Network Neutrality or Internet Innovation?

Over the past two decades, the Internet has undergone an extensive re-ordering of its topology that has resulted in increased variation in the price and quality of its services. Innovations such as private peering, multihoming, secondary peering, server farms, and content delivery networks have caused the Internet’s traditionally hierarchical architecture to be replaced by one that is more heterogeneous. Relatedly, network providers have begun to employ an increasingly varied array of business arrangements and pricing. This variation has been interpreted by some as network providers attempting to promote their self interest at the expense of the public. In fact, these changes reflect network providers’ attempts to reduce cost, manage congestion, and maintain quality of service. Current policy proposals to constrain this variation risk harming these beneficial developments.

Charging up a mountain of debt: households and their credit cards.

I use the Surveys of Consumer Finances conducted in 1983, 1989 and 1992 to separate the growth of credit card debt into two categories, changes in the number of households with credit cards and changes in households credit card debt. I can then account for the relative contributions of increases in credit card availability, number of households, and average credit card debt. I also use the household income information to quantify the impact of more lower income households with credit cards. Data suggest that the increases in credit card debt is largely attributable to increased average credit card debt of households, not from more households with access to credit cards. Moreover, households in the top half of the income distribution accounted for most of the changes in the growth of credit card debt although lower income households increased their access to credit cards at a faster rate than households in general, and increased their average debt faster than the population.Debt ; Credit cards

The baby boom and international capital flows

This paper presents a model of economic growth based on the life-cycle hypothesis to determine the path of international capital flows as the baby boom passes through the U.S. economy. The model predicts that a baby boom causes a temporary increase in capital flow into the U.S. but the increase in capital is not sufficient to maintain the capital-labor ratio in the U.S. The baby boom increases saving in the U.S. but decreases the saving abroad due to the higher world interest rates.Economic conditions - United States ; International finance

The baby boom and economic growth

This paper presents a model of economic growth based on the life-cycle hypothesis to determine the path of capital accumulation and economic growth as the baby boom passes through the U.S. economy. The model predicts that a baby boom causes a temporary decline of the capital-labor ratio. The temporary drop of the capital-labor ratio requires a decrease in consumption per capita but as the baby boom generation nears retirement, capital intensity increases, which raises output per worker and per capita consumption. Furthermore, and perhaps counter intuitively, the model predicts that the saving rate of the economy falls during the period of increasing consumer welfare. These results suggest that consumer welfare may increase as the baby boom generation begins to retire near the turn of the century. Thus the retirement of the baby boom generation need not necessarily be a cause of concern.Demography ; Population

The Convergence of Broadcasting and Telephony: Legal and Regulatory Implications

This article, written for the inaugural issue of a new journal, analyzes the extent to which the convergence of broadcasting and telephony induced by the digitization of communications technologies is forcing policymakers to rethink their basic approach to regulating these industries. Now that voice and video are becoming available through every transmission technology, policymakers can no longer define the scope of regulatory obligations in terms of the mode of transmission. In addition, jurisdictions that employ separate agencies to regulate broadcasting and telephony must reform their institutional structures to bring both within the ambit of a single regulatory agency. The emergence of intermodal competition will also place pressure on both telephone-style regulation, which protects against monopoly pricing and vertical exclusion, as well as broadcast-style regulation, which focuses on content and ownership structure. It will also force regulators to rethink social policies such as universal service and public broadcasting. At the same time, it is possible that convergence will be incomplete and that end users will maintain more than one network connection, which would reduce the danger of anticompetitive activity and allow policymakers to stop short of forcing every connection to be everything to everyone. Lastly, the increase in traffic volumes associated with the advent of Internet video may require the deployment of multicast protocols, content delivery networks, and more aggressive traffic management, all of which potentially implicate the debate over network neutrality currently taking place in the U.S. This article was published in Communications & Convergence Review 2009, vol. 1, no. 1, pp. 44-55.

Charging up a mountain of debt: accounting for the growth of credit card debt

Total U.S. credit card debt has almost doubled since 1988. Little is apparent from the aggregate data, however, about the composition of credit card debt growth. In this article, Peter S. Yoo separates household data into two categories: changes in the number of households with credit cards, and changes in average credit card debt for increased total credit card debt. Moreover, he finds that the principal contributors to the increase are households with above-average incomes rather than low-income households.Debt ; Credit cards

The tax man cometh: consumer spending and tax payments

Consumer behavior ; Taxation

Age dependent portfolio selection

This paper addresses the issue of portfolio risk exposure as a function of age, and it focuses the debate by presenting detailed cross-sectional evidence about individual portfolios. It provides new empirical results that characterized the relationship between age and the risk exposure of individual portfolios. The evidence from cross-sectional data suggests that individuals do not follow behavior proscribed by economic theory or by Wall Street advisors, rather the results of this paper suggest that current body of theoretical literature does not adequately describe the behavior of individuals. It implies that a satisfactory model ofindividual behavior needs to focus on factors not linearly correlated with age.Demography ; Saving and investment

The FOMC in 1997: a real conundrum

Although the economic performance of the U.S. economy in 1997 was very good, it was troubling in at least one respect for the Federal Open Market Committee. Traditional signals of inflation - rapid money growth and high levels of economic activity - were not accompanied by higher inflation. Rather, inflation fell steadily throughout the year. The committee put forth several hypotheses for the subdued inflation but found the situation puzzling, nevertheless. Compounding the problem, members did not know how long such dampening factors might last. In the end the FOMC changed the intended federal funds target once and searched anxiously for the answers to the conundrum it faced in 1997.Federal Open Market Committee