Christopher Westley

Institutions, incentives, and disaster relief: The case of the Federal Emergency Management Agency following Hurricane Katrina

Purpose - The purpose of this paper is to highlight the importance of property rights institutions to disaster relief efforts, with a focus on the US Federal Emergency Management Agency in the aftermath of Hurricane Katrina in New Orleans, Louisiana. Design/methodology/approach - The paper utilizes public choice, Austrian, and new institutional analyses of bureaucracy. It discusses private and public sector responses to the situation in New Orleans following Katrina and to disasters in general, and compares the institutional frameworks that develop over time in both sectors. Findings - The paper finds that a large and bureaucratized response to disasters hinders economic calculation, incentive structure, and property rights institutions, all of which are crucial for rapid disaster response, the relief of human suffering, the minimization of knowledge problems, and the promotion of an efficient allocation of resources. Practical implications - This research suggests that the role of the price system in allocating resources is especially important following disasters and that in order to ensure relief efforts are as efficient as possible, public-sector actors should do nothing to impede them. It also suggests that the incentives to prepare an efficient emergency preparedness program are greater when those most affected by potential disasters are held responsible for their implementation. Originality/value - The paper provides a critical evaluation of the role of highly centralized approaches to disaster relief.

Government Regulation and Income Inequality in the United States, 1970-1990

While many studies of income inequality in the United States focus of the significance of declining marginal tax rates in the 1980s, very little research to date has considered the effect of government regulations which have increased dramatically during the time of marked increases in the Gini coefficient. This paper presents a simple Ordinary Least Squares regression suggesting a relationship between government regulation and income inequality. It is suggested that increases in the regulatory burden in the US labour market increases the cost of low skilled labour relative to high skilled labour, contributing to increases in income inequality.

Degredados, Their Human Agency, and Micro Institutions in Colonial Brazil: An Institutionalist Reinterpretation

Abstract: Institutions are widely recognized as determinants of economic development. However, institutional economists often overlook pertinent historical incidents in their search for broad patterns. At times, this search oversimplifies truly complex phenomena. In light of this, we apply a micro-institutional analysis to explain the success of colonial Brazils early settlements as a mix of accident and design. By doing so, we stress the limitations that can result when applying an aggregate institutional interpretation of economic history and development. We also apply the principal-agent model and its main feature – risk-sharing – to an extreme case that involves settlers and natives risking their lives, while Portuguese principals sought to reduce transaction costs in an important and resource-rich colony.

Common Sense School Reform, by Frederick M. Hess

that in a free market teachers would not blatantly ignore students during posted office hours because students would flee to other teachers. This could be what would occur, but it also could be that such behavior would persist either because the teacher was a popular lecturer or was cheaper than other alternatives. Overall, however, I think there is a lot to learn from this book, and Professor Kirkpatrick should be applauded for attempting to develop a philosophy of education consistent with the free market. In particular, I found his discussion of the teaching and learning process and how authority and coercion can undermine learning (Chapter 4) to be both insightful and helpful to me as a classroom teacher.