E. Frank Stephenson

Average marginal tax rates revisited

Abstract I revise and update through 1994 the estimated average marginal income and Social Security tax rates of Seater (1982) [Marginal federal personal and corporate income tax rates in the US, 1909–1975. Journal of Monetary Economics, 10, 361–381], Seater (1985) [On the construction of marginal federal personal and social security tax rates in the US. Journal of Monetary Economics, 15, 121–135] and Barro and Sahasakul (1983) [Measuring the average marginal tax rate from the individual income tax. Journal of Business, 56, 419–452] and Barro and Sahasakul (1986) [Average marginal tax rates on social security and the individual income tax. Journal of Business, 59, 555–566], and I introduce a return-weighted Social Security tax rate. Since 1981, the average marginal effective income tax rate has declined from about 16% to 12%; however, the combined federal tax burden remains high by historic standards because the average marginal Social Security tax rate has increased from about 5% to about 6.5%.

The link between volatility and growth: Evidence from the States

We present evidence on the relationship between output volatility and growth using state data. No evidence of such a relationship is found once other correlates of growth are incorporated into the analysis. This finding contradicts published results using international data; some possible explanations for the contradictory results are discussed.

Economic Information versus Quality Variation in Cross-Country Data

Data quality in the Penn World Tables varies systematically across countries that have different growth rates and are at different stages of economic development, thus introducing measurement error correlated with variables of economic interest. We explore this problem with three examples from the literature, showing that the problem appears to be minor in growth convergence regressions but serious in estimating the effect of income volatility on growth and in a cross-country test of the Permanent Income Hypothesis. The results suggest, at the least, a need for performing appropriate sensitivity tests before drawing conclusions from analyses based on these data.

Economic Freedom and Labor Market Conditions: Evidence from the States

Using 1981–2009 data for the 50 states, this article examines the relationship between economic freedom and the unemployment rate, the labor force participation rate, and the employment‐population ratio. After controlling for a variety of state‐level characteristics, the results from most specifications indicate that economic freedom is associated with lower unemployment and with higher labor force participation and employment‐population ratios.

Football Frenzy The Effect of the 2011 World Cup on Women’s Professional Soccer League Attendance

The dramatic play of the American team in the 2011 Women’s World Cup tournament brought much attention to women’s soccer in the United States. This article uses match-level data from the Women’s Professional Soccer (WPS) league to analyze the effect of the World Cup on WPS attendance. The results indicate that attendance for matches played after the World Cup roughly doubled and that matches involving star players Hope Solo and Abby Wambach received an additional 33% attendance bump although this effect is imprecisely estimated.

Strategic voting in open primaries: evidence from Rush Limbaugh's "operation chaos"

Open primaries create the possibility of strategic crossover voting. On his March 3, 2008 program and subsequent broadcasts, radio personality Rush Limbaugh called on his listeners to extend the Democratic presidential contest by crossing over to vote for Sen. Hillary Clinton. Using voter registration data from North Carolina and election return data from Indiana, North Carolina, and Pennsylvania (states with open, semi-closed, and closed primaries, respectively), I find no evidence of a Limbaugh-motivated switch in political party registration or of a large or statistically significant Limbaugh-motivated increase in voting for Sen. Clinton.

Economic freedom, homeownership, and state labor market conditions

Purpose - – The purpose of this paper is to reconcile research finding that labor market outcomes are related to economic freedom for entrepreneurs and separate research finding that higher homeownership rates are associated with more unemployment. Design/methodology/approach - – Using panel data covering the 50 states over 1981-2009, this paper analyzes the relationship between labor market conditions, economic freedom, and homeownership rates. Findings - – The results indicate that economic freedom is associated with favorable labor market conditions but that the relationship between homeownership and poor labor market outcomes is small and insignificant in most specifications once economic freedom is accounted for. Originality/value - – This paper is the first paper to examine the relationship between labor market outcomes and both homeownership and economic freedom. The results suggest that the economic environment for entrepreneurs is more important than any rigidities created by homeownership.

Beer Availability and College Football Attendance: Evidence From Mid-Major Conferences

We examine the relationship between beer being sold at college football stadiums and both attendance and football revenue for 29 mid-major universities over the 2005-2012 period. Using both ordinary least squares and instrumental variable estimation, no evidence that beer availability increases attendance or football revenue is found.

A Public Choice Analysis of Congressional Franking

Based on the rational choice assumption that politicians seek to enhance their reelection chances, the authors posit and test several hypotheses about how the use of franked mail varies across members of the House of Representatives. This study improves upon the existing literature by using a sample of all full-term representatives and by using multiple regression analysis that allows for estimation of the marginal effect of each explanatory variable after controlling for other factors that might affect franking behavior. The results of this study indicate that (1) politicians seeking higher office tend to make greater use of franked mail while those who are retiring engage in less franking, (2) narrower electoral margins, especially for first termers, are associated with more franking, (3) representatives who have larger campaign expenditures also have higher levels of franked mail, and (4) franked mail increases with a congressional district’s distance from Washington, D.C.

The Incidence of Hybrid Automobile Tax Preferences

We use national and California price data from January, 2002 to June, 2009 for three hybrid and five non-hybrid car models to estimate the share of federal tax preferences for purchasing hybrid cars that accrues to car sellers. Our preferred estimates suggest that almost one-half of the subsidy is capitalized into car prices, but some specifications lead to larger estimated benefits for car suppliers. Our results also show (1) that a California program providing HOV stickers to owners of hybrid fuel automobiles led to large increases in the price of those vehicles, and (2) that failing to control for rising gas prices which increase the demand for fuel efficient vehicles leads to upwardly biased estimates of the amount of the hybrid car tax subsidy captured by automakers.