William F Shughart - Profile on Academia.edu (original) (raw)

Papers by William F Shughart

Public Choice, Sep 1, 1994

This paper investigates the determinants of legal change in a public choice framework. An empiric... more This paper investigates the determinants of legal change in a public choice framework. An empirical model explaining the timing and probability of decisions to adopt state-operated lotteries is developed. Employing a Tobit estimator and explicitly considering the effects of statespecific constitutional and political structures, spending and tax policies, and federal revenue importation, evidence is presented showing that legal change is much like economic change: Lotteries are more likely to be adopted and to be adopted earlier where the costs are lowest relative to expected benefits. State legislatures appear to be the main beneficiaries of this public choice process. * We are especially indebted to Tim Sass for many helpful suggestions. Roger Folsom, Thomas Husted, Lydia Ortega, Robert Tollison, and an anonymous referee also provided useful comments. Saurman gratefully acknowledges financial support from the College of Social Sciences at San Jose University. Any remaining errors are our own. U.S. Department of Commerce, Bureau of the Census. (1988 and other various years of issue).

Palgrave Macmillan eBooks, Oct 8, 2013

The use of general descriptive names, registered names, trademarks, service marks, etc. in this p... more The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made.The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations

WhatDidEconomists Do? Euvoluntary, Voluntary, and Coercive Institutions for Collective Action

Southern Economic Journal, Apr 1, 2014

ABSTRACT Taking James Buchanan’s 1963 presidential address to the Southern Economic Association a... more ABSTRACT Taking James Buchanan’s 1963 presidential address to the Southern Economic Association as our point of departure, we summarize some of the contributions to the literatures of economics and political science that responded over the next 50 years to his challenge to concentrate on “exchange” rather than on “choice,” thereby placing the theory of markets rather than the theory of resource allocation at center stage. We specifically expand upon his example of swamp draining as a collective action problem, in response to which the swamp’s neighbors likely will find it their individual self-interests to delegate decisions about swamp-clearing to the “community as a collective unit,” operating under clearly specified “rules for making choices, and these decisions coercively enforced once they are made.” Consideration of actual solutions to the challenges of managing common pool resources or of providing collectively consumed goods shows that alternatives exist to top-down rule enforcement by a community or state exercising its police powers. Governance does not require a government, and we do not see coercion if the penalties for violating rules emerge from the bottom up, are freely agreed to ahead of time and exit from the collective unit is possible.

Wealth Creation as a “Sin”

The Independent Review, Sep 22, 2018

Wellington must now cede victory to Napoleon and the common law must give way to the civil code. ... more Wellington must now cede victory to Napoleon and the common law must give way to the civil code. -Gordon Tullock, The Case against the Common Law (1997) G ordon Tullock, trained in the law at the University of Chicago, was an implacable critic of the common law, which originated in England centuries ago and was transplanted to the United States, Canada, Australia, and other English-speaking nations during colonial times. 1 Tullock generally favored legal regimes based on civil law or "Roman civil law," the latter being the phrase used by John Henry Merryman and Rogelio Pérez-Perdomo ([1969] 2007) to solve a terminological problem in the comparative legal studies literature. 2 Although applications of that regime differ from place to place and have evolved over time

For Your Own Good, Jan 3, 2018

Selective consumption taxes apply to specific goods rather than to a broad range of goods. Policy... more Selective consumption taxes apply to specific goods rather than to a broad range of goods. Policymakers justify these taxes on the basis of the goal of reducing societal problems — like the consumption of alcohol or cigarettes — and nudging consumers toward healthier choices. But this chapter shows that selective consumption taxes are being applied to more and more goods, and they fail many of the criteria for sound tax policy. Selective consumption taxes fail the neutrality criterion. Economists support “neutral” tax policies that do not distort consumer choice. Sin taxes, with the stated goal of reducing the consumption of selected goods that consumers want to buy, violate neutrality. Selective consumption taxes also fail the equity criterion. Because consumers pay sin taxes based on their individual choices, people with similar incomes may face different tax burdens. The costs of sin taxes tend to fall hardest on low-income people, who tend to spend a higher percentage of their income on excise taxes.

Journal of Applied Business Research, Oct 18, 2011

Moneyball: The art of winning an unfair game, by Lewis, M. New York and London: Norton, 2003, xv + 288 pp., USD 24.95 (cloth)

Managerial and Decision Economics, 2004

ABSTRACT

Fordham Urban Law Journal, 2003

As long ago as 1980, even public officials otherwise strongly supportive of expansive governmenta... more As long ago as 1980, even public officials otherwise strongly supportive of expansive governmental authority have disparaged the bureau's methods: "If I were to select a jack-booted group of fascists who were perhaps as large a danger to American society as I could pick today, I would pick the BATF. They are a shame and a disgrace to our country." Id. at 177 (quoting Congressman John H. Dingell). 4. Id. at 177-200 (supplying details about the Ruby Ridge and Waco incidents in a chapter entitled "BATF Abuses").

Managerial and Decision Economics, Jul 1, 1995

The Modification of Final Judgment (MFJ) prohibits the seven regional Bell operating companies (R... more The Modification of Final Judgment (MFJ) prohibits the seven regional Bell operating companies (RBOCs) spun off by AT&T from competing with one another in various markets 'adjacent' to the local telephone exchange. I have examined the competitiveness of three of these a4acent markets (cellular telephone, paging services, and yellow pages publishing) since divestiture in order to assess the likelihood of collusion among the RBOCs. On the basis of a decade of post-divestiture experience, I find the prospect of collusion to be remote and, hence, the probability of anticompetitive effects from lifting the MFJ to be vanishingly small.

Journal of Economic Behavior and Organization, Sep 1, 1992

This paper examines the relationship between industry profitability, sales to government, market ... more This paper examines the relationship between industry profitability, sales to government, market structure, and firm size. The empirical results consistently show that government purchases of goods and services from the private sector significantly raise the profits of small firms across all industries, but that there is no significant relationship between large firm profitability and sales to government, even in highly concentrated industries. It is concluded that sales to government do not appear to facilitate collusion among large firms. Instead, the main impact of government purchases is to transfer wealth from the general taxpayer to small business. The problem implicitly raised by these remarks is why all sales to the government are not at collusive prices. Part of the answer is that the government is usually not a sufftciently large buyer of a commodity to remunerate the costs of collusion [Stigler (1968, p. 431. *We benetitted from comments by Keith Womer and Samson Kimenyi. Remaining errors are our own.

Public Choice, Mar 1, 1992

Terrorism in Rational Choice Perspective

Chapters, 2011

... economies. Abadie and Gardeazabal (2003), for example, find that GDP per capita in Spain&... more ... economies. Abadie and Gardeazabal (2003), for example, find that GDP per capita in Spain's Basque region was 10 percent below predicted trend over 20 years of the terror campaign launched by ethnic separatists. Eckstein ...

Excise Taxation in the Rent-Seeking Society

Social Science Research Network, Oct 22, 2013

During his presidential campaign, Sen. Barack Obama criticized sharply the lax antitrust law enfo... more During his presidential campaign, Sen. Barack Obama criticized sharply the lax antitrust law enforcement record of the George W. Bush administration. Subsequently, his first assistant attorney general for antitrust even went so far as to suggest that the Great Recession was, at least in part, caused by federal antitrust policy failures during the previous eight years. This paper sets out to investigate how and in what ways antitrust enforcement has changed since President Obama took office in 2009. We review four recent antitrust cases and the behavioral remedies that were imposed on the defendants in those matters in detail. We find that the Obama administration has been significantly more active in enforcing the antitrust laws with respect to proposed mergers than his two predecessors in the White House had been. In addition, the Federal Trade Commission, together with the Department of Justice, withdrew a thoughtful report on the enforcement of Section 2 of the Sherman Act and issued new merger guidelines and a new merger policy remedy guide, all of which have moved antitrust law enforcement away from traditional structural remedies in favor of very intrusive behavioral remedies in an unprecedented fashion. That policy shift has further transformed antitrust law enforcers into regulatory agencies, a mission for which they are not well-suited, resulting in the Department of Justice and Federal Trade Commission being more vulnerable to rent seeking.

Cato Journal, 1998

Since U.S. combat forces left Indochina in 1973, no political, moral, financial, or personal priv... more Since U.S. combat forces left Indochina in 1973, no political, moral, financial, or personal privacy issue has left its mark on the American conscience like the question of legalized abortion. Opinions are divided as on no other topic of public policy debate. The controversy is tendentious, contentious, and sometimes violent. Almost no one is indifferent to the issue of legalized abortion, and the vast majority of individuals who have already formed an opinion stopped listening to arguments from the other side long ago. Most public opinion polls show the country sharply split on the question of abortion. Pro-abortion forces point to numbers indicating that a majority of Americans favor abortion rights when there is an imminent risk to the mother's health if the baby is carried to term, or in cases of rape or incest. Pro-lifers tout numbers showing a large majority of Americans opposed to ''abortion on demand.'' But few abortions are in fact performed to save the life of the mother; even fewer are performed to terminate pregnancies resulting from rape or incest. In modern society, the procedure of abortion is simply used to terminate unwanted pregnancies for many women. Bitter opposition to any proposal that would restrict in any way a woman's ''right to choose'' suggests that this is so. And if many abortion-minded women are in fact searching for an inexpensive way of disposing of an unwanted child-using abortion as a kind of foolproof birth control device-laws that make abortions less costly should

Is Breaking up Hard to Do? Legal Institutions and the Rate of Divorce

Journal of public finance and public choice, Oct 1, 1991

Alcune teorie economiche hanno tentato di rappresentare la famiglia come una specie di impresa ec... more Alcune teorie economiche hanno tentato di rappresentare la famiglia come una specie di impresa economica, applicando il ragionamento economico al matrimonio ed al divorzio. Non vi è stata, tuttavia, un’analisi altrettanto approfondita dell’influenza del sistema giuridico sulla struttura e la natura dei contratti di matrimonio. Se la famiglia viene configurata come un’impresa, ed il divorzio come una rinegoziazione contrattuale, ci si può attendere che i parametri giuridici dello scambio svolgano un ruolo significativo sui costi e, quindi, sul numero dei divorzi. L’indagine svolta dimostra la correttezza di quest’ipotesi. In particolare, si dimostra che la legislazione che prevede una custodia dei figli congiunta tende ad aumentare il tasso di divorzio, forse perché evita una costosa battaglia per l’attribuzione della custodia dei figli. Al contrario, sistemi che richiedono lunghi periodi di residenza e impongono periodi obbligatori di separazione tendono ad avere un tasso di divorzio più basso. Questi risultati sono conformi all’intuizione e ai recenti contributi della teoria economica dei diritti di proprietà, applicati al modello della famiglia come impresa di carattere economico.

Regulatory rent seeking

Edward Elgar Publishing eBooks, Mar 27, 2015

Public Finance Review, Nov 1, 2006

resolved litigation between the states and the major US cigarette manufacturers. In total, Big To... more resolved litigation between the states and the major US cigarette manufacturers. In total, Big Tobacco agreed to pay more than $246 billion over 25 years to compensate the states for costs incurred in treating smoking-related diseases. This paper explores the political and economic determinants of the amounts distributed to the states under the MSA. About one-third of the variation in payouts is explained by the states' smoking-attributable healthcare expenditures. We also find that significantly larger settlement payments went to big-government states and to those with greater numbers of medical professionals and health-related organizations. * This article is based on the first-named author's dissertation . We benefited from comments by committee members William Chappell, Robert Tollison and Harvey Palmer as well as those of Hilary Shughart. As is customary, however, the authors accept full responsibility for any remaining errors. In the interest of full disclosure, the second-named author served as an economic expert on behalf of Philip Morris USA in the Mississippi and Texas tobacco litigation, both of which settled prior to finalizing the Master Settlement Agreement.

Public Choice, Sep 1, 1994

This paper investigates the determinants of legal change in a public choice framework. An empiric... more This paper investigates the determinants of legal change in a public choice framework. An empirical model explaining the timing and probability of decisions to adopt state-operated lotteries is developed. Employing a Tobit estimator and explicitly considering the effects of statespecific constitutional and political structures, spending and tax policies, and federal revenue importation, evidence is presented showing that legal change is much like economic change: Lotteries are more likely to be adopted and to be adopted earlier where the costs are lowest relative to expected benefits. State legislatures appear to be the main beneficiaries of this public choice process. * We are especially indebted to Tim Sass for many helpful suggestions. Roger Folsom, Thomas Husted, Lydia Ortega, Robert Tollison, and an anonymous referee also provided useful comments. Saurman gratefully acknowledges financial support from the College of Social Sciences at San Jose University. Any remaining errors are our own. U.S. Department of Commerce, Bureau of the Census. (1988 and other various years of issue).

Palgrave Macmillan eBooks, Oct 8, 2013

The use of general descriptive names, registered names, trademarks, service marks, etc. in this p... more The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made.The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations

WhatDidEconomists Do? Euvoluntary, Voluntary, and Coercive Institutions for Collective Action

Southern Economic Journal, Apr 1, 2014

ABSTRACT Taking James Buchanan’s 1963 presidential address to the Southern Economic Association a... more ABSTRACT Taking James Buchanan’s 1963 presidential address to the Southern Economic Association as our point of departure, we summarize some of the contributions to the literatures of economics and political science that responded over the next 50 years to his challenge to concentrate on “exchange” rather than on “choice,” thereby placing the theory of markets rather than the theory of resource allocation at center stage. We specifically expand upon his example of swamp draining as a collective action problem, in response to which the swamp’s neighbors likely will find it their individual self-interests to delegate decisions about swamp-clearing to the “community as a collective unit,” operating under clearly specified “rules for making choices, and these decisions coercively enforced once they are made.” Consideration of actual solutions to the challenges of managing common pool resources or of providing collectively consumed goods shows that alternatives exist to top-down rule enforcement by a community or state exercising its police powers. Governance does not require a government, and we do not see coercion if the penalties for violating rules emerge from the bottom up, are freely agreed to ahead of time and exit from the collective unit is possible.

Wealth Creation as a “Sin”

The Independent Review, Sep 22, 2018

Wellington must now cede victory to Napoleon and the common law must give way to the civil code. ... more Wellington must now cede victory to Napoleon and the common law must give way to the civil code. -Gordon Tullock, The Case against the Common Law (1997) G ordon Tullock, trained in the law at the University of Chicago, was an implacable critic of the common law, which originated in England centuries ago and was transplanted to the United States, Canada, Australia, and other English-speaking nations during colonial times. 1 Tullock generally favored legal regimes based on civil law or "Roman civil law," the latter being the phrase used by John Henry Merryman and Rogelio Pérez-Perdomo ([1969] 2007) to solve a terminological problem in the comparative legal studies literature. 2 Although applications of that regime differ from place to place and have evolved over time

For Your Own Good, Jan 3, 2018

Selective consumption taxes apply to specific goods rather than to a broad range of goods. Policy... more Selective consumption taxes apply to specific goods rather than to a broad range of goods. Policymakers justify these taxes on the basis of the goal of reducing societal problems — like the consumption of alcohol or cigarettes — and nudging consumers toward healthier choices. But this chapter shows that selective consumption taxes are being applied to more and more goods, and they fail many of the criteria for sound tax policy. Selective consumption taxes fail the neutrality criterion. Economists support “neutral” tax policies that do not distort consumer choice. Sin taxes, with the stated goal of reducing the consumption of selected goods that consumers want to buy, violate neutrality. Selective consumption taxes also fail the equity criterion. Because consumers pay sin taxes based on their individual choices, people with similar incomes may face different tax burdens. The costs of sin taxes tend to fall hardest on low-income people, who tend to spend a higher percentage of their income on excise taxes.

Journal of Applied Business Research, Oct 18, 2011

Moneyball: The art of winning an unfair game, by Lewis, M. New York and London: Norton, 2003, xv + 288 pp., USD 24.95 (cloth)

Managerial and Decision Economics, 2004

ABSTRACT

Fordham Urban Law Journal, 2003

As long ago as 1980, even public officials otherwise strongly supportive of expansive governmenta... more As long ago as 1980, even public officials otherwise strongly supportive of expansive governmental authority have disparaged the bureau's methods: "If I were to select a jack-booted group of fascists who were perhaps as large a danger to American society as I could pick today, I would pick the BATF. They are a shame and a disgrace to our country." Id. at 177 (quoting Congressman John H. Dingell). 4. Id. at 177-200 (supplying details about the Ruby Ridge and Waco incidents in a chapter entitled "BATF Abuses").

Managerial and Decision Economics, Jul 1, 1995

The Modification of Final Judgment (MFJ) prohibits the seven regional Bell operating companies (R... more The Modification of Final Judgment (MFJ) prohibits the seven regional Bell operating companies (RBOCs) spun off by AT&T from competing with one another in various markets 'adjacent' to the local telephone exchange. I have examined the competitiveness of three of these a4acent markets (cellular telephone, paging services, and yellow pages publishing) since divestiture in order to assess the likelihood of collusion among the RBOCs. On the basis of a decade of post-divestiture experience, I find the prospect of collusion to be remote and, hence, the probability of anticompetitive effects from lifting the MFJ to be vanishingly small.

Journal of Economic Behavior and Organization, Sep 1, 1992

This paper examines the relationship between industry profitability, sales to government, market ... more This paper examines the relationship between industry profitability, sales to government, market structure, and firm size. The empirical results consistently show that government purchases of goods and services from the private sector significantly raise the profits of small firms across all industries, but that there is no significant relationship between large firm profitability and sales to government, even in highly concentrated industries. It is concluded that sales to government do not appear to facilitate collusion among large firms. Instead, the main impact of government purchases is to transfer wealth from the general taxpayer to small business. The problem implicitly raised by these remarks is why all sales to the government are not at collusive prices. Part of the answer is that the government is usually not a sufftciently large buyer of a commodity to remunerate the costs of collusion [Stigler (1968, p. 431. *We benetitted from comments by Keith Womer and Samson Kimenyi. Remaining errors are our own.

Public Choice, Mar 1, 1992

Terrorism in Rational Choice Perspective

Chapters, 2011

... economies. Abadie and Gardeazabal (2003), for example, find that GDP per capita in Spain&... more ... economies. Abadie and Gardeazabal (2003), for example, find that GDP per capita in Spain's Basque region was 10 percent below predicted trend over 20 years of the terror campaign launched by ethnic separatists. Eckstein ...

Excise Taxation in the Rent-Seeking Society

Social Science Research Network, Oct 22, 2013

During his presidential campaign, Sen. Barack Obama criticized sharply the lax antitrust law enfo... more During his presidential campaign, Sen. Barack Obama criticized sharply the lax antitrust law enforcement record of the George W. Bush administration. Subsequently, his first assistant attorney general for antitrust even went so far as to suggest that the Great Recession was, at least in part, caused by federal antitrust policy failures during the previous eight years. This paper sets out to investigate how and in what ways antitrust enforcement has changed since President Obama took office in 2009. We review four recent antitrust cases and the behavioral remedies that were imposed on the defendants in those matters in detail. We find that the Obama administration has been significantly more active in enforcing the antitrust laws with respect to proposed mergers than his two predecessors in the White House had been. In addition, the Federal Trade Commission, together with the Department of Justice, withdrew a thoughtful report on the enforcement of Section 2 of the Sherman Act and issued new merger guidelines and a new merger policy remedy guide, all of which have moved antitrust law enforcement away from traditional structural remedies in favor of very intrusive behavioral remedies in an unprecedented fashion. That policy shift has further transformed antitrust law enforcers into regulatory agencies, a mission for which they are not well-suited, resulting in the Department of Justice and Federal Trade Commission being more vulnerable to rent seeking.

Cato Journal, 1998

Since U.S. combat forces left Indochina in 1973, no political, moral, financial, or personal priv... more Since U.S. combat forces left Indochina in 1973, no political, moral, financial, or personal privacy issue has left its mark on the American conscience like the question of legalized abortion. Opinions are divided as on no other topic of public policy debate. The controversy is tendentious, contentious, and sometimes violent. Almost no one is indifferent to the issue of legalized abortion, and the vast majority of individuals who have already formed an opinion stopped listening to arguments from the other side long ago. Most public opinion polls show the country sharply split on the question of abortion. Pro-abortion forces point to numbers indicating that a majority of Americans favor abortion rights when there is an imminent risk to the mother's health if the baby is carried to term, or in cases of rape or incest. Pro-lifers tout numbers showing a large majority of Americans opposed to ''abortion on demand.'' But few abortions are in fact performed to save the life of the mother; even fewer are performed to terminate pregnancies resulting from rape or incest. In modern society, the procedure of abortion is simply used to terminate unwanted pregnancies for many women. Bitter opposition to any proposal that would restrict in any way a woman's ''right to choose'' suggests that this is so. And if many abortion-minded women are in fact searching for an inexpensive way of disposing of an unwanted child-using abortion as a kind of foolproof birth control device-laws that make abortions less costly should

Is Breaking up Hard to Do? Legal Institutions and the Rate of Divorce

Journal of public finance and public choice, Oct 1, 1991

Alcune teorie economiche hanno tentato di rappresentare la famiglia come una specie di impresa ec... more Alcune teorie economiche hanno tentato di rappresentare la famiglia come una specie di impresa economica, applicando il ragionamento economico al matrimonio ed al divorzio. Non vi è stata, tuttavia, un’analisi altrettanto approfondita dell’influenza del sistema giuridico sulla struttura e la natura dei contratti di matrimonio. Se la famiglia viene configurata come un’impresa, ed il divorzio come una rinegoziazione contrattuale, ci si può attendere che i parametri giuridici dello scambio svolgano un ruolo significativo sui costi e, quindi, sul numero dei divorzi. L’indagine svolta dimostra la correttezza di quest’ipotesi. In particolare, si dimostra che la legislazione che prevede una custodia dei figli congiunta tende ad aumentare il tasso di divorzio, forse perché evita una costosa battaglia per l’attribuzione della custodia dei figli. Al contrario, sistemi che richiedono lunghi periodi di residenza e impongono periodi obbligatori di separazione tendono ad avere un tasso di divorzio più basso. Questi risultati sono conformi all’intuizione e ai recenti contributi della teoria economica dei diritti di proprietà, applicati al modello della famiglia come impresa di carattere economico.

Regulatory rent seeking

Edward Elgar Publishing eBooks, Mar 27, 2015

Public Finance Review, Nov 1, 2006

resolved litigation between the states and the major US cigarette manufacturers. In total, Big To... more resolved litigation between the states and the major US cigarette manufacturers. In total, Big Tobacco agreed to pay more than $246 billion over 25 years to compensate the states for costs incurred in treating smoking-related diseases. This paper explores the political and economic determinants of the amounts distributed to the states under the MSA. About one-third of the variation in payouts is explained by the states' smoking-attributable healthcare expenditures. We also find that significantly larger settlement payments went to big-government states and to those with greater numbers of medical professionals and health-related organizations. * This article is based on the first-named author's dissertation . We benefited from comments by committee members William Chappell, Robert Tollison and Harvey Palmer as well as those of Hilary Shughart. As is customary, however, the authors accept full responsibility for any remaining errors. In the interest of full disclosure, the second-named author served as an economic expert on behalf of Philip Morris USA in the Mississippi and Texas tobacco litigation, both of which settled prior to finalizing the Master Settlement Agreement.