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Book review

Eleven years ago, Harvey Averch and Leland Johnson demonstrated that firms subject to rate of return regulation have an incentive to use inputs in proportions that differ from the cost minimizing input levels. In the intervening years, numerous theoretical papers have appeared in the literature...

A form of nonhomogeneous production function is utilized to compute marginal productivities, various elasticities, optimum input ratios, and the like, for different levels of inputs and outputs. Such comparisons are relevant for labor negotiations, capital investment, and control by either a...

Define a reputation good to be any product or service for which sellers' products are differentiated and consumers' search among sellers consists of a series of inquiries to relatives, friends, and associates for recommendations. Examples of reputation goods are personal legal services and...

Using a simple formal model, the present paper analyzes under what conditions the price system or crude rationing is more effective in matching up the limited supply of a deficit commodity with those users who need it most. The answer depends in a well-defined way on the distribution of needs...

This paper assesses the effects of combination gas-electric utilities on income redistribution and economic efficiency. It finds that such combinations appear to exercise greater market power than straight electric utilities. A series of regression equations shows that they earn higher rates of...

Under the assumption of complete markets, a fundamental result of competitive market analysis (whether for speculative or commodity markets) is that prices contain all information necessary for optimal decisionmaking by individual economic units. The role that prices play in disseminating...

In this paper, a television program cost function is derived from a simple model of network rivalry based upon the Cournot postulate. This cost function is then fitted to data from a cross section of new network entertainment series for 1960-1965. The resulting estimates are quite unfavorable to...

The role of imperfect information in a principal-agent relationship subject to moral hazard is considered. A necessary and sufficient condition for imperfect information to improve on contracts based on the payoff alone is derived, and a characterization of the optimal use of such information is...