American Law and Economics Association
Seventeenth Annual Meeting
May 5-6, 2007

Harvard Law School

American Law and Economics Association 2006-2007
OfficersPresident: Oliver Hart, Harvard University
Vice President/President-Elect: Lucian Bebchuk, Harvard University
Secretary-Treasurer: Michelle White, University of California at San Diego
Board of Directors
Class of 2007
Howard F. Chang, University of Pennsylvania
Roberta Romano, Yale University
Kathryn E. Spier, Northwestern University
George G. Triantis, Harvard University
Class of 2008
Richard H. McAdams, University of Illinois
Katharina Pistor, Columbia University
Suzanne Scotchmer, University of California, Berkeley
Eric Talley, University of California, Berkeley
Class of 2009
Jennifer Arlen, New York University
Omri Ben-Shahar, University of Michigan
Jennifer Reinganum, Vanderbilt University
Chris Sanchirico, University of Pennsylvania
Nominating Committee

Program Committee

Omri Ben-Shahar
Jennifer Reinganum
Roberta Romano

Oliver Hart
Richard McAdams
Suzanne Scotchmer

Editors of the American Law and Economics Review
John J. Donohue, Yale University
Steven Shavell, Harvard University
Executive Secretary
Karen G. Crocco
Area Organizers for the 2007 Annual Meeting
Jeffrey Rachlinski
Barry AdlerJennifer Reinganum
Omri Ben-Shahar
Daniel Rubinfeld
Kevin Davis
Steven ShavellJohn de Figueiredo
Christopher Snyder
John Donohue
Matthew Spitzer
Henry Farber
Alan Sykes
Jeffrey Gordon
David Weisbach
Josh Lerner
Katharina Pistor

Saturday, May 5(All sessions to be held at the Law School)(Author's name in bold indicates person presenting paper)

8:00 - 8:45:

Registration and Continental Breakfast

8:45 - 9:00:

Welcome by Dean Elena Kagan.
(Ropes Gray Room, Pound Hall, 2nd floor)

9:00-10:30:

Session I:

Panel IA:

Public and Administrative Law (I) (Pound 101)

Panel Chair: Matthew Spitzer
Christopher Avery, Christine Jolls, Richard Posner, Alvin Roth, “The New Market forFederal Judicial Law Clerks”
Daniel E. Ho, “Congressional Agency Control: The Impact of Statutory Partisan
Requirements on Regulation”
Alexander Volokh, “Privatization and the Effectiveness of Monitoring Agencies”

Panel IB:

Empirical Bankruptcy (Pound 102)

Panel Chair: Mark Roe
Edward R. Morrison, “Bargaining Around Bankruptcy: Small Business Distress andState Law”
Lawrence A. Weiss and Vedran Capkun, “Bankruptcy Resolution: Priority of Claims
with the Secured Creditor in Control”
Douglas G. Baird, Arturo Bris, and Ning Zhu, “The Dynamics of Large and Small
Chapter 11 Cases: An Empirical Study”

Panel IC:

Behavioral Law and Economics/Social Norms (I) (Pound 107)

Panel Chair: Richard McAdams
Robert D. Cooter, Yuval Feldman, and Michal Feldman, “The Misperception ofNorms: The Psychology of Bias and the Economics of Equilibrium”
Tonja Jacobi, “Acknowledging Guilt: Forcing Self-Identification in Post-Conviction
DNA Testing”
Leigh Linden and Jonah Rockoff, “There Goes the Neighborhood? Estimates of theImpact of Crime Risk on Property Values from Megan’s Laws”

Saturday, May 5
Panel ID:

Contracts and Commercial Law (I) (Pound 100)

Panel Chair: Avery Katz
Kenneth M. Ayotte and Patrick Bolton, “Optimal Property Rights in Financial
Contracting”
Ricard Gil and Francine Lafontaine, “The Role of Revenue Sharing in Movie
Exhibition Contracts”
Tai-Yeong Chung and Alan Chan, “Contract Damages and Investment Dynamics”

Panel IE:

Corporate, Securities, and Organizational Law: Comparative andInternational (I) (Pound 200)

Panel Chair: Katharina Pistor
Anita I. Anand and Laura N. Beny, “Why Do Firms Adopt Insider Trading Policies?
Evidence from Canadian Firms”
Douglas J. Cumming and Sofia A. Johan, “Global Market Surveillance”
Michal Barzuza, “Lemon Signaling in Cross-Listings”

10:30-10:45:

Coffee Break (Pound Hall, 1st floor)

10:45-12:15:

Session II:

Panel IIA:

Corporate Finance (Pound 102)

Panel Chair: Alan Schwartz
Efraim Benmelech and Nittai K. Bergman, “Liquidation Values and the Credibility of
Financial Contract Renegotiation: Evidence from U.S. Airlines”
Frank Partnoy and David A. Skeel Jr., “The Promise and Perils of Credit Derivatives”
Stephen J. Lubben, “Credit Derivatives & the Future Of Chapter 11”

Panel IIB:

Empirical Studies of Tort Reform (Pound 101)

Panel Chair: Omri Ben-Shahar
Ronen Avraham and Alvaro Bustos, “The Unexpected Effect of Tort Reform: Do Caps
Delay Settlements? Evidence from Medical Malpractice Cases”
Paul H. Rubin and Joanna M. Shepherd, “The Demographics of Tort Reform: Winnersand Losers”
Janet Currie and W. Bentley MacLeod, “First Do No Harm? Tort Reform and BirthOutcomes”

Saturday, May 5
Panel IIC:

Property and Environmental Law (Pound 107)

Panel Chair: Christopher Snyder
Yeon-Koo Che and Ian Gale, “Market versus Non-Market Assignment of InitialOwnership”
Howard F. Chang and Hilary Sigman, “The Effect of Joint and Several Liability underSuperfund on Brownfields”
Antonio Nicita, Matteo Rizzolli, and Alessandra Maria Rossi, “Towards a Theory ofIncomplete Property Rights”

Panel IID:

Antitrust and Governance (Pound 100)

Panel Chair: Daniel Rubinfeld
Dean V. Williamson, “Organization, Control and the Single Entity Defense inAntitrust”
Jonathan Klick and Robert H. Sitkoff, “Agency Costs, Charitable Trusts, andCorporate Control: Evidence from Hershey’s Kiss-Off”
Eric Helland and Jonathan Klick, “The Tradeoff Between Regulation and Litigation:
Evidence from Insurance Class Actions”

Panel IIE:

Law and Politics: Ideology and Decision-Making (Pound 200)

Panel Chair: John de Figueiredo
Joshua B. Fischman, “Decision Making Under a Norm of Consensus: An Analysis ofThree-Judge Panels”
Stephen Choi and Mitu Gulati, “Bias in Judicial Citations: A Window into theBehavior of Judges?”
Minoru Nakazato, J. Mark Ramseyer and Eric B. Rasmusen, “The Industrial
Organization of the Japanese Bar: Levels and Determinants of Attorney Income”

12:15-1:30:

Lunch (Ropes Gray Room, Pound Hall, 2nd floor)

Saturday, May 5
1:30-3:00:

Session III:Panel IIIA:

Theoretical Bankruptcy (Pound 102)

Panel Chair: George Triantis
Michelle J. White, “Personal Bankruptcy Law: Abuse Prevention versus Debtor
Protection”
Michel A. Robe and Eva-Maria Steiger, “Human Capital and the Toughness ofConsumer Bankruptcy Law”
Robert K. Rasmussen, “Where are all the Transnational Bankruptcies?”

Panel IIIB:

Corporate, Securities, and Organizational Law: Comparative andInternational (II) (Pound 101)

Panel Chair: Katharina Pistor
John Armour, Audrey Hsu, and Adrian Walters, “The Costs and Benefits of Secured
Creditor Control in Bankruptcy: Evidence from the UK”
Bernard S. Black and Vikramaditya Khanna, “Can Corporate Governance Reforms
Increase Firms' Market Values: Evidence From India”
Bernard S. Black and Woochan Kim, “The Effect of Board Structure on Firm Value inan Emerging Market: IV, DiD, and Firm Fixed Effects Evidence from Korea”
Panel IIIC:The Dynamics of Settlement (Pound 100)

Panel Chair: Kathryn Spier
Oren Bar-Gill and Omri Ben-Shahar, “The Prisoners’ (Plea Bargain) Dilemma”
Kevin E. Davis and Katrina M. Wyman, “Sovereigns, Settlement, Delay and Trial”
Yasutora Watanabe, “Estimating the Degree of Expert’s Agency Problem: The Caseof Medical Malpractice Lawyers”

Panel IIID:

Patents and Litigation (Pound 200)

Panel Chair: Josh Lerner
Scott E. Atkinson, Alan C. Marco, and John L. Turner, “The Economics of aCentralized Judiciary: Uniformity, Forum Shopping, and the Federal Circuit."
Doug Lichtman and Scott A. Baker, “Discouraging Patent Holdouts throughReciprocal Commitments”
Ronald J. Mann and John Allison, “The Disputed Quality of Software Patents”

Saturday, May 5
Panel IIIE:

Empirical Analyses of Judges and Juries (Pound 107)

Panel Chair: Jennifer Reinganum
Theodore Eisenberg and Geoffrey Miller, “Do Juries Add Value?: Evidence from an
Empirical Study of Jury Trial Waiver Clauses in Large Corporate Contracts”
Jacob K. Goeree and Leeat Yariv, “An Experimental Study of Jury Deliberation”
Jeffrey J. Rachlinski, Andrew J. Wistrich, Sheri Johnson, Chris Guthrie, “Does
Unconscious Bias Affect Trial Judges?”

3:00-3:15:

Coffee Break (Pound Hall, 1st Floor)

3:15-4:45:

Session IV:

Panel IVA:

Contracts and Commercial Law (II) (Pound 102)

Panel Chair: Ian Ayres
Luca Anderlini, Leonardo Felli, and Andrew Postlewaite, “Should Courts AlwaysEnforce What Contracting Parties Write?”George Triantis and Albert Choi, “Completing Contracts in the Shadow of Costly
Verification”
Marcel Kahan, Shmuel Leshem, and Rangarajan K. Sundaram, “Rights of First
Refusal”

Panel IVB:

Corporate, Securities, and Organizational Law: Evaluating Governance
Reforms (Pound 101)

Panel Chair: Paul Mahoney
Mira Ganor, “Why do Managers Dismantle Staggered Boards?”
Kate Litvak, “Sarbanes-Oxley and the Cross-Listing Premium”
Martijn Cremers and Roberta Romano, “Institutional Investors and Proxy Voting: The
Impact of the 2003 Mutual Fund Voting Disclosure Regulation”

Saturday, May 5
Panel IVC:

Antitrust Policy (Pound 100)

Panel Chair: William Bishop
Barak D. Richman and Christopher R. Murray, “Rebuilding Illinois' Bricks: Toward a
New Approach to Indirect Purchaser Standing”
Mikko Packalen, “Market Share Exclusion”
David Gilo, “The Subtle Virtues of Prohibiting Excessive Pricing by Dominant Firms”

Panel IVD:Criminal Law: Empirical (I) (Pound 200)

Panel Chair: Jeff Stnad
JJ Prescott, Leigh Linden, and Jonah Rockoff, “The Effects of Sex Offender
Notification Laws”
Mirko Draca, Stephen Machin, and Robert Witt, “Panic on the Streets of London:
Police, Crime and the July 2005 Terror Attacks”
David S. Abrams and Albert Yoon, “The Returns to Legal Representation”

Panel IVE:

Theoretical Models of Civil Procedure: Evidence and Litigation (Pound 107)

Panel Chair: Andrew Daughety
Warren F. Schwartz and Abraham L. Wickelgren, “The Profitability of Sinking Costs
in Negative Expected Value Claims”
Chris William Sanchirico, “A Primary Activity Approach to Proof Burdens”
Alan O. Sykes, “Transnational Tort Litigation as a Trade and Investment Issue”

5:30-6:45:

Cocktails (John Chipman Gray Room, Pound Hall, 2nd floor)
Sponsored by the Analysis Group

7:00:

Dinner (Ropes Gray Room, Pound Hall, 2nd floor)
Speaker: Lucian Bebchuk, Harvard University“Self-Regulation by Public Firms”

Sunday, May 6
8:00-9:00:

Continental Breakfast

9:00-10:30:

Session V:

Panel VA:

Public and Administrative Law (Pound 200)

Panel Chair: Matthew Spitzer
Michael D. Gilbert and Josh Levine, “Less Can Be More: Conflicting Ballot Proposals
and the Highest Vote Rule”
Jonathan Masur, “Judicial Deference and the Credibility of Agency Commitments”
Eugene Kontorovich, “What Standing Is Good For”

Panel VB:

Corporate, Securities, and Organizational Law: Hedge Funds (Pound 101)

Panel Chair: Eric Talley
Randall S. Thomas, Alon Brav, Wei Jiang, and Frank Partnoy, “Hedge Fund Activism,
Corporate Governance, and Firm Performance”
Emanuel Zur and April Klein, “Hedge Fund Activism”
Douglas J. Cumming and Li Que, “A Law and Finance Analysis of Hedge Funds”

Panel VC:

International and Comparative Law/Legal Systems (I) (Pound 100)

Panel Chair: Rachel Brewster
Ryan Bubb, Michael R. Kremer, and David I. I. Levine, “The Economics ofInternational Refugee Law”
Thomas J. Miles and Eric Posner, “Treaties, State Size, and Development”
Andrew J. Green, Michael Trebilcock, and Vivien Milat, “The Enduring Problem of
WTO Export Subsidies Rules”

Panel VD:

Tort Law: Theory (Pound 102)

Panel Chair: Jennifer Arlen
Kathryn E. Spier, “Product Safety, Buybacks, and the Post-Sale Duty to Warn”
A. Mitchell Polinsky and Steven Shavell, “The Uneasy Case for Product Liability”
Nuno Garoupa and Chris William Sanchirico, “Decoupling as Transactions Tax”

Sunday, May 6
Panel VE:

Contracts and Commercial Law (III) (Pound 201)

Panel Chair: George Barker
Florencia Marotta-Wurgler, "`Unfair’" Dispute Resolution Clauses: Much Ado AboutNothing?”
Ofer Grosskopf and Barak Medina, “Rationalizing Drennan: On Irrevocable Offers,
Bid Shopping and Binding Range”
Juliet P. Kostritsky, “Plain Meaning vs. Broad Interpretation: How the Risk ofOpportunism Defeats a Unitary Default Rule for Interpretation”

Panel VF:

Law and Development (Pound 107)

Panel Chair: Kevin DavisPaul Wachtel and Rainer Haselmann, “Institutions and Bank Behavior”
Vikrant Vig, “Access to Collateral and Corporate Debt Structure: Evidence from a
Natural Experiment”
Michael R. Kremer and Tom Wilkening, “Antiquities: Long Term Leases as an
Alternative to Export Bans”
10:30-10:45:

Coffee Break (Pound Hall, 1st floor)

10:45-12:15:

Session VI:

Panel VIA:

Empirical Analyses of Race and Gender (Pound 101)

Panel Chair: Margaret Brinig
Betsey A. Stevenson, “Divorce-Law Changes, Household Bargaining, and Married
Women’s Labor Supply Revisited”
Joseph P. Price IV and Justin J. Wolfers, “Racial Discrimination among NBA
Referees”

Sunday, May 6
Panel VIB:

Behavioral Law and Economics/Social Norms (II) (Pound 200)

Panel Chair: Jeffrey Rachlinski
Alicia Davis Evans, “Do Individual Investors Affect Share Price Accuracy?”
Ehud Guttel and Alon Harel, “Uncertainty Revisited: Legal Prediction and LegalPostdiction”
Michael S. Barr and Jane Dokko, “Paying to Save: Tax Withholding and Asset
Allocation Among Low- and Moderate-Income Households”

Panel VIC:

Tax, Public Finance, and Social Welfare (Pound 100)

Panel Chair: Chris Sanchirico
Louis Kaplow, “Taxation and Social Security”
Jacob Nussim, “On a Passé Defense: Unjust Enrichment and the Refund of Overpaid
Taxes”
Dhammika Dharmapala and James R. Hines Jr., “Which Countries Become TaxHavens?”

Panel VID:

Corporate, Securities, and Organizational Law: Stock Market Efficiency
and Firm Governance (Pound 102)

Panel Chair: Henry Hansmann
Art Durnev and Claudine Mangan, “Erroneous Accounting and Industry Investment
Efficiency”
Brian Broughman and Jesse M. Fried, “Deviations from Contractual Priority in theSale of VC-Backed Firms”
Alexander J. Dyck, Luigi Zingales, and Adair Morse, “Who Blows the Whistle on
Corporate Fraud?”

Panel VIE:

Vertical Relationships (Pound 107)

Panel Chair: Francine Lafontaine
Giorgio Zanarone, “Vertical Restraints as Incentive Alignment Mechanisms in Longterm Relationships”
Itai Ater and Oren Rigbi, “Vertical Restraints in Franchised Chains: The Case of
McDonald's Dollar Menu”
Ittai Paldor, “The Vertical Restraints’ Paradox: Justifying the Different Legal
Treatment of Price and Non-price Vertical Restraints”

Sunday, May 6
Panel VIF:

Criminal Law: Empirical (II) (Pound 201)

Panel Chair: Thomas Miles
Kristin F. Butcher and Anne Morrison Piehl, “Why are Immigrants' Incarceration
Rates So Low? Evidence on Selective Immigration, Deterrence, and Deportation”
Jeff Strnad, “Should Legal Empiricists Go Bayesian?”

12:15-1:30:

Lunch (Ropes Gray Room, Pound Hall, 2nd floor)
Sponsored by Cornerstone Research

1:30-3:00:

Session VII:

Panel VIIA:

Information, Incentives, and Efficiency in Employment andLitigation (Pound 201)

Panel Chair: Orley Ashenfelter
Philip A. Curry and Tilman Klumpp, “Statistical Discrimination in the Criminal
Justice System: The Case for Fines Instead of Jail”
Matthew T. Bodie, “Information and the Market for Union Representation”
Scott A. Moss, “Illuminating Secrecy: A New Economic Analysis of Confidential
Settlements”

Panel VIIB:

Corporate, Securities, and Organizational Law: Executive Compensation(Pound 102)

Panel Chair: Jeffrey Gordon
Lucian Bebchuk, Yaniv Grinstein, and Urs Peyer, “Lucky Directors and Lucky CEO’s”
Urs C. Peyer, K. J. Martijn Cremers, and Lucian Bebchuk, “Pay Distribution in The
Top Executive Team”
David I. Walker, “Unpacking Backdating: Economic Analysis and Observations”

Sunday, May 6
Panel VIIC:

International and Comparative Law/Legal Systems (II) (Pound 100)

Panel Chair: Alan Sykes
Tom Ginsburg, Zach Elkins, and James Melkin, “The Lifespan of Written
Constitutions”
Emanuela Carbonara and Francesco Parisi, “Choice of Law and Legal Evolution:
Rethinking the Market for Legal Rules”
Abraham Bell, “Optimal Proportionality in the Law of War”

Panel VIID:

Tort Law: General (Pound 107)

Panel Chair: Henrik Lando
Ariel Porat, “Offsetting Risks”
Andrew F. Daughety and Jennifer F. Reinganum, “Products Liability, Signaling andDisclosure”
Joni Hersch and W. Kip Viscusi, “Tort Liability Litigation Costs”

Panel VIIE:

Criminal Law: Theory (Pound 101)

Panel Chair: Suzanne Scotchmer
Tomer Blumkin and Yoram Margalioth, “On Terror, Drugs and Racial Profiling”
A. Mitchell Polinsky, “Optimal Sentences to Induce Prisoners to Behave Well”
Philip Bond and Kathleen Hagerty, “Preventing Crime Waves”

Panel VIIF:

Law and Politics: Legal Institutions, Taxation, and Economic Growth(Pound 200)

Panel Chair: Mark Ramseyer
Jacob E. Gersen and Christopher R. Berry, “Representation without Taxation: The
Fiscal Consequences of Electoral Institutions”
Dan Bogart, “Political Institutions and the Evolution of Regulation in England:
Evidence from River and Road Improvement Authorities, 1600-1750.”
Daniel Berkowitz and Karen B. Clay, “Legal Origins and the Evolution of Institutions:
Evidence from American State Courts”