Atlantic Economic Journal articles from December 1994

Atlantic Economic Journal archives from December 1994

Optimal choice of monetary policy instruments when policymaking is costly.
December 1, 1994... I. Introduction Perhaps the most influential analysis of monetary policy rules was that provided by Poole [1970]. By the beginning of the 1980s, numerous authors had extended the Poole analysis to rational expectations settings and to other...

Capital adjustment costs, time-to-build effects, and inflation nonneutrality.
December 1, 1994... The influence of adjustment costs on a firm's decision to borrow and invest has received considerable theoretical and empirical support in microeconomic literature [Holt et al., 1960; Lucas, 1967; Gould, 1968; Abel, 1979; Galeotti, 1987; Hayashi,...

Seasonal money movements and the January effect.
December 1, 1994... I. Introduction The unusual stock prices during January remain a puzzle even after extensive study [Rozeff and Kinney, 1976; Thaler, 1987]. It is frequently suggested that tax considerations lead investors to sell losing stock positions in...

A CGE analysis of the impact of trade liberalization between the U.S. and Mexico. (computable general equilibrium)(includes appendix)
December 1, 1994... I. Introduction The idea of the U.S. and Mexico entering into a free trade agreement evolved from a distant goal to a reality in a relatively short time. Less than seven years ago, Mexico was mired in debt and committed to a highly...

A comparison of ad valorem and per unit taxes in regulated monopolies.
December 1, 1994... I. Introduction The comparison of ad valorem and per unit taxes in an unregulated monopoly market was begun nearly a century ago by Wicksell [1896]. In a well known paper, Suits and Musgrave [1953] extended Wicksell's analysis using a more...

Monetary policy in interdependent economies: a game theoretic approach.
December 1, 1994... I. Introduction Due to the work of Hamada [1976], Kydland and Prescott [1977], Barro and Gordon [1983], and Canzoneri and Gray [1985], game theory has now become a standard feature of the international finance-money-macroeconomist's tool kit...

Pigskins and publications: an alternative perspective.
December 1, 1994... Recently, much has been written within the economics literature on the quality of research and instruction at various universities, with implications concerning departmental ranking schemes [Laband, SEJ, 1987]. Related to these efforts is an...

Dynamic restrictions on movement of prices due to homogeneity of demand.
December 1, 1994... Demand of goods is known to be homogeneous of degree zero in prices and income, so that if all prices and income in the economy increase by the same factor, then the demand of goods will remain unchanged. Interestingly, in a case of an efficient...

Product durability choice.
December 1, 1994... Economists differ on whether market structure affects product durability and, consequently, on whether planned obsolescence strategies pay. For example, Swan [AER, 1970] finds market structure does not affect product durability. However, Bulow...

A sufficient condition for buying full insurance against risk.
December 1, 1994... It is now well-known that an expected utility-maximizing risk-averse consumer will completely insure himself against the property loss when the expected profit of the insurance policy is zero (which implies that the probability of loss equals the...

The paradox of thrift with the cebula specification.
December 1, 1994... Recently, Mankiw and Summers [JMCB, November 1986] found that the consumer expenditure is an empirically more successful scale variable in estimating the money demand function than national income is. Accordingly, they further show that policies...

Does the football market believe in the "hot hand"?
December 1, 1994... Recent articles in the American Economic Review [Brown and Sauer, 1993; Camerer, 1989] have explored the implications of "hot" teams for basketball-betting market efficiency. Their failure to earn abnormal returns, however, may have less to do...

A bread-and-putter model.
December 1, 1994... Are golfers who drive the ball the farthest any more (or less) successful than those players who have mastered some other important aspect of the game? In this brief note, five common measures of performance are employed to explain variations in...

Predation or price leadership: application of the Joskow-Klevorick rule.
December 1, 1994... A leading debate in antitrust is determining those business practices that are illegal. Areeda and Turner [Harvard Law Review, 1975] have defined predatory pricing as selling at a price less than average variable cost. Joskow and Klevorick [Yale...

Incentives and privatization: an experimental approach.
December 1, 1994... During the spring 1991 semester, the author developed an experimental economics approach to illustrate the role of ownership and incentives. The students learned about problems of reforms in the former Soviet Union and some of the incentives in a...

Impact of taxation on extraction of exhaustible resources.
December 1, 1994... The impact of taxes on exhaustible resource extraction has been examined recently in Gamponia and Mendelsohn [Q.J.E., 1985], Slade [Land Econ., 1984, Can. J. Econ. 1986], Gaudet and Lasserre [J. Pub. Econ., 1986], Yucel [J. Env. Econ & Mgmnt.,...