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Full-Text Articles in Law

Regulation And Deregulation: The Baseline Challenge, Kathryn Judge Jan 2018

Regulation And Deregulation: The Baseline Challenge, Kathryn Judge

Faculty Scholarship

A core challenge for financial regulation is how best to address the inherent dynamism of finance. The financial system is engineered to change. Periods of stability, evolving macroeconomic conditions, and regulation are among the forces driving the constant shape shifting of finance. As a result, rules established at Time A often have a different substantive effect at Time B. And because efforts to reduce the cost of complying with regulatory burdens, commonly known as regulatory arbitrage, are among the forces driving this change, a static regulatory regime will tend to be inherently deregulatory.

Currently, the processes through which the law ...


Valuation Disputes In Corporate Bankruptcy, Kenneth M. Ayotte, Edward R. Morrison Jan 2018

Valuation Disputes In Corporate Bankruptcy, Kenneth M. Ayotte, Edward R. Morrison

Faculty Scholarship

Prior scholarship points to disagreements about valuation and judicial valuation error as key drivers of Chapter 11 outcomes. Avoiding valuation disputes and valuation errors is also the underlying driver of most proposed reforms, from Baird’s auctions to Bebchuk’s options. In this paper, we undertake a detailed examination of bankruptcy court opinions involving valuation disputes. Our paper has two goals. The first is to understand how parties and their expert witnesses justify their opposing views to the judge, and how judges decide between them. The second is to provide practical guidance to judges in resolving valuation disputes. We document ...


The Caroline Affair In The Evolving International Law Of Self-Defense, Matthew C. Waxman Jan 2018

The Caroline Affair In The Evolving International Law Of Self-Defense, Matthew C. Waxman

Faculty Scholarship

The "Caroline" incident – an 1837 raid by British Canadian militia across the Niagara River border to sink an American steamboat being used by Canadian insurgents – is well-known to many international lawyers. United States Secretary of State Daniel Webster’s resulting correspondence with British representative Lord Ashburton is often cited today as a key authority on customary international self-defense standards. University of Ottawa professor Craig Forcese has produced a valuable new history and analysis of that event, its legal context, and its continuing influence: "Destroying the Caroline: The Frontier Raid that Reshaped the Right to War." As explained in this review ...


Unintended Agency Problems: How International Bureaucracies Are Built And Empowered, Anu Bradford, Stavros Gadinis, Katerina Linos Jan 2018

Unintended Agency Problems: How International Bureaucracies Are Built And Empowered, Anu Bradford, Stavros Gadinis, Katerina Linos

Faculty Scholarship

The ground underneath the entire liberal international order is rapidly shifting. Institutions as diverse as the European Union, International Monetary Fund, United Nations, and World Trade Organization are under major threat. These institutions reflect decades of political investments in a world order where institutionalized cooperation was considered an essential cornerstone for peace and prosperity. Going beyond the politics of the day, this Article argues that the seeds of today’s discontent with the international order were in fact sown back when these institutions were first created. We show how states initially design international institutions with features that later haunt them ...


The Supreme Court, Judicial Elections, And Dark Money, Richard Briffault Jan 2018

The Supreme Court, Judicial Elections, And Dark Money, Richard Briffault

Faculty Scholarship

In its cases dealing with judicial elections, the Court has cycled back and forth over whether to treat judges as representatives of the voters, like other elected officials, with judicial elections subject to the same constitutional rules as other elections or to emphasize the distinctive nature of the judicial role, which could support special limits on judicial campaign activity. Over a trilogy of cases decided between 2002 and 2015 – Republican Party of Minnesota v. White, Caperton v. A.T. Massey Coal Co., and Williams-Yulee v. Florida Bar – a divided Court has struggled to hold together the First Amendment’s commitment ...


Do The Ends Justify The Means? Policing And Rights Tradeoffs In New York City, Amanda Geller, Jeffrey Fagan, Tom R. Tyler Jan 2018

Do The Ends Justify The Means? Policing And Rights Tradeoffs In New York City, Amanda Geller, Jeffrey Fagan, Tom R. Tyler

Faculty Scholarship

Policing has become an integral component of urban life. New models of proactive policing create a double-edged sword for communities with strong police presence. While the new policing creates conditions that may deter and prevent crime, close surveillance and frequent intrusive police-citizen contacts have strained police-community relations. The burdens of the new policing often fall on communities with high proportions of African American and Latino residents, yet the returns to crime control are small and the risks of intrusive, impersonal, aggressive non-productive interactions are high. As part of the proffered tradeoff, citizens are often asked to view and accept these ...


How Investors Can (And Can't) Create Social Value, Paul Brest, Ronald J. Gilson, Mark A. Wolfson Jan 2018

How Investors Can (And Can't) Create Social Value, Paul Brest, Ronald J. Gilson, Mark A. Wolfson

Faculty Scholarship

Most investors have a single goal: to earn the highest financial return. These socially-neutral investors maximize their risk-adjusted returns and would not accept a lower financial return from an investment that also produced social benefits. An increasing number of socially-motivated investors have goals beyond maximizing profits. Some seek investments that are aligned with their social values (value alignment), for example by only owning stock in companies whose activities are consistent with the investor’s moral or social values. Others may also want their investment to make portfolio companies create more social value (social value creation). The thrust of this essay ...


Authors And Machines, Jane C. Ginsburg, Luke Ali Budiardjo Jan 2018

Authors And Machines, Jane C. Ginsburg, Luke Ali Budiardjo

Faculty Scholarship

Machines, by providing the means of mass production of works of authorship, engendered copyright law. Throughout history, the emergence of new technologies tested the concept of authorship, and courts in response endeavored to clarify copyright’s foundational principles. Today, developments in computer science have created a new form of machine – the “artificially intelligent” system apparently endowed with “computational creativity” – that introduces challenging variations on the perennial question of what makes one an “author” in copyright law: Is the creator of a generative program automatically the author of the works her process begets, even if she cannot anticipate the contents of ...


Can Restitution Save Fragile Spiderless Networks?, Ariel Porat, Robert E. Scott Jan 2018

Can Restitution Save Fragile Spiderless Networks?, Ariel Porat, Robert E. Scott

Faculty Scholarship

This Article examines the dramatic increase in business networks in recent decades and considers whether the law can play a useful role in supporting the efficient functioning of these inter-firm relationships for coordination and cooperation. Repeat play, reputational sanctions, and norms of trust and reciprocity are the common explanations for the flourishing of networks in many industries and places. But the evidence also shows that a certain class of networks often fails to survive or function effectively and beneficial cooperation among these network members is impaired. These fragile networks develop organically without a controlling party or hierarchy at the center ...


Fiscal Pressures And Discriminatory Policing: Evidence From Traffic Stops In Missouri, Allison P. Harris, Elliott Ash, Jeffrey A. Fagan Jan 2018

Fiscal Pressures And Discriminatory Policing: Evidence From Traffic Stops In Missouri, Allison P. Harris, Elliott Ash, Jeffrey A. Fagan

Faculty Scholarship

This paper provides evidence of racial variation in local governments' traffic enforcement responses to budget stress using data from policing agencies in the state of Missouri for the years 2001 through 2012. Like previous studies, we find that local budget stress is associated with higher citation rates. In addition, we find that there is an increase in traffic-stop arrests. However, we find that these effects are concentrated among white (rather than black or Hispanic) drivers. The results are robust to the inclusion of a range of covariates for traffic stops and to the inclusion of local population features interacted with ...


Trade Openness And Antitrust Law, Anu Bradford, Adam S. Chilton Jan 2018

Trade Openness And Antitrust Law, Anu Bradford, Adam S. Chilton

Faculty Scholarship

Openness to international trade and adoption of antitrust laws can both curb anti-competitive behavior. But scholars have long debated the relationship between the two. Some argue that greater trade openness makes antitrust unnecessary, while others contend that antitrust laws are still needed to realize the benefits of trade liberalization. Data limitations have made this debate largely theoretical to date. We study the relationship between trade and antitrust empirically using new data on antitrust laws and enforcement activities. We find that trade openness and stringency of antitrust laws are positively correlated from 1950 to 2010 overall, but the positive correlation disappears ...


Economic Individualism And Preference Formation, Andrzej Rapaczynski Jan 2018

Economic Individualism And Preference Formation, Andrzej Rapaczynski

Faculty Scholarship

This note examines some issues involved in an attempt to go beyond the assumption, long-made by most economists, that people’s preferences are simply to be treated as “given” and that the principle of consumer sovereignty entails a refusal to consider some (or some people’s) revealed preferences as more authoritative than others. The most important break with that assumption has been the development of behavioral economics, which shows that people may not always know what they really want, and that economists have to develop a more critical approach, distinguishing people’s true preferences from those that are merely apparent ...


Identity And Social Bonds, Joseph Raz Jan 2018

Identity And Social Bonds, Joseph Raz

Faculty Scholarship

I first argue that there is no problem about how to justify partialities (though there is a difficulty in justifying impartialities). Then I consider the role of consent in justifying rights and duties, using voluntary associations as a case in which consent has an important but limited role in doing so, a role determined and circumscribed by evaluative considerations. The values explain why consent can bind and bind one to act as one does not wish to do and even as one judges to be ill advised. That opens the way to an explanation of how value considerations relate to ...


The Law's Own Virtue, Joseph Raz Jan 2018

The Law's Own Virtue, Joseph Raz

Faculty Scholarship

The paper offers a new account of the rule of law, revising my previous view, and criticising some alternatives. It focuses on the rule of law's aim to avoid arbitrary government, and on its relation to the essential functions of government. The rule of law requires that government action will manifest an intention to protect and advance the interests of the governed. As such it is almost a necessary condition for the law's ability to meet other moral demands, and it facilitate coordination and cooperation internally and internationally.


Dissenting Opinions In The Wto Appellate Body: Drivers Of Their Issuance & Implications For The Institutional Jurisprudence, Petros C. Mavroidis, Evan Y. Kim Jan 2018

Dissenting Opinions In The Wto Appellate Body: Drivers Of Their Issuance & Implications For The Institutional Jurisprudence, Petros C. Mavroidis, Evan Y. Kim

Faculty Scholarship

The Appellate Body (AB) of the WTO has issued over 140 reports but only eight separate opinions, four of which are genuinely dissenting. Such paucity, in fact, is the WTO’s implicit tradition inherited from GATT of prioritizing unanimous decisions, hoping they solidify the institution’s legitimacy and countries’ confidence in the system. But at the more individual level, an AB member’s decision to dissent is driven by multiple factors that have implications for the institution’s jurisprudence. First, the factors explain how the symbiotic relationship between an AB member and his or her nominating country – whose interests turn ...


Guarantor Of Last Resort, Kathryn Judge Jan 2018

Guarantor Of Last Resort, Kathryn Judge

Faculty Scholarship

The optimal response to a financial crisis entails addressing two, often conflicting, demands: stopping the panic and starting the clock. When short-term depositors flee, banks can be forced to sell assets at fire-sale prices, causing credit to contract and real economic activity to decline. To reduce these adverse spillover effects, policymakers routinely intervene to stop systemic runs. All too often, however, policymakers deploy stopgap measures that allow the underlying problems to fester. To promote long-term economic health, they must also ferret out the underlying problems and allocate the losses that cannot be avoided. A well-designed guarantor of last resort can ...


Hidden Holdouts: Contract Arbitrageurs And The Pricing Of Collective Rights, Robert E. Scott, G. Mitu Gulati, Stephen J. Choi Jan 2018

Hidden Holdouts: Contract Arbitrageurs And The Pricing Of Collective Rights, Robert E. Scott, G. Mitu Gulati, Stephen J. Choi

Faculty Scholarship

Research on the law and economics of contract typically analyzes the explicit pricing of the contract terms in a debt contract by modeling a bilateral debtor-creditor relationship, a framework we call the “classical model.” Under this model, contract terms that affect the debtor’s repayment obligations are reflected in the price the debtor pays. Much of commercial lending, however, occurs in thick markets with standardized multilateral debt instruments. Depending on the degree to which key contract terms implicate collective decision making among dispersed and anonymous creditors, the classical bilateral model of debt contracting can err in its predictions on the ...


Economic Democracy And Enterprise Form In Finance, William H. Simon Jan 2018

Economic Democracy And Enterprise Form In Finance, William H. Simon

Faculty Scholarship

This comment – a contribution to a project on “democratizing finance” – considers the relative advantages of alternative enterprise forms from the point of view of public accountability. It compares the business corporation to the state agency or authority, the cooperative, the state corporation, and the charitable nonprofit. These forms can be distinguished in terms of whether they aspire to enhance general electoral democracy or stakeholder democracy and in terms of whether their democratic controls operate directly or indirectly. I suggest that the more indirect democratic forms may be more promising than the more direct ones. I also argue that the project ...


Separation Of Powers In Comparative Perspective: How Much Protection For The Rule Of Law?, Peter L. Strauss Jan 2018

Separation Of Powers In Comparative Perspective: How Much Protection For The Rule Of Law?, Peter L. Strauss

Faculty Scholarship

Writing about separation of powers with particular attention to the contrasting American and British views at the time of Trump and Brexit has been challenging and illuminating. The essay takes as its third framework the constrained parliamentarianism Prof. Bruce Ackerman celebrated in his essay, The New Separation of Powers, 113 Harv. L. Rev. 633 (2000), and briefly considers its relative success in Australia, France, and Germany, and failure in Hungary and Poland, in achieving “separation of powers” universally understood ends, the prevention of autocracy and preservation of human freedoms. That courts and judges would not be political actors, that governments ...


Eroding "Checks" On Presidential Authority – Norms, The Civil Service, And The Courts, Peter L. Strauss Jan 2018

Eroding "Checks" On Presidential Authority – Norms, The Civil Service, And The Courts, Peter L. Strauss

Faculty Scholarship

Shortly after the November elections returned control of the House of Representatives to Democrat control, twenty-one scholars of administrative law met at the Chicago-Kent College of Law to hear and discuss seven papers on the general subject of President Trump and administrative law. A number have already been posted to SSRN. This paper is a commentary on Susan Rose-Ackerman’s essay “Executive Rulemaking and Democratic Legitimacy: ‘Reform’ in the US and the UK’s Route to Brexit” which insightfully illuminates important differences between parliamentary and presidential systems of government in relation to executive bodies’ production of the large volume of ...


A Softer, Simpler View Of Chevron, Peter L. Strauss Jan 2018

A Softer, Simpler View Of Chevron, Peter L. Strauss

Faculty Scholarship

Justice Kennedy's concurrence in Pereira gives reason to hope that the Court may be finally catching on to the difficulties it created by Chevron's opening language, as distinct from its inherent reasoning. When courts quote language like "precise question" and "permissible" to limit themselves (as Justice Scalia and others unfortunately tended to reinforce by their quotations from the opinion), they stray not only from judicial function but also from the statute (APA) that instructs them how to review, and which strangely the opinion does not mention. But Chevron actually (a) independently found and defined a statutory gap within ...


Preemption And Commandeering Without Congress, Jessica Bulman-Pozen Jan 2018

Preemption And Commandeering Without Congress, Jessica Bulman-Pozen

Faculty Scholarship

In the “age of polarization” this Symposium addresses, states may introduce salutary pluralism into an executive-dominated regime. With partisan divisions sidelining Congress, states are at once principal implementers and principal opponents of presidential policies. As polarization makes states more central to national policymaking, however, it also poses new threats to their ability to act. This Essay cautions against recent efforts to preempt state control over state officials and to require states to follow other states’ policies, using sanctuary jurisdictions and the pending federal Concealed Carry Reciprocity Act as examples


Aggressive Policing And The Educational Performance Of Minority Youth, Joscha Legewie, Jeffrey A. Fagan Jan 2018

Aggressive Policing And The Educational Performance Of Minority Youth, Joscha Legewie, Jeffrey A. Fagan

Faculty Scholarship

An increasing number of minority youth are confronted with the criminal justice system. But how does the expansion of police presence in poor urban communities affect educational outcomes? Previous research points at multiple mechanisms with opposing effects. This article presents the first causal evidence of the impact of aggressive policing on the educational performance of minority youth. Under Operation Impact, the New York Police Department (NYPD) saturated high crime areas with additional police officers with the mission to engage in aggressive, order maintenance policing. To estimate the effect, we use administrative data from about 250,000 adolescents aged 9 to ...


The Middleman’S Damages Revisited, Victor P. Goldberg Jan 2018

The Middleman’S Damages Revisited, Victor P. Goldberg

Faculty Scholarship

If A promises to sell to B who, in turn, promises to sell to C and either A or C breaches should B receive the gain it expected had both transactions occurred (lost profits) or the larger market/contract differential? Recent case law and commentary argues for the lost profit remedy. The argument is that there is a conflict between awarding market damages and making the nonbreacher whole. This paper argues that there is no conflict. If B were a broker, and C breached, then A would have an action against C for market damages. If B were party to ...


The Lost Volume Seller In English Law, Victor P. Goldberg Jan 2018

The Lost Volume Seller In English Law, Victor P. Goldberg

Faculty Scholarship

If a buyer breaches a contract but the market price has remained unchanged, English courts and the treatises have treated the seller as a “lost volume seller.” The seller, it is argued, could have had two sales, not one, so it lost the profit on the second sale. This paper recognizes that the buyer has an option to terminate and that the contract prices that option. The implicit option price of the lost volume remedy results in an absurd contract, setting the option price high when it should be low and vice versa. The default rule ought to be the ...


Why Autonomy Must Be Contract's Ultimate Value, Hanoch Dagan, Michael A. Heller Jan 2018

Why Autonomy Must Be Contract's Ultimate Value, Hanoch Dagan, Michael A. Heller

Faculty Scholarship

In “The Choice Theory of Contracts”, we develop a liberal theory of contract law. One core task of the book was to persuade advocates of economic analysis that they must situate their enterprise within our liberal framework. Autonomy, rightly understood, is the telos of contract.

Oren Bar-Gill pushes back strongly in “Choice Theory and the Economic Analysis of Contracts”. He offers a penetrating – perhaps devastating – critique of our approach. Bar-Gill notes the substantial convergence between choice theory and a welfarist view. If he is right, then what does choice theory add?

Our task in Part I of this Essay is ...


Autonomy For Contract, Refined, Hanoch Dagan, Michael A. Heller Jan 2018

Autonomy For Contract, Refined, Hanoch Dagan, Michael A. Heller

Faculty Scholarship

In The Choice Theory of Contracts, we advance a claim about the centrality of autonomy to contract. This Issue offers thoughtful and penetrating critiques. Here, we reply. Autonomy is the grounding principle of contract. In Choice Theory, we stressed the (1) proactive facilitation component of autonomy, in particular, the state’s obligation regarding contract types. Here, we highlight two additional, necessary implications of autonomy for contract: (2) regard for future selves and (3) relational justice. These three aspects of autonomy shape the range, limit, and floor, respectively, for the legitimate use of contract. They provide a principled and constrained path ...


Critique & Praxis: A Pure Theory Of Illusions, Values, And Tactics, And An Answer To The Question: "What Is To Be Done?", Bernard E. Harcourt Jan 2018

Critique & Praxis: A Pure Theory Of Illusions, Values, And Tactics, And An Answer To The Question: "What Is To Be Done?", Bernard E. Harcourt

Faculty Scholarship

We are going through an unprecedented period of political instability. With the rise of the alt-right and of xenophobic sentiment, and the fallout of neoliberal government policies, our political future is at stake. These times call for the type of critical theory and praxis that gave rise to the Frankfurt School in the 1920s and to the critical ferment of the 1970s. Yet, in the face of our crises today, contemporary critical theory seems disarmed.

Critical theory is in disarray because of a wave of anti-foundational challenges in the 1960s that shattered the epistemological foundations of the Frankfurt School. The ...


The Keys To The Kingdom: Judges, Pre-Hearing Procedure, And Access To Justice, Colleen F. Shanahan Jan 2018

The Keys To The Kingdom: Judges, Pre-Hearing Procedure, And Access To Justice, Colleen F. Shanahan

Faculty Scholarship

Judges see themselves as – and many reforming voices urge them to be – facilitators of access to justice for pro se parties in our state civil and administrative courts. Judges’ roles in pro se access to justice are inextricably linked with procedures and substantive law, yet our understanding of this relationship is limited. Do we change the rules, judicial behavior, or both to help self-represented parties? We have begun to examine this nuanced question in the courtroom, but we have not examined it in a potentially more promising context: pre-hearing motions made outside the courtroom. Outside the courtroom, judges rule on ...


Things Have Changed (Or Have They?): Tariff Protection And Environmental Concerns In The Wto, Petros C. Mavroidis, Damien J. Neven Jan 2018

Things Have Changed (Or Have They?): Tariff Protection And Environmental Concerns In The Wto, Petros C. Mavroidis, Damien J. Neven

Faculty Scholarship

This paper considers the APEC and proposed EGA agreements which grant tariff concession in favor of "green" goods. We find that the practical significance of the APEC agreement should not be overestimated as it involves modest tariff concessions over a subset of goods which are not heavily traded. Still, these agreements involve a paradigm shift to the extent that they use tariffs concessions negotiated on a plurilateral basis as a policy instrument to meet public policy concern, instead of making market access conditional on meeting national regulations. We model the mechanism through which these tariff preferences provide incentives to change ...