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Series

SSRN

Columbia Law School

Law and Economics

1997

Articles 1 - 6 of 6

Full-Text Articles in Law

Searching For Negotiability In Payment And Credit Systems, Ronald J. Mann Jan 1997

Searching For Negotiability In Payment And Credit Systems, Ronald J. Mann

Faculty Scholarship

Although academics spend a great deal of time analyzing the fine details of the rules that govern negotiable instruments, they have spent little or no time attempting to ascertain whether those rules play a significant role in the modern economy. This article takes up that question from an empirical perspective, presenting evidence from more than a dozen interviews with professionals in a variety of different financial markets, a survey of actual documents used in various financial transactions, site visits to a number of financial institutions, and a survey of published judicial decisions in the checking area.??Relying on that evidence ...


Standard Form Contracts, Avery W. Katz Jan 1997

Standard Form Contracts, Avery W. Katz

Faculty Scholarship

Among legal commentators, standard form contracts have long been received with distrust, and the rules governing their interpretation have engendered considerable controversy. While economic analysis has little to say regarding the libertarian objection to standard form contracts or their relationship to personal autonomy, it can help evaluate their effects on efficiency and the distribution of the gains from trade. From such a perspective, standard forms should be analyzed like any other productive input, comparable to design, marketing, and technical support. Whether their use raises any special regulatory or policy concerns, therefore, depends on their implications for the standard litany of ...


Private Ownership And Corporate Performance: Some Lessons From Transition Economies, Roman Frydman, Cheryl W. Gray, Marek P. Hessel, Andrzej Rapaczynski Jan 1997

Private Ownership And Corporate Performance: Some Lessons From Transition Economies, Roman Frydman, Cheryl W. Gray, Marek P. Hessel, Andrzej Rapaczynski

Faculty Scholarship

Data on mid-sized firms in three transition economies provide strong evidence that private ownership – for worker ownership – improves corporate performance. And the privatized firms' superior ability to generate revenues allows those firms to sustain or expand employment.

Using a large sample of data on mid-sized firms in the Czech Republic, Hungary, and Poland, Frydman, Gray, Hessel, and Rapacynski compare the performance of privatized and state firms in the environment of the postcommunist transition.

They find strong evidence that private ownership – for worker ownership – improves corporate performance. They find no evidence of the privatization shock that was supposed to afflict the ...


Contract Formation And Interpretation, Avery W. Katz Jan 1997

Contract Formation And Interpretation, Avery W. Katz

Faculty Scholarship

Much research in law and economics, following Coase's insight that the effects of a legal rule depend on the ability of those whom it governs to bargain around it, has undertaken to explain how substantive entitlements such as property rights influence the bargaining process. Perhaps more important than any substantive rights or duties in this regard, however, is the extensive body of contract doctrine that governs the procedural mechanics of exchange. The formal rules of contract formation, by attaching consequences to the various acts and omissions that bargainers can choose from in a negotiation, affect the parties' incentives to ...


An Economic Analysis Of The Guaranty Contract, Avery W. Katz Jan 1997

An Economic Analysis Of The Guaranty Contract, Avery W. Katz

Faculty Scholarship

Guaranty arrangements, in which one person stands as surety for a second person's obligation to a third, are ubiquitous in commercial transactions and in commercial law. In recent years, however, scholarly attention to the topic has been scant; and there is still no theoretical treatment of this body of law or practice from a economic policy perspective. This paper, accordingly, attempts to outline the basic economic logic underlying the guaranty relationship, and applies the results to a variety of specific issues in government policy and private planning. It poses and answers three main questions: First, why would a creditor ...


Indemnity Of Legal Fees, Avery W. Katz Jan 1997

Indemnity Of Legal Fees, Avery W. Katz

Faculty Scholarship

This article surveys the effects of legal fee shifting on a variety of decisions arising before and during the litigation process. Section 2 provides a brief survey of the practical situations in which legal fee shifting does and does not arise. Section 3 analyzes the effects of indemnification on the incentives to expend resources in litigated cases. Section 4 examines how indemnification influences the decisions to bring and to defend against suit, and Section 5 assesses its effects on the choice between settlement and trial. Section 6 addresses the interaction between the allocation of legal fees and the parties' incentives ...