Not Available for Download

The Efficiency of the Price System: Evidence from an Alternative Market

Posted: 8 Apr 2003  

Nan-Ting Chou

University of Louisville - College of Business - Department of Economics

Ramon P. DeGennaro

University of Tennessee, Knoxville - Department of Finance

Raymond D. Sauer

Clemson University - John E. Walker Department of Economics; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Abstract

Most economists take it for granted that a price mechanism is usually the most effective means of resource allocation. This paper compares two methods of allocating resources in the thoroughbred racing market: a price mechanism and bureaucratic restrictions. It is shown that a simple price mechanism does a superior job of allocating racing ability than a myriad of conditions and restrictions set by even a highly informed expert.

Keywords: Resource allocation, racing, thoroughbred

JEL Classification: A1, D4, G0, L8, P0, P5

Suggested Citation

Chou, Nan-Ting and DeGennaro, Ramon P. and Sauer, Raymond D., The Efficiency of the Price System: Evidence from an Alternative Market. Applied Economics Letters, Vol. 7. Available at SSRN: https://ssrn.com/abstract=393800

Nan-Ting Chou

University of Louisville - College of Business - Department of Economics ( email )

Louisville, KY 40292
United States

Ramon P. DeGennaro (Contact Author)

University of Tennessee, Knoxville - Department of Finance ( email )

423 Stokely Management Center
Knoxville, TN 37996
United States
865-974-1726 (Phone)
865-974-1716 (Fax)

Raymond D. OSkipo Sauer

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Clemson University - John E. Walker Department of Economics ( email )

Clemson, SC 29634
United States
864-656-3939 (Phone)
864-656-4192 (Fax)

Paper statistics

Abstract Views
675