Robert Litan

The Brookings Institution · Department of Economics

The exponential rise and volatility in the price of Bitcoin has heightened investor interest in cryptocurrencies and crypto assets. These assets have attracted a growing number of investors but also have been used to facilitate a wide range of illicit activities. In some cases, legitimate participants in crypto asset markets have incurred substanti...

Entrepreneurship is key to productivity growth, yet in recent decades new-firm formation has flagged. There is some evidence that business concentration may be a contributing cause. Well-designed antitrust enforcement policy, especially aimed at policing abuse of market power by dominant platforms, will be crucial to preserving opportunities for ne...

Trillion Dollar Economists explores the prize-winning ideas that have shaped business decisions, business models, and government policies, expanding the popular idea of the economist's role from one of forecaster to one of innovator. Written by the former Director of Economic Research at Bloomberg Government, the Kauffman Foundation and the Brookin...

Despite recent innovations in entrepreneurial finance, particularly at the early stage of business creation, many new and young companies continue to face hurdles to acquire capital.The Kauffman Foundation addressed current challenges and opportunities in financing entrepreneurial growth, a key driver of job creation and economic expansion, at its...

The twenty-first-century telecommunications landscape is radically different from the one that prevailed as recently as the last decade of the twentieth century. Robert Litan and Hal Singer argue that given the speed of innovation in this sector, the Federal Communications Commission's outdated policies and rules are inhibiting investment in the te...

A far-reaching discussion is taking place in the United States about the challenges facing higher education and the possible forms postsecondary learning might take in the future. Notwithstanding the strengths of our best research institutions, the shortcomings of many U.S. colleges and universities are significant. There is growing evidence that t...

In this study, we analyze the consumer welfare implications of regulating Rent-to-Own (RTO) transactions. We conclude that the benefits and costs of mandatory disclosure and labeling regulations currently imposed by most states are likely small, and that the effects of imposing a Federal baseline for such regulations would also be relatively small....

By any measure, Google is one of America’s most innovative companies of the last decade. Its search engine has literally changed the way people all around the world access information and conduct research. Google’s ability to continue innovating, as well as the ability of other companies to do the same, is threatened by the potential application of...

This report addresses a deceptively simple question: How can the productivity of American health care be substantially improved? Productivity, in lay terms, is the ratio of output to inputs. A more colloquial rendition of the question might be: how can we get a lot more bang for our health care buck?By design, we have brought together a varied asso...

Without making any bold claim of a “free lunch,” there is nonetheless a compelling case to be made that permanently exempting investments in start ups from any capital gains taxes for five years would come reasonably close. It would conservatively boost annual equity investment in start ups by 50 percent more than the annual revenue loss to the fed...

This white paper outlines some of the remaining state barriers and a few federal ones and how they prevent disruptive innovations by entrepreneurs and established firms alike that potentially could bring new and more efficient business models to the market. In the case of the legal sector, the barriers we identify not only adversely affect legal in...

Experts have long believed that the high economic returns on sound early childhood programs means it should be possible to pay for such programs with so-called "invest-in-kid bonds", a form of social impact finance that would pay income and repay invested capital from the proceeds of the economic gains from high-quality early childhood programs. Th...

Research carried out or supported by the Ewing Marion Kauffman Foundation confirms that new and young firms generate a disproportionately large share of net job creation in the U.S. economy. However, even before the recession and since, the job-creating engine of startups (those less than five years old) has been slowing down. This not only is unhe...

This volume consists of seven articles on the economics and regulation of interchange fees. All rely on the multi-sided platform framework. The first two chapters examine whether there is a market failure in setting interchange fees and present principles for considering correction to a market failure. One of the themes of these articles is that re...

A wide range of United States political policies influence the level of innovative entrepreneurial activity in the country, that is the number of new businesses started each year that bring truly new products and ideas to the market. These policies begin with an educational system that fosters a creative, inventive, and educated population with the...

Prepared Testimony by Harold Bradley and Robert E. Litan before the United States Senate Committee on Banking, Housing, and Urban Affairs Subcommittee on Securities, Insurance, and Investments.

Almost all U.S. hospitals procure their equipment through group purchasing organizations ("GPOs"). Some hospitals subject the prices secured by GPOs to a second round of competition in an "aftermarket," in which vendors both on and off the GPO contract compete for the hospital's business. To measure the extent of the potential benefit to hospitals...

Although understandable in light of its traumatic impact, the Great Recession of 2007–2009 may be distracting attention from a more fundamental troubling economic trend. The United States appears to be suffering from a long-term leak in job creation that pre-dates the 2007–2009 recession and has the potential to persist for an unknown time. The hea...

Financial plumbing is taken for granted, except when things go wrong. It was only a few years ago, for example, that the Federal Reserve Bank of New York saw the mess in the derivatives market, where transactions were recorded on slips of paper and sometimes misplaced before the Fed forced the major banks that were part of that market to clean up t...

This paper examines the impact of the reductions in interchange fees proposed by the the Federal Reserve Board on consumers and small businesses. We find that consumers and small business would face higher retail banking fees and lose valuable services as banks rationally seek to make up as much as they can for the debit interchange revenues they w...

This paper uses the standard economic framework for designing government regulations to evaluate the Federal Reserve Board’s proposed cost-based price caps for debit card interchange fees. We argue that the Board has not prepared an economically sound diagnosis of the problem that it is trying to fix and therefore has no basis for knowing whether i...

The United States economy is struggling to recover from its worst economic downturn since the Great Depression. After several huge doses of conventional macroeconomic stimulus - deficit-spending and monetary stimulus - policymakers are understandably eager to find innovative no-cost ways of sustaining growth both in the short and long runs. In resp...

A central goal of any economy is to achieve rapid and sustained growth. This cannot happen without continued innovation. This landmark Handbook brings together many of the world's legal scholars to examine features of the legal infrastructure that affect both innovation and growth. Individual chapters explore different legal subject areas, in most...

One of the questions or challenges we constantly wrestle with at Kauffman is “how could annual U.S. economic growth be increased by one additional percentage point?” It is not an idle question. If, for example, the economy grew at 4 percent annually rather than 3 percent, GDP would double six years faster (eighteen years versus twenty-four years)....

A strong, sustained recovery will require the formation and growth of new scale companies. These companies, in turn, often require access to equity capital as they grow. Traditionally, this has best been accomplished by the floating of shares in an initial public offering (IPO). IPOs have been down substantially over the past decade. Many factors h...

As the recession drags on, states and municipalities find themselves in a deep hole. For the first time since the Great Depression, income, sales and property taxes have declined in unison. The cyclical challenges are clear: falling tax receipts, high unemployment, tepid investment returns, and overall economic uncertainty.But even more daunting ar...

The ultimate formulation of the Federal Communications Commission's “nondiscrimination on the Internet” principle could have a significant impact on economic welfare and on innovation. In this article, we explain the economics of discrimination as it applies to the Internet, and we offer a new approach for identifying anticompetitive discrimination...

A lack of entrepreneurial behaviour has often been highlighted as a contributor to the decline in the research and development (R&D) productivity of the pharmaceutical industry. Here, we present an assessment of entrepreneurship in the industry, based on interviews with 26 former and current leaders of R&D departments at major pharmaceutical and bi...

We analyze a Business Dynamics Statistics (BDS) dataset broken out by firm age to determine how total employment in startups changes as startups age. Conventional thinking on employment from startups is that many of the new jobs created by startups evaporate over the course of just a few years as firms exit the market. By tracking cohorts of firms...

We are a group of scientists and business people who share a common interest in the application to financial systems of a scientific methodology called agent-based modeling (ABM). We believe this methodology represents a scientifically validated and powerful tool to facilitate the Commission's regulation of equity markets. We believe that its use w...

In the authors' shared opinion, the economic evidence does not support the regulations proposed in the Commission’s Notice of Proposed Rulemaking Regarding Preserving the Open Internet and Broadband Industry Practices (the “NPRM”). To the contrary, the economic evidence provides no support for the existence of market failure sufficient to warrant e...

With America desperate for jobs, now is the worst time for the Federal Communications Commission to be imposing “net-neutrality†and potentially scaring away billions of dollars in telecommunications investment, according to Robert Litan of the Kauffman Foundation and Brookings Institution and Hal Singer of Navigant Economics.

In October 2009, the Federal Communications Commission released a Notice of Proposed Rule Making in which it asked for guidance on how to convert a principle of “nondiscrimination on the Internet” into a practical rule for broadband service providers. The ultimate formulation of the nondiscrimination principle could have a significant economic effe...

In this essay, I take up Volcker’s challenge. I do so by highlighting many, perhaps most, of the key truly “financial” (not mechanical) innovations since the 1960s that have changed the way finance carries out its four economic functions: enabling parties to pay each other; mobilizing society’s savings; channeling those savings toward productive in...

Compared to all prior recessions since the end of World War II, the 2007-2009 recession ranks worst in terms of the number of jobs lost (over eight million), and second worst in the percentage decline (6 percent). The key to economic recovery will come in the form of newly created jobs. But where will these jobs come from?Using United States Census...

The widespread adoption of mandatory unbundling in telecommunications markets has led to growing interest in mandatory “functional separation” i.e., separation of upstream network operations from downstream retail operations. Since 2002, vertical separation has been implemented in five OECD countries: Australia, Italy, New Zealand, Sweden, and the...

America’s top economics bloggers - a diverse group of writers with wide-ranging intellectual and political vantage points - largely agree on one important issue: To help speed the recovery, remove barriers to entrepreneurship. That’s according to the findings reported in the Kauffman Economic Bloggers Survey conducted by the Ewing Marion Kauffman F...

The single most important policy reform that will boost long-term economic growth in the United States is to reduce the barriers facing highly skilled and highly educated immigrants. At least 50,000 workers with advanced degrees are sent out of the United States each year, although they have already passed security tests and become part of the prod...

Robert Litan points out that much has been done already to prevent future financial crises, and tells us what remains.

Akey element of most legislative proposals to establish an optional federal charter (OFC) for insurers is that market competition rather than government regulation would set insurance rates. Insurers choosing the federal charter, therefore, would be free to set premiums based on their actuarial calculations of risk and other competitive considerati...

Once we paid for things with bills, coins, or checks. Today we pay with zeroes and ones digital entries on credit and debit cards, or electronic messages sent over the Internet. In Moving Money, distinguished analysts explore this trend, its development and likely future, and the ramifications of this transformation. This is a book about money as a...

A growing body of evidence has documented the critical role that entrepreneurs play in fostering economic growth. But entrepreneurs can only be expected to take risks in 'open settings', where individuals and firms are free to contract with one another. In this important book, leading economists explain and document the role of open markets, within...

The linkLine price squeeze case pending in the Supreme Court for the Fall 2008 Term is one of the most significant antitrust cases on monopolization law that the Court has taken in years. Amici are professors and scholars in law and economics who have taught, or have conducted research on, antitrust law and the economics of industrial organization....

As economists, we believe that the Second Circuit's ruling, by not allowing the consideration of important information about the relationships between the benefits and costs of alternatives, is economically unsound. In particular, we believe that, as a general principle, regulators cannot make rational decisions unless they are allowed to compare c...

A volume of scholarly papers addressing the future of the university for the entrepreneurial age, presented at the 2008 Kauffman-Planck Summit on Entrepreneurship Research and Policy held June 8-11, 2008, in Bavaria, Germany.

The ability of groups of people to make predictions is a potent research tool that should be freed of unnecessary government restrictions.

In 2007, nearly 60 percent of all Federal individual tax returns were filed electronically, about three times the proportion 10 years earlier. Because electronic filing is both more efficient and more accurate than filing by mail, it generates substantial savings for taxpayers: The Internal Revenue Service (IRS) estimates it saves $2.36 for each el...

Like all politics, all entrepreneurship is local. Individuals launch firms and, if successful, expand their enterprises to other locations. But new firms must start somewhere, even if their businesses are conducted largely or exclusively on the Internet. Likewise, policymakers at local and state levels increasingly recognize that entrepreneurship i...

From the Publisher:Should we continue to regulate industries the way we have in the past? Does the digital age require a new approach to antitrust enforcement? To best facilitate global electronic commerce, what changes are needed in intellectual property law, professional licensing requirements, laws governing privacy and content, and policies rel...

Financial Innovation and the Rise of Subprime Lending How Were Such Dangerous Excesses Allowed to Build Up? Note About the Authors

Imprenditorialità innovativa: quali politiche per il sostegno della crescita economica? - Nel presente articolo analizziamo le politiche atte a promuovere l’imprenditorialità di tipo innovativo, vale a dire, ci interroghiamo su quali siano le politiche più idonee a promuovere il sostegno e l’espansione delle attività imprenditoriali di tipo innovat...

*Mr. Hahn is executive director of the Reg-Markets Center and a senior fellow at the American Enterprise Institute. He is also a senior visiting fellow at the Smith School at Oxford. Mr. Hahn would like to thank Adam Schmidt for research assistance. The views expressed in this paper reflect solely those of the author and do not necessarily reflect

The linkLine price squeeze case from the Ninth Circuit is the most important antitrust case that the Supreme Court could take during the Fall 2007 Term. Amici are professors and scholars in law and economics who have taught, or have conducted research on, antitrust law and the economics of industrial organization. They include William J. Baumol, Ro...

Although the creation of the European Union has created lots of positive things in Europe such as a half-century of peace, growing cooperation, including the former Soviet-bloc countries to EU and a common currency, the continent has its share of problems. For one, the countries have prospered but not as much as previously expected. Although unempl...

Among the factors contributing to the success of the U.S. economy over the past decade — as reflected in the doubling of productivity growth compared to the preceding two decades — is the continued transformation of the U.S. economy toward a more entrepreneurial form of capitalism. In such a system, innovative new firms play an unusually central ro...

Just as Simon Cowell is revolutionizing the music business with his American Idol television series, a group of new entrepreneurs is quietly changing the face of the venture capital industry and entrepreneurship. American Idol has proved to be a major success in identifying and establishing entertainment stars. A similar Idol formula is emerging am...

Network neutrality issues have been vigorously debated worldwide over the past few years. One major aim of network neutrality proponents is to prevent high-speed Internet service providers from charging content providers for priority delivery. Recently, proponents have turned their attention to the regulation of wireless networks, such as those for...

A permanent challenge related to university-driven innovation has been to ensure that the university structures help innovation and its commercialization. The universities would gradually lose their global leadership in innovation, if they fail to address those challenges. Many universities have channeled their innovation-dissemination activities t...

For much of the past century, universities and university-based researchers have played a critical role in driving technological progress, from the fortification of Vitamin D in the 1920s to the creation of Google in the 1990s. In the process, universities have been a strong catalyst for U.S. economic growth. But a perennial challenge related to un...

Prediction markets are markets for contracts that yield payments based on the outcome of an uncertain future event, such as a presidential election. Using these markets as forecasting tools could substantially improve decision making in the private and public sectors. We argue that U.S. regulators should lower barriers to the creation and design of...

Robert Hahn and Robert Litan defend President Bush's recent executive order on government regulation.

The conventional wisdom is that the surge in productivity growth which has surged in the United States over the past 15 years has been attributed almost wholly to advances in the production and use of information technology. While this is certainly evident from the statistics, a driving force behind the IT revolution has been the development and gr...

High-speed internet access has developed rapidly in the last decade and is increasingly viewed as essential infrastructure for our global information economy.2 For example, as recently as mid-2000 there were only 4.1 million broadband lines in the United States and only 3.2 million of these were residential lines.3 Thus, in mid-2000 less than one h...

Imagine this: a mere century ago, the purchasing power of an average American was one-tenth of what it is today. But what will it take to sustain that growth through the next century? And what can be said about economic growth to aspiring nations seeking higher standards of living for their citizens? In Good Capitalism, Bad Capitalism, and the Econ...

High-speed internet access has developed rapidly in the last decade and is increasingly viewed as essential infrastructure for our global information economy. 1 For example, as recently as mid-2000 there were only 4.1 million broadband lines in the United States and only 3.2 million of these were residential lines. 2 Thus, in mid-2000 less than one...

With the passage of the Bayh-Dole Act of 1980, the federal government explicitly endorsed the transfer of exclusive control over government-funded inventions to universities and businesses operating with federal contracts. While this legislation was intended to accelerate further development and commercialization of the ideas and inventions develop...

Network neutrality is a policy proposal that would regulate how network providers manage and price the use of their networks. Congress has introduced several bills on network neutrality. Proposed legislation generally would mandate that Internet service providers exercise no control over the content that flows over their lines and would bar provide...

This paper critically reviews the draft of the Office of Management and Budget's ninth report on the benefits and costs of federal regulation. The draft report is similar to previous reports, and does not break new ground. We offer seven recommendations, six for OMB and one for Congress, that would help hold lawmakers and regulators more accountabl...

U.S. policymakers are in the midst of an active debate over how best to accelerate the build-out of next-generation broadband networks. The U.S. economy has a significant economic stake in the outcome. It is increasingly apparent in the global economy linked together by the Internet that the future competitiveness of individual firms, and indeed en...

A quarter century ago, there was a very influential paper that shaped thinking on how best to design what we now call the Internet. The article offered a design principle called "end-to-end." The idea was to keep the inner part of a computer network as simple as possible and allow the "intelligence" to reside at the edges of the network closer to t...

International accounting standards tend to converge, as do auditing, enforcement, and corporate governance, whereas trading of equity shares remains essentially national. The book provides a thorough analysis of what information investors really need, how financial accounting systems developed and their current requirements in major commercial coun...

This book provides readers with reasonably concise descriptions of the state of global markets, the benefits and limitations of financial accounting and accounting/auditing standards, and the development, status, and current policy issues of corporate financial reporting in major countries and the European Union. The globalization of financial mark...

This book provides readers with reasonably concise descriptions of the state of global markets, the benefits and limitations of financial accounting and accounting/auditing standards, and the development, status, and current policy issues of corporate financial reporting in major countries and the European Union. The globalization of financial mark...

This book provides readers with reasonably concise descriptions of the state of global markets, the benefits and limitations of financial accounting and accounting/auditing standards, and the development, status, and current policy issues of corporate financial reporting in major countries and the European Union. The globalization of financial mark...

This book provides readers with reasonably concise descriptions of the state of global markets, the benefits and limitations of financial accounting and accounting/auditing standards, and the development, status, and current policy issues of corporate financial reporting in major countries and the European Union. The globalization of financial mark...

This book provides readers with reasonably concise descriptions of the state of global markets, the benefits and limitations of financial accounting and accounting/auditing standards, and the development, status, and current policy issues of corporate financial reporting in major countries and the European Union. The globalization of financial mark...

This book provides readers with reasonably concise descriptions of the state of global markets, the benefits and limitations of financial accounting and accounting/auditing standards, and the development, status, and current policy issues of corporate financial reporting in major countries and the European Union. The globalization of financial mark...

This book provides readers with reasonably concise descriptions of the state of global markets, the benefits and limitations of financial accounting and accounting/auditing standards, and the development, status, and current policy issues of corporate financial reporting in major countries and the European Union. The globalization of financial mark...

This book provides readers with reasonably concise descriptions of the state of global markets, the benefits and limitations of financial accounting and accounting/auditing standards, and the development, status, and current policy issues of corporate financial reporting in major countries and the European Union. The globalization of financial mark...

This book provides readers with reasonably concise descriptions of the state of global markets, the benefits and limitations of financial accounting and accounting/auditing standards, and the development, status, and current policy issues of corporate financial reporting in major countries and the European Union. The globalization of financial mark...

This book provides readers with reasonably concise descriptions of the state of global markets, the benefits and limitations of financial accounting and accounting/auditing standards, and the development, status, and current policy issues of corporate financial reporting in major countries and the European Union. The globalization of financial mark...

This book provides readers with reasonably concise descriptions of the state of global markets, the benefits and limitations of financial accounting and accounting/auditing standards, and the development, status, and current policy issues of corporate financial reporting in major countries and the European Union. The globalization of financial mark...