A Consumer Perspective of the Investment Services Market

Some thirty million American consumers pursue their financial objectives through individual participation in the stock market. They clearly view the stock market as a savings alternative which offers at least normal returns to persons outside the circle of professional investors. In the absence of data reflecting the performance of personal portfolios it is difficult to assess the validity of this view. However, as an initial step this paper evaluates the performance of the market servicing individual investors. The evidence indicates that noninstitutional investors have reason to question stock brokerage pricing, service and sales practices. Moreover on the basis of more than 1,000 sampled investment recommendations, it appears that investment publications directed at individual investors have failed to identify superior investment alternatives.     

Large‐Scale Risks and Technological Change: What About Limited Liability?

We consider a firm under strict liability that must choose between two risky technologies, one being safer but costlier than the other one. The total potential level of damage increases with the level of activity. We show that, under limited liability, technological change is welfare‐improving and leads to full risk internalization when the firms are sufficiently capitalized. Nevertheless, the percentage of firms adopting the safer technology and full risk internalization is higher under unlimited liability than under limited liability. We show how an adequate tax policy increases this percentage. We also determine the characteristics of a second‐best tax policy.     

Profit Sharing and Productivity: Further Evidence from the Chemicals Industry

Profit sharing potentially augments productivity by affecting motivational variables that promote group norms favoring effort. A factor augmentation model of production is developed to measure the impact of profit sharing on productivity using a test industry in U.S. manufacturing. The model is applied using alternative exogenous and endogenous specifications for the profit-sharing incentive variable. The results are consistent with those obtained in other recent studies and suggest that profit sharing results in improvements in productivity.     

The Economic Effects of Repealing Fair Trade Laws

Legislation in 1976 abolishing fair trade appears to have led to limited price cutting among retailers. In particular, stores identified by their managers as being “discount” outlets were found to have undercut the prices of other stores in most product groups while the pricing policies of chain stores and multi-line stores have not become more aggressive on fair trade items since repeal. Limited evidence indicates that a reduction in nonprice competition in the form of newspaper advertising and sales personnel has also attended repeal. Finally, a substantial increase in the frequency of business failures in fair trade states during 1976 indicates that a consolidation among retailers may have coincided with the abolishment of uniform, manufacturer-specified retail prices.     

Worth,age, and social status in early modern England1

This article introduces a new source for assessing the distribution of wealth in early modern England derived from witness depositions taken by the church courts. It discusses the accuracy of statements of ‘worth’ provided by thousands of witnesses between the mid‐sixteenth and later seventeenth centuries, and uses the monetary estimates of worth in goods that the majority of deponents supplied to assess the changing distribution of personal wealth. We argue that this data supports recent claims that the pre‐industrial English economy experienced significant levels of economic growth, while showing that its benefits were increasingly unevenly distributed between different social groups. In particular, the century after 1550 witnessed spectacular increases in yeoman worth that outstripped inflation by a factor of 10. The relative wealth of yeomen was also underpinned by its more secure distribution over the life cycle which further compounded the differences between them and other social groups.     

The Impact of Price Advertising: The California Eyewear Market After One Year

Recent judicial decisions and regulatory actions have reversed advertising restrictions enforced in the professions. This study examined the degree to which such regulatory reform has in its first year resulted in increased advertising competition among California eyewear practitioners. It also analyzed price differences between advertising and nonadvertising ophthalmologists, optometrists, and opticians. The study found that while relatively few practitioners engaged in advertising, those that did charged 17 percent less than nonadvertisers.     

Toward A Framework for Consumer Policy Analysis

In this paper, an attempt is made to define the scope of the various subdisciplines of consumer studies. The topical relationships between these subdisciplines are also explored. From this basis, a framework is developed for investigating consumer issues and related policy questions.