In this paper we develop and test the hypothesis that institutional funding arrangments affect the extent to which public agencies are influenced by special interests. We test this hypothesis using data on state medical boards. In 1989, medical boards in twenty-one states received budget appropriations from their legislatures. The remaining boards operated independent of legislative control, fi...

Policymakers in publicly funded health-care systems are frequently required to make intricate decisions on which health-care services to include or exclude from the basic health-care package. Although it seems likely that the concept of individual responsibility is an essential feature of such decisions, it is rarely explicitly articulated or evaluated in health policy. This paper presents a te...

T he U.S. government subjects corporate dividends to double taxation: It first taxes corporate income, then taxes the same income again when shareholders receive dividends paid out of corporate income. Until 2003, individuals were taxed on dividend income at the same rates as on other forms of income, resulting in overall taxes on dividends much higher than those in most other countries (PriceW...

In New York, as in a number of other states in which recent state court decisions have invalidated the existing system of school financing, the court decision has focused on the failure of the existing system to provide each student with an adequate (“a sound, basic”) education. While the legal strategies that have led to these decisions have been prompted, in part, by longstanding discussions ...

The authors examine the impact of assets’ useful lives on firms’ leasing decisions in Canada. Their theoretical analysis demonstrates that firms are more likely to lease assets with shorter useful lives. More specifically, they show that in a competitive financing market, lease payments are a decreasing function of lessors’ tax rates. Therefore, the useful life of an asset is relevant in leasin...

Interest in objective, credible comparative clinical effectiveness information has been growing in the United States, both by those who support competitive behavior in health care and by those who support administered pricing. The Medicare drug benefit has heightened interest in better information, although the potential payoff is even greater for medical procedures than for drugs, since proced...

This paper brings into focus a link between the investment and nancing decisions of a rm which has an access to costly debt nancing. Our analysis shows that lump-sum debt issuance costs play a prominent role in a determination of the optimal investment strategy. Faced with larger lump-sum debt issuance costs, a rm will optimally set up a higher-scale investment project in order to "compensate" ...

I study the exchange rate disconnect puzzle in a two-country DSGE framework that features a financial intermediation sector. An intermediary is subject to two types of financing constraints: 1. a segmented deposit market restricted to local households, and 2. a balance-sheet constraint. These two constraints drive a wedge between marginal decisions of home and foreign intermediaries, which in t...

This paper examines how external governance pressure provided by both the product market and the market for corporate control affects a borrowing firm’s choice of debt source. Using reductions in import tariffs to capture exogenous changes in a firm’s competitive environment, we find that increased product market competition has a significant negative impact on a firm’s reliance on bank debt fi...

BACKGROUND Guided by the evidence that delaying coronary revascularization may lead to symptom worsening and poorer clinical outcomes, expansion in cardiac surgery capacity has been recommended in Canada. Provincial governments started providing one-time and recurring increases in budgets for additional open heart surgeries to reduce waiting times. We sought to determine whether the year of dec...