The Review of Economics and Statistics199375(1), 148
The efficiency of governments may be influenced by institutional factors and by the intensity of monitoring by citizens. This paper develops a theory of optimal monitoring and then uses frontier estimation techniques to construct measures of efficiency f or police departments in 141 cities. Using these efficiency measures, i t is possible to test the extent to which efficiency is influenced by the presence of a professional city manager and by characteristics of th e citizens.
Reviews the book "Implementing Activity-Based Cost Management: Moving From Analysis to Action," by Robin Cooper, Robert S. Kaplan, Lawrence S. Maisel, Eileen Morrissey and Ronald N. Oehn.
[Auditor liability is a growing concern of public accounting firms (Collins 1985; Flynn et al. 1990; Mednick 1987; Minow 1984). In lawsuits brought by clients for breach of contract and tort actions for negligent execution of an audit, as well as in an increasing number of lawsuits brought by third parties, a common defense is the auditor's compliance with generally accepted auditing standards (GAAS). In this study, the source of professional auditing standards was manipulated to examine its influence on jurors' decisions. Four fact patterns were presented to members of jury pools called to jury duty. Prospective jurors responded to a fact pattern by voting in favor of either the plaintiff/client or the defendant/auditor. The fact patterns were manipulated to compare jurors' responses to standards of auditing performance established by the federal government versus those established by the auditing profession. In addition, a comparison was made of jurors' responses to two sets of instructions provided by the judge: either that standards alone set the required level of performance or that standards are only a part of the evidence to be considered in establishing the required level of performance. At trial, a judge's instructions to the jury before its deliberations can be influenced by counsel for the public accounting firm as to the evidentiary weight assigned to professional standards. The results that follow indicate that jurors are more likely to rule against a CPA firm when the profession's standards are offered in defense and less likely to rule against it when government standards of performance are offered in defense. Also, as expected, jurors are more likely to accept standards in defense, whether established by the government or the profession, if the judge identifies the standards as the only criterion for an expected level of performance rather than as only part of the evidence.]
The Review of Economics and Statistics199375(3), 493
This paper offers a direct econometric test of the proposition that U.S. merger activity has occurred in waves. The authors fit a set of sine waves to the annual time-series data on mergers and find that the sine curves generally provide significant explanatory power. The parameters are statistically significant and reasonable in magnitudes, and the implied timing of peaks and troughs in merger activity is close to the actual dates of the peaks and troughs in the data. Thus, this formal test confirms what others have observed impressionistically: the data are consistent with a wave characterization.
This paper investigates the role of induced innovation in the development of American agriculture from 1880 to 1980. The induced innovation hypothesis, most closely associated with the work of Hayami and Ruttan, argues that successful economies develop technologies in accordance with market price signals to loosen constraints on growth imposed by factor scarcities. Our analysis employing new state and regional level data fails to find support for Hayami and Ruttan's hypothesis. This paper suggests that many of the fundamental generalizations about American agricultural development need to be reconsidered and redirects attention to the role of settlement, changing crop patterns, and biological investments in explaining changes in factor utilization in American agriculture.