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MGPE 18-46 Joe Brunk
No. 18-46 Summer 2018 MERCATUS GRADUATE POLICY ESSAY ANALYZING TWO APPROACHES OF SUPERVISING CULTURE IN BANKING by Joe Brunk The opinions expressed in this Graduate Policy Essay are the author’s and do not represent Abstract In light of the financial crisis and other culture-related scandals, regulators have recently begun to address the issues of toxic cultures plaguing banks. The US and the UK have attempted to address these issues using two slightly different top-down approaches. The purpose of this paper is to address the question of whether the US approach to supervising the culture of its banks is superior to the UK’s approach to supervising the culture of its banks. Two case studies show that corporations and industries, even in the absence of government regulations, can create the proper institutional framework and incentives to change their culture. This paper argues that the US approach to supervising bank culture is superior because it is more likely to mitigate the unintended consequences associated with the knowledge problem, namely unethical behavior. Because of its less regimented and burdensome nature, the US approach fosters an environment where banks can adapt to changing circumstances or errors. This approach allows for more flexibility, variation, and competition in attempts to positively change banking culture. Author Bio Joe Brunk is an alumnus of the Mercatus Center MA Fellowship at George Mason University. He is currently a Research Assistant for the Financial Regulation team at the Mercatus Center at George Mason University. During the summer of 2017, Joe interned on Capitol Hill with the House Financial Services Committee. -
Public Choice and Public Health
Public Choice https://doi.org/10.1007/s11127-021-00900-2 Public choice and public health Peter T. Leeson1 · Henry A. Thompson1 Received: 3 March 2021 / Accepted: 12 March 2021 © The Author(s), under exclusive licence to Springer Science+Business Media, LLC, part of Springer Nature 2021 Abstract Public choice scholars have attended only modestly to issues in public health. We expect that to change rapidly given the Covid-19 pandemic. The time therefore is ripe for tak- ing stock of public-choice relevant scholarship that addresses issues in public health. That is what we do. Our stock-taking highlights three themes: (1) Public health regulations often are driven by private interests, not public ones. (2) The allocation of public health resources often refects private interests, not public ones. (3) Public health policies may have perverse efects, undermining instead of promoting health-consumer welfare. Keywords Public choice · Public health · COVID-19 · Interest groups JEL Classifcations D72 · I18 1 Introduction Public health is “The health of the population as a whole, esp. as monitored, regulated, and promoted by the state” (Oxford English Dictionary, 2020). Public choice is “the applica- tion of the principles of maximizing behavior…to institutions and behavior in the political world” (Tollison, 2004, p. 191).1 You might therefore think that public health has attracted major attention from public choice scholars. But then you would be wrong. The Elgar Companion to Public Choice (Reksulak et al. 2014), an “authoritative and encyclopaedic reference work” of more than 600 pages that “provides a thorough account of the public choice approach”, contains just six pages on which the term health (or a vari- ant) appears. -
Evaluating Regulatory Reform of Network Industries: a Survey of Empirical Models Based on Categorical Proxies
Evaluating regulatory reform of network industries: a survey of empirical models based on categorical proxies Andrea Bastianin Paolo Castelnovo Massimo Florio University of Milan University of Milan University of Milan This version: September 25, 2018 Abstract Proxies for regulatory reforms based on categorical variables are increasingly used in empirical evaluation models. We surveyed 63 studies that rely on such indices to analyze the effects of entry liberalization, privatization, unbundling, and independent regulation of the electricity, natural gas, and telecommunications sectors. We highlight methodological issues related to the use of these proxies. Next, taking stock of the literature, we provide practical advice for the design of the empirical strategy and discuss the selection of control and instrumental variables to attenuate endogeneity problems undermining identification of the effects of regulatory reforms. Keywords: network industries; regulatory reforms; categorical variables. JEL Codes: B41, C20, C54, D04, L98. Corresponding author: Massimo Florio, Department of Economics, Management and Quantitative Methods (DEMM), University of Milan, via Conservatorio 7, I-20122 Milan, Italy. E-mail: [email protected] 1. Introduction At least since the 1980s, governments around the world have implemented wide regulatory reforms that have reshaped network industries such as energy, telecommunications, and transport. The empirical evaluation of the societal impacts of these reforms1 is essential to guiding policymakers and regulators in the selection of the most appropriate measures. This process seems straightforward: reforms are desirable when they yield economic and social benefits that outweigh their costs (Coglianese, 2012). While this simple description is backed-up by a well-established theoretical literature in public economics (see Boadway, 2012 for a survey), empirical assessments of regulatory reforms by means of econometric analyses are complex (Jamasb and Pollit, 2001). -
5000 General Theories of Regulation | Findlaw
5000 GENERAL THEORIES OF REGULATION Johan den Hertog Economic Institute/ CLAV, Utrecht University © Copyright 1999 Johan den Hertog Abstract This chapter makes a distinction between three types of theories of regulation: public interest theories, the Chicago theory of regulation and the public choice theories. The Chicago theory is mainly directed at the explanation of economic regulation; public interest theories and public choice theories envisage in addition to that an account of social regulation. The core of the diverse theories is discussed as well as the criticisms that have been leveled at them. It can be derived from the theories in what sectors regulation can be expected and what form the regulation will take. The extent to which these theories are also able to account for deregulation, and the expectations for the future, are discussed. JEL classification: D72, D78, H10, K20 Keywords: Regulation, Deregulation, Public Interest Theories, Private Interest Theories, Interest Groups, Market Failures 1. Introduction In legal and economic literature, there is no fixed definition of the term ‘regulation’. Some researchers devote considerable attention to the various definitions and attempt through systematization to make the term amenable to further analysis (Mitnick, 1980). Other researchers, however, entirely abstain from a further definition of regulation (Joskow and Noll, 1981). In order to delineate the subject and because of the limited space, a further definition of regulation is nevertheless necessary. In this article, regulation will be taken to mean the employment of legal instruments for the implementation of social-economic policy objectives. A characteristic of legal instruments is that individuals or organizations can be compelled by government to comply with prescribed behavior under penalty of sanctions. -
Peter J. Boettke
PETER J. BOETTKE BB&T Professor for the Study of Capitalism, Mercatus Center at George Mason University, & University Professor of Economics and Philosophy Department of Economics, MSN 3G4 George Mason University Fairfax, VA 22030 Tel: 703-993-1149 Fax: 703-993-1133 Web: http://www.peter-boettke.com http://papers.ssrn.com/sol3/cf_dev/AbsByAuth.cfm?per_id=182652 http://www.coordinationproblem.org PERSONAL Date of birth: January 3, 1960 Nationality: United States EDUCATION Ph.D. in Economics, George Mason University, January, 1989 M.A. in Economics, George Mason University, January, 1987 B.A. in Economics, Grove City College, May, 1983 TITLE OF DOCTORAL THESIS: The Political Economy of Soviet Socialism, 1918-1928 PROFESSIONAL EXPERIENCE Academic Positions 1987 –88 Visiting Assistant Professor, Department of Economics, George Mason University 1988 –90 Assistant Professor, Department of Economics, School of Business Administration, Oakland University, Rochester, MI 48309 1990 –97 Assistant Professor, Department of Economics, New York University, New York, NY 10003 1997 –98 Associate Professor, Department of Economics and Finance, School of Business, Manhattan College, Riverdale, NY 10471 1998 – 2003 Associate Professor, Department of Economics, George Mason University, Fairfax, VA 22030 (tenured Fall 2000) 2003 –07 Professor, Department of Economics, George Mason University, Fairfax, VA 22030 2007 – University Professor, George Mason University 2011 – Affiliate Faculty, Department of Philosophy, George Mason University FIELDS OF INTEREST -
ROGER W. GARRISON Curriculum Vitae (Fall 2011)
ROGER W. GARRISON Curriculum Vitae (Fall 2011) BUSINESS ADDRESS AND PHONE: HOME ADDRESS AND PHONE: Department of Economics 2017 Country Squire Road Auburn University Auburn, AL 36830 Auburn, AL 36849 (334) 826-7416 (334) 844-2920 FAX: (334) 844-4615 PERSONAL DATA: Email: [email protected] Married: Karen Lynn (Harrison) Website: http://www.auburn.edu/~garriro One child: James Eric (1991) DEGREES: Ph. D. 1981 Economics University of Virginia M.A. 1974 Economics University of Missouri at Kansas City B.S. 1967 Electrical Engineering University of Missouri at Rolla FIELDS OF RESEARCH: Major Fields: Macroeconomics, Monetary Theory Minor Fields: Capital and Interest, History of Economic Thought PERMANENT ACADEMIC POSITION: Department of Economics September 1996 - Professor Auburn University September 1988 - September 1996 Associate Professor Auburn, Alabama September 1981 - September 1988 Assistant Professor September 1978 - December 1980 Instructor VISITING ACADEMIC POSITIONS: London School of Economics May/June 2003 First Visiting Hayek Fellow (Suntory London, England and Toyota International Centers for Economics and Related Disciplines) Department of Economics January-May 1981 Adjunct Assistant Professor New York University and Post-Doctoral Fellow NON-ACADEMIC POSITIONS AND MILITARY SERVICE: July 1973 - December 1974 Research Associate, Department of Bank Supervision and Structure, Federal Reserve Bank of Kansas City, Kansas City, Mo. April 1967 - April 1971 Commissioned Service (Captain), United States Air Force Rome Air Development Center, Griffiss AFB, Rome, New York. ROGER W. GARRISON PAGE 2 COURSES TAUGHT: TEACHING HONORS: Principles of Macroeconomics (mass lectures) 1988: Named Mortar Board Favorite Principles of Microeconomics (mass lectures) Professor Economics and Society Money and Banking 1989: Inducted into Omicron Delta Kappa History of Economic Thought Intermediate Macroeconomics 1997: Delivered Ludwig Lachmann Business Conditions Analysis (MBA program) Memorial Lecture (Johannesburg, Macroeconomics I (Ph.D. -
The Regulatory Roots of Inequality in America
Steven K. Vogel, University of California, Berkeley* The Regulatory Roots of Inequality in America Abstract: Why has US income inequality surged to unprecedented heights since the 1970s? The rise in inequality was not simply the natural result of differential rates of return but was powerfully driven by politics and policy. This article explores the underlying mechanisms with a focus on market governance, including corporate governance, financial regulation, labor relations, antitrust, sector- specific regulation, and intellectual property rights. Firms and individuals actively shaped market governance in their own favor and then took advantage of that favorable governance in the marketplace. This “inequality snowball” was particularly pronounced in the United States because firms were more aggressive in their business and political strategies and because the political system delivered more winner-take-all policy outcomes than the more consensual political systems of continental Europe and Japan. Keywords: Inequality, regulation, deregulation, market governance, market power, firm preferences, corporate governance I. The Marketcraft of Inequality The basic facts are now familiar: economic inequality has risen substantially since the 1970s in most industrial countries, and particularly sharply in the United States. The US surge is unprecedented in that it is driven more by inequality of wage income than by inequality of capital income (Piketty 2014, 374–81).1 This severe inequality denies ordinary workers the fruits of their labor, constrains economic opportunities, impedes economic growth, and compromises the legitimacy of the political and economic systems (Atkinson 2015, 9–14; Boushey 2019, 194–5). US labor productivity has continued to rise over this period, but most people have not benefited from higher wages or a better standard of living. -
Measuring Regulatory Performance
Measuring Regulatory Performance THE ECONOMIC IMPACT OF REGULATORY POLICY: A LITERATURE REVIEW OF QUANTITATIVE EVIDENCE By David Parker and Colin Kirkpatrick Expert Paper No. 3, August 2012 THE ECONOMIC IMPACT OF REGULATORY POLICY: A LITERATURE REVIEW OF QUANTITATIVE EVIDENCE This study provides a critical literature review of the theory and quantitative evidence of the impact of regulatory policy. The theory is addressed through a causal chain analysis which connects regulatory policy through the “better regulation” agenda to economic outcomes. The literature review is intended to provide a reasonably representative sample of studies on regulatory policy and governance in general; administrative simplification and reducing regulatory burdens; ex ante and ex post analyses of regulations; consultation, transparency and accountability; and regulatory institutions. The main policy lessons are highlighted, alongside discussion of the limitations of the literature in terms of content and coverage. © OECD (2012). All rights reserved. 3 FOREWORD OECD countries require better information about where investments in programs to improve regulations should be focused to pay growth and welfare dividends. This is necessary to target scarce resources for reform efforts, and also to communicate progress and generate the political support needed for implementing regulatory policy reforms. The OECD work on Measuring Regulatory Performance is intended to assist countries with the task of identifying this information through the development of measurement frameworks and the collection and interpretation of salient data (www.oecd.org/regreform/measuringperformance). The OECD is developing a framework for Regulatory Policy Evaluation to help countries evaluate the design and implementation of their regulatory policy against the achievement of strategic regulatory objectives (OECD, forthcoming). -
Anarchism and Austrian Economics
View metadata, citation and similar papers at core.ac.uk brought to you by CORE provided by Munich Personal RePEc Archive MPRA Munich Personal RePEc Archive Anarchism and Austrian economics Peter Boettke George Mason University 2011 Online at https://mpra.ub.uni-muenchen.de/33069/ MPRA Paper No. 33069, posted 30. August 2011 16:16 UTC Anarchism and Austrian Economics Peter Boettke I. Introduction It is a great honor for me to give the Cuhel Memorial Lecture at the Prague Conference on Political Economy for 2011. Franz Cuhel rightly holds an honored place in the development of the pure theory of the Austrian school of economics.1 Ludwig von Mises credits Cuhel (1907) with providing the first presentation of a strict ordinal marginal utility analysis. The confusion in choice theory that eventually lead to the purging of the human element in the economic analysis of decision making would have been avoided had Cuhel’s ordinal presentation of marginal utility analysis been more widely accepted. Instead, it was for Mises (1949) and later Rothbard (1962b) to develop that presentation and offer it as an alternative to the neoclassical theory of microeconomics that developed after John Hicks’ (1939) Value and Capital. The implications, I would argue, are far greater than the technical issues of ordinal versus cardinal utility and the subsequent debate among ordinal utility theorists of marginal utility analysis and demonstrated preference versus marginal rates of substitution and indifference curve analysis, etc. The implications of the debate in choice theory go to core of how we view the individual that we study in economics.2 The University Professor of Economics at George Mason University, and BB&T Professor for the Study of Capitalism at the Mercatus Center. -
Centre for Law, Economics and Society Research Paper Series: 1/2019
Centre for Law, Economics and Society Research Paper Series: 1/2019 Are Economists Kings? Economic Evidence and Discretionary Assessments at the UK Utility Regulatory Agencies Despoina Mantzari Centre for Law, Economics and Society CLES Faculty of Laws, UCL Director: Professor Ioannis Lianos CLES Research Paper Series 1/2019 Are Economists Kings? Economic Evidence and Discretionary Assessments at the UK Utility Regulatory Agencies Despoina Mantzari June 2019 Centre for Law, Economics and Society (CLES) Faculty of Laws, UCL London, WC1H 0EG The CLES Research Paper Series can be found at www.ucl.ac.uk/cles/research-papers Pre-published version of: Despoina Mantzari, ‘Are Economists Kings? Economic Evidence and Discretionary Assessments at the UK Utility Regulatory Agencies’, Journal of Antitrust Enforcement, DOI: 10.1093/jaenfo/jnaa007 All rights reserved. No part of this paper may be reproduced in any form without permission of the author ISBN 978-1-910801-25-3 © Despoina Mantzari 2019 Centre for Law, Economics and Society Faculty of Laws, UCL London, WC1H 0EG United Kingdom ARE ECONOMISTS KINGS? ECONOMIC EVIDENCE AND DISCRETIONARY ASSESSMENTS AT THE UK UTILITY REGULATORY AGENCIES Despoina Mantzari* * Lecturer in Competition Law and Policy, University College London, Faculty of Laws. Email: [email protected]. I thank Ioannis Lianos, Diamond Ashiagbor, Stephen Littlechild, Andriani Kalintiri, Maria Ioannidou, the two anonymous reviewers, as well as participants at the IALS 2018 Lunchtime seminar series, the UCL Laws 2019 Lunchtime Research Seminars, the Annual Meeting of Law and Society 2018, the UK IVR conference 2017 (where an early draft of this paper received the ‘best early career paper prize’) as well as stakeholders of the Essential Services Access Network (ESAN) and policymakers at UK Office for Gas and Electricity Markets (Ofgem) for helpful comments and discussions on earlier versions of this paper. -
1 an Austrian Approach to Law and Economics, with Special Reference
1 An Austrian approach to law and economics, with special reference to superstition* Peter T. Leeson Abstract This paper has two purposes. First, it considers what the components of an “Austrian” law and economics might consist of. I argue that Ronald Coase’s conception of law and economics precludes the economic analysis of legal institutions and, in particular, the beliefs that support them. In doing so, Coase’s conception precludes an Austrian law and economics. In contrast, Richard Posner’s conception of law and economics makes such analysis the core of its study. In doing so, Posner’s conception provides a productive foundation for an Austrian law and economics. Second, to illustrate what some aspects of an Austrian law and economics might look like in practice, I consider several examples of the economic analysis of beliefs of import for the law. I focus on objectively false beliefs, or superstitions, and argue that some such beliefs are socially productive. JEL codes: B53, D8, K00, K49, Z12 Keywords: Austrian-Chicago synthesis, law and economics; Coase; Posner; superstition; beliefs; economic analysis of law * Email: [email protected]. Address: Department of Economics, George Mason University, MS 3G4, Fairfax, VA 22030, USA. I thank Pete Boettke and Chris Coyne for helpful comments and discussion. I also thank the Mercatus Center at George Mason University for financial support. 2 1 Introduction A hallmark of the Austrian approach to economic science is its emphasis on individuals’ beliefs.1 This emphasis derives from the importance the Austrian approach attaches to subjectivism. According to that approach, to understand observed patterns of human decision making and its results, you must understand the “meanings” humans attach to their actions and the problem situations they confront. -
Pirates and the Uses of History
© ephemera 2010 reviews ISSN 1473-2866 ephemera www.ephemeraweb.org theory & politics in organization volume 10(2): 194-198 Pirates and the uses of history Martin Parker review of: Gabriel Kuhn (2010) Life under the Jolly Roger: Reflections on golden age piracy. Oakland, CA: PM Press. (PB: pp. 272, $20.00, ISBN: 9781604860528) Peter T. Leeson (2009) The invisible hook: The hidden economics of pirates. Princeton, NJ: Princeton University Press. (PB: pp. 288, £11.95, ISBN: 9780691150093) When research, teaching and writing about history is being done, it is usually justified with reference to the problem of induction. Though induction is called a ‘logic’, it is really a guess about probability. If the sun has risen every day for all of my life, then it will probably rise tomorrow. There is no necessary reason implied here, no deduction from principles, simply a guess based on spotting a pattern and then predicting it into the future. So the largely descriptive practice of history becomes articulated as a search for patterns which trail from then to then, from the crow’s nest of now. Not always, because it could be justified as a literary or cultural practice which is being done for its own sake, or for commercial reasons of selling books and TV series, but when a loftier reason is called for it would usually be about ‘learning’ from history. If you don’t know your past, you are doomed to repeat it. How can we know where we are going if we don’t know where we’ve been? In theory then, when it comes to wars, revolutions or financial collapses, we can go back and look at what happened and use it to shape our actions now with the benefit of hindsight.