ECO2327 Potential Topics for Class Presentation

Transcription

1 ECO2327 Potential Topics for Class Presentation These topics are found by the Instructor to be relevant to the understanding of the Development of American Business Enterprise as it relates to antitrust policy in the USA historically and as well cover some contemporary issues. Student groups may chose their own topics of interest which do not appear below but students must in advance justify their choice of topic to the Instructor and gain approval of their chosen topics either at Instructor office hours or through . Class presentations must address the following questions: 1) why did the government deem the industry or firm to have monopoly power (be it a natural monopoly, some type of perceived collusion or some type of perceived abuse in pricing or cost strategy)?; 2) what was the government response to regulating or breaking-up this monopoly power? e.g., what was the legal process, and/or creation of a government agency, that resulted from this government perception of monopoly power?; 4) did the government win or lose in their pursuit of curtailing this monopoly power ; 5) who were the special-interest groups involved in the public policy debate over government regulation?, 6) which special-interest groups gained and/or lost from this government intervention?, and 7) what was the end-result of government intervention on the consumer (e.g., in the model of consumer sovereignty where it is seen that regulation is necessary to maximize consumer surplus) in the industry which was regulated by government? Each class presentation team is to provide the Instructor with a one or two page outline of their presentation, at least one class period prior to their presentation. This outline will include the names of the individuals in the group, the general outline of the presentation, and will include at least two scholarly references (meaning peer-reviewed journal articles, books from an academic press, or policy research from a not-for-profit research institution) from which the group drew their findings. i In addition, each case study listed below has specific questions which should be addressed in addition to those listed above. The first lesson in any assignment is to follow the assignment criteria, so, the first thing to do is to make sure all of the questions posed above and below get answered. Not all of the questions posed above relate specifically to all of the cases listed below (or perhaps do not relate to your specific case of interest if not one of those below, the Instructor too might pose additional questions for you to answer if you do not chose one of the cases

2 below). You should delineate specifically in your presentation why or why not a question posed above is relevant or not relevant to your case. 1. USA Railroad Regulation. Hughes and Cain (2007, p. 374) write that First, since the Civil War, Congress had been attempting to find a way to regulate the railroads and had even imposed financial organization on the Union and Central Pacific railroads. The Interstate Commerce Commission was formed in 1887 in part to regulate the railroads, how are railroads, seen by many economic historians as the engine of economic growth during industrialization, regulated today, and how and why has this regulation developed historically? R.H. Porter (1983) A Study of Cartel Stability: The Joint Executive Committee, , Bell Journal of Economics, 15(2), , is one classic study of perceived railroad cartelization. 2. The National Labor Relations Act of 1935 (also known as the Wagner Act) removed the regulation of labor unions from the civil courts (judicial branch of government) to administrative law (the presidential branch of government) as part of Franklin Delano Roosevelt s New Deal. Did this legislation give unions monopoly-rents?, what happened to the rate of unionization in the USA after this Act was passed?, what has been the repercussions of this Act on American industrial competitiveness through today? What has been the trend in private sector unionization in the USA since the 1930s and why? You can choose one specific industry to track the historical competitiveness and unionization issue if appropriate, though you should address the monopoly-rents issue looking at labor-unions themselves as an industry. 3. In 1974 the DOJ (Department of Justice) brought an antitrust case against AT&T, America s leading phone company, for anticompetitive practices in the long-distance phone market, which lead to the break-up of AT&T in What did this do to American competitiveness in the telephony industry in the short- and long-terms? How would you relate the government s policy in a dynamic-versus-static framework of economic analysis given today s technologies for telephony, e.g., the move from landlines to satellite technology?

3 4. The Organization of Petroleum Exporting Countries (OPEC) is seen as the classic international cartel and is often blamed for the rise of inflation and economic stagnation in the USA in the 1970s. Why did OPEC come about? Is OPEC actually successful in controlling gas prices? What are some of the competing empirical studies on OPEC and what does economic/competitive theory say about the long-term possibilities for a cartel s ability to control prices? Do the empirical findings on OPEC confirm or refute the economic theory? 5. In 1998 the US Government (DOJ) brought a case against Microsoft under the Sherman Act for anticompetitive behavior in bundling its browser with its operating system, which was resolved with a Consent Decree in Many economists argued against the US Governments case, why was this? What was the result of the Consent Decree? What is your opinion as to the case s outcome and the rise of Google as the top browser today? What are the differences and similarities between the US Government s and the European Union s antitrust cases against Microsoft? 6. In 2009 the DOJ started to investigate the Google Books settlement between Google and authors and publishers. What is the status of this case today? What is the government s reasoning for investigation? What are the anticompetitive and property rights issues involved, a starting point for this is, who exactly are the publishers and authors that Google signed with? Did Google exercise monopoly power in negotiating their agreement with authors and publishers? Why or why not? 7. Professional sports have been granted an exemption to antitrust policy in the USA. Why is this? Additionally, specifically, the Texas Rangers baseball team is for sale, yet the sale is being made difficult due to the antitrust issues involved. Why is this? What are the consumer sovereignty (demand) issues involved in the case, if any? How does sports-team subsidization at the local level effect the supply and demand of sports franchises? What is the status of the Ranger s sale at the time you are researching this project? What is your recommendation for the future of profession sports regulation in the USA?

4 8. Open access and net neutrality are the current hot topics regarding the internet. What are the issues involved, is the internet a natural monopoly? Who would be the winners and losers if the internet is to be regulated? Is it indeed possible to regulate the internet, why or why not? How does the law of supply and demand as related to the theory of consumer sovereignty apply to the open access debate? 9. It is generally accepted that airline deregulation in 1978 lead to a drastic decrease in fares and a vast increase in commercial airline passengers being able to afford airline trips. Why were airlines regulated in the first place by the Civil Aeronautics Board and what lead to the demise of the CAB? Why did it take so long to deregulate (allow price and route competition) in the airline industry? Many airlines became bankrupt due to this deregulation, why is this? Yet today there is still not a free-market in the airline industry, why is this and do airports themselves represent an essential facility which prevents free enterprise in the airline industry? If so, is there a competitive alternative to providing this essential facility? 10. In 1996 the New York State Public Service Commission allowed market competition in the provision of gas and electrical services to the consumer in the market. Has this deregulation reduced costs to consumer? Why or why not? Why was this deregulation policy put into place? Who were the winners and losers of this deregulation? (see questions required above and answer those relevant to this topic). 11. Jeffrey Friedman in Critical Review (Vol. 21, 2009) states that the top three bond rating agencies were given near oligopoly status by the SEC in 1975, which in turn lead to underpricing the risk of the subprime mortgages leading to the financial crisis of Did this policy of issuer pays for bond-ratings limit competition, and skew market-decisions, for risk during the housing-based boom in the mid-2000s? Why did the SEC make this policy decision? (see questions required above and answer those appropriate to this topic).

5 12. The FDIC offers deposit insurance to banks, but on the condition that the FDIC monitors the financial status of these banks, and in turn the FDIC determines when a bank is insolvent and can therefore shut-down banks and sell their assets to other banks. What is the basis for the FDIC determination of insolvency and how do they determine who is able to buy the distressed assets of a forced-fdic foreclosure and when? Who gains and loses when the FDIC makes this determination? i Internet-only publications are admissible, however Wikipedia does not count as a scholarly reference because it is anonymously published.