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Full-Text Articles in Law
The Many Faces Of Fault In Contract Law: Or How To Do Economics Right, Richard A. Epstein
The Many Faces Of Fault In Contract Law: Or How To Do Economics Right, Richard A. Epstein
Coase-Sandor Working Paper Series in Law and Economics
Modern law often rests on the assumption that a uniform cost/benefit formula is the proper way to determine fault in ordinary contract disputes. This Article disputes that vision by defending the view that different standards of fault are appropriate in different contexts. The central distinction is one that holds parties in gratuitous transactions only to the standard of care that they bring to their own affairs, while insisting on the higher objective standard of ordinary care in commercial transactions. That bifurcation leads to efficient searches. Persons who hold themselves out in particular lines of business in effect warrant their ability …
Overreaction To Fearsome Risks, Cass R. Sunstein, Richard Zeckhauser
Overreaction To Fearsome Risks, Cass R. Sunstein, Richard Zeckhauser
Coase-Sandor Working Paper Series in Law and Economics
Fearsome risks are those that stimulate strong emotional responses. Such risks, which usually involve high consequences, tend to have low probabilities, since life today is no longer nasty, brutish and short. In the face of a low-probability fearsome risk, people often exaggerate the benefits of preventive, risk-reducing, or ameliorative measures. In both personal life and politics, the result is damaging overreactions to risks. We offer evidence for the phenomenon of probability neglect, failing to distinguish between high and low-probability risks. Action bias is a likely result.
Adjusting Alienabillity, Lee Anne Fennell
Adjusting Alienabillity, Lee Anne Fennell
Coase-Sandor Working Paper Series in Law and Economics
No abstract provided.
Behavioral Criminal Law And Economics, Richard H. Mcadams, Thomas S. Ulen
Behavioral Criminal Law And Economics, Richard H. Mcadams, Thomas S. Ulen
Coase-Sandor Working Paper Series in Law and Economics
A behavioral economics literature identifies how behaviorally-derived assumptions affect the economic analysis of criminal law and public law enforcement. We review and extend that literature. Specifically, we consider the effect of cognitive biases, prospect theory, hedonic adaptation, hyperbolic discounting, fairness preferences, and other deviations from standard economic assumptions on the optimal rules for deterring potential offenders and for regulating (or motivating) potential crime victims, legislators, police, prosecutors, judges, and juries.
Crisis Governance In The Administrative State: 9/11 And The Financial Meltdown Of 2008, Eric A. Posner, Adrian Vermeule
Crisis Governance In The Administrative State: 9/11 And The Financial Meltdown Of 2008, Eric A. Posner, Adrian Vermeule
Coase-Sandor Working Paper Series in Law and Economics
No abstract provided.
Guarding The Guardians: Judicial Councils And Judicial Independence, Nuno Garoupa, Tom Ginsburg
Guarding The Guardians: Judicial Councils And Judicial Independence, Nuno Garoupa, Tom Ginsburg
Coase-Sandor Working Paper Series in Law and Economics
This Article uses comparative evidence to inform the ongoing debate about the selection and discipline of judges. In recent decades, many countries around the world have created judicial councils, institutions designed to maintain an appropriate balance between judicial independence and accountability. Our Article has two aims. First, we provide a theory of the formation of judicial councils and identify some of the dimensions along which they differ. Second, we test the extent to which different designs of judicial council affect judicial quality. We find that there is little relationship between councils and quality. We also offer a positive explanation for …
Judging National Security Post-9/11: An Empirical Investigation, Cass R. Sunstein
Judging National Security Post-9/11: An Empirical Investigation, Cass R. Sunstein
Coase-Sandor Working Paper Series in Law and Economics
Many people believe that when national security is threatened, federal courts should defer to the government. Many other people believe that in times of crisis, citizens are vulnerable to a kind of "panic" that leads to unjustified intrusions on liberty. But to date, there is little information about what federal courts have actually done in this domain, especially in the period after the attacks of September 11, 2001. On the basis of a comprehensive study of relevant courts of appeals decisions in the aftermath of those attacks, this essay offers four findings. First, the invalidation rate is about 15 percent …
The Impotence Of Delaware's Taxes: A Short Response To Professor Barzuza's Delaware's Compentation, M. Todd Henderson
The Impotence Of Delaware's Taxes: A Short Response To Professor Barzuza's Delaware's Compentation, M. Todd Henderson
Coase-Sandor Working Paper Series in Law and Economics
No abstract provided.
A Comparative Fault Defense In Contract Law, Ariel Porat
A Comparative Fault Defense In Contract Law, Ariel Porat
Coase-Sandor Working Paper Series in Law and Economics
This Article calls for the recognition of a comparative fault defense in contract law. Part I sets the framework for this defense and suggests the situations in which it should apply. These situations are sorted under two headings: cases of non-cooperation and overreliance. Part II unfolds the main argument for recognizing the defense. It recommends applying the defense only in cases where cooperation or avoidance of over-reliance is low-cost.
Belief In A Just World, Blaming The Victim, And Hate Crime Statutes, Dhammika Dharmapala, Nuno Garoupa, Richard H. Mcadams
Belief In A Just World, Blaming The Victim, And Hate Crime Statutes, Dhammika Dharmapala, Nuno Garoupa, Richard H. Mcadams
Coase-Sandor Working Paper Series in Law and Economics
The earliest economic theory of discrimination proposed the subsequently neglected idea of a "vicious circle" of discrimination (Myrdal, 1944). We draw on psychological evidence (that people derive utility from believing that the world is just) to propose a behavioral economic model in which the vicious circle envisaged by Myrdal can arise. We demonstrate the power of this approach through an application to the issue of whether and how to justify penalty enhancements for hate crimes against members of disfavored groups. The crucial assumption is that individuals engage in biased inference in order to preserve their Belief in a Just World, …
Beyond The Prisoner's Dilemma: Coordination, Game Theory And The Law, Richard H. Mcadams
Beyond The Prisoner's Dilemma: Coordination, Game Theory And The Law, Richard H. Mcadams
Coase-Sandor Working Paper Series in Law and Economics
No abstract provided.
Liability For Lapses: First Or Second Order Negligence?, Robert D. Cooter, Ariel Porat
Liability For Lapses: First Or Second Order Negligence?, Robert D. Cooter, Ariel Porat
Coase-Sandor Working Paper Series in Law and Economics
"First order precaution" directly affects the probability of an accident, such as judging the speed of a car and stepping on the brakes. Intentions are not always realized, so first order precaution is a draw from a probability distribution. Drawing an uncharacteristically low value is a "lapse." "Second order precaution" reduces the probability of a lapse. Examples include concentration when driving and preparation before performing a medical operation. The prevailing tort rule holds the injurer liable for harm caused by unreasonable first order precaution, regardless of second order precaution. Unlike the standard model, our model allows injurers to make second …
Testing The Over- And Under-Exploitation Hypothesis: Bestselling Musical Compositions (1913-32) And Their Use In Cinema (1968-2007), Paul J. Heald
Testing The Over- And Under-Exploitation Hypothesis: Bestselling Musical Compositions (1913-32) And Their Use In Cinema (1968-2007), Paul J. Heald
Coase-Sandor Working Paper Series in Law and Economics
Some economists assert that as valuable works transition from copyrighted status and fall into the public domain they will be underexploited and their value dissipated. Others insist instead that without an owner to control their use, valuable public domain works will be overexploited or otherwise debased. This study of the most valuable musical compositions from 1913-32 demonstrates that neither hypothesis is true as it applies to the exploitation of songs in movies from 1968-2007. When compositions fall into the public domain, they are just as likely to be exploited in movies, suggesting no under-exploitation. And the rate of exploitation of …
Abolition In The U.S.A. By 2050: On Political Capital And Ordinary Acts Of Resistance, Bernard E. Harcourt
Abolition In The U.S.A. By 2050: On Political Capital And Ordinary Acts Of Resistance, Bernard E. Harcourt
Coase-Sandor Working Paper Series in Law and Economics
The United States, like the larger international community, likely will tend toward greater abolition of the death penalty during the first half of the twenty-first century. A handful of individual states—states that have historically carried out few or no executions—probably will abolish capital punishment over the next twenty years, which will create political momentum and ultimately a federal constitutional ban on capital punishment in the United States. It is entirely reasonable to expect that, by the mid-twenty-first century, capital punishment will have the same status internationally as torture: an outlier practice, prohibited by international agreements and customary international law, practiced …
Beyond Judicial Minimalism, Cass R. Sunstein
Beyond Judicial Minimalism, Cass R. Sunstein
Coase-Sandor Working Paper Series in Law and Economics
Many judges are minimalists. They favor rulings that are narrow, in the sense that they govern only the circumstances of the particular case, and also shallow, in the sense that they do not accept a deep theory of the legal provision at issue. In law, narrow and shallow decisions have real advantages insofar as they reduce both decision costs and error costs; make space for democratic engagement on fundamental questions; and reflect a norm of civic respect. In many cases, however, minimalism is hard to justify in these ways. Sometimes small steps increase the aggregate costs of decisions; sometimes they …
Introduction To ‘The Going Private Phenomenon: Causes And Implications’, M. Todd Henderson, Richard A. Epstein
Introduction To ‘The Going Private Phenomenon: Causes And Implications’, M. Todd Henderson, Richard A. Epstein
Coase-Sandor Working Paper Series in Law and Economics
No abstract provided.
Neoliberal Penality: The Birth Of Natural Order, The Illusion Of Free Markets, Bernard E. Harcourt
Neoliberal Penality: The Birth Of Natural Order, The Illusion Of Free Markets, Bernard E. Harcourt
Coase-Sandor Working Paper Series in Law and Economics
The major function of criminal law in a capitalist society is to prevent people from bypassing the system of voluntary, compensated exchange—the "market," explicit or implicit—in situations where, because transaction costs are low, the market is a more efficient method of allocating resources than forced exchange… When transaction costs are low, the market is, virtually by definition, the most efficient method of allocating resources. Attempts to bypass the market will therefore be discouraged by a legal system bent on promoting efficiency.
Optimal Remedies For Patent Infringement: A Transactional Model, Paul J. Heald
Optimal Remedies For Patent Infringement: A Transactional Model, Paul J. Heald
Coase-Sandor Working Paper Series in Law and Economics
In a world of zero transaction costs, one should observe optimal invention and innovation. As long as a system of enforceable contracts were in place, firms with inventive capacity and firms requiring inventions would negotiate for the optimal production of new creations. With adequate information, an observer could accurately predict which transactions would occur between firms and which transactions would not, thereby permitting description of the conditions for optimal inventiveness. Patent remedies in a world with transactions costs can be calibrated so that real firms behave as ideal firms, providing incentives for real world transactions to mimic those in a …
Privatizing Trademarks, Irina Manta
Privatizing Trademarks, Irina Manta
Coase-Sandor Working Paper Series in Law and Economics
While trademarks are designed to promote a competitive and productive marketplace, the current system of trademark registration is run by the Patent & Trademark Office as a monopoly of questionable productivity. The average time that it takes for the Patent & Trademark Office to process a trademark application is fifteen months, and even registrations that do not encounter legal issues can require a year. As a result, trademark applicants risk investing substantial sums of money into a mark to discover much later that the Patent & Trademark Office will not register it. This Article considers a possible solution - a …
The Disintegration Of Intellectual Property, Richard A. Epstein
The Disintegration Of Intellectual Property, Richard A. Epstein
Coase-Sandor Working Paper Series in Law and Economics
This Article plays off the title of Thomas Grey's well-known article, The Disintegration of Property, which argued in part that the ceaseless consensual fragmentation and recombination of property rights revealed some inner incoherence of the underlying private property institutions. I take the opposite position and treat this supposed disintegration of private property as evidence of its robust nature, not only for land but for all forms of intellectual property. Low transaction costs facilitate the creation of efficient regimes of property rights. I use this framework to critique modern intellectual property rights cases that limit the use of injunctive relief in …
Trimming, Cass R. Sunstein
Trimming, Cass R. Sunstein
Coase-Sandor Working Paper Series in Law and Economics
In law and politics, some people are trimmers. They attempt to steer between the poles. Trimming might be defended as a heuristic for what is right, as a means of reducing political conflict over especially controversial questions, or as a method of ensuring that people who hold competing positions are not humiliated, excluded, or hurt. There are two kinds of trimmers: compromisers, who follow a kind of “trimming heuristic” and thus conclude that the middle course is best; and preservers, who attempt to preserve what is deepest in and most essential to competing reasonable positions, which they are willing to …
Which States Enter Into Treaties, And Why?, Thomas J. Miles, Eric A. Posner
Which States Enter Into Treaties, And Why?, Thomas J. Miles, Eric A. Posner
Coase-Sandor Working Paper Series in Law and Economics
Treaties are the primary source of international law. But little is known about which countries enter into treaties, which forms the treaties take, and which subjects they address. We present an exploratory analysis of a unique dataset of roughly 50,000 treaties ratified since 1946. We hypothesize that states enter treaties in order to obtain public goods but that the transaction costs of negotiating and enforcing treaties also limit the value of treaties. Simple predictions are that larger and richer states should benefit more from cooperation: therefore, they should be parties to more treaties. Older, less corrupt, and (again) larger states …
A Nation Divided: Eastern China, Western China, And The Problem Of Global Warming, Jonathan Masur, Daniel Abebe
A Nation Divided: Eastern China, Western China, And The Problem Of Global Warming, Jonathan Masur, Daniel Abebe
Coase-Sandor Working Paper Series in Law and Economics
No abstract provided.
Erga Omnes Norms, Institutionalization, And Constitutionalism In International Law, Eric A. Posner
Erga Omnes Norms, Institutionalization, And Constitutionalism In International Law, Eric A. Posner
Coase-Sandor Working Paper Series in Law and Economics
Erga omnes norms are those that give third-party states, rather than just the victim, legal claims against states that violate them. This paper argues that ordinary two-party norms arise when states recognize that a norm violation injures only one state and that other states that seek to retaliate on that state's behalf are likely using the violation as a pretext for predatory behavior. Erga omnes norms arise when states recognize that a norm violation injures multiple states and that states have an incentive to free ride rather than retaliate against the violator. Erga omnes norms reduce the incentive to free …
Happiness And Punishment, John Bronsteen, Christopher Buccafusco, Jonathan Masur
Happiness And Punishment, John Bronsteen, Christopher Buccafusco, Jonathan Masur
Coase-Sandor Working Paper Series in Law and Economics
No abstract provided.
Judicial Ideology And The Transformation Of Voting Rights Jurisprudence, Thomas J. Miles, Adam B. Cox
Judicial Ideology And The Transformation Of Voting Rights Jurisprudence, Thomas J. Miles, Adam B. Cox
Coase-Sandor Working Paper Series in Law and Economics
For two decades, the doctrinal test laid out in Thornburg v Gingles has been the centerpiece of vote dilution litigation in the United States. Gingles defined a sequential, two-part framework combining a set of rule-like preconditions to liability with a standard-like inquiry into the totality of the circumstances. Despite this elaborate framework, emerging empirical work shows that political ideology connects closely with how judges have decided vote dilution cases; Democratic appointees have proven much more likely than Republican appointees to favor liability under Section 2 of the Voting Rights Act. This work raises the question of what role the Gingles …
One Hat Too Many? Investment Desegregation In Private Equity, M. Todd Henderson, William A. Birdthistle
One Hat Too Many? Investment Desegregation In Private Equity, M. Todd Henderson, William A. Birdthistle
Coase-Sandor Working Paper Series in Law and Economics
No abstract provided.
Second Amendment Minimalism: Heller As Griswold, Cass R. Sunstein
Second Amendment Minimalism: Heller As Griswold, Cass R. Sunstein
Coase-Sandor Working Paper Series in Law and Economics
The Court's decision in District of Columbia v. Heller might be taken in three different ways. First, it might be seen as a modern version of Marbury v. Madison, speaking neutrally for the text, structure, and original understanding of the Constitution. Second, it might be seen as analogous to Lochner v. New York, in which a majority of the Court invoked a dubious understanding of the Constitution in order to override the democratic will. Third, it might be taken as analogous to Griswold v. Connecticut, in which a majority of the Court, proceeding in minimalist fashion, used the Constitution to …
Taxes And The Success Of Non-Tax Market-Based Environmental Regulatory Regimes, Jonathan Remy Nash
Taxes And The Success Of Non-Tax Market-Based Environmental Regulatory Regimes, Jonathan Remy Nash
Coase-Sandor Working Paper Series in Law and Economics
No abstract provided.
The Myth Of The ‘Opportunity To Read’ In Contract Law, Omri Ben-Shahar
The Myth Of The ‘Opportunity To Read’ In Contract Law, Omri Ben-Shahar
Coase-Sandor Working Paper Series in Law and Economics
Standard form contracts in consumer transactions are usually not read by consumers. This "unreadness" of contracts creates opportunities for drafters to engage in unfair trade practices. Various doctrines of contracts and consumer protection law address this concern. One of the prominent solutions coming out of recent proposals for reform is to give individuals a more substantial opportunity to read the contract before manifesting assent. With the greater opportunity to read, more transactors will actually read the terms and assent to the boilerplate will be more "robust." This Essay argues that solutions that focus on providing consumers an opportunity to read …