Law Commons^™

Litigation Discovery Cannot Be Optimal But Could Be Better: The Economics Of Improving Discovery Timing In A Digital Age, Scott A. Moss

Publications

Cases are won and lost in discovery, yet discovery draws little academic attention. Most scholarship focuses on how much discovery to allow, not on how courts decide discovery disputes--which, unlike trials, occur in most cases. The growth of computer data--e-mails, lingering deleted files, and so forth--increased discovery cost, but the new e-discovery rules just reiterate existing cost-benefit proportionality limits that draw broad consensus among litigation scholars and economists. But proportionality rules are impossible to apply effectively; they fail to curb discovery excess yet disallow discovery that meritorious cases need. This Article notes proportionality's flaws but rejects the consensus blaming bad …

How The New Economics Can Improve Employment Discrimination Law, And How Economics Can Survive The Demise Of The Rational Actor, Scott A. Moss, Peter H. Huang

Publications

Much employment discrimination law is premised on a purely money-focused "reasonable" employee, the sort who can be made whole with damages equal to lost wages, and who does not hesitate to challenge workplace discrimination. This type of "rational" actor populated older economic models but has been since modified by behavioral economics and research on happiness. Behavioral and traditional economists alike have analyzed broad employment policies, such as the wisdom of discrimination statutes, but the devil is in the details of employment law. On the critical damages-and-liability issues the Supreme Court and litigators face regularly, the law essentially ignores the lessons …

Code, Crash, And Open Source: The Outsourcing Of Financial Regulation To Risk Models And The Global Financial Crisis, Erik F. Gerding

Publications

The widespread use of computer-based risk models in the financial industry during the last two decades enabled the marketing of more complex financial products to consumers, the growth of securitization and derivatives, and the development of sophisticated risk-management strategies by financial institutions. Over this same period, regulators increasingly delegated or outsourced vast responsibility for regulating risk in both consumer finance and financial markets to these privately owned industry models. Proprietary risk models of financial institutions thus came to serve as a "new financial code" that regulated transfers of risk among consumers, financial institutions, and investors.

The spectacular failure of financial-industry …

The Subprime Crisis And The Link Between Consumer Financial Protection And Systemic Risk, Erik F. Gerding

Publications

This Article argues that the current global financial crisis, which was first called the “subprime crisis,” demonstrates the need to revisit the division between financial regulations designed to protect consumers from excessively risky loans and safety-and-soundness regulations intended to protect financial markets from the collapse of financial institutions. Consumer financial protection can, and must, serve a role not only in protecting individuals from excessive risk, but also in protecting markets from systemic risk. Economic studies indicate it is not merely high rates of defaults on consumer loans, but also unpredictable and highly correlated defaults that create risks for both lenders …