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Flypaper Effect
The flypaper effect is a concept from the field of public finance that suggests that a government grant to a recipient municipality increases the level of local public spending more than an increase in local income of an equivalent size. When a dollar of exogenous grants to a community leads to significantly greater public spending than an equivalent dollar of citizen income: money sticks where it hits, like a fly to flypaper. Grants to the government will stay in the hands of the government and income to individuals will stay with these individuals. Founding The concept was first described in a metaphorical way by Arthur Okun in response to the research of his colleague Edward Gramlich, which was published in 1979 as ''The Stimulative Effects of Intergovernmental Grants''. Gramlich, together with Courant and Rubinfeld, sought an explanation for the phenomenon that nonmatching grants stimulate much more local spending per dollar of grant than does income going to private citizens ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Public Finance
Public finance is the study of the role of the government in the economy. It is the branch of economics that assesses the government revenue and government expenditure of the public authorities and the adjustment of one or the other to achieve desirable effects and avoid undesirable ones. The purview of public finance is considered to be threefold, consisting of governmental effects on: # The efficient allocation of available resources; # The distribution of income among citizens; and # The stability of the economy. Economist Jonathan Gruber has put forth a framework to assess the broad field of public finance. Gruber suggests public finance should be thought of in terms of four central questions: # When should the government intervene in the economy? To which there are two central motivations for government intervention, Market failure and redistribution of income and wealth. # How might the government intervene? Once the decision is made to intervene the government must ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Arthur Okun
Arthur Melvin "Art" Okun (November 28, 1928 – March 23, 1980) was an American economist. He served as the chairman of the Council of Economic Advisers between 1968 and 1969. Before serving on the C.E.A., he was a professor at Yale University and, afterwards, was a fellow at the Brookings Institution in Washington, D.C. In 1968 he was elected as a Fellow of the American Statistical Association. Okun is known in particular for promulgating Okun's law, an observed relationship that states that for every 1% increase in the unemployment rate, a country's GDP will be roughly an additional 2.5% lower than its potential GDP. He is also known as the creator of the misery index and the analogy of the deadweight loss of taxation with a leaky bucket. He died on March 23, 1980 of a heart attack. [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Edward Gramlich
Edward M. Gramlich (June 18, 1939 – September 5, 2007) was an American economist who served as a member of the Federal Reserve Board of Governors from 1997 to 2005. Gramlich was also an acting director of the Congressional Budget Office. Gramlich graduated from Williams College in 1961 and received a master's degree in 1962 and a Ph.D. in economics in 1965 from Yale University. He joined the Federal Reserve as a research economist from 1965 to 1970, and was a senior fellow at the Brookings Institution from 1973 to 1976. He then taught economics and public policy at the University of Michigan from 1976 to 1997, including a term as dean of the Gerald R. Ford School of Public Policy, and returned to Michigan as a professor in 2005. Biography He was appointed to the Federal Reserve System by President Bill Clinton in 1997 and resigned in August 2005. For much of his term, he was the chair of the Board's Committee on Consumer and Community Affairs. He was also the chairman o ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Market Anomaly
A market anomaly in a financial market is predictability that seems to be inconsistent with (typically risk-based) theories of asset prices. Standard theories include the capital asset pricing model and the Fama–French three-factor model, Fama-French Three Factor Model, but a lack of agreement among academics about the proper theory leads many to refer to anomalies without a reference to a benchmark theory (Daniel and Hirschleifer 2015 and Barberis 2018, for example). Indeed, many academics simply refer to anomalies as "return predictors", avoiding the problem of defining a benchmark theory. Academics have documented more than 150 return predictors (see ''Market anomaly#List of Anomalies Documented in Academic Journals, List of Anomalies Documented in Academic Journals).'' These "anomalies", however, come with many caveats. Almost all documented anomalies focus on illiquid, small stocks. Moreover, the studies do not account for trading costs. As a result, many anomalies do not ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
William A
William is a male given name of Germanic origin.Hanks, Hardcastle and Hodges, ''Oxford Dictionary of First Names'', Oxford University Press, 2nd edition, , p. 276. It became very popular in the English language after the Norman conquest of England in 1066,All Things William"Meaning & Origin of the Name"/ref> and remained so throughout the Middle Ages and into the modern era. It is sometimes abbreviated "Wm." Shortened familiar versions in English include Will, Wills, Willy, Willie, Bill, and Billy. A common Irish form is Liam. Scottish diminutives include Wull, Willie or Wullie (as in Oor Wullie or the play ''Douglas''). Female forms are Willa, Willemina, Wilma and Wilhelmina. Etymology William is related to the given name ''Wilhelm'' (cf. Proto-Germanic ᚹᛁᛚᛃᚨᚺᛖᛚᛗᚨᛉ, ''*Wiljahelmaz'' > German ''Wilhelm'' and Old Norse ᚢᛁᛚᛋᛅᚼᛅᛚᛘᛅᛋ, ''Vilhjálmr''). By regular sound changes, the native, inherited English form of the name shoul ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Budget-maximizing Model
The budget-maximizing model is a stream of public choice theory and rational choice analysis in public administration inaugurated by William Niskanen. Niskanen first presented the idea in 1968, and later developed it into a book published in 1971.William A. Niskanen, 9711994. ''Bureaucracy and Public Economics'', Elgar. Expanded ed. Description and reviewlinks and revieexcerpts According to the budget-maximizing model, rational bureaucrat A bureaucrat is a member of a bureaucracy and can compose the administration of any organization of any size, although the term usually connotes someone within an institution of government. The term ''bureaucrat'' derives from "bureaucracy", w ...s will always and everywhere seek to increase their budgets in order to increase their own power, thereby contributing strongly to state growth and potentially reducing social efficiency. The bureau-shaping model has been developed as a response to the budget-maximizing model. Niskanen's inspirati ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Fiscal Illusion
In public choice theory, fiscal illusion is a failure to accurately perceive the amount of government expenditure. The theory of fiscal illusion was first developed by the Italian economist Amilcare Puviani in his 1903 book ''Teoria della illusione finanziaria'' (''Theory of Financial Illusion'' (not yet translated into English, but translated into German in 1960 under the title ''Die Illusionen in der öffentlichen Finanzwirtschaft'', Berlin: Duncker & Humblot, 1960)). Fiscal illusion occurs when government revenues are not completely transparent or are not fully perceived by taxpayers; then the cost of government is seen to be less than it actually is. Since some or all taxpayers benefit from government expenditures from these unobserved or hidden revenues, the public's appetite for government expenditures increases, thus providing politicians incentive to expand the size of government. Overview Fiscal illusion has been used to explain the flypaper effect often seen when a hi ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Fiscal Incidence
In public finance, a sub-discipline of economics, fiscal incidence is the combined overall economic impact of both government taxation and expenditures on the real economic income of individuals. While taxation reduces the economic well-being of individuals, government expenditures raise their economic well-being. Fiscal incidence is the overall impact of government taxing and spending considered together. Theory In theory, governments withdraw resources from society in the form of taxation, and contribute resources back into society in the form of expenditures. However, the burdens of taxation are not borne equally by individuals, and the benefits of government expenditures are not distributed equally throughout society. As a result, the distribution of tax burdens and government expenditure benefits is an important economic question to those concerned with the equity of the fiscal system. When the economic incidence of taxation is combined with the economic incidence of governm ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |