A Strategy for Efficient Debt Reduction

[Symposium: New Institutions for Developing Country Debt]

By Jeffrey D. Sachs

Journal of Economic Perspectives, Winter 1990

Debt reduction, like bankruptcy, needs an institutional setting to bring it about, to overcome an inherent free-rider problem. Even when it is in the collective interests of the banks to reduce the debt, each individual bank is still tempted to insist on ...

Cleaning Up Third World Debt without Getting Taken to the Cleaners

[Symposium: New Institutions for Developing Country Debt]

By Jeremy Bulow and Kenneth Rogoff

Journal of Economic Perspectives, Winter 1990

Should taxpayers of wealthy countries finance a leveraged buyout of third world debt? The case for establishing an international debt discount facility rests on the belief that the overhang of foreign commercial bank debt is stifling growth in the Highly ...

Debt Relief and the International Enforcement of Loan Contracts

[Symposium: New Institutions for Developing Country Debt]

By Jonathan Eaton

Journal of Economic Perspectives, Winter 1990

It is now apparent that the governments of many developing countries will not repay their debts as initially contracted. Creditors and creditor governments must now adjust to the realization that full repayment is either infeasible or that enforcing full ...

The Economist's Lament: Public Assistance in America

[Symposium: Welfare and Workfare]

By Gary Burtless

Journal of Economic Perspectives, Winter 1990

This survey will provide a brief summary of the main features of the U.S. welfare system together with an assessment of some major criticisms of it. I will discuss major reforms proposed by economists and consider some recent evidence about the behavioral...

Work and Welfare: Lessons on Employment Programs

[Symposium: Welfare and Workfare]

By Judith M. Gueron

Journal of Economic Perspectives, Winter 1990

The nation's social welfare policy reflects an ongoing effort to balance sometimes competing objectives—alleviating poverty and promoting self-sufficiency—in a manner consistent with underlying public values about the primacy of the family and...

Micro-to-Macro Simulation: A Primer with a Labor Market Example

By Barbara R. Bergmann

Journal of Economic Perspectives, Winter 1990

Simulation models, now widely used in the physical sciences, can also help economists in depicting the actions and interactions of individuals and firms through time. This article provides an introduction to microsimulation: how it works, how to do it, it...

Currency Fluctuations in the Post-Bretton Woods Era

By Richard Meese

Journal of Economic Perspectives, Winter 1990

The international monetary landscape that has emerged since the felling of Bretton Woods is characterized by a hybrid exchange rate system that lies somewhere between the textbook polar cases of a gold standard and a pure float. This system has relatively...

The Benefits of Asymmetric Markets

By Tibor Scitovsky

Journal of Economic Perspectives, Winter 1990

Economists are often so mesmerized by the magic of perfect competition that they neglect or fail to notice other, equally important achievements of the real market economy around us, most of which seem to result from monopoly tempered by competition and c...

Great and Almost-Great Magnitudes in Economics

By Julian L. Simon

Journal of Economic Perspectives, Winter 1990

Which ratios and key magnitudes should an educated economist know? An inevitably personal selection is offered below. The list is presented in the form of a quiz to liven up the exercise of pondering them, and therefore a question mark follows each title....

Optimal Taxation and Optimal Tax Systems

By Joel Slemrod

Journal of Economic Perspectives, Winter 1990

In its current state, optimal tax theory is incomplete as a guide to action for critical issues in tax policy. It is incomplete because it has not yet come to terms with taxation as a system of coercively collecting revenues from individuals who will tend...

Puzzles: Slot Machines, Zomepirac, Squash, and More

By Barry Nalebuff

Journal of Economic Perspectives, Winter 1990

This issue of puzzles can only be described as eclectic. The topics of the puzzles range from medical statistics to TV game shows to Las Vegas slot machines to squash to running around in squares. As usual, most puzzle answers are at the back. However, th...

Recommendations for Further Reading

By Bernard Saffran

Journal of Economic Perspectives, Winter 1990

Anomalies: Saving, Fungibility, and Mental Accounts

By Richard H. Thaler

Journal of Economic Perspectives, Winter 1990

Last New Year's day, after a long evening of rooting the right team to victory in the Orange Bowl, I was lucky enough to win $300 in a college football betting pool. I then turned to the important matter of splurging the proceeds wisely. Would a case of c...

Correspondence

By William Walter Brown

Journal of Economic Perspectives, Winter 1990

Correspodence regarding: Symposium on Real Business Cycles The Corporate Bankruptcy Decision

Front Matter

Journal of Economic Perspectives, Winter 1990

Notes

Journal of Economic Perspectives, Winter 1990

Distinguished Lecture on Economics in Government: Data Quality and Public Policy

By Janet L. Norwood

Journal of Economic Perspectives, Spring 1990

The goal of a government statistical agency must be to produce data that are objective, relevant, accurate, and timely. But none of these criteria is absolute, and sometimes tradeoffs must be made among them. Timeliness and accuracy compete when we decide...

Symposium on Bubbles

[Symposium: Bubbles]

By Joseph E. Stiglitz

Journal of Economic Perspectives, Spring 1990

The papers in this symposium represent the divergent views of economists on an important issue: the extent to which prices of assets represent "fundamental" values. While the papers in the symposium present different formal definitions of what a bubble is...

The Noise Trader Approach to Finance

[Symposium: Bubbles]

By Andrei Shleifer and Lawrence H. Summers

Journal of Economic Perspectives, Spring 1990

This paper reviews an alternative to the efficient markets approach that we and others have recently pursued. Our approach rests on two assumptions. First, some investors are not fully rational and their demand for risky assets is affected by their belief...

Famous First Bubbles

[Symposium: Bubbles]

By Peter M. Garber

Journal of Economic Perspectives, Spring 1990

Before economists relegate a speculative event to the inexplicable or bubble category, we must exhaust all reasonable economic explanations. Among the "reasonable" or "market fundamental" explanations I would include the perception of an increased probabi...