George Akerlof

University of California, Berkeley | UCB · Department of Economics

Free markets are products of peace and freedom, flourishing in stable times when people do not live in fear. But they also create an economic equilibrium that is highly suitable for enterprises that manipulate or distort our judgment on competitive markets. Unregulated free markets rarely reward the different kind of heroism, of those who restrain...

This paper examines how intellectual property rights' enforcement in poor countries may have unin-tended consequences given a rapid flow of price information across national borders. Such flows may affect market segmentation between rich and poor countries if consumers in rich countries incorporate prices from poor countries into their reference pr...

Real-estate markets are almost as volatile as stock markets. Prices of agricultural land, of commercial real estate, and of homes and condominiums have gone through a series of huge bubbles, as if people never learned from the previous ones. Such events--in particular the recent housing bubble--are driven by what John Maynard Keynes called animal s...

This paper considers the impact of family planning on dowry transfers. We construct a model of the marriage market in which prospective mates anticipate the outcome of intrahousehold bargaining over fertility. We show that as the price of contracep-tion falls, brides must compensate men with higher dowries in order to attract them into marriage. We...

This paper quantifies the impact of drug monopolies on prices using the example of the antiretroviral (ARV) drugs used to treat the HIV virus. I use a new cross-country price dataset from 2000 to 2003 to estimate each ARV 's marginal cost and markup by country. These markups are compared across two groups of countries: those with and those without...

This paper uses an experimental design to assess the effectiveness of calls on cooperation in managing the shortage of a vital commodity through non-price mechanisms. Using the large unexpected shortage of flu-vaccines in the Fall 2004, we observed the responses of the members of a campus population to two distinct randomized treatments: providing...

In this paper Eric Chaney has given some extremely clever arguments that the Arab conquests in the centuries after Muhammad and their long-term effects account for the low levels of democracy in Arab countries today. The paper is a tour de force. For the sake of brevity, I will forgo summarizing what he has done and will refrain from commenting on...

This paper quantifies the impact of drug monopolies on prices in developing countries using the example of the antiretroviral (ARV) drugs used to treat the HIV virus. I use a new cross-country price dataset of ARV drugs to estimate the relationship between ARV prices and per-capita income across countries. I find that ARV prices had little or no re...

In a campaign speech given in Iowa, George Akerlof argues that the Bush administration has hamstrung its good administrators and opted time and again for waving a magic wand to solve problems instead of facing reality. The problem may be most severe in the case of the deficits, where if we don't face up to reality, Akerlof argues, there will be pro...

Intestinal helminths – including hookworm, roundworm, whipworm, and schistosomiasis – infect more than one-quarter of the world's population. Studies in which medical treatment is randomized at the individual level potentially doubly underestimate the benefits of treatment, missing externality benefits to the comparison group from reduced disease t...

The standard public finance approach to health care in less developed countries involves identifying and heavily subsidizing priority health interventions that generate treatment externalities (e.g., vaccines). A popular recent approach instead argues that health education, community mobilization, and cost-recovery are also necessary for successful...

I was born on June 17, 1940 in New Haven, Connecticut. My father was a chemist on the Yale faculty, my mother a housewife. They had met ten years earlier at a departmental picnic when my mother had been a chemistry graduate student at Yale. My brother, Carl, was two years older. My father, who was born in Sweden in 1898, had come to the United Stat...

This brief provides an economic analysis of the main feature of the Copyright Term Extension Act of 1998 ('CTEA'), a twenty-year extension of the copyright term for existing and future works. Taken as a whole, the authors believe that it is highly unlikely that the economic benefits from copyright extension under the CTEA outweigh the additional co...

These essays explore what happens when a skilful economist makes unconventional assumptions. Economic theory has traditionally relied upon a tacit and ‘classical’ set of assumptions that have gradually acquired a life of their own in defining how economists write and how they justify economic models. Similarly, these assumptions have acquired an au...

For twenty years since the publication of his seminal paper 'The Market for "Lemons"', George A. Akerlof's work has changed the way we see economics, and the economics of information in particular. In abandoning the perfect-competition benchmarks of classical economics, the pragmatic modern economics championed by Akerlof has provided deep insights...

This paper proposes a model that integrates a bilateral Nash bargain-ing mechanism between a retailer and a wholesaler into a menu cost model. In a static model of Nash bargaining without menu cost, negative correla-tions between the bargaining power and the price duration and that with pass-through rates are established, which are consistent with...

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