Econ Price Theory

2 papers as agreed

The paper must be typed and double-spaced in 12-point font with normal one-inch margins, in which case a 2,500 word document will be approximately 8.5 pages long.

All sources used in the paper must be listed alphabetically by author in a "List of References" appearing at the end of the paper. Do not list items that are not cited in the paper. Use a consistent style of footnotes, endnotes or textual references to cite sources. The List of References itself, of course, does not count toward the 2,500 words.

The purpose of the paper is to demonstrate your ability to apply price theory to explain some interesting attributes of any chosen industry or to understand the effects of some public policy. Below are three suggested topics for your paper, together with suggested information sources on each. These suggested topics are intended to be merely illustrative: you do not need to write on any of them. However, you can pick one of these topics if you wish, or choose a topic of your own. If you choose one of the topics listed below, you may use the sources provided, and/or find your own. However, you must cite at least two sources in your paper. While it is acceptable to refer to newspaper or magazine stories (a magazine that is particularly helpful in providing topical news coverage of these issues is The Economist, www.economist.com), at least two of your sources must be scholarly articles or books similar to those listed below. Again, remember to clearly reference any sources that you use.

If you choose a topic of your own, instead of one of those given below, it would be a good idea to clear it with me first, to make sure that the subject matter is appropriate and feasible. In this case you will be primarily responsible for finding sources of information on your topic, although you can certainly ask me for help during office hours.

The textbook may be a useful source for your paper, especially in providing the analytical tools you will probably need. Although it is fine to cite material from the textbook, the textbook does not count as one of the two scholarly sources you are required to use.

Topic 1: Is Microsoft a Monopoly?

Microsoft has been the subject of antitrust litigation in both the U.S. and abroad, often accused of using its monopoly of the Windows operating system to drive potential competitors out of business, manipulate suppliers of both hardware and software, and deny consumers a choice of alternatives. Some economists have argued, however, that the rapid pace of innovation in the information and communications technology industry, as well as the unwillingness of users to abandon older software platforms, mean that Microsoft actually has considerably less market power than it might at first seem. Discuss the arguments for or against regulating Microsoft as a monopoly (you can take either position, or critically evaluate claims from both sides).

Sources for Topic 1:

Shughart, William F., II, "Barbarians at Bill Gates," The Freeman, April 1, 2000, (reproduced by The Independent Institute, Oakland, CA, http://www.independent.org/publications/article.asp?id=155)

McKenzie, Richard B., "Microsoft's ‘Applications Barrier to Entry:' The Missing 70,000 Programs," Policy Analysis No. 380, Cato Institute, Washington, D.C., August 31, 2000, http://www.cato.org/publications/policy-analysis/microsofts-applications-barrier-entry- missing-70000-programs

Carlton, Dennis W., "The Lessons from Microsoft," Business Economics, January 2001, 36, 47-53.

Gilbert, Richard J. and Katz, Michael L., "An Economist's Guide to U.S. v. Microsoft," Journal of Economic Perspectives, Spring 2001, 15, 25-44.

Liebowitz, Stan J. and Margolis, Stephen E., Winners, Losers and Microsoft: Competition and Antitrust in High Technology, Oakland, CA: The Independent Institute, 2001.

Topic 2: Intellectual Property Rights

Intellectual property rights (IPRs) - such as patents on scientific innovations and performance rights for artists - are protected in order to ensure that producers have sufficient incentive to invest in the creation of new products that benefit consumers. But new technologies and globalization have made the protection of some IPRs extremely costly. Developing countries, in particular, face a difficult decision in determining how much resources to spend on protecting IPRs. Some analysts argue that a cost-benefit calculation should determine which IPRs are worth protecting and the extent and type of protection that is socially efficient. Discuss the social benefits and costs of protecting IPRs.

Sources for Topic 2:

Kobayashi, Bruce H. and Yu, Ben T., "An Economic Analysis of Performance Rights: Some Implications of the Copyright Act of 1976," Research in Law and Economics, 1995, 17, 237-70.

Maskus, Keith E., "The International Regulation of Intellectual Property," Weltwirtschaftliches Archiv/Review of World Economics, 1998, 134(2), 186-208.

Maskus, Keith E., Intellectual Property Rights in the Global Economy, Washington, D.C.: Institute for International Economics, 2000.

Thierer, Adam and Crews, Clyde Wayne, Jr., eds., Copy Fights: The Future of Intellectual Property in the Information Age, Washington, D.C.: Cato Institute, 2002.

Liebowitz, Stan J., "Policing Pirates in the Networked Age," Policy Analysis No. 438, Cato Institute, Washington, D.C., May 15, 2002, http://www.cato.org/publications/policy-analysis/policing-pirates-networked-age

Einhorn, Michael A. and Rosenblatt, Bill, "Peer-to-Peer Networking and Digital Rights Management: How Market Tools Can Solve Copyright Problems," Policy Analysis No. 534, Cato Institute, Washington, D.C., February 17, 2005, http://www.cato.org/publications/policy-analysis/peerpeer-networking-digital-rights- management-how-market-tools-can-solve-copyright-problems

Fink, Carsten and Maskus, Keith E., "Why We Study Intellectual Property Rights and What We Have Learned," in Carsten Fink and Keith E. Maskus, eds., Intellectual Property and Development: Lessons from Recent Economic Research, New York: Oxford University Press, 2005, pp. 1-15.

Topic 3: The Employment Effects of the Minimum Wage

Traditionally, economists have argued that imposing a minimum wage above the market clearing equilibrium wage will reduce employment and contribute to increased unemployment particularly among young and relatively unskilled workers - precisely those workers that the minimum wage is intended to help. Some economists, however, have claimed that there is no evidence of a significant employment-reducing impact of the minimum wage on low-wage workers and that, in some cases, an increase in the minimum wage might even have caused an increase in employment. Critically evaluate these competing arguments on the effects of the minimum wage on employment.

Sources for Topic 3:

Neumark, David and Wascher, William L., "Employment Effects of Minimum and Subminimum Wages: Panel Data on State Minimum Wage Laws," Industrial and Labor Relations Review, October 1992, 46, 55-81, http://www.nber.org/papers/w3859

Card, David, Katz, Lawrence F. and Krueger, Alan B., "Employment Effects of Minimum and Subminimum Wages: Panel Data on State Minimum Wage Laws: Comment," Industrial and Labor Relations Review, April 1994, 47, 487-96, http://www.nber.org/papers/w4528

Neumark, David and Wascher, William L., "Employment Effects of Minimum and Subminimum Wages: Panel Data on State Minimum Wage Laws: Reply," Industrial and Labor Relations Review, April 1994, 47, 497-512, http://www.nber.org/papers/w4570

Card, David and Krueger, Alan B., "Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania," American Economic Review, September 1994, 84, 772-93, http://www.nber.org/papers/w4509

Neumark, David and Wascher, William L., "Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania: Comment," American Economic Review, December 2000, 90, 1362-96, http://www.nber.org/papers/w5224

Card, David and Krueger, Alan B., "Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania: Reply," American Economic Review, December 2000, 90, 1397-1420, http://www.nber.org/papers/w6386

Neumark, David and Wascher, William L., "Minimum Wages and Employment," Foundations and Trends in Microeconomics, 2007, 3(1-2), 1-182, http://www.nber.org/papers/w12663

Neumark, David, Salas, J. M. Ian and Wascher, William L., "More on Recent Evidence on the Effects of Minimum Wages in the United States," NBER Working Paper No. 20619, National Bureau of Economic Research, Cambridge, MA, October 2014, http://www.nber.org/papers/w20619?utm_campaign=ntw&utm_medium=email&utm_so urce=ntw