The Bush-Obama Stimulus Programs and the Future of American Capitalism

This paper discusses the implications of the measures that the U.S. Federal Government has taken in response to the recent financial crisis. It focuses on the Federal Reserve, the Troubled Asset Relief Program, the Obama stimulus package, and the bailouts of various industries by the Federal Government. This paper argues that these policies undermine the fundamental incentives of the market economy, but what we can learn from these policies to avoid similar negative consequences in the future

The Linkage Between Public and Private Investment: A Co-integration Analysis of a Panel of Developing Countries

This study uses panel data from 19 developing countries from 1980 to 1997 to examine the impact of public investment on private investment. A model is developed to identify both the short run and long-run effects of public investment on private investment, builds in the role of uncertainty on investment, and uses co-integration tests on panel data to check the time series properties of the data. The empirical results show that public investment is complementary to private investment in developing economies, and that credit constraints restrict the amount of private investment.

Institutional quality and the wealth of autocrats

One frequently given explanation for why autocrats maintain corrupt and inefficient institutions is that the autocrats benefit personally even though the citizens of their countries are worse off. The empirical evidence does not support this hypothesis. Autocrats in countries with low-quality institutions do tend to be wealthy, but typically, they were wealthy before they assumed power. A plausible explanation, consistent with the data, is that wealthy individuals in countries with inefficient and corrupt institutions face the threat of having their wealth appropriated by government, so have the incentive to use some of their wealth to seek political power to protect the rest of their wealth from confiscation. While autocrats may use government institutions to increase their wealth, autocrats in countries with low-quality institutions tend to be wealthy when they assume power, because wealthy individuals have the incentive to use their wealth to acquire political power to protect themselves from a potentially predatory government

A Method for Identifying General Aviation Airports that are Candidates for Runway Extensions: A Planning Model for State Aviation Systems

One of the most important characteristics of an airport is the length of its longest runway: that length determines the types of aircraft that can use the airport and provides a margin of safety for users. A runway extension, therefore, would enhance the utility of many airports. But resources are scarce, and if funds are to be allocated at the state level, state officials need a method for determining which airports could best use a longer runway. Consideration of demographic factors enhances the traditional engineering analysis approach to runway evaluation. This combined approach is more consistent with the goals of comprehensive airport planning. This paper describes a model that uses regression analysis to compare airports in Alabama, taking into account a number of different demographic factors and airport related factors. A linear regression model was used to evaluate how an airport\u27s runway length compared to others around the state with similar characteristics. The residuals from the regressions were used to identify those airports with relatively short runways, considering their other characteristics. The regression analysis identified 22 of the 106 public-use airports in Alabama as having runways substantially shorter than their other characteristics would predict

Consumption Externalities and Economic Welfare

The distinction between technological and pecuniary externalities, usually made in production, can also be applied to consumption. Technological externalities create resource misallocations while pecuniary externalities do not. Taking a household production approach to consumption, this paper shows that many cases in which there are external effects on people's utility functions are pecuniary externalities, and public policy should ignore them. The economic literature has been inconsistent in its treatment of pecuniary consumption externalities, and this paper provides a framework for analysis in cases where the actions of some people affect the utility of others.Consumption; Economic Welfare; Externalities; Welfare

Specification Search and Levels of Significance in Econometric Models

This paper describes the problem specification searches pose for inference, presents the results of some simulations for purposes of illustration, and uses the bootstrapping procedure to give a better estimate of statistical significance than a standard t-test. The value of the illustrations of specification searches is that they help demonstrate the severity of the problem. The examples presented here illustrate that in most cases, a researcher can undertake specification search and report a statistically significant result regardless of whether the variables in a regression equation are actually related. The bootstrap procedure used to analyze the specification searches does provide another way to examine the true statistical significance of empirical results. Two different specification searches are examined: a "drop insignificant coefficients" search and a "biggest t-ratio" search. Both are shown to lead to larger than reported standard errors. In general, standard errors get larger if a specification search has taken place, but exactly how much larger must be determined on a case-by-case basis.

Constitutions and Democracy

Cet article étudie le rôle des démocraties dans un système constitutionnel et montre comment la démocratie menace les droits et libertés des individus. L’exemple des Etats-Unis illustre l’argument. L’article montré également que les réformes économiques, et non politiques, sont la clé de la prospécrité (mais pas nécessairement de la liberté) ; ce n’est pas la démocratie mais un système dans lequel les droits sont protégés constitutionnellement qui assure la liberté politique et la liberté économique. La démocratie, si elle n’est pas contrôlée, est aussi dangereuse qu’une dictature.The purpose of this paper is to discuss the role of democracy in a system of constitutional law, and to show how democracy threatens rights and freedom, using the case of the United States to illustrate the point. There are some minor and correlated themes : first, economic reforms, not political reforms, are the key to prosperity (although not freedom) ; second, the key to both political and economic freedom is a system of constitutionally protected rights, not democracy. Democracy, unchecked, is as much a threat to freedom as dictatorship