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Full-Text Articles in Law

Duality In Contract And Tort, Tim Friehe, Joshua C. Teitelbaum Jan 2024

Duality In Contract And Tort, Tim Friehe, Joshua C. Teitelbaum

Georgetown Law Faculty Publications and Other Works

We study situations in which a single investment serves the dual role of increasing the expected value of a contract (a reliance investment) and reducing the expected harm of a post-performance accident (a care investment). We show that failing to account for the duality of the investment leads to inefficient damages for breach of contract and inefficient standards for due care in tort. Conversely, we show that accounting for the duality yields contract damage measures and tort liability rules that provide correct incentives for efficient breach and reliance in contract and for efficient care in tort.


Defeating The Empire Of Forms, David Hoffman Nov 2023

Defeating The Empire Of Forms, David Hoffman

Articles

For generations, contract scholars have waged a faint-hearted campaign against form contracts. It’s widely believed that adhesive forms are unread and chock full of terms that courts will not, or should not, enforce. Most think that the market for contract terms is broken, for both employees and consumer adherents. And yet forms are so embedded in our economy that it’s hard to imagine modern commercial life without them. Scholars thus push calibrated, careful solutions that walk a deeply rutted path. Notwithstanding hundreds of proposals calling for their retrenchment, the empire of forms has continued to advance into new areas of …


The Hidden Cost Of Contracting For Esg: A New Perspective On Private Ordering, Juliet P. Kostritsky, Jillian T. Fox, Blake Spiller Jan 2023

The Hidden Cost Of Contracting For Esg: A New Perspective On Private Ordering, Juliet P. Kostritsky, Jillian T. Fox, Blake Spiller

Faculty Publications

Currently, despite the increasing pressure on corporations to account for Environmental Social Governance (ESG) factors in their disclosures and actions, a lack of clarity on the meaning of ESG persists. ESG might be equivalent to stakeholderism, in which companies can sacrifice firm or shareholder market value to serve non-financial values. A second meaning would permit companies to pursue ESG only if it advanced the firm’s financial value. The second meaning poses no new challenges for corporate law.

This Article will address how the lack of clarity on ESG makes it difficult to assess whether a provision in a contract of …


Rationing Access, Roy Baharad, Gideon Parchomovsky Jan 2023

Rationing Access, Roy Baharad, Gideon Parchomovsky

All Faculty Scholarship

Protection of common natural resources is one of the foremost challenges facing our society. Since Garrett Hardin published his immensely influential The Tragedy of the Commons, theorists have contemplated the best way to save common-pool resources—national parks, fisheries, heritage sites, and fragile ecosystems—from overuse and extinction. These efforts have given rise to three principal methods: private ownership, community governance, and use restrictions. In this Essay, we present a different solution to the commons problem that has eluded the attention of theorists: access rationing. Access rationing measures rely not only on restrictions on the number of users but also on …


A Proposed Sec Cyber Data Disclosure Advisory Commission, Lawrence J. Trautman, Neal Newman Oct 2022

A Proposed Sec Cyber Data Disclosure Advisory Commission, Lawrence J. Trautman, Neal Newman

Faculty Scholarship

Constant cyber threats result in: intellectual property loss; data disruption; ransomware attacks; theft of valuable company intellectual property and sensitive customer information. During March 2022, The Securities and Exchange Commission (SEC) issued a proposed rule addressing Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure, which requires: 1. Current reporting about material cybersecurity incidents; 2. Periodic disclosures about a registrant’s policies and procedures to identify and manage cybersecurity risks; 3. Management’s role in implementing cybersecurity policies and procedures; 4. Board of directors’ cybersecurity expertise, if any, and its oversight of cybersecurity risk; 5. Registrants to provide updates about previously reported cybersecurity …


Nonparty Interests In Contract Law, Omri Ben-Shahar, David A. Hoffman, Cathy Hwang Feb 2022

Nonparty Interests In Contract Law, Omri Ben-Shahar, David A. Hoffman, Cathy Hwang

All Faculty Scholarship

Contract law has one overarching goal: to advance the legitimate interests of the contracting parties. For the most part, scholars, judges, and parties embrace this party primacy norm, recognizing only a few exceptions, such as mandatory rules that bar enforcement of agreements that harm others. This Article describes a distinct species of previously unnoticed contract law rules that advance nonparty interests, which it calls “nonparty defaults."

In doing so, this Article makes three contributions to the contract law literature. First, it identifies nonparty defaults as a judicial technique. It shows how courts deviate from the party primary norm with surprising …


Controlling Externalities: Ownership Structure And Cross-Firm Externalities, Dhammika Dharmapala, Vikramaditya S. Khanna Aug 2021

Controlling Externalities: Ownership Structure And Cross-Firm Externalities, Dhammika Dharmapala, Vikramaditya S. Khanna

Law & Economics Working Papers

In recent years, debates over the social purpose of corporations have taken center stage amidst rising concern about externalities (such as those associated with climate change and harmful speech) generated by firms. A key motivation is the claim that government regulation and liability regimes appear not to be functioning sufficiently well to force firms to internalize these externalities. There is thus rising interest in exploring alternative mechanisms. In particular, a rapidly growing body of scholarship argues that index funds increasingly approximate diversified “universal owners” with incentives to maximize portfolio value (and thus to internalize cross-firm externalities). However, much of this …


No Time To Waste: Embracing Sustainable Procurement To Mitigate The Accelerating Climate Crisis, Steven L. Schooner Jan 2021

No Time To Waste: Embracing Sustainable Procurement To Mitigate The Accelerating Climate Crisis, Steven L. Schooner

GW Law Faculty Publications & Other Works

Procurement professionals will increasingly be asked to play an important role in adapting to and mitigating the effects of climate change. Unfortunately, we don't have time to waste, either feeling hopeless or waiting for changes to the Federal Acquisition Regulation (FAR) and subsequent efforts to implement new regulations. The time to start progressing up the learning curve is now. We need to talk - seriously, thoughtfully - about climate change and sustainable procurement, particularly early in the acquisition planning process. We need to rethink the value proposition, particularly with regard to factoring in the social costs of continuing to rely …


What Regulators Can Learn From Global Health Governance, Cary Coglianese Jan 2021

What Regulators Can Learn From Global Health Governance, Cary Coglianese

All Faculty Scholarship

The Great Pandemic of 2020 shows how much public health around the world depends on effective global and domestic governance. Yet for too long, global health governance and domestic regulatory governance have remained largely separate fields of scholarship and practice. In her book, Global Health Justice and Governance, Jennifer Prah Ruger offers scholars and practitioners of regulatory governance an excellent opportunity to see how domestic regulation shares many of the same problems, strategies, and challenges as global health governance. These commonalities reinforce how much national and subnational regulators can learn from global health governance. Drawing on insights from Prah …


The Future Of Disclosure: Esg, Common Ownership, And Systematic Risk, John C. Coffee Jr. Jan 2021

The Future Of Disclosure: Esg, Common Ownership, And Systematic Risk, John C. Coffee Jr.

Faculty Scholarship

The U.S. securities markets have recently undergone (or are undergoing) three fundamental transitions: (1) institutionalization (with the result that institutional investors now dominate both trading and stock ownership); (2) extraordinary ownership concentration (with the consequence that the three largest U.S. institutional investors now hold 20% and vote 25% of the shares in S&P 500 companies); and (3) the introduction of ESG disclosures (which process has been driven in the U.S. by pressure from large institutional investors). In light of these transitions, how should disclosure policy change? Do institutions and retail investors have the same or different disclosure needs? Why are …


Network Effects In Action, Christopher S. Yoo Nov 2020

Network Effects In Action, Christopher S. Yoo

All Faculty Scholarship

This Chapter begins by examining and exploring the theoretical and empirical limits of the possible bases of network effects, paying particular attention to the most commonly cited framework known as Metcalfe’s Law. It continues by exploring the concept of network externalities, defined as the positive external consumption benefits that the decision to join a network creates for the other members of the network, which is more ambiguous than commonly realized. It then reviews the structural factors needed for models based on network effects to have anticompetitive effects and identifies other factors that can dissipate those effects. Finally, it identifies alternative …


An Economic Approach To Religious Exemptions, Stephanie H. Barclay Jan 2020

An Economic Approach To Religious Exemptions, Stephanie H. Barclay

Journal Articles

Externalities caused by religious exemptions have been getting the spotlight again in light a case the U.S. Supreme Court will hear this term: Fulton v. City of Philadelphia. Some argue that religious individuals should be required to internalize the costs they impose on third parties and thus should be denied the right to practice that harmful behavior. These new progressive theories about harm trade on rhetoric and normative intuitions regarding externalities and costs. But curiously, these theories also largely ignore an influential theoretical movement that has studied externalities and costs for the last fifty years: law and economics.

This Article …


‘Warming Up’ To Sustainable Procurement, Steven L. Schooner, Markus Speidel Jan 2020

‘Warming Up’ To Sustainable Procurement, Steven L. Schooner, Markus Speidel

GW Law Faculty Publications & Other Works

Procurement professionals will play a critical role in the belated but necessary effort to slow the pace of climate change. That critical, evolved role will lie in sustainable procurement, which, if effectively implemented, will dramatically alter markets and fundamentally change purchasing behaviors. To be effective, procurement professionals will need to rethink how we define our profession, assess our outcomes, and bring value to our government customers. Successfully establishing a sustainable procurement regime will require dramatic change, including, among other things, overcoming the persistent tyranny of low price, understanding and adopting lifecycle costing, considering externalities in the value proposition, and, of …


Hushing Contracts, David A. Hoffman, Erik Lampmann Jan 2019

Hushing Contracts, David A. Hoffman, Erik Lampmann

All Faculty Scholarship

The last few years have brought a renewed appreciation of the costs of nondisclosure agreements that suppress information about sexual wrongdoing. Recently passed bills in a number of states, including New York and California, has attempted to deal with such hush contracts. But such legislation is often incomplete, and many courts and commentators continue to ask if victims of harassment can sign enforceable settlements that conceal serious, potentially metastasizing, social harms. In this Article, we argue that employing the public policy doctrine, courts ought to generally refuse to enforce hush agreements, especially those created by organizations. We restate public policy …


Corporate Governance As Privately-Ordered Public Policy: A Proposal, Lynn A. Stout, Sergio Alberto Gramitto Ricci Jan 2018

Corporate Governance As Privately-Ordered Public Policy: A Proposal, Lynn A. Stout, Sergio Alberto Gramitto Ricci

Faculty Works

In this Article, we show how our society can use corporate governance shifts to address, if not entirely resolve, a number of currently pressing social and economic problems. These problems include: rising income inequality; demographic disparities in wealth and equity ownership; increasing poverty and income insecurity; a need for greater innovation and investment in solving problems like disease and climate change; the “externalization” of many costs of corporate activity onto third parties such as customers, employees, creditors, and the broader society; the corrosive influence of corporate money in politics; and discontent and loss of trust in the capitalist system among …


The Global Diffusion Of Law: Transnational Crime And The Case Of Human Trafficking, Beth A. Simmons, Paulette Lloyd, Brandon M. Steward Jan 2018

The Global Diffusion Of Law: Transnational Crime And The Case Of Human Trafficking, Beth A. Simmons, Paulette Lloyd, Brandon M. Steward

All Faculty Scholarship

The past few decades have seen the proliferation of new laws criminalizing certain transnational activities, from money laundering to corruption; from insider trading to trafficking in weapons and drugs. Human trafficking is one example. We argue criminalization of trafficking in persons has diffused in large part because of the way the issue has been framed: primarily as a problem of organized crime rather than predominantly an egregious human rights abuse. Framing human trafficking as an organized crime practice empowers states to confront cross border human movements viewed as potentially threatening. We show that the diffusion of criminalization is explained by …


Rationing Criminal Justice, Richard A. Bierschbach, Stephanos Bibas Jan 2017

Rationing Criminal Justice, Richard A. Bierschbach, Stephanos Bibas

All Faculty Scholarship

Of the many diagnoses of American criminal justice’s ills, few focus on externalities. Yet American criminal justice systematically overpunishes in large part because few mechanisms exist to force consideration of the full social costs of criminal justice interventions. Actors often lack good information or incentives to minimize the harms they impose. Part of the problem is structural: criminal justice is fragmented vertically among governments, horizontally among agencies, and individually among self-interested actors. Part is a matter of focus: doctrinally and pragmatically, actors overwhelmingly view each case as an isolated, short-term transaction to the exclusion of broader, long-term, and aggregate effects. …


In Praise Of (Some) Ex Post Regulation: A Response To Professor Galle, Kyle D. Logue Jan 2016

In Praise Of (Some) Ex Post Regulation: A Response To Professor Galle, Kyle D. Logue

Articles

According to modern law-and-economics (“L&E”) orthodoxy, the primary—maybe even the only—legitimate justification for government regulation is to correct a market failure. This conclusion is based on two key assumptions. First, when markets are functioning reasonably well, they are better at achieving efficiency than the government is. Second, most markets function reasonably well most of the time. Although there is probably evidence to support these assumptions (for example, the relative prosperity of market-based economies in comparison with the relative poverty of centrally planned economies), both assumptions are usually taken as articles of faith by mainstream L&E scholars. This is why scholarly …


Ferc’S Expansive Authority To Transform The Electric Grid, Joel B. Eisen Jan 2016

Ferc’S Expansive Authority To Transform The Electric Grid, Joel B. Eisen

Law Faculty Publications

Using an unprecedented historical analysis of over 100 years of law dating to the Progressive Era, this Article concludes that the Supreme Court’s landmark decision in Federal Energy Regulatory Commission (“FERC”) v. Electric Power Supply Association properly asserted that FERC has ample authority to pursue broad environmental and energy goals in transforming the electric grid. Building on the Court’s finding that FERC may regulate “practices” that “directly affect” rates in wholesale electricity markets, the analysis develops a detailed standard that is consistent with interpretation of regulatory statutes in each of three distinct eras: the Progressive Era, the era of regulation …


Catalyzing Fans, Howard Wasserman, Dan Markel, Michael Mccann Jan 2015

Catalyzing Fans, Howard Wasserman, Dan Markel, Michael Mccann

Faculty Publications

This paper proposes the development of Fan Action Committees (“FACs”), which, like their political counterpart ("PACs"), could mobilize and empower fans to play a larger role in the decision-making associated with which “production teams” the talent will work.

We outline two institutional options: FACs could directly compensate talent by crowdfunding, or they could make donations to charities favored by talent. We then discuss both obstacles and objections from a variety of policy and legal perspectives ranging from competitive balance to distributive justice. Finally, we consider possible extensions of the FAC model as well as offer some ruminations on why FACs …


How To Do Things With Hohfeld, Pierre Schlag Jan 2015

How To Do Things With Hohfeld, Pierre Schlag

Publications

Wesley Newcomb Hohfeld’s 1913 article, Fundamental Legal Conceptions as Applied in Judicial Reasoning, is widely viewed as brilliant. A thrilling read, it is not. More like chewing on sawdust. The arguments are dense, the examples unfriendly, and the prose turgid.

“How to Do Things With Hohfeld” is an effort to provide an accessible and sawdust-free account of Hohfeld’s article, as well as to show how and why his analysis of “legal relations” (e.g., right/duty, etc.) matters. Perhaps the principal reason is that the analysis furnishes a discriminating platform to discern the economic and political import of legal rules and …


The Subprime Market Roller Coaster, Willa E. Gibson Sep 2014

The Subprime Market Roller Coaster, Willa E. Gibson

Akron Law Faculty Publications

Please find attached an essay entitled “The Subprime Market Roller Coaster.” The essay discusses the economic and societal implications of the subprime market losses with an emphasis on the federal regulators’ inability to curtail such losses. It discusses collateralized mortgage obligations and how these debt securities fueled the subprime market. The essay discusses how each of the players – lenders, debtors, investment bankers, securities firms and investors – speculated on homes whose values were a mere illusion. It describes how each party along the chain starting with the lender used basic risk-shifting principles to engage in reckless speculation assuming they …


Taxing The Platypygous, James J. White Jan 2013

Taxing The Platypygous, James J. White

Articles

This Article maintains that obesity in the United States is an enormous public health issue that causes the health care costs of the obese Americans greatly to exceed those of citizens of normal weight. Recognizing that that much of that cost will be born by publicly financed programs and that the taxes supporting those programs will constitute an externality that the fat impose on the thin, the Article proposes a tax on high calorie food-but only when that food is purchased by the obese. The Article addresses many of the administrative, moral and other objections to a tax aimed at …


The Tragedy Of The Carrots: Economics & Politics In The Choice Of Price Instruments, Brian Galle Jan 2012

The Tragedy Of The Carrots: Economics & Politics In The Choice Of Price Instruments, Brian Galle

Georgetown Law Faculty Publications and Other Works

Externalities are one of the most fundamental market-failure justifications for government action, and pigouvian taxes and subsidies are standard tools for correcting them. Even so, neither the legal nor economic literatures offer any comprehensive account of when policy makers should prefer one to the other. This Article takes up that task. Prior efforts to distinguish between “carrots” and “sticks” have generally been limited to the context of pollution regulation, and I show here that even those are incomplete. I also extend the analysis to the case of positive externalities, where there is no prior literature to speak of. Overall I …


Reassessing The Citizen Virtues Of Homeownership, Stephanie M. Stern Apr 2011

Reassessing The Citizen Virtues Of Homeownership, Stephanie M. Stern

All Faculty Scholarship

The assumption that homeownership creates more politically and civically engaged citizens who contribute to local communities (as well as national democracy) dominates property law. This belief underlies influential theories of property and land use and justifies housing policies promoting homeownership and expanding homeownership’s reach. This Essay challenges the “citizenship virtues” of homeownership and contends that the evidence reveals a far more modest, and particularized, picture of citizenship effects than commonly assumed. I explore psychological, historical, and economic factors that may underlie the variable citizenship effects from homeownership. Some of these factors elucidate not only why owners and tenants perform similarly …


Slides: Adapting To Climate Change: Lessons Learnt From The Australian Water Experience, Will Fargher Feb 2011

Slides: Adapting To Climate Change: Lessons Learnt From The Australian Water Experience, Will Fargher

Conversation with Water Management Reps from Colorado and Australia: "Adapting to Climate Change: Lessons Learned from Australia" (February 14)

Presenter: Will Fargher, National Water Commission, Australian Government

18 slides [4 have titles only and are missing images]


Strategic Spillovers, Daniel B. Kelly Jan 2011

Strategic Spillovers, Daniel B. Kelly

Journal Articles

The conventional problem with externalities is well known: Parties often generate harm as an unintended byproduct of using their property. This Article examines situations in which parties may generate harm purposely, in order to extract payments in exchange for desisting. Such “strategic spillovers” have received relatively little attention, but the problem is a perennial one. From the “livery stable scam” in Chicago to “pollution entrepreneurs” in China, parties may engage in externality-generating activities they otherwise would not have undertaken, or increase the level of harm given that they are engaging in such activities, to profit through bargaining or subsidies. This …


What Would Coase Do? (About Parking Regulation), Michael Lewyn Jan 2010

What Would Coase Do? (About Parking Regulation), Michael Lewyn

Scholarly Works

Like many government regulations, municipal minimum parking requirements exist to prevent externalities - most notably the congestion, pollution and greenhouse gas emissions that occur when motorists drive around a city searching for scarce parking. But because such regulations make parking (and thus driving) cheaper, such regulations may in fact increase congestion and pollution, thus creating, rather than reducing, externalities.


The Last Best Hope For Progressivity In Tax, E. J. Mccaffery, James R. Hines Jr. Jan 2010

The Last Best Hope For Progressivity In Tax, E. J. Mccaffery, James R. Hines Jr.

Articles

We argue that a spending tax, as opposed to an income or wage tax, is the “last best hope” for a return to significantly more progressive marginal tax rates than obtain today. The simple explanation for this central claim looks to incentive effects, especially for “rich people,” as both economists and commentators are inclined to focus. High marginal tax rates under an income tax fall on and hence deter the socially productive activities of work and savings. High marginal rates under a wage tax fall on and hence deter the socially productive activity of work alone. But high marginal rates …


Catholic Schools, Urban Neighborhoods, And Education Reform, Margaret F. Brinig, Nicole Stelle Garnett Jan 2010

Catholic Schools, Urban Neighborhoods, And Education Reform, Margaret F. Brinig, Nicole Stelle Garnett

Journal Articles

More than 1,600 Catholic elementary and secondary schools have closed or been consolidated during the last two decades. The Archdiocese of Chicago alone (the subject of our study) has closed 148 schools since 1984. Primarily because urban Catholic schools have a strong track record of educating disadvantaged children who do not, generally, fare well in public schools, these school closures have prompted concern in education policy circles. While we are inclined to agree that Catholic school closures contribute to a broader educational crisis, this paper shies away from debates about educational outcomes. Rather than focusing on the work done inside …