School choice in England is in disarray: schools aren't supposed to be able to use their own preferences to select students, and this is a hard rule to enforce, the Telegraph reports:
Admissions chaos as thousands of schools flout rules
Schools face tighter admissions rules after thousands were found to be flouting guidelines designed to stop middle-class pupils dominating places.
Monday, November 3, 2008
Telephone call pricing between telephone companies
Ever wonder how payments are regulated/arranged between phone companies when you call someone who is a customer of a different company?
FCC Scraps Vote on Controversial Phone-Rate Plan
"Mr. Martin had proposed to lower the rates phone carriers pay each other to transfer calls to almost nothing and allow companies that would lose money from the change to raise their monthly subscriber rates by as much as $1.50 for residential phone lines. Business increases would have gone as high as $2.50 per month.
The current phone-exchange payment system, which dates back to the breakup of the Bell system in 1984, is widely divergent, with some carriers charging a fraction of a penny per minute for outside calls to their customers and others charging hundreds of times that much for the same service.
The FCC has for years tried to reform the payment system, but policy makers and industry sectors can't agree on a solution."
FCC Scraps Vote on Controversial Phone-Rate Plan
"Mr. Martin had proposed to lower the rates phone carriers pay each other to transfer calls to almost nothing and allow companies that would lose money from the change to raise their monthly subscriber rates by as much as $1.50 for residential phone lines. Business increases would have gone as high as $2.50 per month.
The current phone-exchange payment system, which dates back to the breakup of the Bell system in 1984, is widely divergent, with some carriers charging a fraction of a penny per minute for outside calls to their customers and others charging hundreds of times that much for the same service.
The FCC has for years tried to reform the payment system, but policy makers and industry sectors can't agree on a solution."
The market for science
The "republic of science" is the original open source public good, and its origins are traced to Renaissance patronage of science and math, in Paul David's essay in Capitalism and Society, The Historical Origins of 'Open Science': An Essay on Patronage, Reputation and Common Agency Contracting in the Scientific Revolution
The essay is accompanied by a comment by Ken Arrow, who summarizes the issue as follows:
" Scientific activity, like any other, requires resources, in the first instance: human resources usually with considerable alternative value, but also material
resources of an increasingly expensive nature. The typical dissemination of scientific information does not, in general, yield any income; indeed, publication itself is costly and was more so before the invention of printing.
"David concentrates in this paper on the development of scientific activity from the 15th to the 17th centuries, a period clearly of the greatest importance in setting the tone and style of the modern Scientific Revolution. His thesis, amply documented, is that the prestige to patrons, generally rulers, was an important motive for the support of science. They were not unaware of the practical usefulness of scientific discovery in technological development, but the sheer display value was an additional and powerful motive. To achieve this prestige, though, it was necessary to evaluate the qualities of the scientists to be supported. Especially in the case of mathematics, this was beyond the capacity of the rulers or their ministers. An open diffusion of science, then, was needed to permit critical evaluation, as well, indeed, as to display the prestige-granting science. Hence, the gradual emergence of the apparatus and value-system of science: publications, the opportunity for comment and criticism, and, eventually, the emergence of publicly supported academies, such as the Royal Society in England and the Académie des Sciences in France, and of periodicals for the diffusion of ideas."
The essay is accompanied by a comment by Ken Arrow, who summarizes the issue as follows:
" Scientific activity, like any other, requires resources, in the first instance: human resources usually with considerable alternative value, but also material
resources of an increasingly expensive nature. The typical dissemination of scientific information does not, in general, yield any income; indeed, publication itself is costly and was more so before the invention of printing.
"David concentrates in this paper on the development of scientific activity from the 15th to the 17th centuries, a period clearly of the greatest importance in setting the tone and style of the modern Scientific Revolution. His thesis, amply documented, is that the prestige to patrons, generally rulers, was an important motive for the support of science. They were not unaware of the practical usefulness of scientific discovery in technological development, but the sheer display value was an additional and powerful motive. To achieve this prestige, though, it was necessary to evaluate the qualities of the scientists to be supported. Especially in the case of mathematics, this was beyond the capacity of the rulers or their ministers. An open diffusion of science, then, was needed to permit critical evaluation, as well, indeed, as to display the prestige-granting science. Hence, the gradual emergence of the apparatus and value-system of science: publications, the opportunity for comment and criticism, and, eventually, the emergence of publicly supported academies, such as the Royal Society in England and the Académie des Sciences in France, and of periodicals for the diffusion of ideas."
Sunday, November 2, 2008
Incentives for students who get good grades
The Washington Post reports on experimental programs to reward inner city kids when they do well in school: Incentives Can Make Or Break Students: Ethical Issues Come With Gains on Tests
"The inducements range from prepaid cellphones to MP3 players to gift certificates. But most of them are cash: $10 for New York City seventh-graders who complete a periodic test; $50 for Chicago high school freshmen who ace their courses; as much as $110 to Baltimore students for improved scores on the Maryland High School Assessments. "
Some find this repugnant: "Critics denounce the initiatives as bribery and say the money could be better invested in ideas known to work, such as smaller class size. They also point to a body of psychological research suggesting that tangible rewards can erode children's intrinsic motivation. DePaul University education professor Ronald Chennault says there are ethical issues posed by the ventures, most of which are experimental and dependent on private funding and local political support."
Harvard's Roland Fryer is directing some of these experiments. "This is not a silver bullet," he said during a recent visit to the District. "But it's better than sitting around and doing nothing."
"The inducements range from prepaid cellphones to MP3 players to gift certificates. But most of them are cash: $10 for New York City seventh-graders who complete a periodic test; $50 for Chicago high school freshmen who ace their courses; as much as $110 to Baltimore students for improved scores on the Maryland High School Assessments. "
Some find this repugnant: "Critics denounce the initiatives as bribery and say the money could be better invested in ideas known to work, such as smaller class size. They also point to a body of psychological research suggesting that tangible rewards can erode children's intrinsic motivation. DePaul University education professor Ronald Chennault says there are ethical issues posed by the ventures, most of which are experimental and dependent on private funding and local political support."
Harvard's Roland Fryer is directing some of these experiments. "This is not a silver bullet," he said during a recent visit to the District. "But it's better than sitting around and doing nothing."
Saturday, November 1, 2008
Labor Market Intermediation
David Autor has an essay on The Economics of Labour Market Intermediation"
"One might have speculated that in an era of rapid information flows and substantial job mobility, the importance of labour market intermediaries would wane. Indeed, the most prominent labour market intermediary, the traditional labour union, has been in secular declines for decades. Yet, the decline of labour unions is the exception rather than the rule. Two of the intermediaries discussed above – online search engines and centralised medical matches – have only recently gained prominence. And another labour market intermediary not even considered above, temporary help agencies, has risen from relative obscurity to international significance over the last two decades. "
"One might have speculated that in an era of rapid information flows and substantial job mobility, the importance of labour market intermediaries would wane. Indeed, the most prominent labour market intermediary, the traditional labour union, has been in secular declines for decades. Yet, the decline of labour unions is the exception rather than the rule. Two of the intermediaries discussed above – online search engines and centralised medical matches – have only recently gained prominence. And another labour market intermediary not even considered above, temporary help agencies, has risen from relative obscurity to international significance over the last two decades. "
The Federal Reserve’s Term Auction Facility
As the credit crisis unfolded, the Fed prepared to auction funds to banks. Among other design features (such as how expressive a bidding language to allow) they thought about adverse selection: they wanted to reduce the signal value "stigma" of participation.
The Federal Reserve’s Term Auction Facility
July 2008 Volume 14, Number 5
Authors: Olivier Armantier, Sandra Krieger, and James McAndrews
Abstract: "As liquidity conditions in the term funding markets grew increasingly strained in late 2007, the Federal Reserve began making funds available directly to banks through a new tool, the Term Auction Facility (TAF). The TAF provides term funding on a collateralized basis, at interest rates and amounts set by auction. The facility is designed to improve liquidity by making it easier for sound institutions to borrow when the markets are not operating efficiently."
Auction Design: "Once the Federal Reserve concluded that an auction format was an effective funding alternative, it added features aimed at ensuring the most efficient distribution of funds to banks with a high demand. In particular, the Fed established a minimum rate at which bids could be submitted that was set in a comparable, competitive market (rather than a penalty rate, which is set at a premium to existing market rates).This market-based minimum bid rate was likely to encourage participation and reduce any stigma associated with receiving auctioned funds, since banks would not necessarily signal an abnormally high demand by bidding. The Federal Reserve also chose a uniform-price (or single-price) auction rather than a discriminatory (pay-your-bid) auction in part to spur participation further. By using the uniform-price structure common in Treasury auctions, the Fed reasoned that banks would be more comfortable with bidding. Finally, to allow for the widest allocation of funds, the central bank imposed a cap on the bid amount corresponding to 10 percent of the auction size.
The Fed also imposed two important rules. First, based on its experience with option auctions in 1999, it would allow each bidder to make two rate-amount offers. This rule represents the Fed’s resolution of the trade-off associated with multiple rate-amount offers: as the number of offers increases, the auction becomes more complex, but participants are able to make bids that are more representative of their demand. Second, the central bank would require TAF participants to pledge collateral beyond the amount necessary to secure credit in the new facility. This rule was imposed to ensure that bidders in the new facility could still borrow through the discount window’s primary credit facility to meet unexpected overnight funding needs."
The Federal Reserve’s Term Auction Facility
July 2008 Volume 14, Number 5
Authors: Olivier Armantier, Sandra Krieger, and James McAndrews
Abstract: "As liquidity conditions in the term funding markets grew increasingly strained in late 2007, the Federal Reserve began making funds available directly to banks through a new tool, the Term Auction Facility (TAF). The TAF provides term funding on a collateralized basis, at interest rates and amounts set by auction. The facility is designed to improve liquidity by making it easier for sound institutions to borrow when the markets are not operating efficiently."
Auction Design: "Once the Federal Reserve concluded that an auction format was an effective funding alternative, it added features aimed at ensuring the most efficient distribution of funds to banks with a high demand. In particular, the Fed established a minimum rate at which bids could be submitted that was set in a comparable, competitive market (rather than a penalty rate, which is set at a premium to existing market rates).This market-based minimum bid rate was likely to encourage participation and reduce any stigma associated with receiving auctioned funds, since banks would not necessarily signal an abnormally high demand by bidding. The Federal Reserve also chose a uniform-price (or single-price) auction rather than a discriminatory (pay-your-bid) auction in part to spur participation further. By using the uniform-price structure common in Treasury auctions, the Fed reasoned that banks would be more comfortable with bidding. Finally, to allow for the widest allocation of funds, the central bank imposed a cap on the bid amount corresponding to 10 percent of the auction size.
The Fed also imposed two important rules. First, based on its experience with option auctions in 1999, it would allow each bidder to make two rate-amount offers. This rule represents the Fed’s resolution of the trade-off associated with multiple rate-amount offers: as the number of offers increases, the auction becomes more complex, but participants are able to make bids that are more representative of their demand. Second, the central bank would require TAF participants to pledge collateral beyond the amount necessary to secure credit in the new facility. This rule was imposed to ensure that bidders in the new facility could still borrow through the discount window’s primary credit facility to meet unexpected overnight funding needs."
Credit Default Swaps: reducing counterparty risk
New York Fed Welcomes Further Industry Commitments on Over-the-Counter Derivatives
"The following areas constitute our central priorities for addressing both operational and market design concerns for OTC derivatives:
Institute a Central Counterparty (CCP) for Credit Default Swaps (CDS)...
Reduce Levels of Outstanding Trades via Portfolio Compression. Market participants continue to reduce the number of outstanding CDS trades through multilateral trade terminations (tear-ups)
Enhance Market Transparency.
HT to PrefBlog
"The following areas constitute our central priorities for addressing both operational and market design concerns for OTC derivatives:
Institute a Central Counterparty (CCP) for Credit Default Swaps (CDS)...
Reduce Levels of Outstanding Trades via Portfolio Compression. Market participants continue to reduce the number of outstanding CDS trades through multilateral trade terminations (tear-ups)
Enhance Market Transparency.
HT to PrefBlog
Bank secrecy:
U.S. and Swiss law differ regarding U.S. citizens who keep accounts in Swiss banks that do business in the U.S., and an interesting game is afoot:
IRS, Justice Target Undisclosed Assets In Swiss Accounts
"Over the summer, the IRS won permission from a federal court to demand that UBS turn over the identities of an estimated 19,000 American clients who have failed to disclose their Swiss-based accounts on U.S. tax returns. It remains unclear what has or will come of that effort. Swiss law restricts the bank's ability to breach client confidentiality. Swiss law also gives clients the opportunity to oppose the release of their names through a judicial process that could slow any disclosures. "...
"James Nason, a spokesman for the Swiss Bankers Association, said, "UBS itself cannot decide to hand over client data because then it would be violating Swiss law." Any Swiss bank "waits for instructions from the Swiss authorities," Nason said, adding, "Switzerland doesn't allow fishing expeditions." ...
"Whether or not the Swiss officially give up clients' secrets, the U.S. government could have other ways of getting information. For example, bank employees have an incentive to expose tax evaders to the IRS, Skarlatos said, because whistle-blowers could receive 30 percent of the money they help the government collect. "
IRS, Justice Target Undisclosed Assets In Swiss Accounts
"Over the summer, the IRS won permission from a federal court to demand that UBS turn over the identities of an estimated 19,000 American clients who have failed to disclose their Swiss-based accounts on U.S. tax returns. It remains unclear what has or will come of that effort. Swiss law restricts the bank's ability to breach client confidentiality. Swiss law also gives clients the opportunity to oppose the release of their names through a judicial process that could slow any disclosures. "...
"James Nason, a spokesman for the Swiss Bankers Association, said, "UBS itself cannot decide to hand over client data because then it would be violating Swiss law." Any Swiss bank "waits for instructions from the Swiss authorities," Nason said, adding, "Switzerland doesn't allow fishing expeditions." ...
"Whether or not the Swiss officially give up clients' secrets, the U.S. government could have other ways of getting information. For example, bank employees have an incentive to expose tax evaders to the IRS, Skarlatos said, because whistle-blowers could receive 30 percent of the money they help the government collect. "
Friday, October 31, 2008
Market for toilets: NYC marathon
Providing Toilets for 39,000 Runners
The NYC marathon is a peak load event:
"Gathering and placing 2,250 portable toilets for a one-day event — and then removing them almost immediately — is a daunting task. The marathon represents the third-largest annual assemblage of portable toilets in the country, behind the Rose Bowl college football game and parade and the motorcycle rally in Sturgis, S.D. Placed side by side, the 4-foot-wide toilets would stretch 1.7 miles. "
Apparently portable potties have a natural life cycle:
"The average special-event life of a portable toilet, Malone said, is two years — shorter if it attends a lot of concerts — before it is assigned to duty at construction sites, the “bread and butter” of the business. "
The NYC marathon is a peak load event:
"Gathering and placing 2,250 portable toilets for a one-day event — and then removing them almost immediately — is a daunting task. The marathon represents the third-largest annual assemblage of portable toilets in the country, behind the Rose Bowl college football game and parade and the motorcycle rally in Sturgis, S.D. Placed side by side, the 4-foot-wide toilets would stretch 1.7 miles. "
Apparently portable potties have a natural life cycle:
"The average special-event life of a portable toilet, Malone said, is two years — shorter if it attends a lot of concerts — before it is assigned to duty at construction sites, the “bread and butter” of the business. "
Piracy
The LA Times reports: Somalia's pirate problem grows more rampant
"Entire villages along the coast now engage in piracy. Unemployed youths provide the muscle. Idle fishermen offer boats and knowledge of the coastline. Foreign businessmen provide the money for guns, radios and satellite phones. Islamic hard-liners are lured by the chance to attack Western interests offshore.
The result is a criminal free-for-all. Pirate attacks off the coast of Somalia have tripled over the last three years, with nearly three a week in 2008, maritime officials say. Currently there are about a dozen hijacked ships, with more than 300 crew members, being held hostage. Ransom payments are often as high as $2 million."
"Entire villages along the coast now engage in piracy. Unemployed youths provide the muscle. Idle fishermen offer boats and knowledge of the coastline. Foreign businessmen provide the money for guns, radios and satellite phones. Islamic hard-liners are lured by the chance to attack Western interests offshore.
The result is a criminal free-for-all. Pirate attacks off the coast of Somalia have tripled over the last three years, with nearly three a week in 2008, maritime officials say. Currently there are about a dozen hijacked ships, with more than 300 crew members, being held hostage. Ransom payments are often as high as $2 million."
Thursday, October 30, 2008
Market for marketing professors
Dan Goldstein at LBS has published his impressions of and advice about the interviewing process at the American Marketing Association annual meetings: If you can get through this, you can be a marketing professor, EVERYTHING YOU EVER WANTED TO KNOW ABOUT THE AMA INTERVIEWS (2008 edition)
The Marketing meetings come half a year earlier than the Economics meetings, but they have a family resemblance. (I gather that years ago the Marketing job market meetings happened at the same time as Economics, as part of the ASSA meetings, but that the Marketing market unraveled...)
HT to Katy Milkman (who is on the market this year)
The Marketing meetings come half a year earlier than the Economics meetings, but they have a family resemblance. (I gather that years ago the Marketing job market meetings happened at the same time as Economics, as part of the ASSA meetings, but that the Marketing market unraveled...)
HT to Katy Milkman (who is on the market this year)
Market for masseurs in S. Korea
SKorean Court Rules in Favor of Blind Masseurs
"A law that allows only visually impaired people to become licensed masseurs does not violate South Korea's constitution, a court ruled Thursday in a victory for the blind.
The decision brings an end to a fierce legal battle over whether the sighted should be allowed to become professional masseurs, a trade that has been reserved for the blind for nearly a century. The debate has sparked fervent protests by the blind, who say massage is their only chance at making a living."
"A law that allows only visually impaired people to become licensed masseurs does not violate South Korea's constitution, a court ruled Thursday in a victory for the blind.
The decision brings an end to a fierce legal battle over whether the sighted should be allowed to become professional masseurs, a trade that has been reserved for the blind for nearly a century. The debate has sparked fervent protests by the blind, who say massage is their only chance at making a living."
Wednesday, October 29, 2008
Market for elephant ivory
The Times of London reports on a government sponsored sale of legal elephant ivory (I presume taken from elephants that died a natural death):
Ivory from 10,000 elephants on sale amid fears of new slaughter
"Wildlife groups and other African nations fear that the controversial sell-off could breathe life back into the ivory trade, banned in 1989, and trigger a resurgence of the poaching that devastated Africa’s elephant populations in the 1970s and 1980s.
Julian Newman, campaigns director with the Environmental Investigation Agency, said that the move could once again open the floodgates to poaching, which reduced Africa’s total elephant population from five million in the 1930s to about 600,000 today. “This [auction], coupled with a lack of sufficient checks in importing countries such as China and instability in some African range states, could easily drag us back to the dark and bloody days of the 1980s when we were seeing around 200 elephants killed by poachers each week.” Conservationists argue that a lack of proper oversight will allow poachers to mix illegal and legal ivory and slip it past regulators, many of them corrupt. "
Ivory from 10,000 elephants on sale amid fears of new slaughter
"Wildlife groups and other African nations fear that the controversial sell-off could breathe life back into the ivory trade, banned in 1989, and trigger a resurgence of the poaching that devastated Africa’s elephant populations in the 1970s and 1980s.
Julian Newman, campaigns director with the Environmental Investigation Agency, said that the move could once again open the floodgates to poaching, which reduced Africa’s total elephant population from five million in the 1930s to about 600,000 today. “This [auction], coupled with a lack of sufficient checks in importing countries such as China and instability in some African range states, could easily drag us back to the dark and bloody days of the 1980s when we were seeing around 200 elephants killed by poachers each week.” Conservationists argue that a lack of proper oversight will allow poachers to mix illegal and legal ivory and slip it past regulators, many of them corrupt. "
Market for bribes and corrupt influence
A MA state senator has been charged with accepting bribes to influence the issuing of a liquor license. The criminal complaint describes how the transactions are alleged to have been carried out. It turns out to be unwise to take bribes from a cooperating witness.
Blood supply safety--paid versus unpaid
The Food and Drug Administration is responsible for keeping the blood suppy safe. As anyone who gives blood knows, before you can give blood you have to be interviewed about your sexual habits and other potential risk factors. Some donors are turned away, "deferred," based on their answers. (There are recently limits on how much cumulative time overseas a donor can have had, which exclude me.)
Here is a transcript of an FDA conference on Behavior-Based Donor Deferrals in the NAT Era (NAT is nucleic acid testing, i.e. it refers to the non-behavioral ways of screening the blood supply). It has some interesting points, including this on paid versus unpaid donation:
"But looking a little bit more closely at the role that has been played by behavioral exclusion, this is just an example for viral hepatitis. In the 1970s there was concomitant introduction of labeling of paid versus volunteer donation for blood for transfusion, which was at the same time as the first generation of the test for HBsAg, and the combined effect was a very dramatic, approximately 90 percent, reduction. We have never completely teased out how much of this was due solely to the change in labeling which eliminated paid donation, but we do know from the antecedent literature that paid donation was highly associated with transmission of hepatitis."
That is, donors can be paid for blood donation, but paid donations must be labelled as such.
Here is a transcript of an FDA conference on Behavior-Based Donor Deferrals in the NAT Era (NAT is nucleic acid testing, i.e. it refers to the non-behavioral ways of screening the blood supply). It has some interesting points, including this on paid versus unpaid donation:
"But looking a little bit more closely at the role that has been played by behavioral exclusion, this is just an example for viral hepatitis. In the 1970s there was concomitant introduction of labeling of paid versus volunteer donation for blood for transfusion, which was at the same time as the first generation of the test for HBsAg, and the combined effect was a very dramatic, approximately 90 percent, reduction. We have never completely teased out how much of this was due solely to the change in labeling which eliminated paid donation, but we do know from the antecedent literature that paid donation was highly associated with transmission of hepatitis."
That is, donors can be paid for blood donation, but paid donations must be labelled as such.
Universities in the current economy
The Chronicle of Higher Education reports: Booming States Lure Academics From Those With Financial Woes (un-gated version here for five days).
Texas, anyone?
Texas, anyone?
Tuesday, October 28, 2008
Auctions for seats at sporting events
The Jets Gross $16 Million in a Seat-License Auction
The days when sports teams sold tickets at below market clearing prices to fans who waited on long lines are fading fast.
The days when sports teams sold tickets at below market clearing prices to fans who waited on long lines are fading fast.
NBER working papers on design of partnerships and auctions
Two new NBER papers touch on market design: Hilt and O'Banion discuss the introduction of limited partnerships, and Bajari and Yeo look at how changes in the rules of FCC spectrum auctions changed bidding behavior.
The Limited Partnership in New York, 1822-1853: Partnerships without Kinship
by Eric Hilt, Katharine E. O'Banion - #14412 (DAE LE)
Abstract:
In 1822, New York became the first common-law state to authorize the formation of limited partnerships, and over the ensuing decades, many other states followed. Most prior research has suggested that these statutes were utilized only rarely, but little is known about their
effects. Using newly collected data, this paper analyzes the use of the limited partnership in nineteenth-century New York City. We find that the limited partnership form was adopted by a surprising number of firms, and that limited partnerships had more capital, failed at lower rates, and were less likely to be formed on the basis of kinship ties, compared to ordinary partnerships. The latter differences were not simply due to selection: even though the merchants who invested in limited partnerships were a wealthy and successful elite, their own ordinary partnerships were quite different from their limited partnerships. The results suggest that the limited partnership facilitated investments outside kinship networks, and into the hands of talented young merchants.
http://papers.nber.org/papers/W14412
Auction Design and Tacit Collusion in FCC Spectrum Auctions by Patrick Bajari, Jungwon Yeo - #14441 (IO)
Abstract:
The Federal Communications Commission (FCC) has used auctions to award spectrum since 1994. During this time period, the FCC has experimented with a variety of auctions rules including click box bidding and anonymous bidding. These rule changes make the actions of bidders less visible during the auction and also limit the set of bids which can be submitted by a bidder during a particular round. Economic theory suggests that tacit collusion may be more difficult as a result. We examine this proposition using data from 4 auctions: the PCS C Block, Auction 35, the Advanced Wireless Service auction and the 700 Mhz auction. We examine the frequency of jump bids, retaliatory bids and straightforward bids across these auctions. While this simple descriptive exercise has a number of limitations, the data suggests that these rule changes did limit firms' ability to tacitly collude.
http://papers.nber.org/papers/W14441
The Limited Partnership in New York, 1822-1853: Partnerships without Kinship
by Eric Hilt, Katharine E. O'Banion - #14412 (DAE LE)
Abstract:
In 1822, New York became the first common-law state to authorize the formation of limited partnerships, and over the ensuing decades, many other states followed. Most prior research has suggested that these statutes were utilized only rarely, but little is known about their
effects. Using newly collected data, this paper analyzes the use of the limited partnership in nineteenth-century New York City. We find that the limited partnership form was adopted by a surprising number of firms, and that limited partnerships had more capital, failed at lower rates, and were less likely to be formed on the basis of kinship ties, compared to ordinary partnerships. The latter differences were not simply due to selection: even though the merchants who invested in limited partnerships were a wealthy and successful elite, their own ordinary partnerships were quite different from their limited partnerships. The results suggest that the limited partnership facilitated investments outside kinship networks, and into the hands of talented young merchants.
http://papers.nber.org/papers/W14412
Auction Design and Tacit Collusion in FCC Spectrum Auctions by Patrick Bajari, Jungwon Yeo - #14441 (IO)
Abstract:
The Federal Communications Commission (FCC) has used auctions to award spectrum since 1994. During this time period, the FCC has experimented with a variety of auctions rules including click box bidding and anonymous bidding. These rule changes make the actions of bidders less visible during the auction and also limit the set of bids which can be submitted by a bidder during a particular round. Economic theory suggests that tacit collusion may be more difficult as a result. We examine this proposition using data from 4 auctions: the PCS C Block, Auction 35, the Advanced Wireless Service auction and the 700 Mhz auction. We examine the frequency of jump bids, retaliatory bids and straightforward bids across these auctions. While this simple descriptive exercise has a number of limitations, the data suggests that these rule changes did limit firms' ability to tacitly collude.
http://papers.nber.org/papers/W14441
Monday, October 27, 2008
Slavery
Court Finds Niger Guilty on Slavery Charge
"A West African regional court found the government of Niger guilty on Monday of failing to protect a young woman who was sold into slavery at the age of 12. ...
"Slavery is outlawed in Niger and the rest of Africa, but it persists in pockets of Niger, Mali and Mauritania. Ms. Mani’s experience was typical of the practice. Her impoverished family sold her to a farmer named Souleymane Naroua when she was 12 for about $500."
"A West African regional court found the government of Niger guilty on Monday of failing to protect a young woman who was sold into slavery at the age of 12. ...
"Slavery is outlawed in Niger and the rest of Africa, but it persists in pockets of Niger, Mali and Mauritania. Ms. Mani’s experience was typical of the practice. Her impoverished family sold her to a farmer named Souleymane Naroua when she was 12 for about $500."
Sunday, October 26, 2008
Business networking thrives in a recession
Business networking is countercyclical: the Financial Times reports
"Professional networks such as LinkedIn and Xing, a European rival, have surged in popularity amid the economic crisis, as people look for advice and jobs from their online contacts."
"Online recruitment sites, such as Monster, Careerbuilder and Yahoo’s HotJobs, saw visitors leap 42 per cent in the same period.
“Financial services is one of our fastest-growing sectors,” said Mr Nye, with activity – frequency and duration of visits – up 50 per cent in August and September.
“Clearly people are joining as they are thinking about their employment situation. People are also getting advice from their network, reference-checking vendors or searching for candidates to fill positions.”
Xing now hosts a 2,000-strong group for “Lehman Brothers Alumni”.
Lars Hinrichs, chairman and chief executive of Xing, said: “We see the crisis as very beneficial for business networks because you are spending more time on your career than on luxuries.”
"Professional networks such as LinkedIn and Xing, a European rival, have surged in popularity amid the economic crisis, as people look for advice and jobs from their online contacts."
"Online recruitment sites, such as Monster, Careerbuilder and Yahoo’s HotJobs, saw visitors leap 42 per cent in the same period.
“Financial services is one of our fastest-growing sectors,” said Mr Nye, with activity – frequency and duration of visits – up 50 per cent in August and September.
“Clearly people are joining as they are thinking about their employment situation. People are also getting advice from their network, reference-checking vendors or searching for candidates to fill positions.”
Xing now hosts a 2,000-strong group for “Lehman Brothers Alumni”.
Lars Hinrichs, chairman and chief executive of Xing, said: “We see the crisis as very beneficial for business networks because you are spending more time on your career than on luxuries.”
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