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  Working Paper No. 15

  The Financially Fragile Firm

  This paper is an empirical investigation of Minsky’s hypothesis in the U.S. consumer durables sector during the 1920s. The first section of the paper briefly describes Minsky’s financial fragility hypothesis, while the second sketches a brief economic historical background of the 1920s in the U.S. The third section introduces the methodology utilized and the fourth […]
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  Working Paper No. 14

  Classical and Neoclassical Elements in Industrial Organization

  This article analyzes the theoretical foundations of industrial organization studies of monopolistic and competitive pricing. Our analysis will focus on the central debates of the 1950s, 1960s, and 1970s that formed the theoretical basis of the modern industrial organization paradigm. We will argue that despite claims to the contrary, and often unknowingly, the majority of […]
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  Working Paper No. 13

  The Effects of Worker Participation, Employee Ownership, and Profit Sharing on Economic Performance

  For alternative sharing arrangements we review theory on the economic effects on employment, productivity, investment, income and wealth distribution, and life cycle and survival. We find that predictions are often ambiguous and that sometimes the nature and size of the specific effect is determined in part by the particular institutional arrangements. Next recent econometric work […]
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  Working Paper No. 12

  The Real Wage and the Marginal Product of Labor

  As I see it, the errors in Keynes’s analysis in chapter 2 of the General Theorv were his acceptance of diminishing returns in the short-period relation between output and labor employed, and of perfect competition in the product market. These "errors," however, are easily corrected and do not alter Keynes’s basic and correct ideas—that employment […]
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  Working Paper No. 11

  Ranking Urban Areas

  Rankings of urban areas provide useful information to planning recreational or tourism activities, making housing-locational decisions, and designing policies to attract industries. This paper illustrates how the structural approach to hedonic equilibrium models can be used to derive a quality of life based ranking of urban areas.
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  Working Paper No. 10

  Long-Term Trends in Profitability

  It is accepted doctrine among economists that the rate of profit in the United States has declined since the mid-1960s. What is less a matter of agreement is whether this decline represents a stage in a long-term secular decline. In a recent article, Dumenil, Glick, and Rangel (1987) reviewed the existing empirical evidence on this […]
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  Working Paper No. 9

  Consumer Benefit from Air Quality Improvements

  This paper applies a simultaneous equations estimation technique to estimate a hedonic equilibrium model. The estimation results are used to compute consumer benefit from air quality improvements.
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  Working Paper No. 8

  The Effects of Alternative Sharing Arrangements on Employment

  A sample of British firms with diverse sharing arrangements is used to investigate the effects of profit sharing on employment levels. Employment effects are sometimes significant but depend upon the measure of profit sharing, how the dynamics are modeled, and whether measures of employee participation in decision making are included in the estimating equation. Using […]
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  Working Paper No. 7

  Why Is the Rate of Profit Still Falling?

  This paper elaborates a fixed-coefficient, capital, labor, non-raw material intermediates, raw materials production model; estimates the wage share-profit rate frontier associated with it for U.S. manufacturing from 1949 to 1986; and suggests the following explanation of declining profitability. From 1949 to 1970, a rising wage share drove the manufacturing industries up along the wage-profit frontier. […]
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  Working Paper No. 6

  A Structural Approach to Hedonic Equilibrium Models

  This paper presents a quality theory for differentiated products. Analytical solutions for the equilibrium demand for quality and the equilibrium price equation are computed. The model is estimated and the willingness to pay for improvements in the air quality of Houston is computed. The empirical results show that the standard n on-structural approach would seriously […]
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  Working Paper No. 5

  The Finance Constraint Theory of Money

  The theory of money that emerged from the Keynesian Revolution is coming increasingly into question, and a variety of new theories are being put forward as alternatives. The most promising is one I will call the finance constraint theory. This paper is a progress report on its development. It is particularly fitting that this progress […]
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  Working Paper No. 4

  Housing Quality Differentials in Urban Areas

  This paper applies an equilibrium quality theory for differentiated products to estimate the willingness to pay for improvements in the air quality of Chicago, Cleveland, Dallas, Houston, and Indianapolis. The empirical results show (i) that the structural approach and the standard nonstructural approach give very different benefit figures even for small improvements in air quality, […]