Essay in empirical industrial organization and public finance
Abstract/Contents
- Abstract
- This dissertation comprises three chapters. The first two chapters investigate competition in the U.S. credit card market. The first looks at broad changes in the market's competitive environment over the past two decades. More specifically, it establishes how the classical facts characterizing a failure of competition in credit card lending during the 1980s are largely reversed in the decades following. Extending previous theories of limited competition in credit card lending, it illustrates how many of these changes can be explained by considering the role of costly screening in mitigating adverse selection. The second chapter studies more directly how issuers compete in today's market. To this end, it presents an equilibrium model of credit card issuers' mail out decisions and estimates it using data on direct mail credit card offers. In contrast to previous work, the model accounts for the complexity of card products, for heterogeneity in individuals' tastes for cards, and for differences in how profitable consumers are to issuers. It then explores the equilibrium supply effects of changes in the market environment. Specifically, it shows that an increase in the cost of funds (Treasury rate) unambiguously reduces consumers' propensity to receive offers and the range of rates on offers received. Conversely, reducing sending costs unambiguously increases the number and variety of offers. It also leads to an increase in the average rate on offered products. Adding a competitor on net increases the propensity to receive credit. However, it also deters existing competitors from making offers to some individuals whom they might have otherwise found profitable. The third chapter looks at the potential effects of differing methods for taxing inter-generational wealth transfers. Using wealth data on U.S. households, it forecasts changes in household wealth in the coming decade and calculates the importance of untaxed wealth in bequeathed estates. It then compares the aggregate and distributional effects of the current estate tax to those in which only the unrealized capital gains are subject to tax. It estimates that, in the coming decade, policies taxing capital gains can potentially raise more revenue than the current estate tax, but not without a substantial increase in the fraction of households facing a tax. Moreover, modest increases in capital gains allowance is likely to both sharply reduce total revenue and focus the burden of the tax on high wealth households.
Description
| Type of resource | text |
|---|---|
| Form | electronic; electronic resource; remote |
| Extent | 1 online resource. |
| Publication date | 2014 |
| Issuance | monographic |
| Language | English |
Creators/Contributors
| Associated with | Grodzicki, Daniel |
|---|---|
| Associated with | Stanford University, Department of Economics. |
| Primary advisor | Bresnahan, Timothy F |
| Primary advisor | Einav, Liran |
| Thesis advisor | Bresnahan, Timothy F |
| Thesis advisor | Einav, Liran |
| Thesis advisor | Bloom, Nick, 1973- |
| Thesis advisor | Levin, Jonathan D. (Jonathan David), 1972- |
| Advisor | Bloom, Nick, 1973- |
| Advisor | Levin, Jonathan D. (Jonathan David), 1972- |
Subjects
| Genre | Theses |
|---|
Bibliographic information
| Statement of responsibility | Daniel Grodzicki. |
|---|---|
| Note | Submitted to the Department of Economics. |
| Thesis | Thesis (Ph.D.)--Stanford University, 2014. |
| Location | electronic resource |
Access conditions
- Copyright
- © 2014 by Daniel Jose Grodzicki
- License
- This work is licensed under a Creative Commons Attribution Non Commercial 3.0 Unported license (CC BY-NC).
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