David Kiefer

Housing Deterioration, Housing Codes and Rent Control

The life cycle of a dwelling unit is a succession of tenants, generally proceeding to lower-income groups, and a sequence of quality levels, generally ending in a dilapidated state. The process of tenant turnover mirrors a neighbourhood turnover process which is identified as contributing to antagonism between social classes. The paper develops an optimal control model of the housing life cycle and extends this model to incorporate housing codes and rent control. The efficacy of these two popular policy instruments is investigated with respect to the goal of encouraging housing stability and thus neighbourhood stability.

Educational Production Functions for Rural Pakistan: A Comparative Institutional Analysis

Abstract This study uses a production function approach to identify the impact of student, parent, teacher, and school policy variables on student performance as measured by test scores. Our statistical analysis is conducted in a comparative institutional context that includes government, private, and non‐governmental organization schools. We find that, at least in the Pakistani context, non‐governmental organization schools are more effective than government or private schools.

Activist Macroeconomic Policy, Election Effects and the Formation of Expectations: Evidence from OECD Economies

We examine the explanatory power of a political-business cycle theory in which governments practice short-run policy to lessen the impact of exogenous shocks. Governments have ideological objectives with respect to macroeconomic performance, but are constrained by an augmented Phillips curve. The most prominent version, the rational partisan model, incorporates forward-looking expectations. This model can be compared to a competing model based on backward-looking expectations. Alesina and Roubinis recent advocacy of the rational model uses OECD data. Our reconsideration of the same data, updated to 1995, suggests that the adaptive expectations version offers a better explanation than the rational one. Copyright Blackwell Publishers Ltd 2000.

Macroeconomic policy and public choice

A Historical Introduction: The Keynesian revolution and the evolution of governments role.- Keynesian orthodoxy.- The political consequences of depression proofing.- The economic consequences of depression proofing.- Schools of thought.- Ideology and politics.- The market failure rationale for government intervention.- Public choice.- Conclusion.- Microeconomic Foundations: Introduction.- Consumers.- Producers.- General equilibrium.- Pareto efficiency.- Social welfare functions.- Unemployment and inflation.- The government budget and economic policy.- Conclusion.- Social Choice: Introduction.- The theoretical superiority of majority rule.- The impossibility of asking for move.- Median voter model.- Two-dimensional social choice.- Probabilistic voting.- Political information and party ideology.- Conclusion.- Short-Run Macro Models: Introduction.- Classical macro from microfoundations.- Rationed equilibrium and rigid prices.- Non-Walrasian equilibria.- A Cobb-Douglas example.- Unemployment equilibrium with imperfect competition.- Conclusion.- The Phillips Curve and Expectations: Introduction.- The natural rate hypothesis.- Unemployment and output gaps.- Expectations about inflation in the future.- Econometric uncertainty.- One model of supply: producer uncertainty.- Another model: predetermined wages.- New classical macroeconomics.- Conclusion.- Fiscal and Monetary Policy: Introduction.- Accounting peculiarities in the US budget.- Built-in stabilizers.- Balanced and unbalanced budgets.- Doubts about fiscal policy effectiveness.- The Federal Reserve and the president.- Describing the money stock.- Causality tests.- Spurious regression.- Conclusion.- Keynesian Business Cycles: Introduction.- Cycles in a Keynesian model.- A linear econometric model.- Linear versus nonlinear models.- Specification uncertainty.- Dynamic behavior.- Conclusion.- Citizen Preferences for Stabilization: Introduction.- Incumbent performance and voter preferences.- Presidential popularity.- Modeling popularity.- Results.- Conclusion.- Endogenous Stabilization and Macroeconomic Ideology: Introduction.- New Keynesian stabilization analysis.- New classical stabilization analysis.- Ideology.- Perceptions and expected utility.- Plausible parameter values.- The zero-inflation rule and inflation rule and inflation volatility.- Voters should prefer conservatives, under certain conditions.- Uncertainty about candidate platforms.- Conclusion.- Appendix.- Theories of the Political Business Cycle: Introduction.- Election opportunism.- Partisan macroeconomics.- Forward-looking expectations.- Backward-looking expectations.- Growth rate targets.- Generalizations.- Conclusion.- Evidence of Political Business Cycles: US observations remain unexplainted.- Econometric specification.- Regression results.- Observations from 18 OECD democracies.- Regression tests for the OECD.- Alternative OECD results.- Conclusion.- Government Debt, Deficit and Social Security: Public debt in the short- and long-run.- Overlapping generations and efficiency.- Public debt.- Pay-as-you-go social security.- Overlapping generations and equity.- Market imperfections in the credit market.- The Ricardian equivalence theorem.- Rationality, taboo or inertia.- Economic growth and the bequest constraint.- Social security.- Conclusion.- Appendix: More overlapping scenarios.- Conclusion: The Keynesian revolution.- Foundations.- Weak evidence of policy effectiveness.- Rational expectations and the Phillips curve.- An inherently unstable equilibrium.- Stabilization and conservatism.- Doubts about rational expectations.- Long-run Keynesian outcomes.

Distribution-Utilization Interactions: A Race-to-the-Bottom Among Oecd Countries

We explore four decades of short and long run interactions between income distribution and real economic activity for a panel of OECD countries. Allowing for predator-prey dynamics, we find a convergent, rather than persistent, cycle exhibiting profit-led dynamics. Our regressions suggest that the dynamic interaction of these two variables is rather complicated. Estimating the long run point, we argue that this equilibrium has been shifting as a matter of public policy. We hypothesize that a race to the bottom arises from a need to be competitive in globalized markets. We report evidence that globalization does have a negative long-run effect on the wage share, and perhaps a positive effect on utilization. We also find that other factors have been important: unionization has been pro-labor, while contractionary monetary policy and R&D spending have been anti-labor.

The Phillips Curve and Expectations

One theoretical result of Chap. 4 is the short-run tradeoff between unemployment and inflation (4.16), but in the history of economic thought this relation originated as an empirical regularity. Its name derives from Phillips’ (1958) statistical plot of a century of unemployment rates for the United Kingdom against nominal wage inflation. Subsequent investigators found that this empirical regularity can take several forms: general price inflation can be substituted for the wage inflation rate, and the deviation of actual output from its natural level for the unemployment rate. The curve implies a limit on governmental options. It was originally thought, as implied by Fig. 4.2, that a government could employ Keynesian techniques to pick any point along the Phillips curve.

The Political Economy of the SARS Epidemic: The Impact on Human Resources in East Asia, Grace O.M. Lee, Malcolm Warner, Routledge London and New York, 2008, xxii+168 pp.

Unknown

19.95, ISBN: 0-415-39498-8

When depression struck as had predicted, [Keynes] proposed that nations “spend their way back to prosperity,” and made an early convert of Franklin D. Roosevelt…. [H]e drew the famous Keynesian corollaries: deficit financing to put money in the hands of the unemployed, managed currency, reconstruction of the social system….1

Short-Run Macro Models

The conventional argument against deficit spending holds that it will crowd out private investment spending, and that the resultant reduction in the capital stock leads to an eventual efficiency loss1. Long-term public debt thus creates a burden on future generations. However, national emergencies, investment opportunities and intergenerational altruism are several reasons why rational voters and their governments may issue public debt. Debt allows a country to cope with an emergency, like war, without dramatic changes in its tax structure. Deficits may be preferred to the large economic distortions associated with balanced-budget finance. In developing nations the emergency may be a lack of capital, physical or human, and public debt sold to foreigners could be a way of financing profitable investments in productive capital. When the resulting productive increases exceed the financial costs this kind of debt can be efficient. But, in the long run and in the absence of shocks, public debt implies a loss of welfare. The impact of public debt has been much discussed in recent years due to the secular rise in the debt of the US government; see Fig. 11.1. The explanation of observed differences in public debt may lie in redistribution rather than efficiency. We simplify discussion by a conceptually separation; Sections 11.2, 11.3 and 11.4 deal with efficiency effects alone and the following sections with equity alone.

Government Debt, Deficit and Social Security

It is impossible to consider the ordinary course of affairs in the United States without perceiving that the desire to be re-elected is the chief aim of the President;…and that especially as [election] approaches, his personal interest takes the place of his interest in the public good.-Alexis de Tocqueville as quoted by Mueller (1989).