### Rasmusen's Unpublished Papers (January 11, 2013)

To see other abstracts, go to Abstracts of my published articles. To return to my homepage, go to http://www.rasmusen.org/.

### 1. Working Papers

1. "Three Years or Six to Audit? The Ill-Considered Intermountain Decision," The IRS wishes to interpret “omits from gross income” to mean “reports but understates gross income” to extend the period for audit from three years to six. It took that position without notice-and-comment, in the context of the hot pursuit of a particular tax shelter, and after losing in court, with all 13 Tax Court judges concurring, it made the motions of going through notice-and-comment so as to get Chevron deference on appeal. This paper discusses what should be considered in choosing a statute of limitations and points out how these considerations were completely ignored in IRS decisionmaking. This provides a good example for showing how the various theories of Chevron deference work.

2. The Economics of Regulation. I am writing an undergraduate textbook on regulation. I start with 4 chapters of theory (supply-and-demand, market failure, government failure, discounting and life valuation) and have just 2 chapters of antitrust, with 6 more chapters on other topics. My aim is to write a relatively short book (350 pages) with lots of photos and stories, skipping many topics and being interesting enough for someone to read for recreation.I also want to charge a low price, and I might well self-publish. http://www.rasmusen.org/g406/chapters/

3. Isoperfect Price Discrimination: Bargaining and Market Power,'' with David Myatt. Standard discussions of perfect price discrimination rest on a hidden assumption: that the monopolist can make take-it-or-leave-it offers. If a monopoly charges different prices to each of a large number of buyers, the correct paradigm is not the ultimatum game, but bilateral monopoly. The monopolist's profit will not be the entire surplus, but something less. Under balanced isoperfect price discrimination''-- a constant split \lambda=.5 of the bargaining surplus with each buyer--- and constant marginal cost, the monopolist has the same profit as monopoly pricing if the demand curve is linear, less if demand is concave, and more if demand is convex. Increasing marginal cost tends to make the monopolist prefer price discrimination. Isoperfect price discrimination is complemented by an idiosyncratic product design and informative advertising, whereas simple monopoly pricing is facilitated by plain-vanilla designs promoted via pure hype. Competition pushes suppliers away from isoperfect price discrimination and towards simple posted pricing. http://www.rasmusen.org/papers/pdisc-myatt-rasmusen.pdf or in http://www.rasmusen.org/papers/pdisc-myatt- rasmusen.tex.

4. Monopoly versus Competitive Leveraging of Reputation through Umbrella Pricing.'' A firm with a reputation for high quality in one product may usefully extend that reputation to other products. We look at how that works in a moral hazard model of product quality. http://www.rasmusen.org/papers/umbrella.pdf or http://www.rasmusen.org/papers/umbrella.tex.

5. Coarse Grades,'' with Rick Harbaugh. Certifiers of quality often report only coarse grades to the public despite having measured quality more finely, e.g., "A" instead of "98". Why? We show that using coarse grades can actually result in more information reaching the public, because it encourages low-quality individuals or firms to become certified. In our model the certifier aims to minimize public uncertainty over quality subject to the feasibility constraint of voluntary certification at a fixed cost. Moving from the best exact grading scheme to the best coarse one (a) induces more participation and (b) reduces public uncertainty. http://www.rasmusen.org/papers/coarse-harbaugh-rasmusen.pdf or in http://www.rasmusen.org/papers/coarse-harbaugh-rasmusen.tex.

6. The Concealment Argument: Why No Conclusive Evidence or Proof for God's Existence Will Be Found.'' Logic and Biblical evidence suggest that God wishes that some but not all humans become convinced of His existence and desires. If so, this suggests that attempts to either prove or disprove such things as God's existence, past miracles, or present supernatural intervention are doomed to failure, because God could and would take care to evade any such efforts. In tex and pdf. (http://rasmusen.org/papers/conceal-rasmusen.pdf).

7. Concavifying the Quasi-Concave,'' with Christopher Connell. We show that if and only if a real valued function f is strictly quasi-concave except possibly for a flat interval at its maximum and belongs to a precise regularity class, there exists a strictly monotonically increasing function g such that g of f is concave. We prove this sharp sharp characterization of quasi-concavity for any Euclidean space or even any arbitrary geodesic metric space. We also establish a simpler sufficient condition suitable for most applications for concavifiability on Euclidean spaces or any other Riemannian manifolds. http://rasmusen.org/papers/quasi-connell-rasmusen.pdf or in http://rasmusen.org/papers/quasi-connell-rasmusen.tex.

8. Book Publishing Ideas: I've put these on a separate page, at http://www.rasmusen.org/abros.htm.

### 2. Forthcoming

1. "Are Americans More Litigious? Some Quantitative Evidence (with J. Mark Ramseyer). Forthcoming in An American Illness , edited by Frank Buckley, http://buckleysmix.com/american-illness-4/ Yale University Press (scheduled for March 4, 2013). Many observers suggest that American citizens sue more readily than citizens elsewhere, and that American judges shape society more powerfully than judges elsewhere. We examine the problems involved in exploring these questions quantitatively. The data themselves indicate that American law’s notoriety does not result from how we handle routine disputes. Instead, it results from the peculiar and dysfunctional way American courts handle particular legal doctrines like class actions. In MS Word ( http://www.rasmusen.org/papers/litigation-ramseyer-rasmusen.doc). and pdf ( http://www.rasmusen.org/papers/litigation-ramseyer-rasmusen.pdf).

### 3. Useful Notes, Not for Publication

1. "Principles of Graphs and Tables." Tips for undergraduate writing ( http://www.rasmusen.org/g492/14_graphs.htm).

### 4. Miscellaneous, without Circulating Papers,

1. "Belief in God: A Game Theory Approach. "

2. Isoperfect Price Discrimination in a Hotelling Duopoly,'' with David Myatt. When duopolists compete by haggling with consumers, the form of the bargaining model is very important, whether in a Bertrand model or a Hotelling model.

3. Notes on Biased Experts in a Sender-Receiver Model.'' http://www.rasmusen.org/papers/bias-rasmusen.tex.

4. Odd, Enter; Even, Out: A Peculiarity of Buyout, Blackmail, Extortion, and Nuisance Suit Games.''

5. "Hold-Up as a Social Cost of Monopoly with Perfectly Competitive Retailers or with Consumers."

6. What Asset Sale Price Is Fair? – The Chrysler Bankruptcy Section 363 Sale'' (with J. Mark Ramseyer).

7. "A Simple Model of Keynesian Fiscal Policy." A one-input, one-period, two-good, extremely simple structural model with rigid prices and labor markets can generate Keynesian effects.

8. Government Regulation,''a 12-chapter text on the economics and politics of regulation. http://www.rasmusen.org/regulation.

URL: http://www.rasmusen.org/unpabs.htm. Indiana University, Department of Business Economics and Public Policy, in the Kelley School of Business, BU 456, 1309 East Tenth Street, Bloomington, Indiana 47405-1701, (812)855-9219. Comments: Erasmuse@Indiana.edu.

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