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Regulation and Subsidies
A Category Archive (130 entries)
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August 31, 2009
Regulation and Subsidies
Bryan Caplan
Marginal Revolution premiered six years and tens days ago. Alex and Tyler may not have been the very first academic economists to start blogging, but they still got in at the ground floor. I don't know how many people read... MORE
February 2, 2009
Finance: stocks, options, etc.
Arnold Kling
Ed Glaeser writes, Ellickson's analysis suggests that this is just about the worst of all possible policy responses. By drawing out the foreclosure process, these moratoria increase the time during which homes are no-man's-land. During such periods, homes and neighborhoods... MORE
December 7, 2008
Regulation and Subsidies
David Henderson
For decades, I believed, as I think almost everyone who followed the issue did, that the Smothers Brothers Comedy Hour was yanked by CBS because of CBS's objection to the Smothers Brothers' edgy commentary about social issues. Various "public" television... MORE
December 5, 2008
Regulation and Subsidies
David Henderson
On CNBC this morning, Congressman Barney Frank was shown making his opening statement in the hearings on the bailout of GM, Ford, and Chrysler. He actually admitted that Congress had made mistakes and mentioned one such mistake. Perhaps, you might... MORE
September 30, 2008
Regulation and Subsidies
Bryan Caplan
When's the best time to beg for a bail-out? When everyone's talking about another, bigger bail-out, of course! Via James Hamilton:The US Senate Saturday approved 25 billion dollars in loan guarantees for the financially strapped US auto industry... The bill,... MORE
September 15, 2008
Regulation and Subsidies
Arnold Kling
Daniel Klein writes, knowledge has certain public goods properties. But the public-goods point in no way justifies the restrictions we see; it could only justify government subsidization of knowledge production. He is writing about FDA regulation of pharmaceuticals. Think of... MORE
August 20, 2008
Regulation and Subsidies
Arnold Kling
David Leonhardt writes, For three decades now, the American economy has been in what the historian Sean Wilentz calls the Age of Reagan. The government has deregulated industries, opened the economy more to market forces and, above all, cut income... MORE
August 18, 2008
Regulation and Subsidies
Arnold Kling
Stan J. Liebowitz says that the road to mortgage crisis was paved with good intentions. Concerning a Boston Fed study that purported to find mortgage discrimination, he writes, Most politicians jumped to support the study. "This study is definitive," and... MORE
Regulation and Subsidies
Arnold Kling
The Village Voice reports, [Secretary of Housing Andrew] Cuomo's predecessor, Henry Cisneros [moved] the GSEs toward a requirement that 42 percent of their mortgages serve low- and moderate-income families. Cuomo raised that number to 50 percent and dramatically hiked GSE... MORE
August 17, 2008
Regulation and Subsidies
Arnold Kling
Robert H. Frank writes, Adopting some variant of a tax on carbon, as both leading presidential candidates have proposed, would help eliminate this discrepancy. That would set the stage for our next president to explain to other leaders why eliminating... MORE
August 7, 2008
Regulation and Subsidies
Bryan Caplan
When the Lion Rock Institute asked me to sign its petition against possible antitrust laws for Hong Kong, the decision was a no-brainer. After all, I oppose antitrust laws. At best, antitrust laws are unnecessary, legislating outcomes that free competition... MORE
August 1, 2008
Regulation and Subsidies
Arnold Kling
Bob Van Order writes, The 1992 law that set up FF regulation required taking the stress test from the worst regional downturn in the data. We shall surely have a region (the southwest? Florida?) from the current period that will... MORE
July 31, 2008
Regulation and Subsidies
Bryan Caplan
I just got this fund-raising letter from The Nation, alerting me to a dangerous economists' plot to undermine democracy:Dear Nation Friend: I spent 27 years as the Editor in Chief of The Nation, so -- as you might imagine --... MORE
Regulation and Subsidies
Arnold Kling
John Tierney writes, it is the duty of the press to scour the known universe looking for ways to ruin your day. Indeed. David Broder writes, Each year, as the money comes in, the trust fund will distribute it to... MORE
July 30, 2008
Regulation and Subsidies
Arnold Kling
Holman Jenkins writes, So far, Washington has put its political capital into trying to refinance salvageable homes for unsalvageable homeowners, when a relevant policy would consist of judiciously buying unsalvageable houses and demolishing them. Fannie and Freddie's strength is housing... MORE
July 25, 2008
Regulation and Subsidies
Bryan Caplan
Despite vocal opposition from lobbyists for terrestrial radio, it looks like satellite radio providers XM and Sirius will finally get to merge. It only took 17 months, plus some absurd concessions:The deal reportedly will also include a three-year price freeze... MORE
July 24, 2008
Regulation and Subsidies
Arnold Kling
Regarding the Freddie-Fannie bailout, the Republican Presidential nominee writes, if a dime of taxpayer money ends up being directly invested, the management and the board should immediately be replaced, multimillion dollar salaries should be cut, and bonuses and other compensation... MORE
July 22, 2008
Regulation and Subsidies
Arnold Kling
Marc Fisher writes, Montgomery County, the government that brought you bans on trans fats, smoking and any sales of liquor except by the county's own stores, last week added a new kind of regulation, becoming probably the first place in... MORE
July 18, 2008
Regulation and Subsidies
Bryan Caplan
Arnold's just written some of the best sentences I've read in years:In the mortgage market, people saw risk-takers outperforming prudent lenders. So they took more risks. There is no simple fix for that. For the foreseeable future, we can count... MORE
Regulation and Subsidies
Arnold Kling
Vince Reinhart writes, The problem with securitization is that it dilutes individual responsibility. The mortgage broker can easily become disconnected from the outcome of the initial lending decision. Federal regulation is needed to ensure that mortgage originators perform the appropriate... MORE
July 17, 2008
Regulation and Subsidies
Arnold Kling
The Washington Post editorializes, Earlier this year, as clouds were already gathering over the GSEs, Congress raised the limit -- to almost $730,000 in certain high-cost areas -- on the theory that Fannie and Freddie could help unfreeze the housing... MORE
July 2, 2008
Business Economics
Arnold Kling
Mihir A. Desai, Dhammika Dharmapala, and Monica Singhal write, The Low Income Housing Tax Credit (LIHTC) program provides for the majority of new affordable housing units built in the U.S. and has resulted in the production of 1.5 million low-income... MORE
June 27, 2008
Regulation and Subsidies
Arnold Kling
Martin Wolf says, When house prices are going to rise, or people expect them to rise, by 10 or 12 per cent a year, an additional 1 per cent on the interest rate is not going to stop people from... MORE
June 23, 2008
Regulation and Subsidies
Arnold Kling
Paul Krugman writes, Why should ever-increasing homeownership be a policy goal? How many people should own homes, anyway? It's a good question. Some of the subsidies to homeowners, such as the mortgage interest deduction, tend to go to more affluent... MORE
June 10, 2008
Regulation and Subsidies
Arnold Kling
On the one hand, The Washington Post reports, high fuel prices are having disparate effects: the end of free pizza deliveries at major franchises, a plunge in the sales of sport-utility vehicles, a steep drop in the price of houses... MORE
May 22, 2008
Regulation and Subsidies
Arnold Kling
Without irony, the Washington Post headline blares, FTC Wants to Know What Big Brother Knows About You The crime under investigation is targeted advertising on the Internet, where firms use databases to try to serve ads that are relevant to... MORE
May 19, 2008
Regulation and Subsidies
Arnold Kling
Richard Posner and Gary Becker have a rare disagreement. Posner writes, There are three possible responses to the problem created by consumer information costs. The first is to require producers to provide more information; the second is to ban products... MORE
May 14, 2008
Regulation and Subsidies
Arnold Kling
James Hamilton writes, Now, there is nothing inherently wrong in making financial investments in the form of derivative contracts rather than outright loans. You're doing something similar whenever you buy or sell an option rather than the stock itself. But,... MORE
April 17, 2008
Regulation and Subsidies
Arnold Kling
Richard H. Thaler and Cass R. Sunstein write, government would achieve simplified transparency by requiring all lenders to provide borrowers with an electronic file that contains, in standardized form, information on every feature of the contract. Instead of fine print,... MORE
March 7, 2008
Regulation and Subsidies
Arnold Kling
While Martin Feldstein is proposing more government meddling in mortgage markets, George McGovern writes, There's no question, however, that delinquency and default rates are far too high. But some of this is due to bad investment decisions by real-estate speculators.... MORE
February 8, 2008
Regulation and Subsidies
Arnold Kling
Alfred Kahn, the saving grace of the Carter Presidency, writes, The assumption of Democratic control of Congress last year and the probability that its majority will be increased by this year's elections portends a growing, deeply troubling ideological split within... MORE
December 13, 2007
Regulation and Subsidies
Arnold Kling
The New York Times reports, Retail prices, particularly of books, are tightly regulated in France. Using "loss-leaders," or selling products below cost to attract customers, is illegal. Other restrictions apply to books retailers must not offer discounts of more than... MORE
November 25, 2007
Regulation and Subsidies
Arnold Kling
A reader asked me to comment on Robert Shiller's column, where he says, In 1932, the National Association of Real Estate Boards proposed and Congress created the Federal Home Loan Bank System, modeled after the Federal Reserve System. Twelve regional... MORE
September 7, 2007
Regulation and Subsidies
Arnold Kling
A reader sent this question: Your post on Prof. Wagner's piece on market order, especially the institutional nature of the order (differences between taxed orders and illegal orders), made me think about the nature of organization within legally established licensed... MORE
June 29, 2007
Regulation and Subsidies
Bryan Caplan
Price-fixing is no longer per se illegal, at least according to the New York Times. Decades after the big academic debate on resale price maintainence (RPM), five justices are convinced:The court struck down the 96-year-old rule that resale price maintenance... MORE
May 11, 2007
Regulation and Subsidies
Bryan Caplan
Penn and Teller had an interesting episode debunking the Americans With Disabilities Act and related regulations. But even a Non-Bleeding Heart Libertarian like myself spent most of the episode furrowing his brow in puzzlement. Penn and Teller appeared to be... MORE
March 19, 2007
Regulation and Subsidies
Bryan Caplan
Here's a neat passage from Clifford Winston's Government Failure versus Market Failure (complete book available for free downloading): Calfee and Ringold (1994) focused on surveys of consumers’ attitudes toward advertising. Analyzing six decades of data that began in the 1930s,... MORE
February 9, 2007
Regulation and Subsidies
Arnold Kling
In the context of Wal-Mart's joining the crowd that wants government to fix health care, Don Boudreaux reminds us of this quote from Milton Friedman. The two chief enemies of the free society or free enterprise are intellectuals on the... MORE
January 8, 2007
Regulation and Subsidies
Bryan Caplan
Don and Russ continue their Herculean effort to make economics too clear not to understand. The latest gems: Don on protectionist anecdotes: But I wonder how many of these people would accept the following line of argument: Researcher Jones, like... MORE
November 2, 2006
Regulation and Subsidies
Arnold Kling
Aaron S. Edlin and Pinar Karaca Mandic write, This study is an attempt to provide better estimates of the size (and sign) of the aggregate accident externality from driving. To begin, we choose a dependent variable, insurer costs, that is... MORE
October 27, 2006
Energy, Environment, Resources
Arnold Kling
Paul Romer writes, Greg Mankiw correctly points out that the tax in Prop 87 is not a Pigovian tax--that is, a tax on oil for the purpose of reducing oil consumption to socially optimal levels. However, the revenues from Prop... MORE
October 10, 2006
Regulation and Subsidies
Bryan Caplan
I'm mildly surprised to learn that parts of the U.S. government are actually trying to crack down on online gambling. Robin Hanson pointed me here and here. If ever there were a time to sarcastically ask, "Don't you have anything... MORE
September 20, 2006
Regulation and Subsidies
Arnold Kling
Even if the California's lawsuit against auto manufacturers for the damages caused by global warming is, as Steve Verdon says, "a cheap political stunt," it is still shocking. The idea that this could win votes tells you something. And then,... MORE
September 13, 2006
Regulation and Subsidies
Arnold Kling
In the course of putting together a critique of a critique of the 2005 Economic Report of the President, Daniel B. Klein and Michael J. Clark surveyed 11 economists at George Mason University and came up with a top ten... MORE
September 7, 2006
Regulation and Subsidies
Bryan Caplan
Contrary to popular belief, Big Business often supports federal regulation. Economists' standard explanation: Regulation either directly restricts competition, or indirectly imposes a greater burden on smaller businesses. But there is another important reason why Big Business supports federal regulation that... MORE
August 28, 2006
Regulation and Subsidies
Bryan Caplan
Don Boudreaux is continuing Bastiat's noble tradition of teaching economics with ridicule: As my friend George Leef points out in an e-mail to me, if government can lower firms' costs by paying workers' health-insurance premiums, why stop there? Why not... MORE
July 26, 2006
Regulation and Subsidies
Bryan Caplan
There's a lot less economic freedom in my state of origin, California, than in my state of residence, Virginia. According to the Pacific Research Institute's rankings, the state of California comes in 49 out of 50th. Virginia comes in 3rd.... MORE
July 18, 2006
Regulation and Subsidies
Eric Crampton
Russ Sobel warns us that NASCAR safety regulations cause more accidents. It seems that the racing industry is starting to take notice: NASCAR has made significant safety strides since the death of Dale Earnhardt, and many drivers credit recent innovations... MORE
June 13, 2006
Regulation and Subsidies
Arnold Kling
Tim Swanson has a set of links, including one to wise essay by Martin Geddes. Network neutrality makes competition and consumer welfare dependent on law and lobbying, not natural competition. So you’ve chosen the area in which the telcos are... MORE
June 9, 2006
Regulation and Subsidies
Arnold Kling
Greg Mankiw writes, After reading these two pieces [on proposals to force Internet carriers to be "neutral"], I am inclined to give the edge to Litan, in part because his piece is more infused with economic reasoning and in part... MORE
May 22, 2006
Regulation and Subsidies
Bryan Caplan
When I was first teaching Industrial Organization (nearly 10 years ago!), there was a big internet campaign to boycott Borders and Barnes & Noble. "It might superficially seem like consumers are getting more and better choices, but just you wait!"... MORE
March 6, 2006
Regulation and Subsidies
Bryan Caplan
My Non-Bleeding Heart Libertarian market niche is being eroded by Jeff Miron's new blog. Here's what he has to say about New Orleans: The Katrina disaster occurred mainly because government spent billions constructing these levees in the first place; without... MORE
February 27, 2006
Regulation and Subsidies
Arnold Kling
Daniel B. Klein writes a review of The High Cost of Free Parking, by Donald Shoup. Shoup shows that the magnitudes are huge. About 87 percent of all trips in the U.S. are made by personal motor vehicles, and parking... MORE
January 30, 2006
Regulation and Subsidies
Bryan Caplan
I was confused last night while watching the Billie Holiday biopic Lady Sings the Blues. For a reason I couldn't grasp, Billie needed to win over public opinion in order to get a "cabaret card." But surely, I told my... MORE
January 13, 2006
Regulation and Subsidies
Bryan Caplan
Economists are lambasting Maryland's "Fair Share Health Care Fund Act", which effectively forces Wal-Mart to spend at least 8% of its payroll on health care. While I'm happy to join in the chorus, I nevertheless believe that many opponents of... MORE
December 6, 2005
Regulation and Subsidies
Bryan Caplan
There's more to James Hamilton's blog than high-quality energy economics. His latest is an incisive analysis of an Americans with Disabilities related lawsuit: If Boone was indeed fired because she was blind, is it a relevant fact that her replacement,... MORE
November 29, 2005
Regulation and Subsidies
Arnold Kling
The FCC thinks that cable TV's bundling policies are bad, according to this report. Chairman Kevin Martin, reversing a course set by predecessor Michael Powell, told lawmakers on Tuesday that cable subscribers could benefit if given the option to pick... MORE
November 8, 2005
Regulation and Subsidies
Bryan Caplan
A while back, I wrote: In a classic episode of Seinfeld, George Costanza realized that his instincts were fundamentally wrong, and vowed to "do the opposite": George: Elaine, bald men, with no jobs, and no money, who live with their... MORE
November 6, 2005
Regulation and Subsidies
Bryan Caplan
The last big populist movement that libertarians could and did embrace was the tax revolt of the late 70's and early 80's. Since then, there's been a long dry spell, at least in the U.S. And if you know much... MORE
October 16, 2005
Economics of Health Care
Arnold Kling
Morris M. Kleiner writes, Even in the 1950s, licensing covered less than 5% of the American workforce. Now more than 20% of the U.S. workforce is covered by state licensing laws...prices in regulated occupations have increased more--and the earnings of... MORE
August 2, 2005
Regulation and Subsidies
Arnold Kling
David R. Henderson writes, The best statement of the philosophical case against antitrust is in philosopher Harry Binswanger's essay, "Antitrust: 'Free Competition' at Gunpoint." Binswanger draws a fundamental distinction between economic power and political power. Economic power, he notes, is... MORE
July 7, 2005
Regulation and Subsidies
Arnold Kling
What do the Kelo decision and eugenics have in common? In this essay, I argue that both involve a faith in government to manage social good while overturning individual rights. we are entitled to hope that our legislators and appointed... MORE
June 27, 2005
Regulation and Subsidies
Arnold Kling
Both Gary Becker and Richard Posner weigh in. Becker writes, Is eminent domain a desirable principle in the 21st century? In the 18th, 19th, and early 20th centuries, governments did rather little, so there was not much to fear from... MORE
May 17, 2005
Regulation and Subsidies
Bryan Caplan
Reading William Greider is one of my guilty pleasures. Credit where credit is due: The guy can write. And the content is interesting, blending fun facts about the economy with bizarre interpretations thereof. Sometimes, however, I wonder whether his "facts"... MORE
May 14, 2005
Regulation and Subsidies
Bryan Caplan
My colleague Larry Iannaccone is not just the world's expert on the economics of religion. He's also got some intriguing views on real estate. Cars have been mass produced on assembly lines for a long time, and the cost savings... MORE
May 3, 2005
Regulation and Subsidies
Arnold Kling
Alex Tabarrok writes, The FDA currently works on a paternalistic model: One choice to rule them all. But another approach, what I call the Consumer Reports model, would meet the needs of diverse health-care consumers much better. Consumer Reports doesn’t... MORE
April 25, 2005
Regulation and Subsidies
Bryan Caplan
Only a small man would pick on the Oakton Sun Gazette, but I can't resist. Friday's editorial attacks proposals to legalize cell phone use on planes: This idea – nincompoopery at its finest – needs to be smothered in its... MORE
April 6, 2005
Regulation and Subsidies
Arnold Kling
The Washington Post reports, Maryland lawmakers yesterday approved legislation that would effectively require Wal-Mart to boost spending on health care... Lawmakers said they did not set out to single out Wal-Mart when they drafted a bill requiring organizations with more... MORE
April 4, 2005
Regulation and Subsidies
Bryan Caplan
I've come across two interesting surveys on the Food and Drug Administration. The first is the latest gem by the Kaiser Family Foundation. Among other topics, it has the dirt on public opinion about regulation of drugs. Does the public... MORE
March 10, 2005
Regulation and Subsidies
Arnold Kling
Hedge Fund Guy writes, Costs of lending are always passed on to the consumer. No one is forced to lend (well, there is the Community Reinvestment Act, but that's a quid pro quo, and an exception), so lenders will either... MORE
March 1, 2005
Regulation and Subsidies
Bryan Caplan
When the typical economist tells me about his latest research, my standard reaction is "Eh, maybe." Then I forget about it. When Robin Hanson tells me about his latest research, my standard reaction is "No way! Impossible!" Then I think... MORE
February 22, 2005
Regulation and Subsidies
Arnold Kling
Edward L. Glaeser, Joseph Gyourko, and Raven E. Saks write, the evidence points toward a man-made scarcity of housing in the sense that the housing supply has been constrained by government regulation as opposed to fundamental geographic limitations. The growing... MORE
January 21, 2005
Regulation and Subsidies
Arnold Kling
Michael Powell, the Chairman of the Federal Communications Commission, is stepping down. In my book, I included an essay on Powell's Hayekian approach at the FCC. The FCC oversees industries in which competition is messy. Broadcasting and telecommunications do not... MORE
January 5, 2005
Regulation and Subsidies
Arnold Kling
Robert J. Samuelson writes, Well, homeownership isn't a big problem, and Fannie and Freddie have been minor -- not major -- forces in past increases. The others include rising incomes, falling interest rates, low-down-payment mortgages (as little as 3 percent)... MORE
December 24, 2004
Regulation and Subsidies
Arnold Kling
Robert W. Crandall writes, the deregulatory movement has led to a modest amount of progress in reining in some of these programs in the United States. Unfortunately, much remains to be done in freeing water, spectrum, and land from inefficient... MORE
December 1, 2004
Regulation and Subsidies
Arnold Kling
Steve Pearlstein uses his column to explain some freshman economics. What two things do a college education, health care and housing have in common? One is that the price of these things has been rising at least twice as fast... MORE
November 15, 2004
Regulation and Subsidies
Arnold Kling
Here is an elementary example of presumably well-intended regulation without thinking through the consequences. Edward P. Stringham and Benjamin Powell write Under most inclusionary ordinances, builders must sell 10 to 25 percent of the homes to very low, low, or... MORE
Regulation and Subsidies
Arnold Kling
David Masten has a brilliant way of explaining the impact of regulation on the pharmaceutical industry. He imagines a world in which computers are regulated like pharmaceuticals. - the Electronics and Computers Administration would have just approved the Intel i486... MORE
November 10, 2004
Regulation and Subsidies
Arnold Kling
Alex Tabarrok links to a story about the decline in the importance of brands, by James Surowiecki, who writes The single biggest explanation for fragile brands is the swelling strength of the consumer. We've seen a pronounced jump in the... MORE
October 17, 2004
Regulation and Subsidies
Arnold Kling
Russ Roberts has been all over the vaccine shortage story. In one post among many, he asks, Normally when there's uncertainty about demand, price rises to compensate suppliers for the extra risk. And consumers are happy to pay that higher... MORE
September 1, 2004
Regulation and Subsidies
Arnold Kling
Who speaks for the Republicans? Is it David Brooks? Now almost every leading politician accepts that government should not interfere with the basic mechanisms of the market system. On the other hand, almost every leading official acknowledges that we should... MORE
August 25, 2004
Regulation and Subsidies
Arnold Kling
The Milken Institute Review has an article by Robert W. Crandall, Robert W. Hahn, Robert E. Litan and Scott Wallsten, who note that Jerry Hausman of MIT has estimated that taxes on interstate and international telephone revenues that are used... MORE
August 19, 2004
Regulation and Subsidies
Arnold Kling
I discuss a suggestion that pharmaceutical companies should be treated like public utilities. Angell is accusing pharmaceutical companies of what economists call "rent-seeking," which Gordon Tullock defines as "special interest coalitions lobbying the government to transfer wealth to them." Her... MORE
August 16, 2004
Regulation and Subsidies
Arnold Kling
David Warsh has an interesting column on the pharmaceutical industry. "If only we could find a patient willing to pay $800 million for that first dose," said Judy Lewent at one point (she is executive vice president and chief financial... MORE
August 15, 2004
Regulation and Subsidies
Michael Munger
by Michael Munger Guest Blogger For those who, like Ralph Nader, think that there is no difference between the major party candidates, consider the regulatory process, which largely operates under the media radar, but affects all of us. Interesting in-depth... MORE
July 26, 2004
Austrian Economics
Arnold Kling
What does government do? Austrian economists fear that government simply serves to protect incumbents. In a long, informative review of a book by Hans Herman-Hoppe, Andy Duncan writes, ask yourself if there are many large corporations in the US or... MORE
July 21, 2004
Regulation and Subsidies
Arnold Kling
Glenn Reynolds makes an articulate point about paternalism. Another -- and it's a lesson that policy wonks seem slow to learn -- is that people other than policy wonks are capable of learning, and of changing their behavior on their... MORE
Regulation and Subsidies
Arnold Kling
Two op-eds today on the issue of technological innovation and government's response. In the Wall Street Journal, former Intel Vice President Les Vadasz writes, The problem with the "Induce bill" is not its intent, but its overly broad language: Any... MORE
July 8, 2004
Regulation and Subsidies
Arnold Kling
A while back, I cited some arguments against regulation of mutual funds. Today, Vanguard's John Bogle makes the case in favor of regulation. In the mutual-fund industry, relying solely on market forces has proved to be a weak remedy for... MORE
June 28, 2004
Regulation and Subsidies
Arnold Kling
Michell J. White writes, That asbestos was so widely used from the 1950’s to the 1980’s suggests that multiple regulatory systems failed, including workers’ compensation, workplace safety regulation, product safety regulation, and liability law. ...Will the asbestos mess at least... MORE
June 24, 2004
Regulation and Subsidies
Arnold Kling
The latest SEC regulation of mutual funds draws fire from Stephen Bainbridge. He quote Cindy Glassman, an SEC Commissioner who dissented, as pointing out that no cost-benefit analysis was done of the proposal to require mutual funds to have an... MORE
June 21, 2004
Regulation and Subsidies
Arnold Kling
Why oh why can't we have a Brad DeLong who will put the adults in charge of the clown show that is John Kerry's campaign? (For those of you who do not read DeLong, I am borrowing his anti-Bush tropes)... MORE
June 15, 2004
Economics of Health Care
Arnold Kling
Today's Washington Post contains another op-ed piece by a physician, and of course he is in favor of price controls on prescription drugs. The pharmaceutical industry will intone its familiar mantra: The cost of drugs is a relatively small percentage... MORE
April 19, 2004
Regulation and Subsidies
Arnold Kling
Glenn Reynolds pointed to an interesting talk by Charles Whitebread on the history of the drug war. In the face of possible Constitutional opposition to what they wanted to do, the people in Congress who supported the Harrison Act came... MORE
April 7, 2004
Regulation and Subsidies
Arnold Kling
Alex Tabarrok looks at the issue of how to increase the availability of organs for transplant. In the minds of many, financial incentives for organ donation means rich people buying up kidneys being hawked on eBay by the desperately poor...Two... MORE
April 5, 2004
Microeconomics
Arnold Kling
I extended my thoughts on bundling with this essay. What George Stigler showed is that ordinary intuition about bundling is wrong. Your intuition is that the reason that the seller engages in bundling is to force you to buy something... MORE
March 29, 2004
Growth: Causal Factors
Arnold Kling
Andrew David Chamberlain points to a World Bank study written by Andrei Shleifer, among others, of barriers to entrepreneurship. Countries with heavier regulation of entry have higher corruption and larger unofficial economies, but not better quality of public or private... MORE
March 26, 2004
Regulation and Subsidies
Arnold Kling
The issue of bundling has been in the news recently. For example, the Europeans want to punish Microsoft for bundling a media player with its operating system. Professor Bainbridge supports the regulators in this case. Prohibiting Microsoft from bundling, say,... MORE
February 26, 2004
Social Security
Arnold Kling
Federal Reserve Chairman Alan Greenspan tries taking on some sacred cows. In a logical assessment of the Social Security's future financial condition, he suggested ways to curtail the growth in future benefits. The response was predictable Sen. Arlen Specter, R-Pa.,... MORE
February 20, 2004
Regulation and Subsidies
Arnold Kling
Stephen M. Bainbridge argues that the cost of regulations under the Sarbanes-Oxley law (SOX) enacted in the wake of the Enron scandal are too high. The SEC initially estimated § 404 compliance would require only 383 staff hours. According to... MORE
February 2, 2004
Regulation and Subsidies
Arnold Kling
Milton Friedman argues that the drug-approval process is the problem. On the drug side, what seems to me to be the most serious situation is the extent to which the Food and Drug Administration makes it extremely expensive to produce... MORE
January 9, 2004
Regulation and Subsidies
Arnold Kling
In a wide-ranging essay on the problem of incomplete information, I write, Perhaps the most important point of all is that government officials operate in a fog. If one looks at all of the imperfections and shortcomings of the market,... MORE
December 12, 2003
Regulation and Subsidies
Arnold Kling
Lynne Kiesling has two interesting posts on water privatization. In her first comment, she writes, Suppose you are not persuaded by my argument that water utilities should be private companies and not municipal utilities. OK, but you could still contract... MORE
December 9, 2003
Regulation and Subsidies
Arnold Kling
If you ask people to list goods that should never be privatized, water is often one of the first that comes to mind. But Richard Tren writes, Those that campaign against private water ownership and supply on the grounds that... MORE
December 4, 2003
International Trade
Arnold Kling
In this essay, I say that libertarians had a bad month in November. Howard Dean came out in favor of re-regulation of "utilities, large media companies and any business that offers stock options." As Megan McArdle put it, "those of... MORE
November 24, 2003
Regulation and Subsidies
Arnold Kling
Is housing more expensive in Manhattan because land is more valuable there? Edward L. Glaeser, Joseph Gyourko, and Raven Saks argue that housing is more expensive because of regulation. In twelve out of the twenty-one markets that we examine, on... MORE
November 13, 2003
Regulation and Subsidies
Arnold Kling
Lynne Kiesling sketched an interesting idea for antitrust enforcement. prosecutions based on the use of lobbying, regulation, and political relationships (i.e., rent seeking) to deter entry. Economists traditionally have evaluated monopoly power using measures such as the Herfindahl index of... MORE
Regulation and Subsidies
Arnold Kling
Both Michael Lind and Ronald Bailey note a population decline in the old prairie states. However, they come to opposite conclusions. Lind wrote, Imagine a federal program that would help poor and working-class Americans to move not from crowded cities... MORE
October 29, 2003
Regulation and Subsidies
Arnold Kling
Wal-Mart is controversial. On the issue of labor costs, Steve Pearlstein writes, I'm talking about a minimum wage that would put a family with two full-time workers above the poverty line in high-cost metropolitan areas -- and no doubt put... MORE
October 27, 2003
Information Goods, Intellectual Property
Arnold Kling
I contrast Hayek and Stiglitz on the importance of imperfect information. Hayek would have the government tolerate messy competition. His point is that with the optimal outcome unknown, government resolution of issues shuts off the learning process that market competition... MORE
October 22, 2003
Regulation and Subsidies
Arnold Kling
Joe Peek and Eric S. Rosengren explain how regulatory incentives contribute to the persistent mis-allocation of capital by Japanese banks. Bank regulation and supervision policies in Japan provide banks that have significant nonperforming loans and impaired capital little incentive to... MORE
October 21, 2003
Regulation and Subsidies
Arnold Kling
Michael Cox writes about trade barriers that affect Internet commerce. Georgia requires buyers to purchase contact lenses in person, ostensibly to protect their health but in effect as a boost to in-state eyewear retailers. Oklahoma won't allow its citizens to... MORE
October 7, 2003
Regulation and Subsidies
Arnold Kling
A few days ago, controversial radio personality Rush Limbaugh created a controversy. As a commentator on a football pre-game show, he said (1) The Philadelphia Eagles' quarterback was overrated by others in the media. (2) The reason that the quarterback... MORE
October 1, 2003
Regulation and Subsidies
Arnold Kling
Posting here will be infrequent until later in October. Meanwhile, here are some links that may be of interest. Is the insecurity of Microsoft software an externality that should be regulated or taxed? An example of professional licensing as rent-seeking... MORE
September 18, 2003
Income Distribution
Arnold Kling
Marc Brazeau asks (see Steve Antler's site), Two common arguments against raising the minimum wage are possible inflationary effects and job loss. Why aren't these issues raised in relation to executive compensation? I think that the conventional wisdom is that... MORE
September 3, 2003
Regulation and Subsidies
Arnold Kling
Regarding the New Deal, Boonton wrote, how much of the New Deal has survived? While national economic planning seems to have finally been discredited...the bulk of the New Deal remains firmly established not only in the US but in most... MORE
August 28, 2003
Microeconomics
Arnold Kling
London's congestion charge, which seemed like such a good idea from an economic perspective, may have run afoul of elastic demand, according to an article by Iain Murray. economists...estimated that a reduction in traffic of 15 percent would require that... MORE
August 25, 2003
Macroeconomics
Arnold Kling
Cato's Jim Powell makes the case against the New Deal. Among the material Powell cites: Richard K. Vedder and Lowell E. Gallaway, in their 1997 study Out of Work, estimated that by 1940 unemployment was eight points higher than it... MORE
August 23, 2003
Energy, Environment, Resources
Arnold Kling
How should the location of undesirable land uses, such as toxic waste dumps or prisons, be determined. Citing Julian Simon, Herbert Inhaber suggests using a reverse auction, in which the Federal government offers to compensate local residents for living near... MORE
August 20, 2003
Energy, Environment, Resources
Arnold Kling
In the wake of the electricity blackout, I have been disappointed that economists have contributed more noise than signal in their comments. For example, Paul Krugman wrote, Under the old regulatory system, power companies had strong incentives to ensure the... MORE
August 18, 2003
Microeconomics
Arnold Kling
About a year ago, the big story in our local suburban newspaper was the adoption of a "living wage" bill in our county. This summer, the big story was the shortage of teenage jobs here. I was tempted to write... MORE
June 16, 2003
Energy, Environment, Resources
Arnold Kling
Lynne Kiesling points to this article by Joel Schwartz on the ethanol mandate. what if our elected officials ... forced you to pay $180 more each year for gasoline that contains an antiquated additive you don't need, and that could... MORE
Information Goods, Intellectual Property
Arnold Kling
Derek Lowe compares the fact that prescription drugs cost less outside the U.S. to the phenomenon of price discrimination by airlines. Most consumers [of pharmaceuticals] in the US don't realize that they're subsidizing the lower prices for everyone else, whereas... MORE
May 31, 2003
Energy, Environment, Resources
Arnold Kling
Could California suffer another "energy crisis?" Lynne Kiesling writes, California has a lower construction rate for proposed generation projects than other states that have implemented electricity restructuring...even in states that started with higher capacity relative to demand, such as Texas... MORE
May 28, 2003
Regulation and Subsidies
Arnold Kling
Two recent columns concerning the regulation of Internet commerce show how regulation sometimes restricts competition at the expense of the consumer. The Wall Street Journal argues that state regulations prevent consumers from obtaining health insurance that otherwise would be available... MORE
May 20, 2003
Regulation and Subsidies
Arnold Kling
Reason Foundation's Ted Balaker sees a libertarian silver lining in the cloud of state government budget deficits. After all, some states are now eyeing legalized gambling as a new cash cow. Maybe the next step will be to legalize –... MORE
May 19, 2003
Regulation and Subsidies
Arnold Kling
In an essay on diversity in economic policy, I propose dividing the United States. By splitting into the virtual regions of Miltonia and Hillaria, we could run a "natural experiment" to see how things work. Perhaps after ten or twenty... MORE
May 8, 2003
Energy, Environment, Resources
Arnold Kling
Lynne Kiesling bemoans electricity regulation policy in California. [The original deregulation effort] was much more about freeing up restrictions on trade in wholesale electricity markets, although it did a pathetic job of that, requiring buyers and sellers to use the... MORE
May 6, 2003
Regulation and Subsidies
Arnold Kling
Is Federal funding for research in nanotechnology justified? Declan McCullagh raises some doubts. First, private sources will pay for basic research. It may not be at the level that all researchers would prefer, but if it can lead to applied... MORE
February 21, 2003
Regulation and Subsidies
Arnold Kling
In the age of the Internet, the FCC has become a pivotal regulatory body, as I pointed out in The Economics of the Wireless Last Mile. In a new essay, I argue that In the United States today, companies that... MORE
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