Search

Increasingly, more school districts across the United States are using centralized admissions for charter, magnet, and neighborhood schools in a common enrollment system. We first show that across all school‐participation patterns, full participation in the common (or unified) enrollment system leads to the most preferred outcome for students. Second, we show that, in general, participation by all schools may not be achievable because schools have incentives to stay out. This may explain why some districts have not managed to attain full participation. We also consider some specific settings where full participation can be achieved and propose two schemes that can be used by policymakers to achieve full participation in general settings. [ABSTRACT FROM AUTHOR]

We study assignment systems where objects are assigned to agents sequentially. Student placement to exam and mainstream schools in the USA and centralized teacher appointment in Turkey are two of many examples. Despite their prevalence in practice, research on sequential systems has been rather limited. We analyze the properties of the systems in use in these places and show that they do not satisfy desirable fairness, welfare, and incentive criteria. It turns out such shortcomings are inherent in more general sequential assignment systems as well. We then analyze preference revelation games associated with various sequential systems including those comprising of combinations of well-known mechanisms. [ABSTRACT FROM AUTHOR]

The main purpose of this paper is to explore the consequences of the formation of either a Regional Popular Vote Interstate compact or a National Popular Vote Interstate compact on the functioning of a toy symmetric version of the Electoral College. The two versions of interstate compacts that are considered here differ in only one respect: in one case, the interstate compact allocates its electoral votes to the regional popular winner, while in the other case it allocates the votes to the national popular winner. They both differ from the ongoing National Popular Vote Interstate Compact as it is assumed that the agreement is effective as soon as the members sign it. Decisiveness and welfare analyses are conducted with a simplified symmetric theoretical version of the Electoral College wherein malapportionment problems are absent. The three most popular probabilistic models are considered and the study is conducted either from the self-interest perspective of the initiators of the interstate compact or from a general interest perspective. The analysis combines analytical arguments and simulations. [ABSTRACT FROM AUTHOR]

Consider spouses who engage in Nash bargaining to allocate resources between them. The person with a higher income when unmarried enjoys a larger share of the joint income, and benefits less from an increase in joint income. This difference can cause spouses who have the same utility functions and the same family incomes to differ in their benefits from governmental tax and spending policies, and to cast opposing votes. In particular, these incentives can generate a gender gap, with women more supportive than men of governmental taxes and spending. [ABSTRACT FROM AUTHOR]

The impact of the Electoral College on U.S. presidential elections is often criticized by academics and political commentators. One facet of its impact, the winner-take-all allocation of states' Electoral College votes, serves in practice to overweight some votes in some states relative to other votes in other states. These disparities in the relative impact of votes in a presidential election can be large. Here, a metric is introduced to quantify the magnitude of these disparities in each presidential election. Using that metric, we show that states whose votes were overweighted in a presidential election subsequently received higher levels of federal grant spending under the newly-elected (re-elected) administration. [ABSTRACT FROM AUTHOR]

This paper explores the early development of three important fiscal institutions faced by U.S. state governments: property tax limits (PTLs), balanced budget rules (BBRs), and the gubernatorial line-item veto (LIV). Specifically, this study attempts to provide historical context for their development and an empirical investigation of their long-run effect on state finances (running from 1830 to 1920). Results, which are robust to a number of specifications, suggest that early PTLs decreased both revenues and expenditures, BBRs had a larger effect on revenues rather than expenditures, while the LIV had a somewhat limited effect on both revenues and expenditures. [ABSTRACT FROM AUTHOR]

Throughout the nineteenth century, U.S. states developed extensive fiscal constraints meant to limit public investment in infrastructure projects, especially railroad aid. These limitations came as a direct result of perceived malinvestment and mishandling of public funds in earlier infrastructure projects that were pursued to promote state and local economic development. However, an important yet under-researched question is to what extent these constraints may have helped or hindered the development of public infrastructure across these states. Overall, the evidence would suggest that in general, more binding constraints that limited the ability of state and local governments to invest in these projects actually led to an increase in railroad mileage. These findings provide important insights both regarding the development of railroads throughout the U.S. and offer a potential counterfactual to some European and Scandinavian experiences, which saw extensive public aid and in some instances nationalisation of railroad lines. [ABSTRACT FROM PUBLISHER]

Through the nineteenth century numerous U.S. states developed extensive municipal fiscal constitutions. These generally came in the wake of financial crises and large-scale default of public debts. Although the constraints were imposed in order to minimize the likelihood that such outcomes would occur in the future, little work has been undertaken to analyze whether they were successful in achieving that goal. Therefore, this current study attempts to do so by empirically investigating how procedural safeguards and outright prohibitions on debt accumulation, along with hard budget constraints, and tax limits impacted the likelihood of default. This is done by evaluating municipal defaults that centered on the Panic of 1893. Overall, the results suggest that outright prohibitions on debt accumulation and hard budget constraints actually reduced the likelihood of municipal default across states, while tax limits and procedural safeguards increased that likelihood. [ABSTRACT FROM AUTHOR]

This paper tests for political budget cycles among U.S. municipalities. According to the political budget cycle hypothesis, in election years government officials engage in opportunistic fiscal policy manipulation for electoral gains. We test that hypothesis using data on taxes, spending, and employment for a panel of 268 U.S. cities over the period 1970-2004. While our estimates provide no evidence of altered total expenditures or taxes in election years, we do find a 0.7 % increase in total municipal employment, including increases in police, education, and sanitation employment. [ABSTRACT FROM AUTHOR]

Elected leaders delegate rulemaking to federal agencies, then seek to influence rulemaking through top-down directives and statutory deadlines. This paper documents an unintended consequence of these control strategies: they reduce regulatory agencies' ability and incentive to conduct high-quality economic analysis to inform their decisions. Using scoring data that measure the quality of regulatory impact analysis, we find that hastily adopted 'interim final' regulations reflecting signature policy priorities of the two most recent presidential administrations were accompanied by significantly lower quality economic analysis. Interim final homeland security regulations adopted during the G.W. Bush administration and interim final regulations implementing the Affordable Care Act in the Obama administration were accompanied by less thorough analysis than other 'economically significant' regulations (regulations with benefits, costs, or other economic impacts exceeding $100 million annually). The lower quality analysis apparently stems from the confluence of presidential priorities and very tight statutory deadlines associated with interim final regulations, rather than either factor alone. [ABSTRACT FROM AUTHOR]

This paper provides a theory of earmarking based on the relative power of a legislature and executive. The politically powerful use earmarking as a means of resolving uncertainty and insulating preferred policy from the reach of future government. Tax revenue will be earmarked more often when political power is unified under one party or when a party has the legislative majority needed to overturn a gubernatorial veto. An empirical test of the theoretical predictions are conducted using a panel of data for US states. A state with a legislature controlled by a single party with a large enough majority to overturn a gubernatorial veto will earmark 5% more of its tax revenue than other states and a state with a unified government will earmark 6.5% more. Together these explain 18.5% of the observed decrease in the percentage of state tax revenues earmarked from 1954 to 1997. [ABSTRACT FROM AUTHOR]

The study addresses the economic effectiveness of vaccination in the case of highly pathogenic avian influenza (HPAI) outbreaks. The effectiveness is evaluated in a U.S. case study comparing the outbreak costs under the currently recommended HPAI control practice versus one which also includes vaccination. An integrated economic-epidemic partial equilibrium model is used to empirically simulate HPAI outbreaks in three different poultry regions within the State of Texas. The simulation results show that the effectiveness of vaccination depends on flock density in the region and risk aversion preferences of the decision maker. In regions with high flock densities, if the decision maker is less risk averse the currently recommended strategy-which includes depopulation, movement restrictions, and flock testing-is more cost-effective than the same strategy supplemented with vaccination. Addition of vaccination improves cost effectiveness only if the decision maker is highly risk averse or if surveillance, carcass disposal, and cleaning costs are high. In regions with medium and low flock densities, adding vaccination to the currently recommended strategy is not cost-effective except in the case of high surveillance, carcass disposal, and cleaning costs. [ABSTRACT FROM AUTHOR]

Many school districts in the US. employ centralized clearing houses to assign students to public schools. An important potential threat against any school choice mechanism is the tendency of schools to circumvent the procedure via two kinds of strategic manipulation: manipulation via capacities and manipulation via pre-arranged matches. This paper studies the extent of the vulnerability of three prominent school choice mechanisms that have been adopted (or, considered for adoption) by some school districts in the US. We find that the highly debated Boston mechanism as well as the top trading cycles mechanism are immune to manipulation via capacities, unlike the student-optimal stable mechanism (SOSM). We show that SOSM is immune to manipulation via capacities if and only if the priority structure satisfies an acyclicity condition proposed by Ergin (Econometrica 70:2489-2497, ). On the other hand, we show that essentially no mechanism is immune to manipulation via pre-arranged matches. [ABSTRACT FROM AUTHOR]

Between 1839 and 1842 the United States suffered through an acute debt crisis. Over this period, eight states and one territory defaulted, five of which outright repudiated all or parts of their outstanding debts. However, for many of those same states, reentry into capital markets occurred relatively rapidly and at rather favorable terms. The question then arises, how and why was this possible? This work attempts to explain this phenomenon by suggesting that soon after default or repudiation many states enacted constitutional amendments meant to significantly constrain and credibly commit future governments from overextending credit and simultaneously to pursue time-consistent public policy. I explore this by examining the impact that these newly imposed constitutional amendments, which limited both the type and amount of debt and created stronger procedural safeguards for issuing debt, had on average bond prices, gathered from New York market data. Overall, my results show that newly constrained states had higher average bond prices than states that did not impose constitutional limits on debt financing, suggesting that markets did, in fact, perceive these constitutional changes to be binding and credible. [ABSTRACT FROM AUTHOR]

Various countries have recently implemented Freedom of Information acts believing that greater transparency can reduce public sector corruption. To test this, we analyze annual data on 128 countries between 1984 and 2003 using a variety of propensity score matching techniques and overall find no significant relationship with one exception: In the developing world, FOI acts are significantly associated with rising levels of corruption. Further investigation suggests this may be due to the fact that the effectiveness of FOI acts appears to be conditioned by a country's institutional arrangements. [ABSTRACT FROM AUTHOR]

A well-intentioned and fully informed regulator may determine that the optimal policy is to deregulate the market, yet the regulator may be constrained from doing so. In this condition, deregulatory policies originate in exogenous shocks to the regulator’s choice environment. Entrepreneurship in political and economic markets is a primary source of institutional change that promotes deregulation. [ABSTRACT FROM AUTHOR]

Ethanol production in the United States has been steadily growing and is expected to continue growing. Many politicians see increased ethanol use as a way to promote environmental goals, such as reducing greenhouse gas emissions, and energy security goals. This paper provides a benefit-cost analysis of increasing ethanol use based on an analysis by the Environmental Protection Agency. We find that the cost of increasing ethanol production to almost ten billion gallons a year is likely to exceed the benefits by about three billion dollars annually. We also suggest that earlier attempts aimed at promoting ethanol would have likely failed a benefit-cost test, and that Congress should consider repealing ethanol incentive programs, such as the ethanol tariff and tax credit. [ABSTRACT FROM AUTHOR]

The paper addresses the incentives of the public sector to implement new technologies in public service provision. The focus is on the role of local governments under decentralization. Exploiting variation in the level of innovation in a large sample of US school districts, the impact of yardstick competition on the choice of public sector technologies is identified. It is shown that the impact of other districts’ innovation activity on a district’s innovation score is much stronger in communities where incumbents face a high risk of being elected out of office. This finding suggests that under decentralization, yardstick competition is an important force shaping the decisions of local governments to adopt new technologies. [ABSTRACT FROM AUTHOR]

Measuring the effect of ballot access restrictions on electoral competition is complicated because the stringency of ballot access regulations cannot be treated as being exogenous to candidates’ entry decisions. This paper exploits the 1968 U.S. Supreme Court decision to strike down Ohio’s ballot access law as a natural experiment to overcome the endogeneity problem. The evidence from difference-in-difference estimations suggests that the court’s decision and the accompanying sharp decrease in Ohio’s petition requirements resulted in major parties facing a significant increase in competition from third party and independent candidates. [ABSTRACT FROM AUTHOR]

Political influence on the use of the nation's war-making resources is considered in this study. Given the ‘tax-like’ consequences arising from military fatalities, rational political agents may engage in behavior that minimizes the negative electoral consequences resulting from the fatalities. An empirical model of the state-by-state allocation of U.S. Army fatalities resulting from Operation Iraqi Freedom is developed and tested. The results suggest that political influence originating in the White House is present in the allocation of fatalities from the military action in Iraq, but that Congressional effects, if any, are much weaker. In particular, population-adjusted fatality rates are lower in states that were highly contested ‘battleground’ states rich in Electoral College votes in the 2004 Presidential election. [ABSTRACT FROM AUTHOR]