William Anderson - Academia.edu (original) (raw)

Papers by William Anderson

The American Journal of Economics and Sociology, Nov 1, 2004

This paper examines the reaction of the market to news that the Washington Post had won a Pulitze... more This paper examines the reaction of the market to news that the Washington Post had won a Pulitzer Prize for a story that was demonstrably false. The reaction to the stock price of the Post as well as the stock prices of other newspapers is examined using dummy variables for two days, four days, and six days. The results show that while the decline in the Post's stock price was relatively small, the tstatistics for all of the dummy variables are significant. The paper also examines the McChesney (1987) hypothesis that the nature of the newspaper business is such that it is difficult for the residual claimants of the paper to receive the financial gains of important news stories. These rents, he points out, are distributed to others. We look to see whether or not residual claimants of that newspaper can be harmed if that newspaper publishes a false story and receives large amounts of bad publicity for its error. Adam Smith in The Wealth of Nations outlined the basic conflict of interests between owners of a firm and those who manage it or work in its employ. He writes that "the directors of. .. companies, being the managers of other people's money than of their own, it cannot well be expected that they should watch over it with the same anxious vigilance with which (owners) watch over their own" (1976, p. 741). In his example of the agent-principal problem, Smith referred to the East India Company, the Hudson's Bay Company, and the Royal African Company. Had he been alive in 1981, he might have included the Washington Post. The system set up by the company's principal

Economists have tried to explain business cycles as well as fluctuations in the economy, but over... more Economists have tried to explain business cycles as well as fluctuations in the economy, but over the past two centuries, the explanations have fallen into two areas. The first area tries to explain business cycles as being the result of fluctuating aggregate demand; if overall demand for goods is strong (or to put it another way, consumers are confidently buying goods), then the economy is in a boom. However, if consumers choose not to spend, then the economy is in recession. The second area, as outlined by Sowell is that of seeing an economy as operating within internal proportions that are brought into imbalances. Say's Law is found in this second category, and the Austrian theory of the business cycle (ATBC) also is a proportionality-based theory. However, most economists have failed to make the connection between Say's Law and the ATBC.

The Quarterly Journal of Austrian Economics, 2000

While the Total Quality Management programs that were extremely popular a decade ago had many suc... more While the Total Quality Management programs that were extremely popular a decade ago had many successes, there also were a large number of failures. This paper lays out some theoretical reasons for why these failures might have occurred. Our methodology is the application of the theories of the "Austrian" economists, including Ludwig von Mises, F.A. Hayek, and Murray N. Rothbard. We apply both the Austrian theory of the firm, as well as the economic calculation theories that Mises and Hayek developed, in order to explain why some TQM failures might have occurred.

American Journal of Economics and Sociology, 2008

The Alchian and Allen Theorem has been a popular staple of many economics classes since Armen Alc... more The Alchian and Allen Theorem has been a popular staple of many economics classes since Armen Alchian and William Allen first introduced it in their well-known text University Economics. The theorem says that the addition of the same fixed cost to two similar goods will result in an increase of demand for the higher-priced, "higher quality" good relative to the lowerquality item. We review some of the literature, and use Carl Menger's economic analysis to challenge the theorem's validity. Based on Menger's analysis, we conclude that the theorem is highly questionable. Further, we find evidence that Alchian and Allen themselves unwittingly contradict their own theorem elsewhere in one of their texts.

The Quarterly Journal of Austrian Economics, 2005

Public Choice, 2003

arian government in Chile, and, in the case of the U.K., because "few people understand how entit... more arian government in Chile, and, in the case of the U.K., because "few people understand how entitlements are calculated" (p. 98). To conclude, this book should prove very insightful and helpful for people interested in old age income provision schemes. It contains unique information as to the functioning and economic analysis of pension programs in six countries. The introductory synopsis delivers an excellent introduction to the current landscape of pension programs, and to the challenges that these programs will face in the future. One can only hope that this book will reach its goal of helping countries to learn from each other's trials and errors.

The Quarterly Journal of Austrian Economics, 2003

A ustrian economists have consistently criticized modern neoclassical economics for its lack of r... more A ustrian economists have consistently criticized modern neoclassical economics for its lack of real-world analysis, depending instead upon Friedman's contention (1953) that the strength of economic theory is its ability to predict events, period. Writes Hülsmann (1999): For more than forty years, economists have routinely rejected the postulate that economic theory should be realistic. Ever since Milton Friedman sketchily outlined a positive methodology for economics, most students of our science have come to endorse Friedman's view and have claimed that the only quality standard of economic reasoning was its predictive power. Good theories yield fairly correct predictions whereas bad theories yield wrong predictions.. .. Today, the utter failure of this program is patent. (p. 3) The view that assumptions are not important in formulating economic theory has led to the intellectual disconnect in which economists carefully craft various scenarios using "rigorous" mathematical constructs, yet are reluctant to take their work seriously, since the results mean nothing unless they can be "proved" through statistical analysis. However, this problem does not keep many in the economics profession from engaging in what must be the ultimate absurdity: creating a theory that (a) cannot be ascertained from the assumptions used to create that theory, and (b) does not hold up under empirical analysis. Such is the story of the theory of predatory pricing. The theory of predatory pricing can be likened to that strange gift from Aunt Maude or a unicorn. In the first case, one looks for an appropriate place

The Quarterly Journal of Austrian Economics, 2002

With the of Rothbard's monumental work publication Murray N. An Austrian Perspective on the Histo... more With the of Rothbard's monumental work publication Murray N. An Austrian Perspective on the History of Economic Thought in 1995, contemporary Austrian economists have become aware that they are the modern heirs to a grand intellectual tradition. The first fruit of further research in the Austrian tradition was 15 Great Austrian Economists, a small volume edited by Randall G. Holcombe in 1999. In the meantime, some predecessors of modern Austrian economics have received more attention. This is the case with Richard Cantillon and, most notably, with Fred¢ric Bastiat whose bicentenary was celebrated in 2001. By contrast, three major figures have so far been unduly neglected: Friedrich von Wieser (1851-1926), Richard von Strigl (1891-1942), and 12tienne de Condillac (1714-1780). In the case of the latter two, their pioneering works in economics have only very recently been translated into English and have not yet penetrated the contemporary communities most akin to their messages. 1 This holds true in particular for Condillac's Commerce and Government, a work that is indeed nothing less than one of the great milestones in the history of economic science and on equal footing with the works of Cantillon, Say, and Bastiat. 2 The ideas contained in this book not only have a strong affinity with Austrian economics, but they also had a considerable and direct impact on the development of Menger's thought. Menger acknowledged this influence in his

Public Choice, 2006

This paper examines a number of demographic aspects in congressional districts and states that pl... more This paper examines a number of demographic aspects in congressional districts and states that played important roles in a series of Congressional votes on environmental issues in 2000. These characteristics include urbanization or population density, education, income, race, and employment. Our findings are mixed. While we find some evidence (at least in Senate votes) that population density is a positive predictor of "pro-environment" votes, we also find that things commensurate with the Environmental Kuznets Curve such as income, education, and lifestyle also play an important role in environmental voting.

American Journal of Economics and Sociology, 2006

ABSRACT. Throughout the 1980s and early 1990s, acid rain was an important topic of public debate.... more ABSRACT. Throughout the 1980s and early 1990s, acid rain was an important topic of public debate. Newspapers ramped up coverage in the early 1980s, which then peaked in the mid-1980s and died off slowly in the late 1980s and early 1990s, to be rarely seen again. The question asked is whether the tone of the acid rain coverage was an example of alleged "liberal bias" of journalists, or if it was due to other factors. This paper examines various explanations of newspaper behavior, including one given by the late Warren Brookes concluding that the real bias of reporters tends toward the expansion of government, or the statist quo. In our paper, we examine the coverage of acid rain before and after the election of George Bush in 1988, an event that led directly to the passage of the the Clean Air Act Amendments of 1990, which had strong acid rain provisions. Our statistical tests, while mixed, give credence to the "statist quo" hypothesis, especially where newspapers of "national stature" are concerned.

American Journal of Economics and Sociology, 1999

The Economics of Peace and Security Journal, 2012

The Austrian school of economics increasingly has become identified with antiwar groups. This is ... more The Austrian school of economics increasingly has become identified with antiwar groups. This is not due to religious or political views. Rather, the antiwar viewpoints of the Austrians come from the fundamental tenets of economics as expressed by the school's founders and refined for 140 years. This article applies post-world war II Austrian thought to the subject of war.

The Economics of Peace and Security Journal, 2011

The Austrian school of economics is generally considered an antiwar school. The Austrian view is ... more The Austrian school of economics is generally considered an antiwar school. The Austrian view is not derived from a religious or class-based ideological viewpoints, but instead derives entirely from the school's fundamental economic tenets. This article examines the writings of Ludwig von Mises and Friedrich von Hayek as they relate to war and the causes of war. (A predecessor article on Carl Menger, Eugen von Böhm-Bawerk, and Friedrich von Wieser, the founders of the Austrian School, appeared in vol. 5, no. 1 of this journal.)

International Journal of Social Economics, 2008

PurposeThe purpose of this paper is to highlight the importance of property rights institutions t... more PurposeThe purpose of this paper is to highlight the importance of property rights institutions to disaster relief efforts, with a focus on the US Federal Emergency Management Agency in the aftermath of Hurricane Katrina in New Orleans, Louisiana.Design/methodology/approachThe paper utilizes public choice, Austrian, and new institutional analyses of bureaucracy. It discusses private and public sector responses to the situation in New Orleans following Katrina and to disasters in general, and compares the institutional frameworks that develop over time in both sectors.FindingsThe paper finds that a large and bureaucratized response to disasters hinders economic calculation, incentive structure, and property rights institutions, all of which are crucial for rapid disaster response, the relief of human suffering, the minimization of knowledge problems, and the promotion of an efficient allocation of resources.Practical implicationsThis research suggests that the role of the price syste...

International Journal of Social Economics, 2008

PurposeThe purpose of this paper is to highlight the importance of property rights institutions t... more PurposeThe purpose of this paper is to highlight the importance of property rights institutions to disaster relief efforts, with a focus on the US Federal Emergency Management Agency in the aftermath of Hurricane Katrina in New Orleans, Louisiana.Design/methodology/approachThe paper utilizes public choice, Austrian, and new institutional analyses of bureaucracy. It discusses private and public sector responses to the situation in New Orleans following Katrina and to disasters in general, and compares the institutional frameworks that develop over time in both sectors.FindingsThe paper finds that a large and bureaucratized response to disasters hinders economic calculation, incentive structure, and property rights institutions, all of which are crucial for rapid disaster response, the relief of human suffering, the minimization of knowledge problems, and the promotion of an efficient allocation of resources.Practical implicationsThis research suggests that the role of the price syste...

JAMA, 2001

In 2000, it took an average of 44 calendar days from manuscript receipt to rejection; 117 days fr... more In 2000, it took an average of 44 calendar days from manuscript receipt to rejection; 117 days from receipt to acceptance; and 182 days from receipt to publication. A mean of 24 days was required for peer review; each reviewer handled an average of 2 manuscripts. Fifty-six percent of the 4366 manuscripts we received were sent for external peer review. Forty-two percent of manuscripts were rejected without external review. Two percent of accepted manuscripts (mostly invited editorials) did not have external review. The total acceptance rate for manuscripts in 2000 was 11%, and

The American Journal of Economics and Sociology, Nov 1, 2004

This paper examines the reaction of the market to news that the Washington Post had won a Pulitze... more This paper examines the reaction of the market to news that the Washington Post had won a Pulitzer Prize for a story that was demonstrably false. The reaction to the stock price of the Post as well as the stock prices of other newspapers is examined using dummy variables for two days, four days, and six days. The results show that while the decline in the Post's stock price was relatively small, the tstatistics for all of the dummy variables are significant. The paper also examines the McChesney (1987) hypothesis that the nature of the newspaper business is such that it is difficult for the residual claimants of the paper to receive the financial gains of important news stories. These rents, he points out, are distributed to others. We look to see whether or not residual claimants of that newspaper can be harmed if that newspaper publishes a false story and receives large amounts of bad publicity for its error. Adam Smith in The Wealth of Nations outlined the basic conflict of interests between owners of a firm and those who manage it or work in its employ. He writes that "the directors of. .. companies, being the managers of other people's money than of their own, it cannot well be expected that they should watch over it with the same anxious vigilance with which (owners) watch over their own" (1976, p. 741). In his example of the agent-principal problem, Smith referred to the East India Company, the Hudson's Bay Company, and the Royal African Company. Had he been alive in 1981, he might have included the Washington Post. The system set up by the company's principal

Economists have tried to explain business cycles as well as fluctuations in the economy, but over... more Economists have tried to explain business cycles as well as fluctuations in the economy, but over the past two centuries, the explanations have fallen into two areas. The first area tries to explain business cycles as being the result of fluctuating aggregate demand; if overall demand for goods is strong (or to put it another way, consumers are confidently buying goods), then the economy is in a boom. However, if consumers choose not to spend, then the economy is in recession. The second area, as outlined by Sowell is that of seeing an economy as operating within internal proportions that are brought into imbalances. Say's Law is found in this second category, and the Austrian theory of the business cycle (ATBC) also is a proportionality-based theory. However, most economists have failed to make the connection between Say's Law and the ATBC.

The Quarterly Journal of Austrian Economics, 2000

While the Total Quality Management programs that were extremely popular a decade ago had many suc... more While the Total Quality Management programs that were extremely popular a decade ago had many successes, there also were a large number of failures. This paper lays out some theoretical reasons for why these failures might have occurred. Our methodology is the application of the theories of the "Austrian" economists, including Ludwig von Mises, F.A. Hayek, and Murray N. Rothbard. We apply both the Austrian theory of the firm, as well as the economic calculation theories that Mises and Hayek developed, in order to explain why some TQM failures might have occurred.

American Journal of Economics and Sociology, 2008

The Alchian and Allen Theorem has been a popular staple of many economics classes since Armen Alc... more The Alchian and Allen Theorem has been a popular staple of many economics classes since Armen Alchian and William Allen first introduced it in their well-known text University Economics. The theorem says that the addition of the same fixed cost to two similar goods will result in an increase of demand for the higher-priced, "higher quality" good relative to the lowerquality item. We review some of the literature, and use Carl Menger's economic analysis to challenge the theorem's validity. Based on Menger's analysis, we conclude that the theorem is highly questionable. Further, we find evidence that Alchian and Allen themselves unwittingly contradict their own theorem elsewhere in one of their texts.

The Quarterly Journal of Austrian Economics, 2005

Public Choice, 2003

arian government in Chile, and, in the case of the U.K., because "few people understand how entit... more arian government in Chile, and, in the case of the U.K., because "few people understand how entitlements are calculated" (p. 98). To conclude, this book should prove very insightful and helpful for people interested in old age income provision schemes. It contains unique information as to the functioning and economic analysis of pension programs in six countries. The introductory synopsis delivers an excellent introduction to the current landscape of pension programs, and to the challenges that these programs will face in the future. One can only hope that this book will reach its goal of helping countries to learn from each other's trials and errors.

The Quarterly Journal of Austrian Economics, 2003

A ustrian economists have consistently criticized modern neoclassical economics for its lack of r... more A ustrian economists have consistently criticized modern neoclassical economics for its lack of real-world analysis, depending instead upon Friedman's contention (1953) that the strength of economic theory is its ability to predict events, period. Writes Hülsmann (1999): For more than forty years, economists have routinely rejected the postulate that economic theory should be realistic. Ever since Milton Friedman sketchily outlined a positive methodology for economics, most students of our science have come to endorse Friedman's view and have claimed that the only quality standard of economic reasoning was its predictive power. Good theories yield fairly correct predictions whereas bad theories yield wrong predictions.. .. Today, the utter failure of this program is patent. (p. 3) The view that assumptions are not important in formulating economic theory has led to the intellectual disconnect in which economists carefully craft various scenarios using "rigorous" mathematical constructs, yet are reluctant to take their work seriously, since the results mean nothing unless they can be "proved" through statistical analysis. However, this problem does not keep many in the economics profession from engaging in what must be the ultimate absurdity: creating a theory that (a) cannot be ascertained from the assumptions used to create that theory, and (b) does not hold up under empirical analysis. Such is the story of the theory of predatory pricing. The theory of predatory pricing can be likened to that strange gift from Aunt Maude or a unicorn. In the first case, one looks for an appropriate place

The Quarterly Journal of Austrian Economics, 2002

With the of Rothbard's monumental work publication Murray N. An Austrian Perspective on the Histo... more With the of Rothbard's monumental work publication Murray N. An Austrian Perspective on the History of Economic Thought in 1995, contemporary Austrian economists have become aware that they are the modern heirs to a grand intellectual tradition. The first fruit of further research in the Austrian tradition was 15 Great Austrian Economists, a small volume edited by Randall G. Holcombe in 1999. In the meantime, some predecessors of modern Austrian economics have received more attention. This is the case with Richard Cantillon and, most notably, with Fred¢ric Bastiat whose bicentenary was celebrated in 2001. By contrast, three major figures have so far been unduly neglected: Friedrich von Wieser (1851-1926), Richard von Strigl (1891-1942), and 12tienne de Condillac (1714-1780). In the case of the latter two, their pioneering works in economics have only very recently been translated into English and have not yet penetrated the contemporary communities most akin to their messages. 1 This holds true in particular for Condillac's Commerce and Government, a work that is indeed nothing less than one of the great milestones in the history of economic science and on equal footing with the works of Cantillon, Say, and Bastiat. 2 The ideas contained in this book not only have a strong affinity with Austrian economics, but they also had a considerable and direct impact on the development of Menger's thought. Menger acknowledged this influence in his

Public Choice, 2006

This paper examines a number of demographic aspects in congressional districts and states that pl... more This paper examines a number of demographic aspects in congressional districts and states that played important roles in a series of Congressional votes on environmental issues in 2000. These characteristics include urbanization or population density, education, income, race, and employment. Our findings are mixed. While we find some evidence (at least in Senate votes) that population density is a positive predictor of "pro-environment" votes, we also find that things commensurate with the Environmental Kuznets Curve such as income, education, and lifestyle also play an important role in environmental voting.

American Journal of Economics and Sociology, 2006

ABSRACT. Throughout the 1980s and early 1990s, acid rain was an important topic of public debate.... more ABSRACT. Throughout the 1980s and early 1990s, acid rain was an important topic of public debate. Newspapers ramped up coverage in the early 1980s, which then peaked in the mid-1980s and died off slowly in the late 1980s and early 1990s, to be rarely seen again. The question asked is whether the tone of the acid rain coverage was an example of alleged "liberal bias" of journalists, or if it was due to other factors. This paper examines various explanations of newspaper behavior, including one given by the late Warren Brookes concluding that the real bias of reporters tends toward the expansion of government, or the statist quo. In our paper, we examine the coverage of acid rain before and after the election of George Bush in 1988, an event that led directly to the passage of the the Clean Air Act Amendments of 1990, which had strong acid rain provisions. Our statistical tests, while mixed, give credence to the "statist quo" hypothesis, especially where newspapers of "national stature" are concerned.

American Journal of Economics and Sociology, 1999

The Economics of Peace and Security Journal, 2012

The Austrian school of economics increasingly has become identified with antiwar groups. This is ... more The Austrian school of economics increasingly has become identified with antiwar groups. This is not due to religious or political views. Rather, the antiwar viewpoints of the Austrians come from the fundamental tenets of economics as expressed by the school's founders and refined for 140 years. This article applies post-world war II Austrian thought to the subject of war.

The Economics of Peace and Security Journal, 2011

The Austrian school of economics is generally considered an antiwar school. The Austrian view is ... more The Austrian school of economics is generally considered an antiwar school. The Austrian view is not derived from a religious or class-based ideological viewpoints, but instead derives entirely from the school's fundamental economic tenets. This article examines the writings of Ludwig von Mises and Friedrich von Hayek as they relate to war and the causes of war. (A predecessor article on Carl Menger, Eugen von Böhm-Bawerk, and Friedrich von Wieser, the founders of the Austrian School, appeared in vol. 5, no. 1 of this journal.)

International Journal of Social Economics, 2008

PurposeThe purpose of this paper is to highlight the importance of property rights institutions t... more PurposeThe purpose of this paper is to highlight the importance of property rights institutions to disaster relief efforts, with a focus on the US Federal Emergency Management Agency in the aftermath of Hurricane Katrina in New Orleans, Louisiana.Design/methodology/approachThe paper utilizes public choice, Austrian, and new institutional analyses of bureaucracy. It discusses private and public sector responses to the situation in New Orleans following Katrina and to disasters in general, and compares the institutional frameworks that develop over time in both sectors.FindingsThe paper finds that a large and bureaucratized response to disasters hinders economic calculation, incentive structure, and property rights institutions, all of which are crucial for rapid disaster response, the relief of human suffering, the minimization of knowledge problems, and the promotion of an efficient allocation of resources.Practical implicationsThis research suggests that the role of the price syste...

International Journal of Social Economics, 2008

PurposeThe purpose of this paper is to highlight the importance of property rights institutions t... more PurposeThe purpose of this paper is to highlight the importance of property rights institutions to disaster relief efforts, with a focus on the US Federal Emergency Management Agency in the aftermath of Hurricane Katrina in New Orleans, Louisiana.Design/methodology/approachThe paper utilizes public choice, Austrian, and new institutional analyses of bureaucracy. It discusses private and public sector responses to the situation in New Orleans following Katrina and to disasters in general, and compares the institutional frameworks that develop over time in both sectors.FindingsThe paper finds that a large and bureaucratized response to disasters hinders economic calculation, incentive structure, and property rights institutions, all of which are crucial for rapid disaster response, the relief of human suffering, the minimization of knowledge problems, and the promotion of an efficient allocation of resources.Practical implicationsThis research suggests that the role of the price syste...

JAMA, 2001

In 2000, it took an average of 44 calendar days from manuscript receipt to rejection; 117 days fr... more In 2000, it took an average of 44 calendar days from manuscript receipt to rejection; 117 days from receipt to acceptance; and 182 days from receipt to publication. A mean of 24 days was required for peer review; each reviewer handled an average of 2 manuscripts. Fifty-six percent of the 4366 manuscripts we received were sent for external peer review. Forty-two percent of manuscripts were rejected without external review. Two percent of accepted manuscripts (mostly invited editorials) did not have external review. The total acceptance rate for manuscripts in 2000 was 11%, and