The Marginal Revenue Product of a Women's College Basketball Player

This paper estimates the marginal revenue product of a premium women's college basketball player. Ordinary least squares estimates indicate that acquiring another one of these players generates nearly $250,000 annually for her team. Quantile regression estimates, however, show that these quantitative effects vary substantially across teams: Players at less successful programs generate little revenue for their team, while those at the elite programs generate considerable revenues. The results provide empirical evidence that schools may have the ability to capture economic rents from the best players at the top women's basketball programs.     

Time Variation in the Inflation Passthrough of Energy Prices

From Bayesian estimates of a vector autoregression that allows for both coefficient drift and stochastic volatility, we obtain the following three results. First, beginning in approximately 1975, the responsiveness of core inflation to changes in energy prices in the United States fell rapidly and remains muted. Second, this decline in the passthrough of energy inflation to core prices has been sustained through a recent period of markedly higher volatility of shocks to energy inflation. Finally, reduced energy inflation passthrough has persisted in the face of monetary policy that became less responsive to energy inflation starting around 1985.     

DETERRENCE: CREDIBILITY AND PROPORTIONALITY

This paper extends the analysis of deterrence to examine terrorism, nuclear proliferation, and rogue nations. Such situations are characterized by differential pre-emptive and response capacity, in contrast to the traditional deterrence literature on nuclear superpowers, where such factors are absent. We focus on the credibility of deterrence responses to pre-emption and show that credible (subgame-perfect) responses are rarely proportional. The analysis is also extended to asymmetric deterrence scenarios whereby credibility and proportionality depend on the potential aggressor's access to conflict technology and the responder's preferences for indirect conflict vs. the status quo.     

Initial Evidence on the Role of Accounting Earnings in the Bond Market

We document that: (1) the incidence of bond trade increases during the days surrounding earnings announcements, (2) there is a bond‐price reaction to the announcement of earnings, and (3) there is a positive association between annual bond returns and both annual changes in earnings and annual analysts' forecast errors. All of these effects are larger when earnings convey bad news or when the underlying bond is more risky. Taken together, our results suggest that the nonlinear payoff structure of bond securities affects the role of accounting earnings in the bond market.     

Global and Regional Public Goods: A Prognosis for Collective Action

This paper applies modern concepts from the theory of public goods to indicate why progress has been made with respect to some global and regional public goods (for example, cutting sulphur emissions) but not with respect to others (for example, cutting greenhouse gases). Factors promoting collective action at the transnational level include the removal of uncertainty, a high share of nation-specific benefits, a limited number of essential participants and the presence of an influential leader nation. The impact of public good aggregation technologies on the future provision of transnational public goods is related to the trend in world-wide income inequality. Principles are presented for designing supranational structures for addressing transnational public good problems. JEL classification: H41, D70, Q20.