Law and Economics Commons^™

Values Primacy & Total Governance Through Activism, Carliss N. Chatman, Sergio Alberto Gramitto Ricci

Faculty Journal Articles and Book Chapters

In the aftermath of George Floyd’s murder, public companies swift-ly pledged sweeping equity commitments—only to abandon them under political and market pressure. These reversals were not aberrations. They were opportunistic, performative, and reactionary marketing responses. They expose a governance regime in which stakeholder interests are structurally reversible because they remain doctrinally optional, lacking the institutional interlock needed to create binding accountability across stakeholder roles.

This Article explores how stakeholder power is already embedded in corporate governance through interlocking initiatives grounded in shared values. Stakeholder activism—boycotts, proxy votes, viral campaigns—is not merely expressive; it is an overlooked form of governance. Drawing …

Expanding State Tax Authority: Public And Private Sector Impacts Of Wayfair, Maxwell Pastoria

Williams Honors College, Honors Research Projects

The 2018 Supreme Court decision in South Dakota v. Wayfair, Inc. (Wayfair) overturned the longstanding physical presence rule for state sales tax collection, enabling states to enforce tax obligations on remote sellers through marketplace facilitator and economic nexus laws (Oyez, 2018). This study investigates the effects of these two post-Wayfair tax laws on state sales tax revenues, entrepreneurship, and public expenditures across all 50 states. Using a two-way fixed effects difference-in-differences (TWFE DID) framework, this research analyzes how policy adoption influenced per-capita outcomes in tax revenue, firm formation, and government spending in social services, education, infrastructure, and …

Trophy Assets, Aneil Kovvali

Articles

Rich people like to own things that make them look cool. When the thing in question is a car, house, or boat, the implications are limited. But sometimes very rich people own assets that are more important. Within media, Elon Musk acquired Twitter, Jeff Bezos ac-quired the Washington Post, and Patrick Soon-Shiong acquired the Los Angeles Times. There has also been a craze for aerospace: Musk with Space X, Bezos with Blue Origin, Richard Branson with Virgin Galactic, and going back further, Howard Hughes with Hughes Aircraft Company. It is often difficult to understand the behavior in purely finan-cial terms, …

The Law Of Quitting, Andrew K. Jennings

Faculty Articles

Throughout life, people enter countless positions of authority and trust in relation to one another and the public. These positions include, among many others, being a public official, being a corporate director, and being an employee. Law announces prerequisites for starting such positions, as well as incumbents’ rights and obligations once in them. But no office holds forever. Indeed, incumbents often choose to exit positions before they would otherwise end by expiration, removal, or death. Yet law governs such voluntary relinquishment—often called “resignation” or, more generically, “quitting”—largely as afterthought. That is, law expansively attends how positions of authority and trust …

Boundaries Of Rules: Social Reactions To Legal Intervention, Francesco Parisi

Articles

This chapter examines what happens at the boundaries of rules: when social practices acquire legal recognition, when legal rules seek to reshape social expectations, and when formal and informal enforcement operate together. The conventional economic model treats the expected formal sanction as the principal source of compliance. Although this model provides a fundamental benchmark, it captures only part of the effects of legal intervention. The taxonomy developed here identifies the different ways in which legal, moral, and social incentives may interact. The kinds of public and private enforcement through which individuals express norms shape the additive, nonadditive, and countervailing effects …

Nest Eggs And Lifelines: The Overlooked Strain Of Economic Volatility On 401(K) Participants, Samantha Prince

Faculty Scholarship

Many Americans rely on defined contribution plans like 401(k) plans for retirement savings. These plans do not guarantee a fixed retirement benefit; rather, the benefit is based on accumulated contributions and investment performance. When the stock market drops, so do retirement account balances. When inflation hikes living expenses, money does not go as far. President Donald Trump's policies, including those associated with tariffs, are causing economic and resource volatility leading to financial hardship. Americans worry as they watch living costs increase and their retirement savings diminish. It is well known that retirees rely on 401(k) plan balances to fund their …

The Apathy Economy: Patents, Advertising, And Consumer Indifference, Gavin J. Milczarek-Desai, Derek E. Bambauer

Cardozo Arts & Entertainment Law Journal

Patents function as signals as well as rights to exclude. They inform competitors, investors, employees, and consumers about the invention and its owner. How this information affects consumers is not well understood. Existing studies disagree about how advertising a product or service as patented, or patent pending, affects the price consumers will pay. This Article offers the first major empirical study of that question andfinds that consumers behave with surprising rationality: they will not pay any price premium for a patented product. A product's patent status conveys little information about whether it is superior to competing offerings. The results hold …

Liability For Non-Disclosure In Ipos, Albert H. Choi, Kathryn E. Spier

Articles

A privately-informed entrepreneur may withhold material information from prospective investors who may sue the firm ex post for (alleged) non-disclosure. Absent liability, the entrepreneur has an excessive incentive to withhold bad news and pursue socially-wasteful projects. Liability deters inefficient non- disclosure and prevents capital misallocation. Any damage award received by investors is partially offset by a reduction in equity value. Depending on the likelihood of court error and litigation cost, the socially-optimal damage award may be either zero or the minimum necessary for full deterrence. The private incentive to waive liability may be socially excessive or insufficient. Positive and normative …

Read But Not Understood? An Empirical Analysis Of Consumer Comprehension In Homeowners Insurance, Daniel Schwarcz, Brenda J. Cude, Kyle D. Logue, German Marquez Alcala

Articles

Modern contract law assumes that consumers meaningfully assent to the standard forms that govern their daily lives. However, this assumption is widely regarded as a legal fiction for two key reasons: first, most consumers do not read standard forms, and second, even those who do often struggle to fully comprehend their terms and implications. Although the lack of consumer reading has been well documented through empirical research, consumers’ ability to comprehend standard-form contracts has received surprisingly little attention.

This Article addresses the latter issue by empirically examining whether providing excerpts from the dominant standard-form homeowners insurance policy improves consumer understanding …

The Basis Of The Labor Exemption Reconsidered, Sanjukta Paul

Articles

Broadly speaking, this symposium queries the question of expanding some actors’ coordination rights under antitrust law as a way of effectuating legal goals relating to “power relations.” I commend the organizers of the symposium for opening this conversation, for asking about the use of “collective bargaining” beyond the traditional labor domain, and for taking on the question in a creative way. These broader questions are essential, and yet my own article will (paradoxically, perhaps) try to contribute to this effort by going back to the core domain of the labor exemption itself—where, it turns

Regulating Robotaxis, Bryant Walker Smith, Matthew T. Wansley

Articles

In several sunbelt cities, commercial robotaxi service has arrived. The leading robotaxi company is providing over 400,000 trips per week. The industry claims that robotaxis will save lives and provide convenient and affordable mobility. Critics counter that they will increase congestion, undermine transit, and subject the public to ubiquitous surveillance. We argue that the social impact of robotaxis depends on how they are regulated. We emphasize two points missing from the debate. First, some of the benefits of robotaxis may be political rather than technological—some longstanding public policy goals may become viable in a robotaxi world. Second, letting one private …

Designing Contract Modification, Albert H. Choi, George G. Triantis

Articles

For long-term commercial contracts, modification tends to be the norm rather than the exception. While modification often takes place in response to an arrival of new information, contracting parties frequently modify the terms in response to a shift in bargaining power. In this Article, we explain how the flexibility to renegotiate in response to a shift in bargaining power can facilitate long-term contracting and thereby beneficial reliance investments and risk allocation. The prospect of modification can induce contracting parties who expect their bargaining power to improve, such as from the emergence of outside opportunities, to enter into contracts earlier and …

The Future Of Monetary Federalism: Rethinking Supremacy In The Stablecoin Era, Richard H. Fair

American University Business Law Review

[INTRODUCTION] In the summer of 2023, the State of Wyoming enacted a law authorizing its state treasurer to issue a blockchain-based, state-backed digital stablecoin known as the Wyoming Stable Token (“WYST”). Two years later, Congress passed the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act, GENIUS, or the Act), moving to establish a comprehensive federal regulatory regime for stablecoins. These dueling initiatives have sparked more than regulatory confusion; they have set the stage for a structural clash between state financial innovation and federal monetary supremacy. At the heart of this confrontation lies a question that the Constitution …

Romanist-Bourgeois Property And The Development Of The Modern Capitalist World System, Anna Di Robilant

Faculty Scholarship

This article examines the role of Romanist-bourgeois property law in the development of the modern capitalist world system, focusing on how nineteenth-century jurists deliberately crafted and adapted Roman law-based property doctrines to address the evolving social relations of production in both Europe and its peripheries. Rather than viewing legal concepts as merely reflective of broader economic transformations, the author highlights the active role played by a professional class of jurists in shaping property law to legitimize and structure emergent capitalist class dynamics. The article critically engages with competing scholarly perspectives that either privilege market expansion or downplay class relations, arguing …

Universities, Capital, And Democratic Vulnerability, Steven Dean, Dana Brakman Reiser

Faculty Scholarship

For many, the university serves as a crucial guardian of democracy. Still, the capitulation of leading American private universities to authoritarian pressure from the Trump Administration should not be terribly surprising. This Essay offers one reason why. It does so by focusing on the law governing private nonprofit universities. It examines both the origins and the impact of a fundamental tension between their charitable missions and their need for capital. It shows how the legal framework designed to protect these nonprofit universities from market pressures can actually intensify their vulnerability.

The so-called “nondistribution constraint” stands at the core of U.S. …

The Law And Ai As An “Apex Collaborator”: Legal Frameworks For Optimized Cooperation, David S. Filippi, Bill Tomlinson, Andrew W. Torrance

FIU Law Review

Law fundamentally exists to enable human cooperation, providing frameworks for everything from basic contracts to complex international agreements. As artificial intelligence systems grow more sophisticated, they may enable new ways that collaborative activity can occur. We posit the possibility of a new kind of AI entity: the “Apex Collaborator,” a computational system with capabilities for cooperation and partnership that are superior, in at least some ways, to those of humans. Just as apex predators shape the ecosystems in which they live through predation, Apex Collaborators would shape human-AI networks through their ability to enhance peaceful coexistence, collective problem-solving, and shared …

Constructive Taxation: How Filing Requirements Turn Tax Benefits Into De Facto Taxes, Orli Oren-Kolbinger

FIU Law Review

Constructive taxation reveals a mismatch between the redistributive objectives Congress claims to pursue and how tax administration is carried out. Procedural barriers allocate benefits through bureaucratic processes rather than on the basis of need or eligibility, reflecting implicit judgments about who deserves them. Low-income households must still file, even when the government already has the necessary information to determine eligibility. Examining this through Congress’s taxing and spending powers, the Article shows that refundable credits function as tax expenditures, using the tax code to deliver benefits while creating administrative burdens that resemble economic penalties. When procedural barriers prevent eligible taxpayers from …

Owning Trading Opportunities, Kevin Douglas

FIU Law Review

Owning Trading Opportunities identifies the doctrines and policy rationales used to protect property rights in corporate opportunities. It then explores adopting these doctrines and rationales to reform the notions of "fairness," "public interest," "investor protection," "market confidence," and "economic efficiency" driving the regulation of insider trading.

This approach yields several benefits. First, it shows that a policy commitment to equal trading opportunities for all investors is the functional equivalent of a commitment to fostering equal access to information for all investors. The U.S. Supreme Court attempted to reject the latter but failed by embracing the former.

Second, corporate opportunity cases …

Ticking Toward Reform: Rethinking The Material Difference Exception In The Luxury Watch Resale Market And Beyond, Mallory K. Hogan

American University Law Review

The rapid growth of the luxury resale market has heightened tension between trademark holders and secondary-market sellers. Courts are increasingly left to apply the material difference exception to first sale doctrine defenses, to find trademark infringement when resold goods differ from the original product, even in de minimis ways. Originally designed to protect consumers from confusion where post-sale modifications affected product quality or safety, the exception has evolved into a broad enforcement tool that luxury brands leverage to challenge resellers over minor or cosmetic alterations. In the luxury watch and accessories markets in particular, courts have deemed even minimal differences …

Antidiscrimination Law Against Labor, Jordan Laris Cohen

American University Law Review

In recent years, employer compliance with antidiscrimination law has emerged as a major justification for limiting the rights of employees to organize and engage in collective action in the workplace. In IBM Corp., a Republican majority of the National Labor Relations Board cited “laws addressing workplace discrimination and sexual harassment” as a primary reason to deny nonunionized employees the right to a coworker representative during investigatory interviews. In General Motors, a Republican Board majority invoked antidiscrimination law in upending four decades of precedent regarding employer discipline of employees engaged in “opprobrious conduct” in the course of protected organizing …