Urban structure,gas prices,and the demand for transportation

This paper investigates how the characteristics of demand for space help determine the response of aggregate automobile mileage to increased gasoline prices. A typical monocentric model is considered in which household heads commute to work at the center of city. Precise results are derived under the assumption that all households have the same income and that transportation is a small item in the typical budget. Finally, a numerical projection is made based on estimates of the relevant parameters.     

The FTC in the 1980s

This paper reviews the antitrust activities of Federal Trade Commission during the 1980s with special emphasis on the role of economics and economists. We contrast the FTC during the 1980s to its record in the 1970s and conclude that the agency was more active during the 1980s than is popularly believed. Perhaps more significant than changes in the level of enforcement activity was the agency's move to a more economics-oriented approach to antitrust enforcement and an increased role for Commission economists. The paper also comments on what FTC economists learned about American industry during the 1980s.     

The timing of residential land development: A general equilibrium approach

A formal model of the development process is constructed in order to arrive at a better understanding of the land development process, the change in land prices over time, and the effects of public policy on these variables. The relationship between the rate of interest and the rate of price appreciation on land is shown to depend upon development costs, agricultural opportunity costs, market structure, and the level of Ricardian rents on land. The effects of a land tax and a capital gains tax on the rate of development are also analyzed.     

A theory of development controls in a ‘small’ city

This paper analyzes the implications of an institutional structure in which current residents of an urban area have the power to exercise control over the level and pattern of new residential development. We develop a general equilibrium spatial model of a ‘small’ urban area in which the current residents can control new residential development through a zoning policy determined by majority vote. The current residents are modeled explicitly as home owners, and are allowed to be arbitrarily different in tastes and endowments. The urban government is assumed to provide a public good for its residents, the level of which is also determined by majority vote.The ‘optimal’ development control policy from the point of view of a particular current resident is determined and the allocation resulting from a majority vote of the current residents is described for both head tax and property tax systems. Efficient development control policies are also analyzed.     

Ten years of Merger Guidelines: A retrospective,critique, and prediction

The period since the 1982 Merger Guidelines is surveyed and assessed, including the 1992 Merger Guidelines. The 1982 Guidelines were an improvement in economic underpinnings and in merger policy, but the Guidelines' focus on short run market power is not a sensible basis for merger policy. The 1992 Guidelines continue this focus on short run market power, attempt to provide some clarifications of current enforcement policy, but add some questionable economics to the stew. The merger policy laid out in the 1992 Guidelines will not survive, since it does not suitably come to grips with the fundamental bases of the social costs and benefits of mergers and ignores ‘competitiveness’ issues.     

Economic Analyses of Mergers at the FTC: The Cruise Ships Mergers Investigation

This paper provides an overview of how economists atthe Federal Trade Commission assess the potentialcompetitive effects of mergers, with a focus on thetypes of quantitative analyses frequently employed.The paper first outlines the general approach employedat the Federal Trade Commission to review mergers.The paper then describes analyses done in theinvestigation of proposed mergers in the cruiseline industry as a specific example. Of particularinterest in this example are the analyses used toassess the potential for coordinated interaction asa result of the merger.     

Is It Time To Createa New Theoryof the Firm? Discussion

In this comment on James Emshoff's (1993) paper, ¹ I will begin by briefly summarizing the paper. Then I will give my reaction to the issues raised in the paper from the perspective of an economist and professor of business strategy. As I discuss later, it is the work of Alfred Chandler, Jr., rather than work of economists, that is most relevant to the issues raised by Emshoff. In my view economists must understand the limitations of standard economic approaches to organizational issues in order to begin to make progress on issues raised by Chandler and Emshoff.     

Strategyand Transaction Costs: The Organizationofdistributioninthecarbonatedsoftdrinkindustry

This paper analyzes the ongoing transformation of the soft drink distribution of Coca-Cola and Pepsi-Cola from systems of independent bottlers to captive bottling subsidiaries, A transaction cost-based theory is developed to explain this restructuring. It is postulated that changes in the external environment and the resulting changes in the strategies of Coca-Cola and Pepsi-Cola raised the costs of transacting between them and their independent bottlers. Two types of empirical tests are presented. One exploits the difference in the distribution of Coca-Cola and Pepsi-Cola in the fountain channel. The other consists of statistical analyses of the competitive effects of the move toward captive distribution. Both types of tests support the basic hypothesis.     

Current Economic Issues at the FTC

This paper provides a summary of recent economic issues ofparticular interest in the Bureau of Economics (``BE') of the FTC. Further developmentof empirical analyses suitable for antitrust investigations is currently of particularinterest to BE. This paper outlines several areas where BE has focused in the past yearincluding: (1) Unilateral effects; (2) coordinated interaction; (3) mergerretrospectives; (4) natural experiments; (5) price discrimination; (6) intellectual property; (7) healthcare;and (8) energy. For each area, we discuss the issues under consideration, the work thatis being done, and what additional research would be useful.