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This article presents abstracts of several papers published in the June 1965 issue of American Economic Review. In the article Economic Education: Aspirations and Achievements, the G. L. Bach and Phillip Saunders described the present state of economics in U.S. high schools. While the article Biased Efficiency Growth and Factor Substitution in the U.S. Economy, 1899-1960, dealt with the central issue of the form taken by increases in the efficiency of conventionally measured labor and capital inputs. In the article Regulation and Conspiracy, the Fred M. Westfield investigated the relationship between profits earned and prices paid for capital goods purchased by the privately-owned public utility firm whose rate of return is limited by a regulatory authority.

The article examines the profit performance effects of the separation of the ownership from control in large United States Industrial corporations. It is reported that between the years 1961 and 1969 there was a growing separation of ownership from control in large U.S. industrial corporations. The article explains that this separation affected three different aspects of the corporations' profit performance. These changes included the average rate of return on net worth, the variability of rates of return, and the response of rates of return to changes in corporate profits tax rates.

This article studies the returns to investment in the graduate education of doctor of philosophy degree (Ph.D.) academicians in the U.S. The alternative income of Ph.D. faculty is an estimate of the income of bachelor's degree holders taken from an extensive survey of salaries in occupations open to the degree holders. The economic condition of all faculty employed by institutions of higher education in the country, is discussed. Lastly, this study investigates the effects of graduate school dropouts on their computed social rates of return.

This article focuses on advertising, profits and corporate tax revisited. In the previous issue of the journal "The Review of Economics and Statistics," L.W. Weiss, an author, estimated the overstatement or understatement of profit and rate of return which result from the corporation income tax rule permitting firms to write off long-lived advertising expenditures in the year in which they are incurred. The purpose of this article is to introduce those improvements and revise the estimates of reported and true profits and rates of return for the U.S. Internal Revenue Service's(IRS) minor industries and 10 large advertisers used in the previous study. T. R. Stauffer, a economist, has developed a very sophisticated analysis of biases in accounting profits. He concluded that the bias introduced by the expensing of advertising depends not only on growth and depreciation rates but on the time profile of cash flow associated with fixed capital outlays and on the ratio of non-depreciable working capital to fixed capital as well.

This study is concerned with an analysis of male earnings in the United States in 1959, with special emphasis on their relation to schooling and age, and on the demand for investment in schooling among various population groups. The empirical investigation is based on a cross-sectional sample of the 1960 Census of Population. The first section comprises an estimation of the earnings function, correlating expected earnings with age and education, after various other relevant factors are standardized. In the second section, internal rates of return on schooling are derived on the basis of the previous estimates. These rates are then interpreted and analyzed in terms of the demand function for investment in education. [ABSTRACT FROM AUTHOR]

In a recent article, economist Robert J. Lamer made an invaluable study of the extent of management control among the 200 largest nonfinancial corporations in 1963 and compared his findings with the 1929 study by economists A.A. Berle and G.C. Means. Lamer obtained data for the 200 largest nonfinancial corporations from annual reports. This list is composed of firms primarily engaged in manufacturing, mining, merchandising, transportation, and electric, gas, and pipeline utilities. Banks, insurance companies, and investment companies are excluded. Size is measured in terms of book assets although this overstates the relative size of transportation and utility companies. The author concludes that while Lamer's study which corroborates the Berle-Means thesis of increasing management control in the U.S. economy is an important contribution, two of these management-related variables with which he was concerned-type of control and change in size do not appear to explain very much of the variation in profit rates among the 200 largest non-financial companies included in his sample.

The uses of regression analysis to estimate market yield curves for U. S. Government securities are considered in this paper. Several possible regression models for this purpose are examined. It is found that models which regress either the before-tax yield or the after-tax yield of governments on the number of days remaining to maturity and the square of the logarithm of the number of days remaining to maturity can fruitfully be applied to actual market data in determining yield curves. [ABSTRACT FROM AUTHOR]

The purpose of this article is to re-examine U.S. entrepreneurial income for the 1926-1969 period. The basic division of entrepreneurial income is achieved by imputing a competitive wage to self-employed workers and allocating the residual income to capital. The implied rate of return on noncorporate capital is then computed and compared to the rate of return on corporate capital. This methodology is not novel, but the conclusions reached are markedly different from those of previous studies, which found that the noncorporate rate of return is much smaller than the corporate rate of return.

Features a study on the relation of railroad establishment to the economic development in the United States. Technological innovations in the railroad industry; Contributions of railroads to national income; Estimated costs of transportation services; Construction and maintenance of railroads.

In this article, the author wishes to show that a specific theory, the theory of investment in human capital, may be used to demonstrate that, across regions, the level of schooling can be related to income inequality and that, this relation is positive. He also demonstrates that the observed negative simple correlation for the states of the U.S. may be related to the omission of two variables that are relevant to the determination of income inequality. These variables are the average rate of return from schooling and the inequality in the distribution of years of schooling attended. The article concludes that the higher the average level of schooling in a region, the greater the inequality of income in that region. If simple correlation coefficients are examined, other variables may produce a negative simple correlation. The greater the relative mobility of those with higher levels of schooling, the larger is the negative correlation between the average level of schooling and the average rate of return, and, thus, the greater is the likelihood of a negative simple relation between the average level of schooling and income inequality.

The author describes the results of his current research designed to measure total investment, tangible and intangible, and the derived capital stocks for the U.S. 1929-1966. With respect to total investment, the estimates show a marked increase in its ratio to GNP. All of the increase occurs in the intangible component comprising R & D, education and training, health, and mobility. The increase was concentrated in the government sector, although households increased the proportion of disposable personal income devoted to total investment. Consistent with the relative investment trends, the stock of intangible capital grew considerably faster than the tangible stock. The growth of total capital stocks was somewhat less than that of GNP, however, in both current and constant prices. Thus, the rate of return on total capital rose somewhat over the period. Average rates of return on human and non-human capital were closely similar. In real terms, the growth of total capital stocks accounted for two-thirds of the growth in real GNP, 1929-1966. One-third of the growth is attributed to residual forces, chiefly economies of scale, changes in economic in economic efficiency, changes in inherent quality of human and natural resources, changes in values and motivations, and changes in rates of utilization of capacity. The growth of the ratio of real intangible stocks to real tangible stocks accounted for less than half of the increase in total factor productivity 1992-1966. This is significantly less than the contribution of intangibles as estimated by Denison, and the author adduces several reasons why his estimates may understate the contribution. Nevertheless, it seems that the net effect of the residual forces enumerated above must also have made a substantial contribution to the growth of tangible factor productivity and real GNP over the 37-year period. [ABSTRACT FROM AUTHOR]

The field market for natural gas in the U.S. in the 1960s is subject to formal price control regulation administered by the Federal Power Commission, which has undertaken to convert a regulatory statute designed to impose traditional rate of return utility regulation into a device for freezing the field price of natural gas at the 1959-1960 level. The decision to impose price control on the field market for natural gas was based on assumptions that the supply of natural gas is unresponsive to price and that price is an undesirable device to allocate the available gas between competing users.

Presents information related to several articles related to economics and statistics. Statistical discrepancies in the Great Britain national income estimates; Issues related to postal finance in the United States; Problems of time-stream evaluation.

The article focuses on price and productivity trends in manufacturing industries. The purpose of this paper is to examine one way in which these supply oriented developments manifest themselves the relationship between price trends and productivity trends for one sector of the economy-manufacturing. The relationship between price and productivity trends in manufacturing industries is examined from two different viewpoints, the administration's price-wage guideposts and expected price movements where an industry attempts to maintain a target rate of return on capital. The first has been put forth as a theoretical norm of how prices should behave in areas where market power is present. The second has been found by many observers to be a plausible and useful explanation of price policies in such areas. To what extent has it reflected attempts to maintain target rates of return and under what conditions are supply dominated price policies, as reflected in the target rate model, compatible with price stability are some of the questions. To implement the empirical investigation of these questions, estimates have been made of price and productivity trends in 26 manufacturing industries over the five-year period, 1959-1964 and in 19 manufacturing industries over the preceding five-year period, 1954-1959.

The article presents information on studies conducted in United States concerning the shortage of physicians. One study has examined incomes of physicians relative to that of the other comparable groups in the economy. The basic assumption in this type of analysis is that if the incomes of physicians increase faster than the incomes of other comparable groups, then, the supply of physicians is not increasing as fast as the demand. Such a rise in the incomes of physicians, relative to the income of others, is taken as evidence of a shortage of physicians. Another study indicates that there is presently a shortage of physicians, but that the shortage is being decreased. This study calculates the internal rate of return on an investment in training to become a physician. In conclusion, then, is that even though the market may operate as we would expect on the basis of market theory, the equilibrium market solution to the supply of physicians is likely to be non-optimal. Although it is not clear, in a world where external effects are not unusual, that an increase in the supply of physicians would move us closer to the optimal allocation of resources, it is clear that the market supply of physicians will be non-optimal.

The theoretical analysis set forth in Section I shows that while the capital controls programs initially improve the balance of payments, this initial effect can be reversed after a time. The dynamic simulations over the period 1965:2- 1970:4 presented in Section II suggest the estimate of the control's effect in the initial year is an improvement of approximately $4.5 billion in the liquidity balance. Also, the effects are estimated to diminish gradually and continuously to an annual rate of some $2.8 billion after 5 years. [ABSTRACT FROM AUTHOR]

The article presents information on marketing research being carried out in various universities. In the University of Illinois, researcher Robert V. Mitchell has prepared a study with the title "Trends in Rural Retailing in Illinois, 1926-38." The said study was published by the Bureau of Business Research. At the University of Minnesota, three dissertations are underway; "National Brand Advertising and Monopolistic Competition" by Helen G. Canoyer, "Social and Economic Aspects of the Chain Store Movement" by Harold Haas and "Analysis of Consumer Cooperation As a Form of Economic Control" by Vant Kebker.

The article presents abstracts of marketing literature. They include "Some Marketing Problems of the United States Automobile Tire Industry and Some of Their Effects Upon That Industry Since 1922," by W. W. Leigh, "The Quantitative Evaluation of New England Retail and Wholesale Channels of Distribution," and "An Economic Study of the Factors Affecting the Demand for the Prices of New York State Potatoes and Competing Products."

The article reports on a study relating to U.S. inflation and public utility inflation in the 1950's. The study indicates that returns to utility stockholders have generally kept pace with inflation. Utility assets constitute 20% of the total assets of all non-financial corporations in the U.S. Total revenue of public utility companies in 1958 approximated 6.9% of the disposable personal income. Public utilities have consumed 40-50% of all new corporate security issues. Experts speculate that the enormous expansion of physical assets combined with the relatively small role of retained earnings creates a dependence on external capital.

The article discusses checks and their importance as a medium of exchange that is free of regulation, and, it seems, analysis. This article examines the price determinants and price impact in New York State of special banking services known under several names that include Checkmaster, Check-o-matic, or Autocheck. The article focuses on the cost reductions that result in an average price, the profitability of the service, and the insulated nature of the pricing component of checking services. Structure of the price, bank revenue and price, bank costs and profits, comparative prices, and competition are all considered.

The article discusses the nature and meaning of the new economic environment being experienced by the U.S. as of 1963. It is noted that there is an increased importance of technological change. An increase in the share of privately produced services in the consumer's dollar is also noted. The growth of government employment and its effect on the economic environment are explained. Some implications of the new economic environment are explained which include the growth of output and employment, organized labor, management and the wage-price problem.

Presents a study which tested Douglass C. North's common sense generalization on the differential earnings of large and small-scale land speculators in Iowa. Focus of the study; Impact of the public land disposal system on income distribution in the United States.

Obviously, the question arises as to whether the National Transportation Policy the National Transportation Policy statement of Congress requires the phrase "to recognize and preserve the inherent advantages of each [mode of transportation]." Under a competitive environment, efficient carrier management, efficient carrier management will recognize and preserve the inherent advantages the carrier possesses or be replaced by a management that can. The market place will determine whether the inherent advantages are sufficient to allow the carrier to survive. The uneconomic status of our current transportation system indicates that the inherent advantages of carriers have not been recognized and preserved. The National Transportation Policy should be more concerned with establishing competitive conditions and preventing aberration from those conditions. Shippers seeking the most economical transportation from a price-quality point of view in combination with carriers seeking by exploiting their inherent advantages will be sufficient to "recognize and preserve." [ABSTRACT FROM AUTHOR]

This article criticizes the Phase II of the wage-price control program of the United States. A number of issues concerning the present program of price and wage controls divide members of the Brookings Panel on Economic Activity, as they divide economists generally. This paper does not deal with the more basic of these issues. Rather, it takes as given the decisions to freeze prices and wages last August 1971, and to follow the freeze with a program for Phase II having essentially the objectives of the present one. It considers how well the program is achieving these objectives and whether and how they might be achieved more effectively. The treatment is selective rather than comprehensive. Assuming that the administration knew what it was getting into in adopting mandatory wage and price controls, it surely deserves credit at least for courage in electing to use them. And having taken that decision, it did some things well. First, it gave no indication that it was going to take this course; the public, business, and the unions were taken completely by surprise. The result is in sharp contrast with the terrible mess created in 1950, when discussion of a possible freeze was allowed to go on for nearly six months -- and government officials themselves actively contributed to it.

This article focuses on the model of growth in which the level of investment is determined jointly by the interaction of the stock of capital, its demand and the flow supply of investment goods in the U.S. To derive a marginal efficiency of investment schedule from a firms' profit maximizing behavior have relied largely on the assumption that there are costs to adjusting the actual to the desired stock of capital at a fast rate. It is believe that the model of investment corresponds quite closely to Keynes' vision of the investment process. When the price of capital goods is high, the level of investment is also high, if the price of capital is low, investment is also low. The simplest notion is the demand for capital services. The demand for capital is distinct and quite different from the demand for capital services.

The article presents a list that specifies doctoral degrees conferred during the academic year terminating June 1964, and theses undertaken in the same period. For General Economics; Methodology, degrees conferred to James F. Hofheinz for his paper on The evolution of economic philosophy. For Price and Allocation Theory; Income and Employment Theory; History of Economic Thought, degrees was conferred to Cleverland W. Bateman for his paper on Investment behavior and the acceleration principle. For Economic History; Economic Development; National Economies, degrees was conferred to researcher Ralph Anspach on his paper The problem of a plural economy and its effects on Indonesia's economic structure: a study in economic policy. For Statistical Methods; Econometrics; Social Accounting, the degree was conferred to researcher Takeshi Amemiya on his paper Specification analysis in econometrics. For Economic System; Planning and Reform: Cooperation, the degree was con fared to Michael Boreteky for his paper on The Soviet challenge to U. S. machine building: a study in production and technological policy.

The discussion in this article presents three aspects of economic effects of capital gains taxation that are of major policy importance. This article addresses the impact of capital gains taxation on economic growth, the impact of capital gains taxation on stabilization of the economy at full employment, and the impact of the tax on efficient use of our economic resources. In discussing the effects of capital gains taxation, the article refers to the differential behavior of the economy under two tax systems — a tax system yielding revenues equal to those collected under the present system but without the preferential features for asset transactions and a tax system such as is actually in effect. The comparison does not refer to the difference between the present tax structure and the same structure with preferential capital gains tax provisions deleted because a closing of all capital gains loopholes would generate different amounts of revenue. The desirability of alternative levels of revenue and their economic effects are issues that need not be discussed in this article.

Perhaps one-fifth of U.S. national income originates in industries subject to some direct regulation, and yet economists know very little about how regulation affects the market performance of an industry. The preambles of regulatory statutes hardly provide a reliable guide. Neither does the intensity of the complaints of regulated businessmen. This article seeks to point out the possible roads leading toward fruitful conclusions and to mention the tales told by a few travelers along the way. In the field of direct regulation, the obvious snare lies in supposing that the existence of maximum-or minimum-rate regulation guarantees profits respectively lower or higher than they would otherwise be. But the degree to which the prices that regulated businesses would like to charge could actually be translated into a different level of long-run profits depends on many factors. In addition, direct inferences of the net effects of regulation from its virtual impact tend to miss the possibility that regulation has important sideeffects on performance, as well as the more dubious possibility discussed by some political scientists that regulation typically becomes subverted to the interests of the regulated.