Working Papers

Small groups face special problems in purchasing health insurance. Among them, small employees are too small to spread the risks of high medical costs, to achieve economies of scale in administration, to manage competition among accountable…

Theory has been formulated that proposes research on the effects of industry variables on individual job mobility. I consider one such proposal — the possibility that the diversity of organizations affects the rate of job moves within and out of…

This paper develops a signaling model of competitive lobbying. Interest groups pay a monetary contribution to gain access and provide information to a policymaker. If their interests are aligned with those of the policymaker’s constituency, they…

This paper studies the cross-border transaction in equity by investors in Canada, Germany, Japan, the U.K. and the U.S. We find that investors from different countries make very different decisions about the allocation of their portfolio across…

This paper examines whether the trading decisions of institutional investors can be explained in part by the effects of taxation on portfolio returns. The trading strategy that maximizes benefits to owners in the absence of taxes on capital gains…

This paper develops a return-based measure of market integration for 19 emerging equity markets. It then examines the relationship between that measure, other return characteristics and investment barriers broadly defined. Although the analysis…

In an economy with uninsured banks, market rate deposits are shown to provide services identical to fixed rate deposits without risking banking panics as long as there is not both aggregate uncertainty about liquidity demands and asymmetric…

An important subfield of physics — Nuclear Physics — deals with the smallest particles of which matter is composed. Constructs developed by Kenneth Arrow (2) and Gerard Debreu (3) provide a similar foundation for financial economics. With a bit…

We analyze a numerical scheme for solving the consumption and investment allocation problem studied in a companion paper by Hindy, Huang, and Zhu (1993). For this problem, Bellman’s equation is a differential inequality involving a second order…

Rather than portray institutions as de jure constraints on behavior that bind in all circumstances, recent formal theories of legislatures have begun to portray institutions more plausibly as de facto constraints on behavior in most circumstances…

We study a model of consumption choice and portfolio allocation that captures, in two different interpretations, the combined effect of durability of consumption goods and habit formation over service flows from those goods. In a third…

We present a new methodology for studying the general problem of labor contracting within a firm’s boundaries where contracts provide only a minimal commitment to wages and employment. Given the peculiar contractual incompleteness of labor…

Returns policies are widely used in the marketing of products and services. That they do much more than provide insurance is, however, not well known. In this paper, we develop a number of other rationales for distributor and consumer returns…

In this paper, we develop a conceptual framework to explore why particular technologies become elaborated and extended, while others are forsaken. The core of the framework is the role-based conception of the technological niche, which is…

This essay presents a sequential choice theory perspective on legislative organization as an alternative to social choice-based theories. Because of the sequential process of proposal-making and voting, sequential choice theory yields equilibrium…

This paper provides perspectives on research on regulation, identifies an agenda of research topics, and discusses approaches to some of those topics. The focus is on a set of presently-identified issues on which social science research may be…

Tax systems around the world are designed to raise revenues in an equitable and efficient manner. While equity and efficiency are defined differently in various tax jurisdictions, most tax systems seek to implement a system of progressive tax…

The gains from exchange hypothesis of legislative organization predicts that legislative authority is allocated in accord with legislator’s extremity or intensity of preferences. By adopting such patterns of authority, it is claimed legislators…

There has been much conceptual discussion of the interfaces between manufacturing and marketing (Hausman and Montgomery, 1985) and manufacturing strategy and tactics (Hayes and Wheelwright, 1984); however there has been a dearth of empirical…

The paper presents a model which attempts to explain the underlying causes of the prolonged cycles observed in real estate markets. In addition, the paper characterizes the features which make some property types more prone to such boom and bust…