gender differences are observed in the relationship between true ability and the decision to enter the more competitive race. Overall, qualified women and older runners are far less likely than qualified young men to enter a competitive race with prizes. However, the fastest young women unanimously enter the competitive race. Therefore, while we confirm age and gender differences in competitiveness in our field setting, the economic consequences to capable young women are rather small. (JEL J1, J7, M5)     

FOREIGN DIRECT INVESTMENT AND ECONOMIC GROWTH: THE GROWTH ACCOUNTING PERSPECTIVE

A positive relationship between FDI and economic growth under two economic conditions has been estimated: a sufficient level of human capital and well-developed financial markets, respectively. However, these two conditions can be fundamentally different catalysts for FDI to promote economic growth in the perspective of growth accounting. Using data from 69 countries over 1970–1989, we find that FDI promotes productivity growth only when the host country reaches a threshold level of human capital; and FDI promotes capital growth only when a certain level of financial development is achieved. ( JEL F21)     

HIERARCHIES AND CONTROL

This article offers a reinterpretation of Oliver Williamson's transaction-cost efficiency approach to economic organizations. Asserted transaction-cost minimizations are found to be based on the exercise of social control power within hierarchical governance structures. Analysis of transaction-cost economics' "justification" of hierarchical employment relations shows the tenuous nature of Williamson's noncoercive conceptualization of control. His "rationale" for integrated firms, based on his assessment of the control efficiency properties of intrafirm governance structures, is also shown to be problematic. Finally, a network exchange framework is presented as an alternative approach for analyzing economic organizations. This framework builds upon, and moves beyond, insights developed in the "Markets and Hierarchies" story.     

BUSINESS RESOURCES AND TAXATION: A CROSS-SECTIONAL EXAMINATION OF THE RELATIONSHIP BETWEEN ECONOMIC ORGANIZATION AND PUBLIC POLICY

Many writers have speculated about the connection between economic resources of corporations and their ability to dominate politics in democratic societies with advanced capitalist economies. Using a cross-sectional analysis of business taxes in the American states, this study examines the political impact of four economic resources that are plausibly related to heightened business political influence. With seven factors held constant, I find that states with larger enterprises are most likely to have lower taxes on manufacturing, but concentrated sales do not have any effect on these taxes. The degree to which the organizational efforts of firms are handicapped because industry products are diverse also has an independent relationship with state and local taxes paid by manufacturers, but this relationship does not hold when the least industrial states are excluded from the equations. I also find that where competition between political parties is most intense, tax policies will be less likely to favor business interests. It follows that the evidence in this study is consistent with a hypothesis that firms can translate their formidable economic resources into political influence at the state and local level.     

RECESSIONS AND RECOVERIES IN REAL BUSINESS CYCLE MODELS

We evaluate the ability of a simple real business cycle model to generate business cycles in the classical NBER sense of the term, where recessions are periods of absolute declines in economic activity. We use the "phase" classification of Burns and Mitchell [1946] to determine the "shape" of the business cycle and to look for asymmetries between expansions and contractions. We show that such a model can generate business cycles of plausible duration and depth, but cannot match the actual "Shape" of the business cycle. Nonlinear models, such as Friedman's [1993] "plucking" model may more closely match the observed shape.     

RISK PREFERENCE AND THE WORK-LEISURE TRADE-OFF

The paper investigates the interrelationships between the wage rate, period of employment, work-leisure choice and the attitude toward risk. The model makes risk preference endogenous given external forces acting on individual choice. Beginning with assumptions normally considered consistent with risk aversion –––namely concave utility with respect to leisure and wealth along with perfect markets–––rational behavior consistent with the "insurance buying gambler" is shown to be a reasonable possibility. The theory also provides an explanation for the "repeating gambler paradox."     

WHO PAYS THE BAR TAB? BEER CONSUMPTION AND ECONOMIC GROWTH IN THE UNITED STATES

Few studies explore the linkages between health behaviors and macroeconomic outcomes. This study uses 1971–2007 state‐level data from the United States to estimate the impact of beer consumption on economic growth. We document that beer consumption has negative effects on economic growth measures once the endogeneity of beer consumption is addressed. Our estimates are robust to a range of specification checks. These findings run parallel to a large body of literature documenting substantial social and economic costs stemming from alcohol use. (JEL I1, O4)