William Beranek

The Illegal Alien Work Force, Demand for Unskilled Labor, and the Minimum Wage

Estimates of the illegal alien work force, employment, and the number employed below the legal minimum wage are not available, but are often required for the study of a variety of public policy issues, e.g., immigration and refugee policy, and policy towards the monitoring of minimum wage laws. This paper attempts to fill this void by developing estimates of these quantities. Of equal importance, however, is determining what light this and other related evidence throws upon the oft-expressed view that the demand for unskilled labor at below-legal-minimum wage rates is virtually inelastic. Evidence is presented which contradicts this belief.

The Emerging Market for Trade Claims of Bankrupt Firms

MA small but growing market has developed for exchanging claims against debtors seeking relief under Chapter 11 of the U.S. Bankruptcy Code. This market provides trade claimants an alternative to forced participation in the reorganization, thereby decreasing the costs of bankruptcy and offering new opportunities for investors. When a debtor files a bankruptcy petition, holders of the debtors trade claims sometimes look for buyers to purchase these obligations and hence, an informal, unregulated, illiquid market has developed for them. To be considered for active trading, the claim must be against a debtor that is large or otherwise well-known. The number of debtors with trade claims trading in such markets has grown rapidly in recent years (1982 to 1991) as the pace of Chapter 11 filings has accelerated. Recent studies have focused on specific aspects of Chapter 11 reorganizations. While Brown (1989), Giammarino (1989), and Bebchuk and Chang (1992) model the conflict resolution process in bankruptcy, Weiss (1990) finds that absolute priority is violated in 29 out of 37 cases, and Eberhart, Moore, and Roenfeldt (1990) document (in a sample of 30 firms) that deviations from absolute priority in reorganizations result in gains to shareholders of, on average, 7.6% of the value of the firm. Daigle and Maloney (1994) develop a hypothesis that predicts the share of the reorganized firm value retained by old shareholders. Gertner and Scharfstein (1991) find that Chapter 11 proceedings enhance real investments of troubled firms while Eberhart

Examining Two of Keynes’s Most Popular Statements—Wasteful Public Spending Can Be Acceptable, and, In The Long Run We Are All Dead—Yields Some Surprising Implications

Analysis shows that John Maynard Keynes likely interpreted the concept “long run” as reflecting the dimension of calendar time, rather than operational time. More importantly, Keynes was not the advocate of wasteful spending as usually believed. He actually placed strong restrictions on this prescription; it was not an unconditional invitation to raid the public larder. Journalists, politicians, and many economists have overstated his ardor for wasteful spending.

Issue costs and regulated returns: A general approach

This paper sets forth a general, unified procedure for the treatment of flotation costs for the regulated utility, a method which reduces to standard treatments as special cases. In this approach, the regulated return becomes a weighted average of the required rates on different portions of equity capital, portions that are distinguished by whether or not issue costs are incurred in their acquisition. In addition, the method provides solutions for a host of financial environments, including solutions where past flotation costs are to be recognized, and where merged utilities with different flotation-cost recovery patterns must be combined.

Disassociations and Legal Combinations

The study of mergers and acquisitions has long attracted the attention of economists. But until recently (Boudreaux [4], Kudla and McInish [9], Miles and Rosenfeld [16], Hite and Owers [8], Schipper and Smith [20], Alexander, Benson, and Kampmeyer [ 1]), the subject of disassociations has received little attention. This paper adds to the growing literature on disassociations, but addresses a different issue from previous studies. Specifically, we investigate differences in disassociation rates between vertical and non-verti-