Copyright (c) 2008 All rights reserved. http://works.bepress.com/michael_t_maloney Recent documents in Michael T. Maloney en-us Thu, 03 Jan 2008 11:05:01 PST 3600 http://works.bepress.com/michael_t_maloney/10 http://works.bepress.com/michael_t_maloney/10 Thu, 16 Aug 2007 09:00:27 PDT Michael T. Maloney Energy http://works.bepress.com/michael_t_maloney/9 http://works.bepress.com/michael_t_maloney/9 Wed, 15 Aug 2007 16:28:43 PDT This paper presents estimates of the variable cost function of electricity generation. The cost function is estimated using a two dimensional definition of capacity utilization. Because electricity cannot be conveniently stored, generation facilities follow the load across demand cycles. Capacity utilization can be captured empirically in two ways. One is generation relative to capacity when a unit is connected to the system; the other is the percent of time the unit is disconnected. The estimated cost function shows that both dimensions affect average cost, which generally declines as capacity utilization increases. Michael T. Maloney Energy http://works.bepress.com/michael_t_maloney/8 http://works.bepress.com/michael_t_maloney/8 Wed, 15 Aug 2007 16:21:20 PDT Michael T. Maloney Asset Markets http://works.bepress.com/michael_t_maloney/7 http://works.bepress.com/michael_t_maloney/7 Wed, 15 Aug 2007 16:07:45 PDT A careful analysis casts doubt on the economic viability of expanded nuclear generation capacity in the Russian homeland. Given Russia's vast reserves of natural gas and modern turbine generation technology, it seems unlikely that nuclear power will emerge as the low-cost generation alternative. Michael T. Maloney Energy http://works.bepress.com/michael_t_maloney/6 http://works.bepress.com/michael_t_maloney/6 Wed, 08 Aug 2007 14:36:45 PDT There is ample evidence that incentive pay structures such as tournaments result in increased performance, but whether this is due to selection or increased individual effort is less clear. We show that empirical specification is the key. Misspecification masks individual effort and interprets it as selection. Looking at data on horse racing, we compare a pure selection model to the Lazear-Rosen tournament model. While both models organize the data, the tournament model does a better job, and it says that nearly two-thirds of the increased performance associated with higher prizes is due to increased individual effort. This estimate is very similar to estimates found in industrial field studies where performance pay is not structured as a tournament. Michael T. Maloney Tournaments http://works.bepress.com/michael_t_maloney/5 http://works.bepress.com/michael_t_maloney/5 Wed, 08 Aug 2007 13:20:53 PDT Recent proposals put forward by the Russian Ministry of Atomic Energy (Minatom) aim to "privatize" Minatom's nondefense activities in hopes of making them commercially profitable. Through such reforms, Minatom is ostensibly seeking to generate funds that can be used to finance environmental remediation and nonproliferation activities, as well as support the vast social responsibilities (schools, hospitals, and the like) that it inherited from the Soviet era. Oana C. Diaconu and Michael T. Maloney, both of the Department of Economics at Clemson University, examine the obstacles Minatom faces as it attempts to commercialize its civilian activities. The authors argue that Minatom's ambitious plans are likely to founder on the rocks of market competition, and that it is far from clear that it can turn a profit in such areas as nuclear power generation, nuclear power plant construction, and spent fuel management. As a result, we conclude that Minatom is likely to remain financially strapped and may even become more responsive in the future to the concerns of U.S. nonproliferation programs that channel hard cash to its departments and divisions. Michael T. Maloney Energy http://works.bepress.com/michael_t_maloney/4 http://works.bepress.com/michael_t_maloney/4 Wed, 08 Aug 2007 06:57:29 PDT This work extends prior research that finds drug development is driven by demand factors such as mortality rates of the diseases new drugs are aimed at. Here we find that the number of drugs in the development pipeline is strongly positively related to the price of existing drugs treating those diseases. Michael T. Maloney Intellectual Property http://works.bepress.com/michael_t_maloney/3 http://works.bepress.com/michael_t_maloney/3 Wed, 08 Aug 2007 06:11:05 PDT We provide evidence on the speed and accuracy of price discovery by studying stock returns and trading volume surrounding the crash of the space shuttle Challenger. While the event was widely observed, it took several months for an esteemed panel to determine which of the mechanical components failed during the launch. By contrast, in the period immediately following the crash, securities trading in the four main shuttle contractors seemingly singled out the firm that manufactured the faulty component. We show that price discovery occurred without large trading profits and that much of the price discovery occurred during a trading halt of the firm responsible for the faulty component. Finally, although we document what are arguably quick and accurate movements of the market, we are unable to detect the actual manner in which particular informed traders induced price discovery. Michael T. Maloney Asset Markets http://works.bepress.com/michael_t_maloney/2 http://works.bepress.com/michael_t_maloney/2 Wed, 08 Aug 2007 04:35:16 PDT This research reports the results of an analysis of prize structures among competing firms paying tournament wages. In motorcycle racing, sponsors compete in an auction for riders using tournament prizes as bids. Since racers can only ride one bike and wear one helmet, they are forced to choose among sponsors of similar products. We find that in the face of competition, sponsors are forced to lower the incentive intensity of their prize differentials as rival sponsors post larger purses. Our test offers new corroboration of the Lazear-Rosen tournament model. Other researchers have found that workers respond to bigger prize differentials by working harder. We find that firms recognize this and also recognize that in the competitive labor-market equilibrium this extra work must be compensated by offering higher expected wages through bigger purses. Our results complete the theoretical circle: workers respond to the incentive effects of tournament wages and firms anticipate this behavior when making tournament wage offers. Michael T. Maloney Tournaments http://works.bepress.com/michael_t_maloney/1 http://works.bepress.com/michael_t_maloney/1 Wed, 08 Aug 2007 04:35:14 PDT Our maintained hypothesis is that drug development responds to the intensity of consumer demand. We look at the distribution of drug development by disease and link this to the economic harm caused by disease as measured by mortality. Mortality data represent the net effect of human frailty and the efficacy of the existing drugs on the market. If people continue to die from a given condition then existing drugs are not perfect and there are potential profits from developing a more effective compound. We aggregate economic harm worldwide and into three broad regions: the United States, other developed countries, and underdeveloped countries. We find that economic harm motivates the distribution of drug development across diseases, but it is economic harm in the United States alone that matters. Abdulkadir Civan Intellectual Property