Optimal wage re-negotiation in a closed and open economy

This paper investigates an economy in which there are short-term wage contracts that are re-negotiated under certain conditions. The paper determines the optimal frequency of wage re-negotiation and shows that it depends positively on measures of aggregate variability and Phillips curve slope. The role of optimal wage re-negotiation is to mitigate the output effects of various shocks. In the context of an open economy, it is shown that the desirable exchange rate regime in an economy with optimal wage re-negotiation depends on the stochastic structure of the economy.     

Strategies for measuring risk in public use microdata files

Statistical agencies have the responsibility to design data release strategies which will not violate pledges of nondisclosure either through intent or neglect. In addition to ethical and legal concerns, statistical offices must be mindful that violating pledges of confidentiality may undermine an agency's ability to collect data due to loss of public trust. Statistical organizations also have the obligation to make information available to a variety of individuals and institutions to allow for informed discussion from differing perspectives on a range of issues. However, it is through fine, accurate detail on a file that risks of disclosure arise. In this report we discuss strategies for controlling risk in the release of public use microdata files. The equivalence class structure of a microdata file is defined and we show how the classic entropy function can be employed on the equivalence class structure to provide a measure of relative risk.     

Basic human needs: The plateau curve

The satisfaction of basic human needs in developing countries follows a nonlinear curve relative to per capita income, asymptotically approaching a limiting level. Within this general relationship, some countries are more ‘efficient’ than others in improving basic needs at lower per capita income levels. Infant mortality rates in 116 countries, from 1950 to 1980, are analyzed to identify factors affecting a country's efficiency in reaching infant mortality targets relative to its Gross Domestic Product per capita. The determinants of efficiency include export structure, internal distribution, late development and access to education. Implications for development policy are discussed.     

Food Insecurity and Hunger in the Kindergarten Classroom: Its Effect on Learning and Growth

This study investigates the correlation between food insecurity, educational achievement, and health among kindergarten children in the United States. Data from the Early Childhood Longitudinal Study—Kindergarten Cohort are used to analyze educational achievement and physical growth of kindergartners faced with food insecurity. The results demonstrate that children begin to experience the effects of food insecurity even at the most marginal level of household food deprivation. Children in households with any signs of food insecurity score lower and learn less during the school year.     

Proprietary costs and sealing documents in patent litigation

We study whether the sealing of a defendant’s judicial records during a patent lawsuit filing correlates with the defendant’s level of competition and disclosure. Courts permit sealing of judicial records when competitive damage outweighs the public interest in access to documents and records. We find that defendants with sealed judicial records have higher research and development (R&D), lower industry sales concentration, and more references to competition in their annual reports than defendants without sealed judicial records. We observe faster mean reversion of return on net operating assets when courts seal defendant records. The results suggest that sealing relates to archival measures of competition. Finally, consistent with proprietary costs restraining disclosure, we find that defendants with sealed judicial records are less likely to issue management forecasts, file 8-Ks less frequently, and have longer and less readable 10-Ks.     

The Sound of One Hand Clapping: The 2010 Merger Guidelines and the Challenge of Judicial Adoption

There is ample justification for the consensus view that the Horizontal Merger Guidelines have proven one of antitrust law??s great successes in the grounding of antitrust doctrine within economic learning. The foundation of the Guidelines?? success has been its widespread adoption by federal courts, which have embraced its rigorous underlying economic logic and analytical approach to merger analysis under the Clayton Act. While some have suggested that the Guidelines?? most recent iteration might jeopardize this record of judicial adoption by downplaying the role of market definition and updating its unilateral effects analysis, we believe that these updates are generally beneficial and include long-overdue shifts away from antiquated structural presumptions in favor of analyzing competitive effects directly where possible. However, this article explores a different reason to be concerned that the 2010 Guidelines may not enjoy widespread judicial adoption: the 2010 Guidelines asymmetrically update economic insights underlying merger analysis. While the 2010 Guidelines?? updated economic thinking on market definition and unilateral effects will likely render the prima facie burden facing plaintiffs easier to satisfy in merger analysis moving forward, and thus have significant practical impact, the Guidelines do not correspondingly update efficiencies analysis, leaving it largely as it first appeared 13 years earlier. We discuss two well-qualified candidates for ??economic updates?? of efficiencies analysis under the Guidelines: (1) out-of-market efficiencies and (2) fixed-cost savings. We conclude with some thoughts about the implications of the asymmetric updates for judicial adoption of the 2010 Guidelines.     

Socioeconomic adjustments and choice experiment benefit function transfer: Evaluating the common wisdom

It is often argued that attribute adjustments made possible within choice experiments have the potential to improve benefit transfer accuracy. These transfers, however, often omit socioeconomic adjustments; this reflects a limited presence of socioeconomic covariates in broader choice experiments. The lack of correspondence between common guidance that socioeconomic adjustments should be applied and simultaneous arguments for the advantages of choice experiment transfers leads to ambiguity for transfer practice. This paper contrasts the change in transfer performance resulting from an ability to adjust for policy attributes with that resulting from an ability to adjust for socioeconomic attributes. Results are illustrated for the case of agricultural land preservation. The goal is to provide evidence regarding the tradeoff faced by practitioners who seek to use choice experiments for benefit transfer but lack the ability to adjust for socioeconomic attributes.     

Corporate financing decisions when investors take the path of least resistance

We argue that inertial behavior on the part of investors can have significant consequences for corporate financial policy. One implication of investor inertia is that it improves the terms for the acquiring firm in a stock-for-stock merger, because acquirer shares are placed in the hands of investors, who, independent of their beliefs, do not resell these shares on the open market. In the presence of a downward-sloping demand curve, this leads to a reduction in price pressure and, hence, to cheaper equity financing. We develop a simple model to illustrate this idea and present supporting empirical evidence.