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EconNews Online is South-Western's service to provide summaries of the latest economics news stories. Review the brief summaries and, for stories of interest, select the full summary. |
| MARKET FAILURE, REGULATION, AND PUBLIC CHOICE | |
| Title | Brief Summary |
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School choice programs tend to bring out polarized opinions about the programs' success and usefulness in fighting poverty. And supporters have just received more support for their argument that vouchers improve educational attainment. (Updated May, 2007) |
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After deregulation, prices in the trucking, airline and long-distance telephone markets all fell, some more significantly than others. But ten years after opening up the utilities market to competitive forces, no such price reductions have appeared. Why? (Updated October, 2006) |
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Canada seems to be determined to continue its war against drug companies. Just when pharmaceutical firms thought that they had prevented Canada from supplying U.S. citizens with cheap drugs from across the border, a Canadian firm ignored a patent and issued a generic drug on its own. The companies owning the patent were not happy. (Updated September, 2006) |
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Rather than go through protracted and expensive court cases, the National Association of Securities Dealers (NASD) prefers to arbitrate disputes between securities dealers and their clients because arbitration is a low-cost, fast way of resolving disputes relative to taking cases to court. Under arbitration, both parties in a dispute argue their case to a three-person panel, and agree to submit to the panel's decision of the panel. The problem? Securities dealers won client-broker disputes 57% of the time in 2005, compared to only 46% of the time in 2001. (Updated July 2006) |
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The Mexican government recently voted to strengthen existing antitrust laws to increase competition among firms. The new regulations should have a significant negative impact on local monopolies, opening the doors for competitive U.S. firms. (Updated June 2006) |
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Recent state efforts to enact health insurance legislation, environmental restrictions and to create incentives to engage in scientific research are noble, and reflect impatience with the federal government's inability to carry out these vital activities. But states incur disproportionate costs by taking the bull by the horns on such issues. (Updated May, 2006) |
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Wal-Mart has found itself in the center of a firestorm again...but it’s not the company’s fault. Canadian dairy farmers are lobbying to prevent Wal-Mart from selling yellow margarine. (Updated December, 2005) |
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Developing countries have long decried the “brain drain” involved when the countries’ best citizens leave for developed nations seeking higher salaries. This phenomenon has always been considered detrimental to the home country. But recent research suggests secondary effects that could outweigh the damage done when the “best and brightest” leave a country. (Updated December, 2005) |
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Consumer watchdog groups have filed suit against some of the biggest funeral home chains and the top U.S. casket maker, arguing that the organizations have conspired to inflate the casket costs. (Updated June, 2005) |
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The U.S. Justice Department is investigating proposed plans by some major newspaper publishers to buy additional newspapers. (Updated April, 2005) |
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The Bush Administration issued new rules designed to more efficiently manage the nation's 155 national forests, allowing regional forest managers to determine appropriate usage, such as logging, drilling, or cell-phone tower construction. (Updated April, 2005) |
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Beginning with the 2005-06 academic year, the government seeks to save approximately $300 million by giving out smaller Pell Grants to recipients, and to eliminate funding for some prospective students. (Updated March, 2005) |
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Southwest Airlines can fly anywhere it wants, as long as it's not more than one state away from its home airbase. Or so says the Wright Amendment. (Updated February, 2005) |
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The US Postal Service will probably be seeking an increase in its postage rates to cover what it calls "inflationary pressures." (Updated January, 2005) |
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The current U.S. system of rewarding drug companies with patents for innovation is drawing significant criticism. While new medications are extremely cheap to produce, they are very expensive to create, giving the government an incentive to reward drug companies with patent for their work. (Updated January 2005) |
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A U. S. Justice Department amnesty program is succeeding in encouraging violators who report themselves--and others--during an investigation of price fixing among numerous chemical companies. (Updated September, 2004) |
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In 1922, hydrologists
estimated the annual average flow of the Colorado River and helped several
states broker a deal to divide up the water's flow for irrigation, drinking
water, and other uses. The hydrologists' estimates were wrong-they estimated
a much greater annual average flow than what actually occurs. And the West
is now fighting to make up for that mistake. (Updated July, 2004) |
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The Federal Trade
Commission (FTC) is looking into possible charges that computer chip makers,
including Samsung Electronics, Hynix Semiconductor, Micron Technology, and
Infineon Technologies, have conspired to raise prices of memory chips. (Updated April, 2004) |
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Driving around in
an SUV may make you safer, but it is more dangerous to those around you,
especially if car drivers are in an accident with an SUV. (Updated February, 2004) |
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Energy prices are predicted
to increase significantly in 2004, resulting from a significant increase
in demand. Higher prices are prompting a move toward greater energy efficiency
in the home and in consumers' purchases. (Updated January 4, 2004) |
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A proposal to create
a new runway at London's Heathrow Airport is based on dubious cost analyses
that do not consider the full costs, including environmental costs, of flying. (Updated Septembe 10, 2003) |
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New regulations being
proposed in Congress to limit the ability of businesses to send spam email
is gaining the support of numerous businesses, but the opposition of consumer
groups traditionally known to fight for an end to spam email. (Updated August 27, 2003) |
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A new study from the
National Academy of Sciences is reported to endorse heavy increases in excise
taxes and curbs on advertising of alcohol in an attempt to reduce underage
drinking. (Updated August 27, 2003) |
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Dentsply, the dominant
supplier of artificial teeth, is alleged to have engaged in illegal exclusive-dealing
arrangements with its dealers, contributing to its monopoly position and
higher prices than would otherwise have occurred. (Updated October 10, 2002) |
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Royal Caribbean and
P&O Princess Cruises wish to merge, but Carnival has mounted a rival
hostile offer. Which, if any, merger will be allowed by regulators depends
on the definition of the market and the implications of any market dominance
for competition. (Updated April 1, 2002) |
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The Federal Energy Regulatory
Commission has imposed price controls on three electricity-generating companies
because they wield too much power in times of peak demand. (Updated January 15, 2002) |
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The Justice Department
is appealing the decision of a district court judge to throw out a lawsuit
alleging predatory pricing by American Airlines against start-up airlines
at its Dallas/Fort Worth hub. (Updated August 1, 2001) |
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Phoenix is the latest
jurisdiction to approve a tax increase on rental cars to fund a new football
stadium. Car rental companies and the Travel Industry Association are not
in favor. However, the Phoenix Travel and Sports Authority states that visitors
will benefit from the stadium and that the tax will not be noticed by consumers. (Updated April 1, 2001) |
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Airlines of Prey Protected by Government Inaction
Full Summary |
The outgoing Clinton
Administration does not propose to regulate predatory pricing by major airlines
to thwart smaller airlines. This is in spite of indicating the opposite
back in 1998. In the interim, intense lobbying has occurred by the major
airlines. (Updated February 1, 2001) |
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Power to the People Threatened
Full Summary |
California state regulators
have recommended emergency electricity rate hikes. A booming economy and
increasingly costly wholesale power purchases in the context of frozen prices
threaten the viability of the utilities. (Updated February 1, 2001) |
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Price-Fixing or Market Forces?
Full Summary |
The Federal Trade Commission
is investigating high gasoline prices in the Midwest. The issue is whether
they were caused by higher costs or illegal communication between producers. (Updated October 1, 2000) |
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Bridgestone Deflated by Tire Separation
Full Summary |
Firestone tires have a tread separation
problem. Mounting numbers of deaths and injuries in the U.S. and overseas
have been attributed to faulty tires. The Venezuelan authorities are recommending
the filing of criminal charges. (Updated October 1, 2000) |
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Turkish Treasures Delight Archaeologists
Full Summary |
Cultural treasures dating from Roman
times have been found during the construction of a dam in southern Turkey.
The government is determined to go ahead with filling the dam in spite of
the archaeological excavation being unfinished. (Updated July 1, 2000) |
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The Economics of Ergonomics
Full Summary |
New ergonomics rules are being issued.
There is debate between the Occupational Safety and Health Administration
and business groups over the true financial costs and the benefits in terms
of reduced repetitive strain injuries. (Updated January 1, 2000) |
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Microsoft Trial: Competition Bundled Out?
Full Summary |
In the Microsoft trial, the government
alleges that Microsoft unfairly bundles its internet browser with Windows
98, in which it has a near monopoly, and also alleges that Microsoft engaged
in deals and threats to deter competition. Microsoft responds that it is
simply making its products easier to use. (Updated December 1, 1998) |
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Full Summary |
A Senate panel criticized
Microsoft's bundling of its web browser with its Windows software because
it could reduce competition. There are both legal questions and concerns
that Microsoft is not showing public responsibility. (Updated June 5, 1998) |
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