Surya N. Janakiraman, Richard A. Lambert, David F. Larcker, An Empirical Investigation of the Relative Performance Evaluation Hypothesis, Journal of Accounting Research, Vol. 30, No. 1 (Spring, 1992), pp. 53-69

Public expenditure under uncertainty is modeled as the problem of determining the quantities of l public goods and m private goods to be provided to n consumers when the private goods are claims to a single commodity, "dollars," which are contingent upon the occurrence of one of m possible states of nature. A real-valued "net benefit function" is identified, and criteria based upon this function are provided which are both necessary and sufficient for Pareto-improving or Pareto-efficient solutions to this problem.

This paper critically evaluates the scope and content of undergraduate courses on the economic status of women. It responds critics who question whether these courses are too interdisciplinary, too laden with ideology, and too soft qualify as economics courses. It details the content of existing courses and investigates how well they meet the following objectives: (1) familiarize students with the economists' toolbox (supply and demand curves, the concept of constrained optimization, etc.); (2) expose students topics of empirical importance in understanding the status of women and topics that pose particular challenges economic orthodoxy; (3) investigate how considerations of gender may lead a restructuring of research questions and economic models; and (4) stimulate and nurture constructive debate on the determinants of the economic status of women by demanding that assertions be backed by analysis and facts. The first objective is a goal of any undergraduate course in economics: teach students to think like economists (John J. Siegfried et al. 1991 p. 199). The second and third objectives serve differentiate this course from other undergraduate courses in economics and acknowledge its feminist perspective. A standard undergraduate course in labor economics has as its organizing theme the study of decisions and constraints faced by individuals engaged in market work. Gender is one of many factors studied. The organizing theme of a course on gender and the sexual division of labor is the study of decisions and constraints faced by women, in some cases as compared with men. With gender as its primary focus, a course on women in the economy devotes more time nonmarket production than does a standard course in labor economics. The fourth objective is protect against the excesses of political correctness from the right or from the left. Every participant in a course on the sexual division of labor has a financial and emotional stake in the issues covered. This has advantages (it is not difficult generate discussion) and disadvantages (biases, prejudices and self interest can easily permeate the discussion). Demanding that students provide facts and analysis support their assertions minimizes this disadvantage, both in classroom discussions and in term papers. To back up assertions with facts, students must learn how access, read, and interpret data on the economic status of women. Information is drawn from two sources: syllabi collected by the author in the fall of 1990 and syllabi compiled by Barbara Bergmann (1991). Twelve undergraduate courses are represented in the sample.' All but one focus on the economic status of women in the United States, and only two are explicitly interdisciplinary. The typical prerequisite is one introductory course in economics.

This paper argues that the macroeconomically interesting features of inventory behavior are well captured by a model in which firms face only demand uncertainty with a nonnegativity constraint on inventories. Empirical implications of the "stockout-avoidance" model of inventory behavior are derived and then tested on disaggregated automobile industry data. The results largely support the model, though they suggest a small role for production-smoothing as well. Subsidiary evidence on the relative variance of demand and cost shocks suggests that demand shocks are indeed more important.

This paper shows that when unemployed workers lose some of their skills, the effects of a temporary shock to employment can persist for a long time. The key mechanism is a thin market externality that reduces the supply of jobs when the duration of unemployment increases. The paper develops an overlapping-generations model of search equilibrium and shows that different patterns of persistence and multiple equilibria are possible even with constant returns production and matching technologies.

We analyze a sequential decision model in which each decision maker looks at the decisions made by previous decision makers in taking her own decision. This is rational for her because these other decision makers may have some information that is important for her. We then show that the decision rules that are chosen by optimizing individuals will be characterized by herd behavior; i.e., people will be doing what others are doing rather than using their information. We then show that the resulting equilibrium is inefficient.