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In recent years many public outcries and expressions of indignation have focused on the claim that the poor pay more for the goods and services they buy than do their wealthier neighbors. A number of empirical studies have been undertaken to examine the specific question of the relative cost of food to low- and high-income consumers. Federal agencies, local governments, civic groups ad hoc consumer groups, the news media, and academic researchers have pursued these studies. This paper analyzes a comprehensive survey of food prices conducted in New York City during the summer of 1967 by the New York City Council on Consumer Affairs. The regression results of this study suggest that commodity-by-commodity with few exceptions, the prices of food items on retail merchants' shelves do not rise with decreases in neighborhood income. The cost of food may, in fact, be greatest to the poor, but a complete investigation of this issue will require data and discussion that go beyond the level of relative shelf prices in stores serving areas with different incomes.

The paper presents comments of the author on the article "Equity and the Finance of Higher Education," by Lee Hansen. Hansen has dome a through job of laying out a smorgasbord of schemes for finding college education and highlighting some of the main equity considerations. He observes that efficiency arguments based upon external benefits lack empirical footing and than proceeds to the analytically less ambiguous but equally unsustained equity issues. Here the very range of his discussion serves to emphasize the diversity of objectives and the lack of factual knowledge. Frankly, the author finds it hard to criticize the paper for sins of commission to given the state of data, for sins of omission. Alternatives are reported generally without taking sides and the author cannot fault the report. Instead of serving as critic in the traditional sense, let the author summarize a few points and then add to the speculation. Further, the distribution of attendance viewed as attendance probabilities by parental-income class is more equal than it would be in a system of full charge without accompanying loan programs.

This paper tests the relationship between average return and risk for New York Stock Exchange common stocks. The theoretical basis of the tests is the "two-parameter" portfolio model and models of market equilibrium derived from the two-parameter portfolio model. We cannot reject the hypothesis of these models that the pricing of common stocks reflects the attempts of risk-averse investors to hold portfolios that are "efficient" in terms of expected value and dispersion of return. Moreover, the observed "fair game" properties of the coefficients and residuals of the risk-return regressions are consistent with an "efficient capital market"--that is, a market where prices of securities fully reflect available information. In the two-parameter portfolio model of Tobin (1958), Markowitz (1959), and Fama (1965b), the capital market is assumed to be perfect in the sense that investors are price takers and there are neither transactions costs nor information costs. Distributions of one-period percentage returns on all assets and portfolios are assumed to be normal or to conform to some other two-parameter member of the symmetric stable class. Investors are assumed to be risk averse and to behave as if they choose among portfolios on the basis of maximum expected utility. A perfect capital market, investor risk aversion, and two-parameter return distributions imply the important "efficient set theorem": The optimal portfolio for any investor must be efficient in the sense that no other portfolio with the same or higher expected return has lower dispersion of return.[1]. [ABSTRACT FROM AUTHOR]

A decline in the variability of the market factor over the period 1926 to 1960 has been noted in various studies. A number of hypotheses have been advanced to explain this decline in the variability of returns. The formation of the U.S. Securities and Exchange Commission by the Securities Act of 1933 has been suggested as an important cause. Another suggested cause is the effect of margin requirements, which were first, instituted in 1934. Still another is the fact that the number of stocks listed on the New York Stock Exchange has more than doubled since 1926: thus we might expect the market factor to reflect a more diversified range of activities, and this could account for a decline in its variability. Finally, another hypothesis is that since the market factor reflects general economic conditions, any decline in its variability might be related to a decline in business fluctuations. This article examines these hypotheses. The major finding of the study, obtained from an examination of market-factor variability over the period of 1897 to 1969, is that the decline in variability observed by other studies is better described as a return to the "normal'' level of variability that existed before the great depression of the 1930's.

A number of empirical studies have been undertaken in recent years on food-price differentials across stores in metropolitan areas and have shed considerable light on this question. To date, the most detailed statistical analysis on whether the urban poor pay more for food than do urban residents with higher incomes is the study of food prices in New York City, New York. On the basis of their statistical-regression results for 37 commodities, they conclude that the price of a given commodity in a particular type of store tends to be unaffected by, or even rises with, an increase in the level of neighborhood income. They also point out, however, that the mean price of each of the items studied is higher in the small independent stores than in the chain stores. To the extent that poor people shop at these smaller stores, they pay higher prices for the same quality food than if they had purchased their groceries at a chain store. This article should be viewed as a first effort to develop a formal framework for understanding consumer purchasing decisions. The questionnaire administered in New Haven, Connecticut, uncovered a number of other factors, which appear to play an important role in the choice of store and package size.