Law and Economics Commons^™

Short Selling And The News: A Preliminary Report On An Empirical Study, Merritt B. Fox, Lawrence R. Glosten, Paul C. Tetlock

NYLS Law Review

No abstract provided.

Counterparty Regulation And Its Limits: The Evolution Of The Credit Default Swaps Market, Houman B. Shadab

NYLS Law Review

No abstract provided.

Keynote Address: The Conflicted Trustee Dilemma, Steven L. Schwarcz

NYLS Law Review

No abstract provided.

A Board’S Duty To Monitor, Eric J. Pan

NYLS Law Review

No abstract provided.

On The Continued Vitality Of Securities Arbitration: Why Reform Efforts Must Not Preclude Predispute Arbitration Clauses, Alicia J. Surdyk

NYLS Law Review

No abstract provided.

China And Brazil: Potential Allies Or Just Brics In The Wall?, Anthony Petros Spanakos

Department of Political Science and Law Faculty Scholarship and Creative Works

Brazil is an increasingly important actor in global governance and for China specifically. Sino-Brazilian relations have deepened considerably but they remain concentrated in areas of trade and investment. There is also considerable overlap in interests between the two countries in other areas, such as diplomatic and political relations. At the same time, China must manage carefully important differences that exist over the enlargement of the UN and the potential challenge to the Brazilian industry.

Following Only Some Of The Money In Russia, Ethan S. Burger

Georgetown Law Faculty Publications and Other Works

Russia adopted the necessary legislation so that it was accepted as a member of the Financial Action Task Force (FATF). It is a member of the UN Convention Against Corruption (although it refuses to enact legislation consistent with the obligations under the OECD Anti-Bribery Convention) and fought to prevent an effective mechanism to monitor compliance with the UN Convention. Russia has created state bodies to combat money laundering. Nonetheless, the Russian Federal Financial Monitoring Service appears to be highly selective in the matters it pursues and appears to lack adequate personnel and material resources.

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 …

Privatopia In Distress: The Impact Of The Foreclosure Crisis On Homeowners’ Associations, Casey Perkins

Nevada Law Journal

Part I of this Note provides an introduction to HOAs, the foreclosure crisis, and the resulting recession that currently threaten many associations' financial stability. Part I begins with a discussion of the rise of common interest communities in the United States, as well as basic association functions. Following this historical introduction is a discussion of the foreclosure crisis and an overview of the severity of this crisis in Nevada.

Part II introduces the problems faced by HOAs across the country because of the foreclosure crisis. These problems fall into two general categories, budget shortfalls and physical deterioration of abandoned properties. …

Of Coase, Calabresi, And Optimal Tax Liability, Kyle D. Logue, Joel Slemrod

Articles

The Article proceeds as follows. Part II offers a primer on the Coase Theorem, beginning with the classic case of neighbor externalizing on neighbor (farmer and rancher), and it explains the basic invariance propositions. Part III shifts the focus to Coasean situations involving buyers and sellers in a market or contractual relationship, buyers and sellers whose market interactions cause harm to third parties. Using supply-and-demand diagrams, we illustrate (in a new way) some of the most basic findings of the economic analysis of law, including both the Coasean invariance and efficiency propositions and the Calabresian least-cost avoider idea. Also in …

Tax Reform In The Aftermath Of The Financial Crisis, Stephen Utz

Faculty Articles and Papers

No abstract provided.

Tontines For The Invincibles: Enticing Low Risks Into The Health-Insurance Pool With An Idea From Insurance History And Behavioral Economics, Peter Siegelman, Tom Baker

Faculty Articles and Papers

Over one-third of the uninsured adults in the U.S. below retirement age are between nineteen and twenty-nine years old. Young adults, especially men, often go without insurance, even when buying it is mandatory and sometimes even when it is a low-cost employment benefit. This Article proposes a new form of health insurance targeted at this group, the "young invincibles"-those who (wrongly) believe that they do not need health insurance because they will not get sick. Our proposal offers a cash bonus to those who turn out to be right in their belief that they did not really need health insurance. …

Reply To Becker And Fuest, James R. Hines Jr.

Articles

It is an understatement to say that the appropriate taxation of foreign business income is a controversial and potentially confusing topic. One of the mysteries of international taxation has been that the prescriptions of what, until recently, was the accepted academic wisdom differs so sharply from widespread international practice. In an important contribution, Richman (1963) noted that a home government confronted with the choice of where it would prefer one of its resident taxpayers to allocate a single unit of capital would weigh the after-foreign-tax return from investing abroad against the pre-tax return from investing at home. From this observation, …

Economically Benevolent Dictators: Lessons For Developing Democracies, Ronald J. Gilson, Curtis J. Milhaupt

Faculty Scholarship

The post-war experience of developing countries leads to two depressing conclusions: only a small number of countries have successfully developed; and development theory has not produced development. In this article we examine one critical fact that might provide insights into the development conundrum: Some autocratic regimes have fundamentally transformed their economies, despite serious deficiencies along a range of other dimensions. Our aim is to understand how growth came about in these regimes, and whether emerging democracies might learn something important from these experiences.

Our thesis is that in these economically successful countries, the authoritarian regime managed a critical juncture in …

Morality And Markets: A Comment On Predicting Crime, Miriam A. Cherry

Faculty Publications

(Excerpt)

In their article, Predicting Crime, Professors Henderson, Wolfers, and Zitzewitz propose an intriguing and futuristic series of market-based models surrounding the broad topic of crime prevention. Harnessing widely dispersed knowledge among groups of people, including cops on the beat, criminologists, residents of neighborhoods, elected officials, snitches, and possibly even the criminals themselves, the authors posit that prediction markets will help to estimate crime statistics more accurately and therefore result in more efficient deployment of policing resources. Further, they hypothesize that posing particular policy alternatives—for example, the option of eliminating the death penalty—to a widely dispersed market will result …

Guilty By Association? Regulating Credit Default Swaps, Houman B. Shadab

Articles & Chapters

A wide range of U.S. policymakers initiated a series of actions in 2008 and 2009 to bring greater regulation and oversight to credit default swaps (CDSs) and other over-the-counter derivatives. The policymakers’ stated motivations echoed widely expressed criticisms of the regulation, characteristics, and practices of the CDS market, and focused on the risks of the instruments and the lack of public transparency over their utilization and execution. Certainly, the misuse of certain CDSs enabled mortgage-related security risk to become overconcentrated in some financial institutions.

Yet as the analysis in this Article suggests, failing to distinguish between CDS derivatives and the …

Roll Up The Constitution And Unfurl The Tarp: How Spending Conditions In The Troubled Asset Relief Program Violate The Constitution, David T. Riley

Kentucky Law Journal

No abstract provided.

Treasure Islands, James R. Hines Jr.

Articles

In movies and novels, tax havens are often settings for shady international deals; in practice, they are rather less flashy. Tax havens are countries and territories that offer low tax rates and favorable regulatory policies to foreign investors. For example, tax havens typically tax inbound investment at zero or very low rates and further encourage investment with telecommunications and transportation facilities, other business infrastructure, favorable legal environments, and limited bureaucratic hurdles to starting new firms. Tax havens are small: most are islands; all but a few have populations below one million; and they have above-average incomes. Tax havens are also …

The Attack On Nonprofit Status: A Charitable Assessment, James R. Hines Jr., Jill R. Horwitz, Austin Nichols

Articles

American nonprofit organizations receive favorable tax treatment, including tax exemptions and tax-deductibility of contributions, in return for their devotion to charitable purposes and restrictions not to distribute profits. Recent efforts to extend some or all of these tax benefits to for-profit companies making social investments, including the creation of the new hybrid nonprofit/for-profit company form known as the Low-Profit Limited Liability Company, threaten to undermine the vitality of the nonprofit sector and the integrity of the tax system. Reform advocates maintain that the ability to compensate executives based on performance and to distribute profits when attractive investment opportunities are scarce …

Burying The Constitution Under A Tarp, Gary S. Lawson

Faculty Scholarship

The Emergency Economic Stabilization Act of 2008, a.k.a. 'the bank bailout bill,' engendered a fair degree of political controversy during and after its enactment but relatively little constitutional controversy. That is unfortunate, and at least a bit puzzling, because, as a matter of original meaning, the statute raises important constitutional questions along at least four dimensions: it is questionable whether Congress had theenumerated power to authorize the Treasury Department to purchase securities, the specific authorizations were sufficiently vague to raise serious questions under the nondelegation doctrine, the expansion of thepowers of the Secretary of the Treasury under the statute make …

International Disparities Panel, Sean Flynn

Scholarly Articles in Law Reviews & Journals

No abstract provided.

Emerging Law Addressing Climate Change And Water, Elizabeth Burleson

Elisabeth Haub School of Law Faculty Publications

The World Economic Forum recognizes that while restrictions on energy affect water systems and vise versa, energy and water policy are rarely coordinated. The International Panel on Climate Change predicts that wet places will become wetter and dry places will become dryer. Transboundary water, energy and climate coordination can occur through international consensus building.

Just Say No (To American Capitalism): Why American Indians Should Reject The Model Tribal Secured Transactions Act And Other Attempts To Promote Economic Assimilation, Aaron Drue Johnson

American Indian Law Review

No abstract provided.

Forced Sale Risk: Class, Race, And The "Double Discount", Thomas W. Mitchell, Stephen Malpezzi, Richard K. Green

Faculty Scholarship

What impact does a forced sale have upon a property owner's wealth? And do certain characteristics of a property owner such as whether they are rich or poor or whether they are black or white, tend to affect the price yielded at a forced sale? This Article addresses arguments made by some courts and legal scholars who have claimed that certain types of forced sales result in wealth maximizing, economic efficiencies. The Article addresses such economic arguments by returning to first principles and reviewing the distinction between sales conducted under fair market value conditions and sales conducted under forced sale …

Excuse Doctrine: The Eisenberg Uncertainty Principle, Victor P. Goldberg

Faculty Scholarship

The world is in a bit of a mess. Oil prices soared to more than $140 per barrel and within months plummeted to below $40. The pound fell from $2 to less than $1.40. Housing and stock prices crashed. Foreclosures, bankruptcies, and bailouts became newspaper staples. When things go awry like this, inevitably many people and firms regret having entered into contracts under more favorable circumstances. Many of them will be looking for ways to limit, or better yet, avoid the consequences. A preeminent contracts scholar, Melvin Eisenberg (2009), has provided them with considerable ammunition in a recent paper, arguing …

Energy Policy For An Economic Downturn: A Proposed Petroleum Fuel Price Stabilization Plan, Thomas W. Merrill, David M. Schizer

Faculty Scholarship

A compelling case can be made for reducing America's consumption of petroleum fuels. Nearly all analysts think that the way to slash consumption of petroleum fuels is through an end-user tax. There is, however, widespread public opposition to higher gasoline taxes. Furthermore, in a recession the appropriate fiscal policy is to cut taxes, not to raise them. This paper proposes a method of stabilizing petroleum fuel prices at a sufficiently high level, without reducing aggregate consumer purchasing power. We introduce a revenue-neutral petroleum fuel price stabilization plan, called the "PFPS" plan for short Under this plan, a government surcharge on …

Bail-Ins Versus Bail-Outs: Using Contingent Capital To Mitigate Systemic Risk, John C. Coffee Jr.

Faculty Scholarship

Because the quickest, simplest way for a financial institution to increase its profitability is to increase its leverage, an enduring tension will exist between regulators and systemically significant financial institutions over the issues of risk and leverage. Many have suggested that the 2008 financial crisis was caused because financial institutions were induced to increase leverage because of flawed systems of executive compensation. Still, there is growing evidence that shareholders acquiesced in these compensation formulas to cause managers to accept higher risk and leverage. Shareholder pressure then is a factor that could induce the failure of a systemically significant financial institution. …

Host’S Dilemma: Rethinking Eu Banking Regulation In Light Of The Global Crisis, Katharina Pistor

Faculty Scholarship

The quest for integrating financial markets into a single global marketplace has produced a host of legal and regulatory measures over the past two decades aimed at taming national protectionism, easing access to foreign markets, and lowering the regulatory burden for financial intermediaries that operate trans-nationally. Home country regulation and supervision – based on commonly agreed prudential standards – has become the core principle in the design of regulatory structures. This principle, first established as the “Basel Concordat” in a series of reports issued by the Bank of International Settlement in Basel has also informed financial regulation in the EU. …

Gridlock Economy: How Too Much Ownership Wrecks Markets, Stops Innovation, And Costs Lives (Introduction), Michael A. Heller

Faculty Scholarship

Twenty-five new runways would eliminate most air travel delays in America; fifty patent owners are blocking a major drug company from creating a cancer cure; 90 percent of our broadcast spectrum sits idle while American cell phone service suffers. These problems have solutions that can jump-start innovation and help save our troubled economy. So, what's holding us back?

Dr. Cézanne And The Art Of Re(Peat)Search: Competing Interests And Obligations In Clinical Research, Robyn Bluhm, Jocelyn Downie, Jeff Nisker

Articles, Book Chapters, & Popular Press

Clinician researchers have a number of roles, each of which carries specific obligations. There are times when these obligations may be in competition (up to and including conflict) with each other. Using a narrative case study that describes a group of colleagues discussing their clinical department's participation in an industry-sponsored research protocol, we illustrate a number of the obligations faced by clinician researchers, and discuss how competing interests and obligations can lead to ethical problems. The case study is followed by a discussion of the effect of university–industry relations on competing interests and obligations in both clinical research and the …