A well-established feature of the labor market is that an inverse relation exists between the unemployment rate (u) and the vacancy rate (v). Hansen (1970) provides a clear exposition of the theoretical model that implies that the u-v relation will be negatively sloped and convex to the origin. The usefulness of the relation is that it provides a means of distinguishing between changes in deficient demand unemployment (indicated by movements along the curve) and changes in nondeficient demand unemployment (indicated by a shift of the curve). In the United States, Great Britain and Canada there has been an upward shift of the u-v relation since the mid-sixties, although the timing and the magnitude of the shifts have varied considerably.' As figure 1 illus-

A substantial portion of the research in input-output analysis has been concerned with attempts to estimate more efficiently the structural parameters. As the coefficients have generally been estimated by nonstochastic techniques, efficiency in this context has implied acceptable estimates at reduced cost. It is possible to distinguish at least two directions of effort. One group of analysts has sought to develop and standardize sampling techniques that would bring the cost of estimating these models within reasonable limits (cf. Miernyk, 1970; Isard and Langford, 1971). Another group has concentrated their effort on non-survey and partial survey techniques-the most widely discussed in recent years being the RAS method developed in the Department of Applied Economics at Cambridge (cf. Bacharach, 1970) and applied for the first time at the regional level by Czamanski and Malizia (1969). In an article in this REVIEW, Gerking (1976a) has argued that acceptable coefficients can be estimated using standard regression techniques. Gerking recognizes the stochastic nature of sample estimates required for the construction of input-output models, and it is argued that a rigorous examination of the value of input-output coefficients is only possible in this context. Elsewhere (Gerking, 1976b; 1976c), he has applied similar methods to the problem of sample size selection and the problem of reconciling row and column coefficients in an input-output context. It is the purpose of this note to demonstrate that the application of stochastic techniques to the estimation of regional input-output coefficients encounters difficulties that must be recognized before more serious work is done in this area. Specifically, we will argue that (1) the nature of the distribution of stochastic disturbances has not been adequately explored, (2) the unique nature of regional input-output models makes application of stochastic techniques particularly difficult, if not impossible, (3) the estimator of major interest in Gerking's article produces parameter values that are not constrained to satisfy both input-output identities, and further, that empirical application of this estimator fails because the associated finitesample distribution does not possess moments.

Bailey, Martin J., Gains and Income Taxation, in A. C. Harberger and M. J. Bailey (eds.), Taxation of Income from Capital (Washington, D.C.: Brookings Institution, 1969), 11-49. Diamond, P. A., Inflation and the Comprehensive Tax Base, Journal of Public Economics 4 (1975), 227244. Feldstein, Martin S., and Amy Taylor, The Income Tax and Charitable Contributions: Estimates and Simulations with the Treasury Tax File, Econometrica 44 (Nov. 1976), 1201-1223. Feldstein, Martin S., and Shlomo Yitzhaki, The Effect of the Capital Gains Tax on the Selling and Switching of Common Stock, Journal of Public Economics 9 (1978), 17-36. Hinrichs, Harley H., Unreporting of Capital Gains on Tax Returns or How to Succeed in Gainsmanship without Actually Paying Taxes, National Tax Journal 17 (June 1964), 158-163. Holt, Charles C., and John P. Shelton, The Lock-in Effect of the Capital Gains Tax, National Tax Journal 15 (Dec. 1962), 337-352, Internal Revenue Service, Sales of Capital Assets Reported on Individual Tax Returns, supplemental report of Statistics of Income, Washington, D.C., 1962.

QINCE the 1930s an unresolved controversy among economists has centered around the connection between market power and fluctuations. After presenting some theoretical arguments relating to this controversy and briefly examining a few previous studies, this paper will address the empirical question of the link between market structure and the stability of employment. By controlling for differences in worker characteristics, the effects of industry variables on instability will be revealed. A few secondary, yet interesting, aspects of this study deserve mention at this point. Data on individual workers, from the University of Michigan's Panel Study of Income Dynamics, will be combined with industry data. Not only will these individual data control for worker differences across industries; they will also permit an examination of the importance of personal characteristics in determining patterns of employment. Another aspect, to be discussed later, is the ambiguity in the meaning of employment instability, particularly on the micro level. Instead of arbitrarily picking one empirical measure, three alternative measures are proposed and used in the empirical work; this allows for a more complete analysis of the effects of both personal and industry variables on the individual's experience. Section II presents a discussion of possible theoretical links between market power and employment. A few previous empirical studies are described in section III. The empirical model used in this study will be described in section IV, including a description of the data sources and variable definitions. The results are presented in section V, and some concluding remarks are given in section VI.