The Project for the Study of American Capitalism

The Project for the Study of American Capitalism

Created in the wake of the 2008 financial crisis, and the government’s subsequent responses, the Project for the Study of American Capitalism at The Mercatus Center is a research program responding to the increased concern about the role of political favoritism in American business.  The project explores the implications of this emerging character of the economy, examining the effects it has on the standard of living in the United States and public perceptions of the legitimacy of government and business. Does it make any difference to average Americans whether ours is a more or less free market? And what can policymakers do to ensure competition and to commit in a credible way to equality of opportunity?

Drawing on hundreds of academics from around the world, the Project for the Study of American Capitalism helps scholars and policymakers investigate the nature of these problems and identify real and sustainable solutions.


Robert L. Beekman, Brian T. Kench | Aug 27, 2015
Authorization for the Export-Import Bank of the United States recently lapsed for the first time in more than 80 years, though it may be reestablished at any time. We present an economic efficiency analysis of bank’s activities in a simple open-economy model. This analysis brings clarity to the ongoing political debate regarding this institution. We discuss key arguments in support of and against the bank’s continued activities. We highlight the special privileges that the bank offers to a few domestic businesses, negatively distorting the private market opportunities in the markets in which these favored businesses operate and widely distributing the economic costs across nonfavored constituencies.
John E. Anderson, Seth H. Giertz, Shafiun N. Shimul | Aug 24, 2015
A new study for the Mercatus Center at George Mason University analyzes the spread of use-value assessment as applied to agricultural and rural lands across the 50 states and finds that while the spread of UVA was driven in part by concern over urbanization, the diffusion of UVA as a tax policy across the United States is best explained by effective political lobbying by agricultural interests.
G. P. Manish, Daniel Sutter | Aug 18, 2015
A new study published by the Mercatus Center at George Mason University synthesizes psychologists’ research on intrinsic motivations with research on the motives of entrepreneurs and shows that entrepreneurs are often motivated by a desire to succeed in competition with others. Consumer choice in markets provides validation to entrepreneurs about who provides the “best” product, so government intervention that results in disruption of choices in markets can make entrepreneurs who care about mastery worse off and harm economic growth.
James Bailey, Douglas Webber | Jun 17, 2015
By 2010, the average US state had passed 37 health insurance benefit mandates (laws requiring health insurance plans to cover certain additional services). Previous work has shown that these mandates likely increase health insurance premiums, which in turn could make it more costly for firms to compensate employees. Using 1996–2010 data from the Quarterly Census of Employment and Wages and a novel instrumental variables strategy, we show that there is limited evidence that mandates reduce employment. However, we find that mandates lead to a distortion in firm size, benefiting larger firms that are able to self-insure and thus exempt themselves from these state-level health insurance regulations. This distortion in firm size away from small businesses may lead to substantial decreases in productivity and economic growth.
Christopher Koopman, Thomas Stratmann, Mohamad Elbarasse | Jun 09, 2015
Thirty-six states and the District of Columbia currently limit entry or expansion of health care facilities through certificate-of-need (CON) programs. These programs prohibit health care providers from entering new markets or making changes to their existing capacity without first gaining the approval of state regulators. Since 1975, Arkansas has been among the states that restrict the supply of health care in this way, with six devices and services—including nursing home beds and long term care beds, psychiatric services, and assisted living and residential care facilities—requiring a certificate of need from the state before the device may be purchased or the service offered.
Christopher Koopman, Thomas Stratmann, Mohamad Elbarasse | Jun 02, 2015
Since 1977, West Virginia has been among the states that restrict the supply of health care in this way, with 21 devices and services—including acute hospital beds, magnetic resonance imaging (MRI) and positron emission tomography (PET) scanners—requiring a certificate of need from the state before the device may be purchased or the service offered.

Testimony & Comments

Christopher Koopman, Thomas Stratmann, Mohamad Elbarasse | Jun 12, 2015
There is little evidence to support the claim that certificates of need are an effective cost-control measure; and Stratmann and Russ have found that these programs have no effect on the level of charity care provided to the poor. While controlling health care costs and increasing care for the poor may be laudable public policy goals, the evidence strongly suggests that CON regulations are not an effective mechanism for achieving them. Instead, these programs simply decrease the supply and availability of health care services by limiting entry and competition.
Veronique de Rugy | Jun 02, 2015
Contrary to what you will hear from its supporters and beneficiaries, the Ex-Im Bank plays a marginal role in export financing—backing a mere 2 percent of US exports each year. The vast majority of exporters secure financing from a wide variety of private banks and other financial institutions without government interference or assistance. With US exports hitting record high levels, it is obvious that such financing is abundant and government assistance is superfluous.
Christopher Koopman, Matthew Mitchell, Adam Thierer | May 26, 2015
The commission should shift enforcement efforts away from stopping private restraint of trade and toward stopping public restraint of trade. In light of George Stigler’s observation that “the state has one basic resource which in pure principle is not shared with even the mightiest of its citizens: the power to coerce,” the commission would be wise to adopt Commissioner Wright’s approach and shift resources toward fighting public restraint of trade.
Veronique de Rugy | Mar 24, 2015
Policymakers who are interested in supporting the entrepreneurs and companies that will deliver the next generation of energy supplies and products should focus their attention on correcting the federal government’s hostile tax climate and dispense with the futile hopes of outsmarting the marketplace.
Christopher Koopman, Scott Eastman | Dec 01, 2014
Focusing on outcomes, rather than outputs, would give theaters more freedom to adjust the amount of devices they need to purchase based on the number of disabled patrons they actually serve.
Veronique de Rugy | Jun 25, 2014
The Bank has long outlived its purpose and cannot manage to meet the standards of the new missions that have been developed to validate its existence. For policymakers who have the facts, the choice is clear: the Export-Import Bank must go.

Speeches & Presentations


Veronique de Rugy | Aug 26, 2015
Defenders of the US Export-Import Bank (Ex-Im Bank) cite its working capital programs as evidence that the agency plays a critical role in supporting small businesses. As one of four main components of Ex-Im’s export subsidies, the working capital programs represent a relatively small component of the agency’s overall portfolio. The agency as a whole mainly benefits large, politically connected firms, as I have previously demonstrated.



Veronique de Rugy | September 17, 2015
In response to the Export Import Bank losing its charter, General Electric has announced that it will move five hundred jobs overseas. Mercatus Senior Research Fellow Veronique de Rugy joins Wall Street Journal Opinion to explain GE's strategy, and why, despite political bullying, the Export Import Bank should remain unauthorized.


Veronique de Rugy | September 18, 2015
General Electric is blaming job cuts on the Export-Import bank’s closure. Veronique de Rugy breaks down this claim for the Morning Brief with Tim Farley on POTUS.


Randall G. Holcombe, Andrea Castillo | Apr 23, 2013
By examining how real governments have operated, this book demonstrates why—despite their diverse designs—in practice all political and economic systems are variants of either liberalism or cronyism.
' '