Copyright (c) 2008 All rights reserved. http://works.bepress.com/ted_bergstrom Recent documents in Ted C Bergstrom en-us Mon, 01 Dec 2008 11:19:27 PST 3600 http://works.bepress.com/ted_bergstrom/103 http://works.bepress.com/ted_bergstrom/103 Wed, 29 Oct 2008 21:08:55 PDT This paper argues that since the supply of oil in the ground is inelastic, the incidence of a sales tax on oil, maintained forever at a fixed rate, would fall entirely on the oil-suppliers. In the world economy, however, the elasticity of supply of oil to a single country depends on that country’s imports as a share of world output and on the elasticity of demand for that country. The paper calculates optimal tax rates for a country as a function of these variables and estimates optimal oil tax rates for the U.S., for some OECD countries separately, and for the U.S. plus the OECD collectively. Current U.S. tax rates are shown to be far below optimal values. Ted Bergstrom http://works.bepress.com/ted_bergstrom/102 http://works.bepress.com/ted_bergstrom/102 Wed, 29 Oct 2008 21:08:50 PDT Ted Bergstrom http://works.bepress.com/ted_bergstrom/101 http://works.bepress.com/ted_bergstrom/101 Wed, 29 Oct 2008 21:08:38 PDT One of the most disconcerting results in welfare economics is the "paradox of the second best". In a general equilibrium, if there are distortions in more than one market, it may not be efficient to remove distortions in a single market if the other distortions are not removed as well. In 1970, Sonnenschein and Foster proved a remarkable result that reduced the sting of this paradox. They showed that fairly generally, at least one form of piecemeal reform, namely proportional reduction of price distortions would improve welfare in a one-consumer general equilibrium economy. Trout Rader wrote an interesting paper that extended the Sonnenschein-Foster result. The current paper, examines Rader's contribution and that of Foster and Sonnenschein. Ted Bergstrom http://works.bepress.com/ted_bergstrom/100 http://works.bepress.com/ted_bergstrom/100 Wed, 29 Oct 2008 21:08:33 PDT This paper was stimulated by a paper by Peter Ware, who used calculus first-order conditons to show that a redistribution of income that does not change the set of voluntary contributors leaves the supply of public goods unchanged. In general, redistributions can change the set of contributors and also the supply of public goods. But we show that even in the general case there are some remarkably sharp comparative statics results. Ted Bergstrom http://works.bepress.com/ted_bergstrom/99 http://works.bepress.com/ted_bergstrom/99 Wed, 29 Oct 2008 21:08:27 PDT Commercial publishers charge libraries about 6 times as much per page and 16 times as much per citation as nonprofit journals. The paper presents evidence that successful for profit journals are priced at several times average cost. They are able to earn "monopoly profits" despite free entry into the industry because journal reputation is the result of a kind of coordination game. The paper advocates withholding free referee services from overpriced journals. Ted Bergstrom http://works.bepress.com/ted_bergstrom/98 http://works.bepress.com/ted_bergstrom/98 Wed, 29 Oct 2008 21:08:21 PDT In many applications, assumptions about the log-concavity of a probability distribution allow just enough special structure to yield a workable theory. This paper catalogs a series of theorems relating log-concavity and/or log-convexity of probability density functions, distribution functions,reliability functions, and their integrals. We list a large number of commonly-used probability distributions and report the log-concavity or log-convexity of their density functions and their integrals. We also discuss a variety of applications of log-concavity that have appeared in the literature. Mark Bagnoli http://works.bepress.com/ted_bergstrom/97 http://works.bepress.com/ted_bergstrom/97 Wed, 29 Oct 2008 21:08:16 PDT This paper explores the quantitative relation between non random, assortative matching and the maintenance of cooperative behavior under evolutionary dynamics. We consider a population of individuals who are \hardwired" to play either cooperate or defect. They meet other individuals according to some random process and play their programmed strategy in a game of Prisoners' Dilemma. The type that gets the higher expected payoff reproduces more rapidly. We deŻne an index of assortativity of encounters and develop an \algebra of assortative encounters." In one set of applications, we calculate the index of assortativity for games between relatives with either cultural or genetic inheritance and we show the logical connection between the index of assortativity and Hamilton's theory of kin selection [5]. We also apply the index of assortativity to determine the population dynamics when players select their partners, using partially informative cues about each others' types. Ted Bergstrom http://works.bepress.com/ted_bergstrom/96 http://works.bepress.com/ted_bergstrom/96 Wed, 29 Oct 2008 21:08:10 PDT Scientific publishing is rapidly shifting from a paper-based system to one of predominantly electronic distribution, in which universities purchase site licenses for online access to journal contents. Will these changes necessarily benefit the scientific community? By using basic microeconomics and elementary statistical theory, we address this question and find a surprising answer. If a journal is priced to maximize the publisher's profits, scholars on average are likely to be worse off when universities purchase site licenses than they would be if access were by individual subscriptions only. However, site licenses are not always disadvantageous. Journals issued by professional societies and university presses are often priced so as to maximize subscriptions while recovering average costs. When such journals are sustained by institutional site licenses, the net benefits to the scientific community are larger than if these journals are sold only by individual subscriptions. Carl T. Bergstrom http://works.bepress.com/ted_bergstrom/95 http://works.bepress.com/ted_bergstrom/95 Wed, 09 Jul 2008 14:42:30 PDT This paper studies a general class of pure exchange economies that have multiple equilibria, which extend an example presented by Lloyd Shapley and Martin Shubik. For such economies, we find easily verified conditions that determine whether there are multiple equilibria. We also provide simple methods for constructing economies in which arbitrary pre-specified sets of prices are equilibria. These economies have simple comparative statics, since prices at interior competitive equilibrium depend on the parameters of utility but not on the endowment quantities. Ted C. Bergstrom Economic Theory http://works.bepress.com/ted_bergstrom/94 http://works.bepress.com/ted_bergstrom/94 Fri, 02 May 2008 15:03:27 PDT Ted C. Bergstrom Public Finance Resource Economics