Burton A. Abrams

The ‘crowding-out’ effect of governmental transfers on private charitable contributions

Concluding RemarksThe above analysis provides support for the proposition that governmental social-welfare transfers have actually served to attenuate private charitable giving. Our finding of less-than-total crowding out tends to reject both the ultrarational and BGR hypotheses for society as a whole. However, our results do not preclude the possibility that some contributors have been completely crowded out nor that some contributors have been unaffected by increases in governmental transfers.The highly aggregative data used in this study may conceal substantially different crowding-out effects for particular types of charitable contributions. Further investigation using microeconomic or less aggregative data should help to identify the categories of private charitable contributions most affected by the growth of governmental transfers.

Women's suffrage and the growth of the welfare state

In this paper we test the hypothesis that extensions of the voting franchise to include lower income people lead to growth in government, especially growth in redistribution expenditures. The empirical analysis takes advantage of the natural experiment provided by Switzerlands extension of the franchise to women in 1971. Womens suffrage represents an institutional change with potentially significant implications for the positioning of the decisive voter. For various reasons, the decisive voter is more likely to favor increases in governmental social welfare spending following the enfranchisement of women. Evidence indicates that this extension of voting rights increased Swiss social welfare spending by 28% and increased the overall size of the Swiss government.

The effect of government size on the unemployment rate

Recent empirical studies have revealed that the size of government is inversely related to economic growth and technical efficiency. Evidence is presented linking the size of government to reported unemployment rates for the industrial countries during recent years. This finding helps to explain the empirical link between government size and poor macroeconomic performance.

Pressure-group influence and institutional change: Branch-banking legislation during the Great Depression*

Between 1931 and 1935 the change in the state laws governing the organizational structure of banking was significant. Twenty-two states relaxed restrictions over branch banking, even though many had previously prohibited it. We apply a model of pressure-group and rent-seeking behavior to investigate the reasons underlying this remarkable shift in the institutional arrangements for regulating the structure of the banking industry. The findings indicate that the extraordinarily high rate of bank failures tipped the political balance toward the pro-branching forces in many states. However, in a number of states growth in the influence of branch and group bankers and increases in urbanization were largely responsible for the relaxation of restrictions over branch banking.

The influence of state-level economic conditions on the 1992 U.S. presidential election*

Evidence is found that state-level economic conditions played a significant role in the defeat of George Bush in the 1992 U.S. presidential election. Evidence is also found which indicates that the entrance of Ross Perot into the race as an independent candidate was not instrumental in the Bush loss.

Human rights and the distribution of U.S. foreign aid

In contrast to the findings of other studies, we conclude that human rights play a significant and substantive role in determining the distribution of U.S. foreign aid. We find that the foreign aid program relates aid to the need of recipient nations, rewards nations for furthering human rights, does not discriminate on the basis of race or religion, and responds to national security interests of the U.S. The finding that the program does what most people assert it should do provides a new explanation for the rigidity of distributions over time.

The Impact of Banking and Fiscal Policies on State-Level Economic Growth

This paper investigates the hypothesis that economic growth is affected by banking structure and fiscal policies. We use data from the 48 contiguous states for the period 1950–1980 aggregated into six five-year time periods, primarily to test the effect of the following factors on growth of state per capita income: (i) restrictions over branch banking, (ii) restrictions over multibank holding companies, (iii) the depth of financial assets in a state, (iv) the financial-intermediary mix, (v) the size of state government, and (vi) the methods of financing state government. We find no support for the hypotheses that branch banking or multibank holding company restrictions affect growth. However, financial depth and the mix of financial intermediaries are strongly correlated with economic growth. Finally, the state fiscal policy variables had no significant effect on income growth.

Cultural and Institutional Determinants of Economic Growth: A Cross-Section Analysis

Economic growth rates for the period 1968–1987 are analyzed for ninety countries. Culture, political and economic arrangements, and personal freedoms are statistically significant determinants of growth. Personal freedom is shown to be a normal good whose demand might be affected by cultural influences. Democracies raise personal freedoms,ceteris paribus, and, consequently, grow more quickly than non-democratic regimes. Evidence is found for the convergence hypothesis; other things equal, lower income countries grow more rapidly than higher income countries.

Predicting Bank Failures: The Role of Structure in Affecting

The acceleration in the number of US bank failures during recent years provides valuable data for developing bank failure prediction models. A probit models which incorporates various bank structure variables as well as traditional financial ratios is used to explain bank failures during the 1982—3 period. The empirical findings suggest that important information regarding a banks likelihood of failure is contained in its balance sheet and income accounting data. It is also found that banks which affiliate with holding companies or are larger in size have a significantly lower probability of failure. This suggests that states which impose unit-banking rules or block holding company formation may be adding to failure risks.

A median-voter model of economic regulation

A basic median-voter model is developed and extended to analyze issues of economic regulation and public policy outcomes. The model is used to generate comparative static results relating changes in public-policy outcomes to changes in relative group sizes, total population, information costs, and population heterogeneity. The model is also used to explore the issue of optimal group size — the size of the special-interest group that maximizes the groups per capita public policy gains. Comparative static analysis reveals how optimal group size and gains per capita are affected by changes in population heterogeneity, the size of the total population, and relative knowledge levels.