Knowledge that Transforms

Efficiency in the Use of Technology in Economic Education: Some Preliminary Results by Kim Sosin, Betty J. Lecha, Rajshree Agarwal, Robin L. Bartlett and Joseph I. Daniel. Published in volume 94, issue 2, pages 253-258 of American Economic Review, May 2004

Vertical Relationships and Competition in Retail Gasoline Markets: Empirical Evidence from Contract Changes in Southern California by Justine S. Hastings. Published in volume 94, issue 1, pages 317-328 of American Economic Review, March 2004

Economists have invested a great deal of effort in trying to understand the motivation for family transfers, yet recent empirical work testing the seemingly appealing models of altruism and exchange has led to decidedly mixed results. A major stumbling block has been the lack of adequate data. We take a fresh look at the issue using responses to an innovative survey question that directly asks mother about the planned division of their estates. We find that both altruism and exchange are frequently offered as explanations of behavior and are of nearly equal importance. Furthermore, the explanations are consistent with observable characteristics of the mother, lending support to the validity of the question. We also find that among step or adopted families, genetic ties play an important role. Because motivating factors appear to differ across families the lack of a consensus among previous researchers about motives ought not to be surprising.

Teacher quality is widely believed to be important for education, despite little ev-idence that teachers ’ credentials matter for student achievement. To accurately measure variation in achievement due to teachers ’ characteristics–both observ-able and unobservable–it is essential to identify teacher fixed effects. Unlike previous studies, I use panel data to estimate teacher fixed effects while control-ling for fixed student characteristics and classroom specific variables. I find large and statistically significant differences among teachers: a one standard deviation increase in teacher quality raises reading and math test scores by approximately.20 and.24 standard deviations, respectively, on a nationally standardized scale. In addition, teaching experience has statistically significant positive effects on reading test scores, controlling for fixed teacher quality.

This paper presents new evidence on how corporate payout policy responds to the differential between the tax burden on dividend income and that on accruing capital gains. It describes the construction of weighted average marginal tax rate series for the period since 1929, and it suggests that the enactment of the Job Growth of Taxpayer Relief Reconciliation Act of 2003 should raise the after-tax value of dividends relative to capital gains by more than five percentage points. The impact of this change on payout depends on the elasticity of dividend payments with respect to the after-tax value of dividend income relative to capital gains. Time series estimates suggest an elasticity of more than three, and imply that the recent tax reform could ultimately increase dividends by almost twenty percent.

The present article is an attempt to resolve the controversies concerning the concept of barriers to entry. We begin by contrasting the definitions of an entry barrier proposed in the economics literature. We then introduce a classification system to clear up the existing confusion, and we employ it to assess the nature of the barriers posed by scale economies and sunk costs.

Reforming Social Security to restore its financial balance is one of the most important public policy issues of the 21st century. Reform is essential whether one favors maintaining the basic structure of the current system or transforming this retirement program to include individual accounts. The needed national debate on Social Security must be based on the best, unbiased measures of the financial status of the program and on appropriate economic research. Unfortunately, projections, data, and research are often misused in reform debates. Even some “experts” are often uninformed about various aspects of the current and future financial status of Social Security. This paper highlights misconceptions and focuses on the facts of Social Security financing.

The role of technology in the transition from premodem, Malthusian to modem economies in late 18thand 19th-century Europe is among the major questions in economic history, but it is still poorly understood. In particular, the view that premodern societies experienced low labor productivity and stagnant living standards, and that technological change before ca. 1800 was close to zero due to pervasive guild rent-seeking and poorly specified property rights to knowledge (Douglass C. North, 1981; Joel Mokyr, 2002), is hard to square with the fact that the surge of technological innovation in the 18th century occurred within institutional frameworks not too dissimilar to those of 1300.

Institutional Strategies to Achieve Gender Equity in Intercollegiate Athletics: Does Title IX Harm Male Athletes? by Deborah J. Anderson and John J. Cheslock. Published in volume 94, issue 2, pages 307-311 of American Economic Review, May 2004

The Productivity of Physician Specialization: Evidence from the Medicare Program by Katherine Baicker and Amitabh Chandra. Published in volume 94, issue 2, pages 357-361 of American Economic Review, May 2004