https://hdl.handle.net/10419/202340 Fri, 23 Oct 2026 11:56:05 GMT 2026-10-23T11:56:05Z https://hdl.handle.net/10419/305487 Title: Scarcity of ideas and optimal R&D policy Authors: Basov, Suren; Erkal, Nisvan; Minehart, Deborah; Scotchmer, Suzanne Abstract: We consider a model of innovation that distinguishes between ideas and innovations. While innovation responds to incentives, ideas are a scarce resource that provide an exogenous constraint on the rate of innovation. We investigate how the optimal reward structure is shaped by the scarcity of ideas. Substitute ideas for innovation in the model arrive to random recipients at random times. By foregoing investment in a current idea, society preserves an option to invest in a better idea for the same market niche but with delay. Because successive ideas may occur to different people, there is a conflict between private and social optimality. The social planner does not observe the arrival of ideas and learns over time about the arrival rate of ideas. We represent the social planner's beliefs using a general continuous density and illustrate that the evolution of beliefs can be tracked by the cumulative hazard function. The reward set by the social planner serves a dual purpose: learning about the arrival rate of ideas and trading off lower delays against lower cost ideas. We show that the optimal reward increases as time passes because the social planner comes to view ideas as more scarce. Mon, 01 Jan 2024 00:00:00 GMT https://hdl.handle.net/10419/305487 2024-01-01T00:00:00Z https://hdl.handle.net/10419/305488 Title: Two roads diverged: Two alternate strategies for protecting captive freight shippers in the "Americas" model of freight rail restructuring Authors: Pittman, Russell W. Abstract: How to protect "captive shippers" from monopolistic abuses by a railway? In an "open access" system, it's straightforward: provide infrastructure access to a competing train operating company. In a system without open access - as in, for example, the United States, Canada, Mexico, and Brazil - it's not so straightforward. For freight shippers lacking economic intramodal or intramodal shipping alternatives, regulators and policymakers have focused on regulatory alternatives in two broad categories: 1) direct regulation of rates, and 2) imposed, regulated competition from a second railway (for example, interswitching or trackage rights). We argue that, despite disadvantages familiar to every Economics 101 student, direct regulation of rates has proven to be the superior alternative, and we discuss alternative mechanisms currently under debate. Mon, 01 Jan 2024 00:00:00 GMT https://hdl.handle.net/10419/305488 2024-01-01T00:00:00Z https://hdl.handle.net/10419/315913 Title: Should conditions regarding non-discrimination be imposed in vertical mergers? The surface transportation board on the acquisition of the Kansas City Southern Railway by the Canadian Pacific Authors: Pittman, Russell W. Abstract: In its 2023 decision approving the acquisition of the Kansas City Southern Railway by the Canadian Pacific, the U.S. Surface Transportation Board conditioned its approval on the merged railway's commitment "to keep gateways open on commercially reasonable terms" - that is, to allow shippers and non-merging railroads to continue to enjoy the option of using joint-line service, despite the merger's creation of the alternative of single-line service on the merged railroad. A century has passed since the Board's predecessor agency, the Interstate Commerce Commission, first imposed a condition of the maintenance of open gateways as a condition for approving a rail merger. This paper asks three questions. First, exactly what, in practice, are open gateways? Second, how have the two regulatory agencies dealt with the inherent tension between maintaining open gateways and achieving merger efficiencies? Third, what is the current state of play? Mon, 01 Jan 2024 00:00:00 GMT https://hdl.handle.net/10419/315913 2024-01-01T00:00:00Z https://hdl.handle.net/10419/284001 Title: Online reviews and hospital choice Authors: McCarthy, Ian M.; Sanbower, Kaylyn R.; Sánchez Aragón, Leonardo Abstract: Information problems in health care and the multifaceted nature of hospital quality complicate hospital choice. Online reviews provide an accessible, salient means through which researchers and health care decision-makers can gather information about a hospital's quality of care, and given their increasing popularity, these measures may affect hospital choice and may have implications for hospital prices. Using the universe of hospital Yelp reviews and inpatient claims data for elective procedures in Florida from 2012 through 2017, we exploit exogenous variation in online hospital ratings over time to identify the effect of online reviews on hospital choice. We find that among admissions for elective, inpatient procedures, patients are willing to travel between 5 and 30 percent further to receive care from a hospital with a higher Yelp rating, relative to other hospitals in the market. We also find evidence that higher ratings translate into higher commercial payments from insurers, albeit with relatively modest magnitudes. Our results indicate that novel, accessible sources of quality information have the potential to affect health care decisions, with potential downstream effects on health care prices. Sat, 01 Jan 2022 00:00:00 GMT https://hdl.handle.net/10419/284001 2022-01-01T00:00:00Z