In a new study for the Mercatus Center at George Mason University, scholar Alexander William Salter examines several different proposed rules that the Fed could follow. Salter provides a framework to help policymakers better understand how incentives and information can affect monetary policy and discusses discretion-based and rule-based approaches to monetary policy.
Hayek’s The Road to Serfdom is often read as a policy book and a political tract for its time. It is also often read as little more than a “slippery slope” argument, leading inevitably down a road from a free society to the gulag. In this paper I will try to counter both of those claims by explaining that Hayek’s book is part of a broader project dealing with the institutional infrastructure within which economic activity takes place. His argument, rather than being a slippery slope, is an imminent critique of the socialist program as advocated by British socialists, who were his primary target in the 1940s.
We find that union political contributions and collective bargaining are associated with higher incomes for state and local employees and with higher public employment, both across state and local government overall as well as within the education sector. We also find little to no evidence that union activity influences total spending.
This paper addresses the following question: how frequently do cities use government regulation of land use to coerce environmentally friendly development? In particular, the paper focuses on minimum density requirements, maximum parking requirements, and laws requiring “green” building (usually buildings that include a variety of energy-conserving features). The article concludes that the first type of regulation is rare, while the latter two are somewhat more frequent.
This paper provides the first examination of the relationship between eminent domain activity and the growth (and level) of state and local revenue. We restrict our attention to takings that are for private use, such as the one that led to the landmark Kelo decision in 2005.
In this paper, we examine existing literature on the prevalence, consequences, wastefulness, and causes of year-end spending surges. We then report executive departments’ year-end obligated federal contract expenditure patterns using data obtained from USASpending.gov. We review literature on purported solutions to curb year-end spending surges, and conclude with a policy recommendation of our own.
This paper suggests that there exists a neglected third branch of Chicago price theory, which includes Armen Alchian (1914-2013), James Buchanan (1919-2013), and Ronald Coase (1910-2013). We argue that this Alchian, Buchanan, Coase approach to price theory provides not a bridge between the "Old" Chicago School and the "New" Chicago School, but an alternative development of the Chicago School. Our paper while building on the joint insights of Alchian, Buchanan and Coase, is focused on Coase’s development of this approach, and clarifying his contribution.
In Nebraska the total forgone revenue due to tax privileges amounts to just over $2 billion, compared with roughly $7.2 billion in total revenue collected by the relevant taxes. Eliminating these privileges and simultaneously lowering tax rates could save an average Nebraskan family more than $3,200 dollars if the benefits of tax reform are evenly distributed, with no reduction in government services.
This essay praises Gerald Gaus’s The Order of Public Reason as a building block for all normative explorations into the institutional foundations of human sociability. It evaluates the normative implications put forth by Gaus in terms of the Kirzner’s “finder’s keeper’s ethic.” This raises a question about the relationship between the moral order and the political order that underlies market processes.
Mercatus PhD Fellow Vipin Veetil, along with Akshaya Vijayalakshmi and Srikanth Viswanathan, address Amartya Sen's criticism of cash-transfer programs such as education vouchers in the Wall Street Journal.
While the "invisible hand" argument was initially focused on the ability of commerce to generate cooperation and ameliorate conflict among strangers, it gradually came to be exclusively associated with a sort of ruthless efficiency and the obtainment of optimality conditions. The authors attempt to recapture the doux-commerce thesis and its relevance for contemporary debates over commerce and culture.