Pricing and Policy Problems in the Northeast Fluid Milk Industry

This article documents the need for reform of milk pricing in the Northeast. The New York price gouging law can be recast as a fair share law. This new milk policy “kills two birds with one stone.” It corrects regional inequities in raw milk pricing by reforming the pricing of milk at retail by limiting and redistributing excessive retail margins to farmers and consumers. The fair share policy relieves allocative price inefficiency, improves the performance of the federal milk market order pool, and the general performance of the Northeast dairy farming and fluid milk industries.

Effects of Food Primes and Thought Suppression on Eating Habits

Food primes and thought suppression have been identified as factors influencing poor eating choices. Primes affect people non-consciously by activating thoughts of food. Suppression of food thoughts leads to a preoccupation with food that is often followed by a hyperaccessibility of food thoughts and increased binging. The current study paired these two processes to examine their interactional effects. We manipulated exposure to food primes and instructions to suppress thoughts of a tasty snack food (M&Ms) for 76 college-aged women. We hypothesized that participants both primed with food images and asked to suppress would consume the most M&Ms at the end of the study. Contrary to predictions, results showed no effects for the manipulations. Perceived weight category, however, did interact with the manipulations, with overweight participants eating more when they got either the food prime or the suppression (but not both together). These findings have important implications for weight-loss strategies.

Corporate Tax Avoidance and High Powered Incentives

This paper analyzes the links between corporate tax avoidance, the growth of highpowered incentives for managers, and the structure of corporate governance. We develop and test a simple model that highlights the role of complementarities between tax sheltering and managerial diversion in determining how high-powered incentives influence tax sheltering decisions. The model generates the testable hypothesis that firm governance characteristics determine how incentive compensation changes sheltering decisions. In order to test the model, we construct an empirical measure of corporate tax avoidance - the component of the book-tax gap not attributable to accounting accruals - and investigate the link between this measure of tax avoidance and incentive compensation. We find that, for the full sample of firms, increases in incentive compensation tend to reduce the level of tax sheltering, suggesting a complementary relationship between diversion and sheltering. As predicted by the model, the relationship between incentive compensation and tax sheltering is a function of a firm.s corporate governance. Our results may help explain the growing cross-sectional variation among firms in their levels of tax avoidance, the .undersheltering puzzle,. and why large book-tax gaps are associated with subsequent negative abnormal returns.