This paper analyzes a one-commodity model in which alternative investment projects are characterized by return functions indicating the output intensities over time resulting from an initial unit investment. Saving is generated partly by households as a constant fraction of net income, and partly by business firms in accordance with a depreciation (or replacement) policy. It is shown that when a declining value depreciation policy is adopted, the ordering of consumption streams in terms of their present values, at any fixed interest rate for which these converge, induces an ordering of investment projects in terms of their internal rates of return. The same ordering of projects is also induced by applying the overtaking criterion to the consumption streams.

PAYROLL AND PROGRESSIVE INCOME taxes play an enormous role in the American fiscal system. It is therefore of some importance to know the extent to which they influence work incentives. The purpose of this study is to present some econometric evidence on the effects of taxes on married women, a group of growing importance in the American labor force.2 A testable model of labor supply is developed which permits statistical estimation of a coefficient of tax perception. Unlike previous models of labor supply, it allows for the possibility that the wage may depend on the number of hours worked. Contrary to much of the literature, the results of this paper strongly suggest that marginal tax rates do have an important impact on labor force behavior. This section reviews briefly the past thought on this problem. Section 2 develops a model to explain work decisions when an individual faces a whole set of wagehour combinations, rather than a given wage independent of the number of hours he works. In Section 3 this model is modified to permit an explicit test of whether or not taxes affect individuals' labor supply decisions. Estimation problems are discussed at length, and the empirical results are presented. A concluding section contains a summary and suggestions for future research.

[One should be very careful in using the "non-informative" priors suggested in the Bayesian econometric literature for the covariance matrix of residuals in simultaneous equations models. To highlight the inadequacies of the prior, this paper shows that the prior leads to sharp posterior distributions even in under identified models. Similar problems also arise with the 2SLS method, but one can apply tests for underidentification. Something similar has to be done in the Bayesian context.]

[Observations are made on the sources of cross-equation constraints and the ways they can be used as identification aids, on possible simplifying transformations of linear homogeneous cross-equation constraints, on a rank condition for identification of a block of equations under such linear constraints, and on a strategy for using these constraints for single-equation identification.]

The paper compares the power functions of the conventional tests of significance based on asymptotic theory with those of some alternative tests suggested by Dhrymes and Richardson and Rohr and also a test that was suggested earlier by Anderson and Rubin in a simple two equation model by means of Monte Carlo experiments.

[Assuming each assignment of strong preference orderings to individuals is equally likely, we examine how the probability of social intransitivity (under asimple majority vote decision rule) changes with changes in the number of alternatives and the number of voters. A similar study is made of violation of quasi-transitivity and failure of existence of a maximal alternative.]