Knowledge that Transforms

Journal Article Accepted Manuscripts Get access The Quarterly Journal of Economics, Volume 101, Issue 3, August 1986, Pages 659–661, https://doi.org/10.1093/qje/101.3.659 Published: 01 August 1986

Accepted Manuscripts The Quarterly Journal of Economics, Volume 101, Issue 1, February 1986, Page 209, https://doi.org/10.1093/qje/101.1.209 Published: 01 February 1986

We reexamine the expectations theory of the term structure using data at the short end of the maturity spectrum. We find that prior to the founding of the Federal Reserve System in 1915, the spread between long rates and short rates has substantial predictive power for the path of interest rates; after 1915, however, the spread contains much less predictive power. We then show that the short rate is approximately a random walk after the founding of the Fed but not before. This latter fact, coupled with even slight variation in the term premium, can explain the observed change in 1915 in the performance of the expectations theory. We suggest that the random walk character of the short rate may be attributable to the Federal Reserve's commitment to stabilizing interest rates.

Journal Article Potential Pareto Optimality of Risky Projects Get access Brendan O'Flaherty Brendan O'Flaherty Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 101, Issue 3, August 1986, Pages 647–651, https://doi.org/10.2307/1885704 Published: 01 August 1986

Journal Article Raw Materials, Profits, and the Productivity Slowdown: A Complementary Note Get access Michael Bruno Michael Bruno The Hebrew University of Jerusalem Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 101, Issue 1, February 1986, Pages 197–200, https://doi.org/10.2307/1884649 Published: 01 February 1986

In this paper we provide an integrative treatment of the welfare effects of trade and industrial policy under oligopoly, and characterize qualitatively the form that optimal intervention takes under a variety of assumptions about the number of firms, their conjectures about the response of their rivals to their actions, the substitutability of their productsand the markets in which they are sold. We find that when no domestic consumption occurs optimal policy under duopoly with a single home firm depends on the difference between firms' actual responses to their rivals and the response that their rivals' conjecture. If conjectures are consistent , free trade is optimal. A tax or subsidy is indicated depending on the sign of the difference between the conjectured and the actual reponse.With more than one home firm but still no domestic consumption, an export tax is indicated if conjectures are consistent. Production subsidies and export tax-cum-subsidies can raise national welfare in the presence of domestic consumption, because these policies can mitigate the extent of the consumption distortion implicit in the deviation of price from marginal cost.

Journal Article Raw Materials, Profits, and the Productivity Slowdown: Some Doubts Get access David Grubb David Grubb London School of Economics Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 101, Issue 1, February 1986, Pages 175–184, https://doi.org/10.2307/1884647 Published: 01 February 1986