technology strategy and financial performance examining the moderating role of the firm s competitive environment abstract success in today s competitive environment requires a company to pursue a coherent technology strategy to articulate its plans to develop acquire and deploy technological resources to achieve superior financial performance this strategy clarifies the company s choices on being a technological pioneer or a follower the breadth of the technology product and process portfolios amounts of investments in internal r d and external sources of technology and levels of technological forecasting to be performed in turn these choices require making decisions on the basic and applied r d to be conduced the intended offensive or defensive uses of the technology and emphasis on incremental and radical r d to date however few studies have attempted to document the collective implications of a company s technological choices for its financial performance in response data from 176 manufacturing companies were used to examine the association between a company s technology strategy and its financial performance and to explore the moderating effect of the environment on the technology strategy performance link therefore the study focused on a company s perceptions of environmental dynamism hostility and heterogeneity dynamism indicated the perceived continuity of changes in an industry hostility referred to the changes in the industry that could adversely impact the firm s operations and performance heterogeneity meant that the environment encompassed many segments with different needs the study developed and empirically tested the following hypotheses 1 h1a pioneering will be highest among firms whose environments are highly dynamic moderately hostile and moderately heterogeneous 2 h1b followership will be highest among firms whose environments are highly hostile and moderately dynamic but low in heterogeneity 3 h2a radical product technologies will be pursued most by firms whose environments are highly dynamic moderately hostile and moderately heterogeneous 4 h2b radical process technologies will be pursued most by firms whose environments are moderately dynamic moderately hostile and moderately heterogeneous 5 h2c incremental product and process technologies will be pursued most by firms whose environments are stable low dynamism benign low hostility and highly heterogeneous 6 h3 the broadest technological portfolios will exist among firms whose environments are characterized by moderate dynamism high heterogeneity and moderate or low hostility 7 h4 r d spending will be highest among firms whose environments are highly dynamic highly heterogeneous and highly benign low in hostility 8 h5 the use of external technology sources will be highest among firms whose environments are highly dynamic highly hostile and highly heterogeneous 9 h6 emphasis on technological forecasting will be highest among firms whose environments are highly dynamic highly hostile and highly heterogeneous 10 h7 the environment is a quasi moderator of the technology strategy performance relationship the results supported the study s hypotheses except h2c and h3 and suggested five ideas for managerial action 1 executives should develop and use a comprehensive technology strategy to ensure that their company achieves superior financial performance 2 executives should be cautious in applying generic prescriptions of how to utilize technological resources to achieve profitability because the financial payoff from technology strategy variables varies from one environment to the other instead executives should examine their company s goals capacity to manage diverse product and process initiatives risk taking orientation resources and the environment 3 attention to developing and using process technology innovation is necessary for success in fact a broad process innovation portfolio is positively associated with return on assets in the overall sample and in three of the study s five clusters 4 managers need to adopt a long term perspective in making r d investments where patient investments over several years are the norm increasing r d spending should not be viewed as a quick fix for the company s poor competitive position 5 whereas the external sources of technology can improve the company s performance managers should identify the conditions under which external sources can be used and educate their employees on the growing importance of these technologies for achieving profitability

capital budgets borrowing rules and state capital spending abstract this paper compares the level and composition of government spending in u s states that maintain separate budgets for capital and operating expenditures with that in states that employ unified budgets it also investigates the effects of pay as you go financing rules for capital projects the empirical findings suggest that states with separate capital budgets spend more on public capital projects than comparable states with unified budgets there is no evidence that the presence or absence of a capital budget affects the level of non capital spending pay as you go requirements for financing capital projects are associated with lower levels of both capital and non capital spending

research and development with asymmetric firm sizes this article presents a theoretical model of research and development r d competition among firms the goal of the model is to simultaneously explain two empirical observations pertaining to the persistence of dominantfirms small firms make a disproportionate share of major innovations while largefirms tend to spend more in absolute terms on r d than smallfirms do in the model here firms choose investment levels and r d project riskiness in equilibrium a large firm invests more than a smaller firm but by choosing safer r d projects makes fewer major innovations

agent discretion regulatory policymaking and different institutional arrangements this paper examines agent discretion that is a result of the structure of the legislative process based on several distributions of lawmaking powers different games are analyzed in which players decide on regulatory policies the analysis shows that agent discretion increases as lawmaking powers are differentiated and assigned to specialized players particularly monopoly initiation power which allows a player to act as a gatekeeper has a substantial impact on discretion agent discretion will be even larger when these players also have heterogenous preferences the framework that is developed in this paper permits comparisons across different political systems with regard to agent discretion and legislative control on policymaking

types of bureaucratic interaction abstract a taxonomy of relationships between a public bureau and its sponsoring institution is modelled within a simple follower leader framework various assumptions are made with respect to who makes the decision about the bureaucratic activity level and with respect to cost information the role played by budgetary slack is emphasized deviations from the socially optimal bureau are identified but no general support is found for the view that bureaus tend to become too big

for love or money the impact of income taxes on marriage higher sometimes lower than their combined single income tax obligations in this paper we explore the impact of the federal individual income tax as well as other economic and demograplhic variables on the marriage decisionis of individuals using longitudinal data from the panel study on income dynamics for the period 1968 92 we estimate a discrete time hazard model of the time to first marriage we find that the probability of marriage is significantly affected by a range of economic and demographic variables importantly we find that an increase in total income taxes paid by married versus single women has a negative effect on the likelihood of marriage and that the change in the marginal tax rate is also a significant determinant of marriage in some cases in contrast the tax effects are rarely significant in determining marriage probabilities among men although there are some differential responses by race in general the impacts of the income tax variables even when statistically significant are small

medicaid afdc and family formation this paper uses the fact that states joined the medicaid programme at different times between early 1966 and early 1970 to estimate the effect of health insurance availability on childbearing and marital choice data on women aged 15 to 45 during the 1964 to 1972 period from the march current population survey cps is used to estimate medicaid s effect on the probability that a woman has recently given birth and is not married it is found that the introduction of medicaid led to a small but statistically significant increase in the probability that a woman is single and has recently given birth specifically the introduction of medicaid led to a 0 3 percentage point increase in the probability that a woman is a single mother of young children this is an approximately 10 increase relative to the average fraction of single mothers in the sample of about 3 although nonwhite women are on average more likely to be single mothers than white women are it is found that medicaid did not significantly contr

the power of the purse and its implications for bureaucratic policy making a dilemma of the power of the purse is thatcutting an agency s budget may make a desired policyinfeasible i examine the implications of thisdilemma with a repeated game in which a bureau choosesunobservable policies after a legislature sets itsbudget the bureau is work averse and has its ownpolicy preferences and therefore may cheat but thelegislature may perform an audit to recover slack funds a main result is that if the legislaturedesires a higher policy level than the agency then itfaces a trade off between good but wasteful policiesand bad but efficient ones

political preferences for the pork barrel a generalization this paper provides a rational explanation for the observation of oversized coalitions often approaching unanimous size in the realm of distributive policies distributive policies are those which concentrate benefits in specific geographic areas states congressional districts while spreading costs through general taxation the explanation offered here that legislators may rationally prefer universalism to hard ball coalition politics generalizes earlier work of weingast and fiorina in particular it extends their results to pork barrel politics i e projects that are economically inefficient and demonstrates how packages of economically inefficient projects can nevertheless be politically popular the main theoretical feature that induces preferences for universalism is uncertainty over the composition of winning coalitions and consequently the desire for the political insurance that universalism provides

running against the status quo institutions for direct democracy referenda and allocations over time stylized institutions for direct democracy referenda are examined in a dynamic full information environment with myopic voters competitive agenda median voter processes are contrasted with monopolistic controlled agenda processes by extending existing static analyses to a class of dynamic institutions not previously characterized the status quo reversion rule this highlights the dependence of the progression of real equilibrium allocations over time on institutional structure by delineating the restrictions implied by each institutional form the model explains some persistent empirical regularities in particular a strict ceteris paribus ordering of the magnitudes of budgets by institutional form is derived for a wide portion of the parameter space

the new economics of organization over the last ten years or so an important new approach to the study of organizations has emerged within economics it is perhaps best characterized by three elements a contractual perspective on organizational relationships a theoretical focus on hierarchical control and formal analysis via principal agent models this paper provides political scientists with an overview of the new economics of organization and explores its implications for the study of public bureaucracy so far positive political theory has not contributed much to our understanding of public bureaucracy in part this is due to the unsympathetic treatment that rational modeling and most other modes of quantitative analysis have long received from students of public administration the other side of the coin however is that positive theorists have not made much of an effort to develop theories of bureaucracy their concerns have centered around two basic mechanisms of social choice voting and markets and they have devoted little systematic attention to a third mechanism that is clearly important for understanding how societies and other aggregates make collective decisions this third and relatively unexplored mechanism is hierarchy movement toward a positive theory of hierarchies would fill a serious gap in the social choice literature while at the same time making a theoretical contribution that strikes to the essence of public bureaucracy indeed of all organizations in fact significant steps toward a positive theory of hierarchies have very recently been taken but by economists not political scientists in small numbers of course economists made contributions to the study of public bureaucracy some time ago with the pioneering works of downs 1967 tullock 1965 and niskanen 1971 but this new wave of theoretical work is different it is already a large complex body of literature that is the focus of innovation and excitement among a growing number of economists and it reflects an unusual degree of theoretical coherence and cumulative effort work in this tradition tends to receive orientation from a distinctive economic approach to the analysis of organizations an approach perhaps best characterized by three elements a contractual perspective on organizational relationships a focus on hierarchical control and formal analysis via principal agent models this approach has emerged from recent attempts to move beyond the neoclassical theory of the firm which assumes away all organizational considerations to a theory of economic organizations that can explain why firms corporations and other enterprises behave as they do propo

the effects of congressional appropriation committee membership on the distribution of federal research funding to universities i introduction in 1994 members of the republican party pledged to seek legislation to impose term limits on members of congress this pledge stemmed from the popular belief that senior members of congress tend to promote personal interests or are more influenced by lobbying efforts that may not be representative of their constituents today term limits continue to be discussed but have not been enacted instead many members have focused their energies toward minimizing the time spent on any particular committee of congress believing that tenure on a committee is a more serious concern than simple tenure in congress implicit in these concerns is the issue whether as incumbent politicians plan to retire they will behave differently and if so whether tenure on a congressional committee exacerbates this behavior this article explores the role of membership on the appropriations committee on the distribution of federal research funding to universities specifically it explores whether funding is diverted to these universities because politicians use their position on a committee to promote personal or constituent interests previous research on shirking compares the voting records of politicians on certain issues with demographic and economic characteristics of the politicians constituents this article explores the issue of shirking differently i explore how membership on congressional appropriations committees affects the distribution of federal research funding to universities i look at two types of relationships between the members and the universities first i consider the relationship between members and the universities that are located in the members districts states in the case of senators second i examine the relationship between members and their undergraduate alma mater i use district representa tion to proxy favoritism that reflects a politician s constituents given that in most instances an alma mater affiliation is not the same as district representation i use alma mater affiliation to proxy favoritism that reflects the politician s personal interests federal research funding accounts for more than 60 of research funding received by research universities previous research has shown a positive impact of federal funding on research outcomes see adams and griliches 1998 arora and gambardella 1997 connolly 1997 payne and siow 2002 and payne 2001 except for payne and siow 2002 however these articles do not consider that political diversion of funds may promote or detract from research productivity as with any other federal program this article concentrates on the impact of membership on the house and senate appropriations committees because they wield the greatest power in the allocation of funding 1 using a panel data set spanning 26 years i explore how changes in the composition of the appropriations committees affects the distribution of research funding after controlling for the heterogeneity that exists across different universities the results suggest that both district representation and alma mater affiliation matter thus there is evidence of shirking for personal interests and evidence of members representing their constituents with respect to the representation of one s constituents the strongest results suggest that public universities benefit from representation on both the senate and house committees private universities however only benefit from representation in the senate with respect to alma mater affiliations the results suggest again that public universities benefit from representation on both the senate and house committees private universities also benefit from representation on both the senate and house committees the results also suggest that the tenure of the member on the committee matters as does whether the member is a part of the majority party in power in the congressional chamber

bureaucrats legislators and the size of government some recent theories have blamed the growth of government on budget maximizing bureaucrats who are assumedly capable of imposing their most preferred budget output combination on legislatures subject to cost and demand constraints however theoretical examination of the range of bargaining outcomes that might occur between bureau and legislature shows that budget maximizing behavior does not necessarily lead to super optimal levels of production nor do the suggested reforms of competition and privatization necessarily improve the situation in this bargaining model the central determinants of governmental growth are not budget maximizing bureaucrats but the legislature s decisions regarding mode of oversight and form of internal organization

the flypaper effect and competition in the local market for public goods in this paper we explore how the ability of bureaucrats to extract resources from their community may be limited by competition in the local market for public goods specifically we examine intergovernmental aid as a resource bureaucrats seek to control intergovernmental aid has been found to be more stimulative of local government expenditures than predicted by neo classical economic theory in this research the flypaper effect is used as an indicator of the ability of bureaucrats to control local resources in excess of local demand and preferences we empirically relate variation in the flypaper effect to the extent of competition in the local market for public goods competition does not consistently limit the flypaper effect the implications of this finding for theories of competition in the local market for public goods are then discussed

an adaptive model of bureaucratic politics in this article we outline a new framework for the formal analysis of bureaucratic politics it departs from standard neoclassical approaches notably those of niskanen 1971 and peltzman 1976 in several important respects first our approach explicitly models a system of three way interaction among bureaus politicians and interest groups second it allows for institutional features of each type of participant third it is a model of dynamic process fourth participants make choices adoptively rather than optimizing fifth participants are only minimally informed the result is a dynamic model of adaptive behavior very much in the spirit of simon s 1947 behavioral tradition that offers a new perspective on political control bureaucratic power and the intelligence of democracy

the institutional dynamics of policy administration bureaucratic influence over securities regulation theory a dynamic systems model of administrative politics that 1 relaxes restrictive causal assumptions among the president congress and an administrative agency 2 emphasizes aggregate institutional behavior and 3 analyzes both anticipated and unanticipated policy behavior is set forth as a more general means to investigate agency political relationships hypotheses the main set of hypotheses focus on the aggregate institutional relationships among the president congress and administrative agency these four possible hypotheses include bureaucratic influence bureaucratic autonomy mutual influence and political influence the purpose here is to assess the relative merits of competing explanations for bureaucratic behavior securities regulation is a perfect area of inquiry to investigate these competing perspectives since the findings of existing research on this topic are disparate methods vector autoregressive time series statistical methods are used to empirically test the dynamic systems model of administrative politics by examining three empirical models of sec enforcement behavior in relation to presidential and congressional budgetary preference signals for the 1949 92 annual period results the sec sends potent signals of their own via their changes in regulatory outputs that will affect the budgetary preferences of its political principles however the sec s administrative outputs are shown to be somewhat less sensitive to political budgetary preference signals than what one would expect presidential and congressional budgetary preference signals with respect to the sec are interdependent to a sizeable extent thus raising doubts about the separate independent effect democratic institutions have over the bureaucracy the implications of this study suggest that conventional theories of agency political relations serve as an oversimplified way to study administrative behavior future research on this topic

political authority expertise and government bureaucracies by applying the revelation principle we focus on how a sponsor who possesses political authority could minimise the efficiency losses when bureaucrats are experts that is when they control information about the true costs of public services production our results come in striking contrast to those in the literature on bureaucracies and public procurement in a two types setting and in the absence of monitoring and control mechanisms we find that the agency is productively efficient under certain conditions the agency is also allocatively efficient while under others the low cost bureau oversupplies and the high cost agency undersupplies its output

shifting foundations of agricultural policy analysis welfare economics when risk markets are incomplete the neat alignment of resources output and prices specified by the perfect competition model is far from duplicated in free markets and the equally neat alignment assumed under the constraints of a program is not experienced when programs are in effect in particular areas under empirically determined supply curves are unlikely to represent opportunity costs the basic theory is invaluable in providing a conceptual orientation for the analysis of programs but the assumptions implicit in the literal use of simple forms of it for policy conclusions are breathtakingly heroic

r d reactions to high technology import competition for a seventeen year panel covering 308 u s manufacturers the authors analyze companies r d spending reactions to changes in high technology imports on average r d sales ratios were reduced in the short run as imports rose reactions tended to be more aggressive the more concentrated the markets were in which the firms operated when company r d operations were multinational and with greater company size and diversification reactions were less aggressive when special trade barriers had been erected reactions became more aggressive over the longer run copyright 1992 by mit press

fragmentation and the growth of local government an assumption of the post world war ii metropolitan reform movement was that fragmentation of metropolitan regions into multiple local governments was wasteful and inefficient increasing the cost and size of government more recently polycentrists have argued that the competition between multiple governments in metropolitan regions can in factreduce the growth in government by providing a competitive check on the excessive demands of local bureaucrats for more resources in this article i explore the effects of fragmentation on growth in the size of suburban municipal government budgets and in the number of services offered competition inherent in more fragmented metropolitan regions is shown to slow the expansion in local government expenditures and service levels

explaining bureaucratic optimism theory and evidence from u s executive agency macroeconomic forecasts we offer a theory of intertemporal bureaucratic decision making which proposes that an agency s forecast optimism is related to the extent to which it discounts future reputation costs associated with bureaucratic incompetence agency forecasts of the distant future are more likely to be optimistic than short term forecasts we claim that unstable organizations will discount reputation costs at a steeper rate than stable organizations and therefore will produce more optimistic forecasts we test our theory using macroeconomic forecasts produced by the office of management and budget omb and the social security administration ssa across six forecast horizons from 1979 to 2003 the statistical results are generally consistent with our theory omb generates more optimistic long term forecasts than ssa further differences in forecast optimism between these executive branch agencies widen as the forecast horizon increases our evidence suggests that more stable agencies place a premium on minimizing reputation costs conversely less stable agencies are more likely to accommodate political pressures for forecast optimism these findings underscore the importance of institutional design for understanding how executive agencies balance the conflicting goals of political responsiveness and bureaucratic competence within the administrative state

delegation as commitment the case of income tax audits in this article we study the value of delegating authority over income tax audit policy arising from the incompleteness of contracts consider a utilitarian government whose ability to commit is limited to aggregate dimensions of its audit policy as publicly verifiable information about detailed allocations of audit budgets is not available we show that the welfare level associated with the full commitment solution can be attained by delegating authority over audit policy to a manager the latter is offered a simple incentive scheme based only on the aggregate variables which are publicly observable in contrast if the government retains authority direct commitment to these same variables does not allow the full commitment welfare level to be achieved thus despite sharing a common informational basis delegation may perform better than centralized arrangements in the presence of incomplete contracts

an analysis of out of wedlock childbearing in the united states this paper relates the erosion of the custom of shotgun marriage to the legalization of abortion and the increased availability of contraception to unmarried women in the united states the decline in shotgun marriage accounts for a significant fraction of the increase in out of wedlock first births several models illustrate the analogy between women who do not adopt either birth control or abortion and the hand loom weavers both victims of changing technology mechanisms causing female immiseration are modeled and historically described this technology shock hypothesis is an alternative to welfare and job shortage theories of the feminization of poverty excerpt

technology strategy and new venture performance a study of corporate sponsored and independent biotechnology ventures abstract new ventures companies eight years or younger play a major role in the development of an emerging high technology industry corporate sponsored new ventures those supported by an established corporation and independent ventures those founded by independent entrepreneurs frequently battle for industry leadership and financial success whereas both venture types use technology to achieve financial and market success little is known about the differences in their technology strategies technology strategy is the plan that guides a new venture s decisions on the development and use of technological capabilities this strategy covers six major areas the first is selecting the pioneering posture where a venture decides whether or not be among the industry s first companies to introduce new products technologies to the market the second is determining the number of products to be introduced to the market the third is choosing the extent of a venture s use of internal and external r d sources internal sources usually refer to in house r d activities external sources may include purchasing or licensing of technology from other companies or joining strategic alliances to acquire that technology the fourth is deciding the level of r d spending the fifth is selecting the combination portfolio of applied and basic research projects whereas basic r d advances science applied r d leads to new products and technologies the sixth and final dimension is the venture s use of patenting to protect any competitive advantages it might gain from its r d activities this article reports the results of a study that explored the differences in the technology strategies and performance of corporate and independent ventures the biotechnology industry was chosen to test the study s hypotheses using 112 ventures seven of the study s hypotheses focused on the potential variations in technology strategy between corporate and independent ventures independent ventures ivs were expected to surpass corporate ventures cvs in pioneering new products technologies using internal r d and emphasizing applied r d cvs were expected to surpass ivs in introducing new products using external r d sources spending on r d and patenting the study s remaining three hypotheses covered possible variations in new venture performance nvp and their sources the results showed that ivs focused more on pioneering pursued a more applied r d portfolio and emphasized internal r d more than cvs cvs utilized external technology sources spent more heavily on r d stressed basic r d and used patenting more intensively than ivs these results were consistent with the hypotheses however contrary to expectations there were no significant differences between cvs and ivs in the frequency of new product introductions probably because most ventures were at the invention rather than the commercialization stage the results on the nvp of cvs and ivs were counter to expectations ivs outperformed cvs probably because of the high motivation of the iv owners who reaped the rewards of growth and profitability also whereas cvs may have greater access to the resources of their sponsors political conflicts and rigid corporate controls might have reduced their ability to achieve competitive advantages the results also indicated that cvs and ivs appeared to gain competitive advantages from different technological choices pioneering a focus on applied r d and extensive use of the internal r d sources were also positively associated with the performance of ivs heavy r d spending the use of both internal and external r d sources frequent product introductions and patenting were positively associated with the performance of cvs finding that technology strategies significantly impacted nvp should encourage executives to consider pursuing a formal technology strategy likewise the finding that different dimensions of technology strategy influenced the performance of cvs and ivs in different ways has practical implications cv managers can learn from their higher performing iv rivals also because established companies frequently acquire ivs information about their technology strategies can be valuable in assimilating the acquired ventures overall the results show that technology strategy is an important factor in enhancing new venture performance

privatization and government size a budget constraint view of government shows that privatization need not alter spending when it is implemented without a rule forbidding re use of the funding backing newly privatized programs only when these funds are eliminated from the budget process e g tax rebates or permanent deficit reduction can these funds not back new programs or expand existing programs this is an important caveat since privatization proposals do not contain such rules with such rules privatization can increase allocational efficiency and lead to smaller government size

bureaucracy monopoly and competition a critical analysis of the budget maximizing model of bureaucracy niskanen has argued that if government bureaus act so as to maximize their budgets they will always produce an output greater than a private industry resulting in efficiency losses to society since the budget maximizing model relates to a number of intersecting areas of organizational analysis from several disciplines it is important to note the limitations of the model first niskanen s result is only true for a bureau which can exercise perfect price discrimination in its relationship with its financial sponsor where this is not the case the bureau may produce less than a private industry second further variation is introduced by examining the effects on a bureau of specialized resources public goods competition and low productivity a bureau which would otherwise produce an output in excess of the competitive level will when any of these factors are present produce an output closer to the competitive output these results may also have significant policy implications since major industrial countries are favoring policies to return some governmental activities to the private sector

coexistence of public and private job agencies screening with heterogeneous institutions in response to the analysis of bureaucracies and the finding of inherent inefficiencies public choice theory argues for an increase in competition by contracting out government services and deregulation the paper explores the effect of coexisting public and private employment services in a model with private information of the worker about her ability and unobservable effort choice the employer s use of an efficient unemployment exchange and an efficient private agency may lead to optimal screening with first best contracts this is due to the assumption that good types of workers lose more human capital than bad types in periods of unemployment or mismatch in contrast to standard screening contracts a bad type of worker earns an information rent if the employment exchange is inefficient but the employer chooses not to use the private agency for good types

do cio it budgets explain bigger or smaller governments theory and evidence from u s state governments given the recent concern on big governments and rising budget deficits in the united states and european nations there has been a fundamental economic debate on the proper boundary and role of governments in a society inspired by this debate we study the relationship between information technology it and government size drawing on a broad range of the literature from multiple disciplines such as information systems industrial organization and political sciences we present several theoretical mechanisms that explain the impact of it on government expenditures using a variety of data on it spending and state government expenditures we find that greater it investments made by a state chief information officer cio are associated with lower state government spending it is estimated that on average a 1 increase in state cio budgets is associated with a reduction of as much as 3 49 in state overall expenditures this study contributes to the literature by identifying a key technological factor that affects government spending and showing that it investments can be a means to restrain government growth

income taxes and the marriage decision economic incentives have been found to play an important role in the marriage decision in developed and developing countries however the way in which the income tax treatment of the family affects these incentives has been routinely ignored this paper uses time series data for the united states from 1947 to 1988 to estimate the impact of economic factors including for the first time the tax consequences of marriage on the aggregate marriage rate the estimation results indicate that economic factors like income female wages and education play an important and statistically significant role in the marriage decision in particular the tax consequences of marriage clearly affect the marriage decision when income taxes increase with marriage the aggregate marriage rate declines however the magnitude of this impact is quite small this result suggests that some individuals respond to tax incentives in their marriage choices but that for many individuals taxes do not affect these decisions

income taxes and the timing of marital decisions abstract in this paper we estimate the impact of the federal individual income tax on the timing of marital decisions anecdotal evidence suggests that the tax penalty often associated with marriage contributes to the decision of when to marry using household data from the panel study on income dynamics we estimate various models of the probability of delaying marriage as a function of the change in tax burden caused by marriage as well as several other variables we find that there is a significant positive relationship between the marriage penalty in a year and the probability of delaying marriage until the following year the magnitude of the effect however is small

gender differences in wage losses from impairments estimates from the survey of income and program participation this article develops a model of the relationships among functional impairments work disability employment participation and wage offers the model is estimated separately for males and females with data from the 1984 survey of income and program participation using estimates of disability and wage equations we rank 25 functional impairments by severity of disability and estimate the wage penalty associated with each impairment the results show that limitations to mobility and strength are relatively more disabling for males than for females while the opposite is true for limitations to sensory capacities and appearance

a theory of jurisdictional assignments in bureaucracies 1 what determines the allocation of tasks among government agencies this paper develops a formal model of task allocation that argues that jurisdictions are strategically designed to achieve legislative goals in the model agencies choose unobservable policies and political outcomes are a noisy indicator of these choices the legislature therefore faces a compliance issue when the agencies policy preferences are different from its own the legislature exerts control by defining agency jurisdictions setting ex ante budgets and choosing ex post contractual inducements the principal result is that tasks will be consolidated under a single roof when that agency prefers lower levels of policy than the legislature in other cases separating tasks prevents resources from being allocated in a manner undesirable for the legislature

legislators and interest groups how unorganized interests get represented this paper derives a supply price for public policy using a constrained maximization model in the model three sets of agents each have preferences over outcomes organized interest groups offer campaign contributions to improve their own wealth voters offer votes to obtain outcomes closer to their most preferred outcomes and legislators seek both campaign contributions and votes to obtain reelection a given legislator s supply price for policy is shown to depend on the productivity of his effort as determined by committee assignments priority and ability and by the preferences of his unorganized constituency in the home district two extreme assumptions about the effectiveness of campaign spending in eliciting votes are used to illustrate the comparative statics properties of the model the prediction of the model is that interest groups will in general seek out legislators whose voters are indifferent to the policy the interest group seeks thus voters who do have preferences over policy are in effect represented even though they are not organized

political solutions to market problems for some market failures serve as a rationale for public intervention however the fact that self interested market behavior does not always produce felicitous social consequences is not sufficient reason to draw this conclusion it is necessary to assess public performance under comparable conditions and hence to analyze self interested political behavior in the institutional structures of the public sector our approach emphasizes this institutional structure warts and all and thereby provides specific cautionary warnings about optimistic reliance on political institutions to improve upon market performance

saying i don t the effect of the affordable care act young adult provision on marriage this paper investigates the effect of the affordable care act young adult provision on the propensity to marry the young adult provision expanded options for obtaining insurance coverage outside of marriage young adults affected by the provision might have less incentive to marry since one avenue for obtaining health insurance coverage is through marriage this paper examines this question by applying difference in differences type methods using the 2008 2013 american community survey results suggest that the provision is associated with decreases in the likelihood of marrying cohabitation and spousal health insurance coverage and an increase in the probability of divorce

markov perfect equilibrium in multi period games between sponsor and bureau we formulate a simple model of the interaction between a sponsor and a bureau the sponsor sets the bureau s budget while the bureau decides on how much to spend on slack we compute numerically markov perfect equilibria of multi period games where the agents move alternately and apply markov strategies both agents are worse off compared to the one period game with simultaneous moves as the discount factors increase the equilibrium outcome becomes less cooperative in nature

the effect of the u s welfare system on marital status abstract an issue of long standing importance in the u s welfare system has been its lack of neutrality with respect to family composition which generally provides payments only to female headed families that is families with no able bodied male present using data from 1969 to 1985 to examine the issue this study finds that 1 the simple cross sectional correlations between marital status and welfare benefits are almost always in the expected direction but are generally weak in significance 2 that the magnitude and significance of the correlations have nevertheless grown over time and 3 that the correlations for men are no weaker and usually stronger especially for blacks than those for women

endogenous public sector budgeting to centralize or not in this paper the impact of budget size on a government s choice to centralize or decentralize the budgetary process is investigated using asymmetric information differing preferences and endogenous budgetary arrangements the central government chooses between a budgetary process that excludes the regional board centralization and one that includes the board decentralization in the determination of program budget levels it is predicted that the central government will decentralize the budgetary process at low and centralize at high overall budget levels switching from decentralization to centralization is predicted to

will extending medicaid to two parent families encourage marriage several welfare programs in the united states restrict eligibility to single parent families this paper asks whether eliminating this restriction for medicaid encourages marriage i identify medicaid s effect through a series of health insurance reforms that were passed in the 1980s and 1990s targeting young children these reforms were associated with an increase in the probability of marriage of 1 7 percentage points while the expansions offered some incentives to become married they also created other incentives to become divorced known as the independence effect after controlling for the outflows from marriage due to the independence effect the estimated effect increases by 10 percent

the political economy of state medicaid policy we develop and test a market based model to explain variations in states welfare medicine policy decisions the empirical results support the model of state policy outputs indicating that states spending efforts for welfare medicine are most sensitive to the supply of services within their borders we learn in addition that spending effort declines with demand for services indicating that the states spending the highest proportions of total personal income for the program are those who need it most and can afford it least measures of political system development affect spending effort positively and significantly suggesting that ideology diversity of interests and administrative professionalism increase states welfare efforts

a critical comment on niskanen s model niskanen s model has been largely criticized but it still remains a standard explanation of bureaucracy s behaviour in this paper we criticize the monopoly power that niskanen assigns to the bureaucracy a bilateral monopoly between bureaucrats and politicians might be a much more adequate framework for explaining the bureaucracy s behaviour than niskanen s original formulation of a perfect discriminating bureaucracy in a bilateral monopoly model in no case the type of relationship which holds between the sponsor and the bureau leads to an oversupply of output should an excess output occur it would be a consequence of the political decision making mechanisms this result stands in sharp contrast to the niskanen s model but at the same time it is coherent with the fact that when the sponsor introduces control and monitoring mechanisms the sponsor does not pretend to decrease the output but rather to supervise and to reduce the costs of producing the output

budgets as dynamic gatekeepers most large organizations allocate resources by means of fixed budgets each subunit is normally entitled to spend a defined amount over a fixed period usually one year fixed budgets create clear incentives for subunits to control costs yet such arrangements create major incentives for dynamic inefficiency for example by encouraging subunits to exhaust their budgets toward the end of the fiscal year this paper develops a dynamic optimization model to examine the incentives fostered by budget systems it invokes the metaphor of physicians involved in a health care delivery system to examine incentives created by decentralized gatekeeping as a mechanism to control medical costs the paper also discusses some methods to reduce the incentives for dynamic inefficiency that fixed budgets create

a stock flow analysis of the welfare caseload this paper reconsiders the methods used in previous studies to assess the welfare caseload movements during the 1990s we develop a model in which the welfare caseload is the net outcome of past flows onto and off of the caseload and show that such a stock flow model can explain some of the anomalous findings in previous studies we then estimate the stock flow model using california administrative data we find that approximately 50 percent of the caseload decline in california can be attributed to the declining unemployment rate these estimates are more robust and larger than those obtained when applying more typical methods to the same california data

a strategic theory of bureaucratic redundancy do redundant bureaucratic arrangements represent wasteful duplication or a hedge against political uncertainty previous attempts at addressing this question have treated agency actions as exogenous thus avoiding strategic issues such as collective action problems or competition i develop a game theoretic model of bureaucratic policy making in which a political principal chooses the number of agents to handle a given task importantly agents have policy preferences that may be opposed to the principal s and furthermore may choose their policy or effort levels among the results are that redundancy can help a principal achieve her policy goals when her preferences are not aligned with the agents but redundancy is less helpful if even a single agent has preferences relatively close to the principal s in this environment collective action problems may cause multiple agents to be less effective than a single agent redundancy can also be unnecessary to the principal if the agent s jurisdiction can be terminated

patterns of growth competitive technology and financial strategies in young ventures abstract young independent technology based ventures have an increasingly complex array of strategic choices about how they can grow while simultaneously competing on the basis of their technological capacity and skills in their markets given the central importance of these choices to the success of the venture there should be a close integral relationship among them similarly financial strategy choices also enter this relationship growth and competition place tremendous resource demands on the young technology based venture and financial strategy choices therefore must also be factored into the choice taking process the choice taking perspective is basic to this inquiry as other researchers have pointed out young entrepreneurial ventures typically do not utilize highly formalized strategic planning processes robinson and pearce 1983 strategy formation in such firms tends to be informal and episodic strategy may be revealed best through the pattern or set of choices taken at a point in time and over time from a choice taking perspective then the critical questions become the following a are there identifiable patterns of growth technology and financial choices b what factors shape or determine which choices are taken and c are these patterns related to venture performance these questions were explored by using data from a survey of 100 ceos of young independent technology based firms across three industries the results generally support the idea that patterns of choices can be identified several of these patterns are related to the ventures demographic characteristics such as form of ownership and scope of sales importantly stage of development was not related to those patterns nor to the performance of the ventures the highest performing ventures were found to be pursuing internal innovation through r d for product breakthroughs this finding is surprising since young ventures at the stage at which most were found in this sample would traditionally be expected to emphasize product extensions and modifications we need to better understand why young ventures would choose to innovate internally for breakthroughs in their growth stages and how well they are able to do so a major implication of this research is that the ceos of young technology based ventures are being presented with a much larger menu or array of choices at many points in time than conventional stage based models of venture development have postulated one explanation of this possibility is that the firm life cycle is being compressed by relatively new conditions such as the availability of more and earlier capital through joint venturing and alliances and shorter product life cycles indeed a follow up survey a year later with 77 ceos from this sample confirmed that joint ventures and alliances were the number one choice being pursued to gain access to distribution channels and new markets what is troubling about this possibility is that the skills and capacities of these young ventures may be limited in comparison with the richness and complexity of the available choices in the follow up survey the sources of information that were by far the most relied upon for strategic decision making were other internal senior managers and board members outsiders such as lawyers ranking distantly behind the leaders of these ventures need to be fully supported in evaluating negotiating and managing these often highly complex relationships