cssi/SciSciGPT-SciSciNet huggingface dataset:
Taming complexity: rationality, the law of evidence and the nature of the legal system

This essay explores the implications of complexity for understanding both the law of evidence and the nature of the legal system. Among the propositions critically analyzed is that one significant way to understand the general problem of the meaning of rationality is that it has involved a multivariate search for tools to understand and regulate a hostile environment. The law of evidence is conceptualized as a subset of this effort, at least in part, as involving a search for tools to regulate the almost infinitely complex domain of potentially relevant evidence and at the same time to accommodate policy demands. The proposition is then considered that the legal system of which the evidentiary system is a part has emergent properties that may not be deducible from its component parts and that suggest that it may be, or at least has properties highly analogous to, a complex adaptive system. One implication of this analysis is that the tools of standard academic research that rely heavily on the isolation and reduction of analytical problems to manageable units to permit them to be subjected to standard deductive methodologies may need to be supplemented with analytical tools that facilitate the regulation of complex natural phenomena such as fluid dynamics. This has direct implications for such things as the conception of law as rules, and thus for the Hart/Dworkin debate that has dominated jurisprudence for 50 years. That debate may have mis-characterized the object of its inquiry, and thus the Dworkinian solution to the difficulties of positivism is inapplicable. Even if that is wrong, it can be shown that the Dworkinian solution is not achievable and cannot rationally be approximated. Solutions to legal problems within the legal system as a whole (as compared to any particular node within the legal system) are arrived at through a process of inference to the best explanation that occurs within a highly interconnected set of nodes that has similarities to a neural network.
The Hangman's Noose and the Lynch Mob: Hate Speech and the Jena Six

The controversy in Jena, Louisiana began innocently enough. On August 30, 2006, administrators at Jena High School held an assembly to discuss rules and policies for the upcoming year. According to reports, at the end of the assembly one Black student asked the assistant principal whether Black students were allowed to sit under the tree in the center of campus.1 In a description of the events, a reporter from The Jena Times noted that the question was asked in a joking manner and that all students, both Black and White, recognized the question as a joke and laughed.2 The vice principal told them that they could sit where they want.3 The next day, nooses were found hanging from a tree in the center of the high school’s campus.4 The nooses hung in the high school yard in Jena did not go unacknowledged by the Black high school students. On September 1, the day after the nooses appeared, a group of Black high school athletes held a silent protest by sitting under the tree where the nooses had been hung.5 Meanwhile, the
A Mexican State-Level Perspective on COVID-19 and its Economic Fallout

Mexico has had one of the highest death tolls from Covid-19 and among the largest declines in output compared to peers. This paper utilizes data on Mexico's thirty-two states to better understand the relationship between health and economic outcomes. For instance, did the states with worse pandemic outcomes suffer more economically? What state-level characteristics impacted health and economic outcomes? Among the findings are: individual traits such as age and certain pre-existing conditions were associated with higher illness and fatality risks. States with higher initial health expenditure and capacity on average had a lower case fatality rate. The economic fallout was widespread well beyond the direct impact of the pandemic. Tourism-heavy states were particularly badly affected, while states with larger exposures to manufacturing exports performed better. These findings support the case for adequate health spending, fiscal lifelines for hard-hit workers and sectors, and further integration into global value chains to bolster economic outcomes and resilience.
The Impact of Popular Culture on American Perceptions of the Courts

After a brief introduction defining popular culture as the commodities and experiences produced by the culture industry for mass audiences, this essay explores the impact of court-related popular culture on what Americans think of and expect from their courts. The Perry Mason effect from an earlier era and the CSI effect from the present are noted, as is scholarly work by Michael Asimow, Philip T. Dunwoody, Kimberlianne Podlas, Victoria S. Salzmann, and others. The essay concludes with suggestions for what might be done in the courthouse, the community, and the family room to control the impact of court-related popular culture on American legal consciousness.
Clones, Thugs, ‘N (Eventual?) Harmony: Using the Federal Rules of Civil Procedure to Simulate a Statutory Defamation Defense and Make the World Safe from Copyright Bullies

In the 1980s and ’90s, companies like Apple and Microsoft introduced the world to products that, by the early 2000’s, enabled each of us to be artistic creators in ways that were unimaginable mere decades ago. The internet revolution of the early aughts has allowed us to be instantaneous global self-distributors of that work. Although copyright thugs—those who use litigation or the threat of it to snuff out what is clearly fair use—are not a new problem, their ranks are ever-increasing in today’s world of music mashups, YouTube cover videos, and viral Facebook memes that build upon and transform existing works. Creators must feel free to make fair use of others’ work. But the fair-use doctrine has arguably become little more than “the right to hire a lawyer” to defend your actions in court. That defense can costs hundreds of thousands of dollars, so standing up to copyright bullies is not cheap.State legislatures have combated a similar type of bullying in defamation cases by enacting what are known as “anti-SLAPP” statutes. Litigants and judges can utilize existing rules of civil procedure, along with the attorney-fee-shifting provision in the Copyright Act, to simulate an anti-SLAPP effect in federal copyright actions. If these procedures are followed by copyright defendants and courts, we may begin to see a decrease in bullying, and creators will begin to feel free to make fair use of existing media.
Hopeless future and the desire for welfare expansion: Testing the prospect of upward mobility hypothesis in South Korea

Abstract Since 2011, the demand for welfare programs has significantly increased in South Korea. Yet, the motivation behind the surge is under-explored. I argue that it is driven by changes in the income prospect due to increasing income inequality and deteriorating social mobility since the 1990s. I test the prospect of an upward mobility hypothesis using the 2009 Korean General Social Survey. I find that people with a pessimistic prospect of income and a negative perception of equal opportunity demand more redistribution. Commonly known factors such as current income and political ideology have no effect in Korea. Consistent with the prospect of upward mobility hypothesis, the motivation behind the demand for a welfare expansion and the emergence of welfare politics is a pessimistic income prospect in the lives of Koreans.
Default and information

Abstract In a traditional structural model of default it is implicitly assumed that the information used to calibrate and run the model is publicly available. In reality, model inputs and parameters are unobservable. In this article we analyze the role of information in structural models, which we specify through a model definition of the default time and a model filtration. The model definition relates the default of a firm to its assets and liabilities. The model filtration describes the information of investors relative to the model definition. It parameterizes a family of default models for a given default time. An important situation is when the default is not observable with respect to the model filtration. Examples include models with incomplete information about firm assets and models with incomplete information about the liability-dependent barrier that triggers default. Here the default time is typically totally inaccessible, as in the intensity-based, reduced-form models of default. In this case the model admits generalized reduced-form security pricing formulae in terms of the trend, which is the cumulative intensity. The trend can be explicitly characterized through the conditional default probability given the model filtration. If the trend is absolutely continuous with respect to the Lebesgue measure, then its density is the intensity and our formulae simplify to the classical intensity-based formulae. Not every incomplete information model admits an intensity. A model in which investors cannot observe the default barrier is a first example.
A damped diffusion framework for financial modeling and closed-form maximum likelihood estimation

Abstract Asset price bubbles can arise unintentionally when one uses continuous-time diffusion processes to model financial quantities. We propose a flexible damped diffusion framework that is able to break many types of bubbles and preserve the martingale pricing approach. Damping can be done on either the diffusion or drift function. Oftentimes, certain solutions to the valuation PDE can be ruled out by requiring the solution to be a limit of martingale prices for damped diffusion models. Monte Carlo study shows that with finite time-series length, maximum likelihood estimation often fails to detect the damped diffusion function while fabricates nonlinear drift function. An alternative method based on Ait-Sahalia's specification test on parametric models is proposed.
Lessons from the North Sea: Should "Safety Cases" Come to America?

The catastrophic oil spill in the Gulf of Mexico last spring and summer has triggered an intense search for more effective regulatory methods that would prevent such disasters. The new Bureau of Ocean Energy Management, Regulation and Enforcement is under pressure to adopt the British safety case system, which requires the preparation of a facility-specific safety plan that is typically several hundred pages long. This system is supposed to inculcate a “safety culture” within companies that operate offshore in the British portion of the North Sea, because it overcomes a “box-ticking” mentality and constitutes “bottom up” implementation of safety measures. Safety cases are strictly confidential; only company officials, regulators, and, in limited circumstances, worker representatives, are allowed to see the entire plan. This Article argues that the safety case approach should not come to America because this confidentiality, as well as the levels of risk tolerated by the British system, conflict with the both the spirit and the letter of American law. American regulators also lack the resources necessary to make a safety case regime minimally successful. Introduction: The Search for New Regulatory Approaches In the aftermath of the catastrophic oil spill at BP’s Deepwater Horizon facility in the Gulf of Mexico, American officials have launched a frantic search for more effective regulatory methods that would prevent such disasters. The European Union has also gotten into the act, threatening to write its own set of prescriptive regulations for facilities located * © 2011, Rena Steinzor, Professor of Law at the University of Maryland School of Law. The author also serves as the President of the Center for Progressive Reform (CPR) and was a co-author, along with symposium participants Alyson Flournoy, Holly Doremus, and several other CPR member scholars, of its publication Regulatory Blowout: How Regulatory Failures Made the BP Disaster Possible, and How the System Can Be Fixed to Avoid a Recurrence. Alyson Flournoy et al., Ctr. for Progressive Reform, White Paper No. 1007, Regulatory Blowout: How Regulatory Failures Made the BP Disaster Possible, and How the System Can be Fixed to Avoid a Recurrence 1–3, 13 (2010), available at http://www.progressivereform.org/articles/BP_Reg_Blowout_1007.pdf. The author is additionally grateful for the invaluable editorial assistance of Alice Johnson, research fellow at the Thurgood Marshall Law Library; the research assistance of Andrew Goldman and Summer Hughes Niazy; and the wise advice of Holly Doremus, Thomas McGarity, Rory O’Neill, Robert Percival, and Matthew Shudtz.
Identifiable but Not Identical: Combining Social Identity and Uniqueness Motives in Choice

How do consumers reconcile conflicting motives for social group identification and individual uniqueness? Four studies demonstrate that consumers simultaneously pursue assimilation and differentiation goals on different dimensions of a single choice: they assimilate to their group on one dimension (by conforming on identity-signaling attributes such as brand) while differentiating on another dimension (distinguishing themselves on uniqueness attributes such as color). Desires to communicate social identity lead consumers to conform on choice dimensions that are strongly associated with their group, particularly in identity-relevant consumer categories such as clothing. Higher needs for uniqueness lead consumers to differentiate within groups by choosing less popular options among those that are associated with their group. By examining both between- and within-group levels of comparison and using multidimensional decisions, this research provides insight into how multiple identity motives jointly influence consumer choice.
The Impact of Compulsory Licensing on Foreign Direct Investment: A Collective Bargaining Approach

The innovation impact of intellectual property compulsory licenses - government-imposed access without the authorization of the property owner - has generated great interest in the academic literature. Moreover, recent measures by the governments of Thailand and Brazil have generated increased international awareness of the issue. Equally significant, but receiving less attention is the impact of compulsory licenses on flows of foreign direct investment (FDI) to the granting nation. It is quite likely that FDI mechanisms provide an important attenuating factor that influences a country's compulsory license strategy. This paper investigates the compulsory license-FDI relationship, using essential medicines as a context. It explores the potential for collective action and bargaining on the part of licensing nations to minimize FDI losses while preserving access. Middle-developed countries (MDC) such as Egypt and Brazil are highlighted to demonstrate the extent to which nations with differing abilities to resist political pressure can influence FDI losses. The paper concludes by demonstrating optimal negotiating strategies using a unique game theory framework that models real-world licensing decisions
A Model of Unorganized and Organized Retailing in Emerging Economies

In the last two decades, organized retailing has transformed the retailing landscape in emerging economies, where unorganized retailing has traditionally been dominant. In this paper, we build a theoretical model of unorganized and organized retailing in emerging economies by carefully modeling key characteristics of the retailing environment, the retailers, the consumers, and product categories. The primary insight that we obtain is that in a competitive market comprising of only unorganized retailers, the advent of organized retailing injects efficiency into the market leading to a reduction in the number of unorganized retailers. This, in turn, makes the market less competitive. Building on this basic insight, we obtain a number of counterintuitive results. For instance, (i) the presence of organized retailing may increase the prices charged by unorganized retailers; (ii) as the consumers’ transportation cost to the unorganized retailers increases, the market share of the unorganized retailing sector m...
Gayffirmative Action: The Constitutionality of Sexual Orientation-Based Affirmative Action Policies

Twenty-five years ago, the U.S. Supreme Court established a consistency principle in its race-based equal protection cases. That principle requires courts to apply the same strict scrutiny to racial classifications designed to benefit racial minorities—such as affirmative action policies—as they do to laws invidiously discriminating against them. The new consistency principle, under which discrimination against whites is subject to strict scrutiny, conflicted with the Court’s established criteria for declaring a group to be a suspect or quasi-suspect class entitled to heightened scrutiny, which focused on such considerations as the history of discrimination against the group and its political powerlessness. As a result of this tension, the Court’s line of precedents for identifying new suspect and quasi-suspect classes has gone dormant, and the Court has not since considered whether any additional such classes exist. Instead, when confronted with plausible candidates for heightened scrutiny, such as gays and lesbians, the Court has engaged in sporadic application of stealth rational basis review. In this Article, I use a hypothetical equal protection challenge to a sexual orientation-based affirmative action policy as a vehicle for proposing a roadmap for harmonizing these competing lines of precedent. I demonstrate that, in light of the consistency principle, an aggrieved heterosexual can bring a challenge to such a policy and seek heightened equal protection scrutiny even though the Court has yet to establish heightened scrutiny for laws discriminating against gays and lesbians. I conclude that such a harmonization of the Court’s equal protection precedents will reinvigorate the Court’s moribund precedents for identifying new suspect and quasi-suspect classes. Moreover, I conclude that announcing heightened scrutiny in such a case would present a  Jeffrey & Susan Brotman Professor of Law and Adjunct Professor of Gender, Women & Sexuality Studies, University of Washington. I wish to thank Josh Blackman, Luke Boso, Michael Boucai, Benjamin G. Davis, and Suzanne B. Goldberg for their valuable feedback on earlier drafts of this Article. Washington University Open Scholarship 734 WASHINGTON UNIVERSITY LAW REVIEW [VOL. 92:733 particularly appealing vehicle to the Court’s center, represented by Justice Kennedy, whose jurisprudence demonstrates both support for gay rights and hostility toward affirmative action policies.
Fiscal Institutions, Credit Ratings, and Borrowing Costs

This paper investigates the impact of fiscal institutions on state government borrowing costs. We find that institutions have both a direct and indirect effect on interest costs paid by state governments. Revenue limits are associated directly with higher interest costs; expenditure limits, stricter balanced budget rules, and restrictions on state debt issuance are indirectly associated with lower interest costs because they lead to higher credit ratings. It appears that investors and bond raters incorporate information on fiscal institutions into their assessment of state government credit quality.
5 U.S.C. § 553: Patent Elephants in Process Mouseholes

Reversing Tafas v. Dudas, 541 F.Supp.2d 805 (E.D.Va. 2008), a panel of the Federal Circuit in Tafas v. Doll, 2009 WL 723353 (Fed. Cir. 2009), finds challenged rules within the rulemaking authority of the U.S. Patent and Trademark Office (PTO). It therfore remands for consideration of a host of issues that the district court had not needed to reach.This comment focuses on one question to be considered on remand: whether the PTO must use notice and comment rule making to promulgate procedural rules. It argues that the statute does not warrant imposing such an unusual duty. Moreover, it argues that the issue need not be addressed insofar as rules in question were in fact promulgated after notice and extensive (if largely unfavorable) public comment.The comment also notes that the opinion was vacated by the Federal Circuit en banc in Tafas v. Kappos.
Capital Market Development and Confidence in Disclosure Quality

ABSTRACT Using a survey-based measure that directly captures beliefs about disclosure quality (SFARS) in a panel with over 1,000 country-year observations, this study examines macro-level capital m...
The Impact of Jumps in Volatility and Returns

This paper examines continuous-time stochastic volatility models incorporating jumps in returns and volatility. We develop a likelihood-based estimation strategy and provide estimates of parameters, spot volatility, jump times, and jump sizes using S&P 500 and Nasdaq 100 index returns. Estimates of jump times, jump sizes, and volatility are particularly useful for identifying the effects of these factors during periods of market stress, such as those in 1987, 1997, and 1998. Using formal and informal diagnostics, we ¢nd strong evidence for jumps in volatility and jumps in returns. Finally, we study how these factors and estimation risk impact option pricing.
A model for sustainable land use in biofuel production: An application to the state of Alabama

Abstract The Renewable Fuel Standard aims to increase the production of biofuels to improve energy efficiency and decrease carbon dioxide emissions in the US. The effectiveness of this regulation is being debated by the scientific community regarding carbon emissions from direct and indirect land-use change. A valid alternative may be to design policies that stimulate sustainable land use in biofuel production. This article develops a model that simulates a voluntary program to increase the land use efficiency in production of biofuels. This stochastic dynamic model optimizes the sustainability of biofuels producible by including climate information and participatory decisions on land use. The model is parameterized using the Maximum Entropy econometric technique to present a simulation of the program in the State of Alabama. The results of this simulation show that participatory decisions on land-use may increase the net energy value of produced biofuel up to 215.68% and reduce the carbon emissions by 19.67% towards the state energy goals.
Competition and product innovation in dynamic oligopoly

We investigate the relationship between competition and innovation using a dynamic oligopoly model that endogenizes both the long-run innovation rate and market structure. We use the model to examine how various determinants of competition, such as product substitutability, entry costs, and innovation spillovers, affect firms’ equilibrium strategies for entry, exit, and investment in product quality. We find an inverted-U relationship between product substitutability and innovation: the returns to innovation initially rise for all firms but eventually, as the market approaches a winner-take-all environment, laggards have few residual profits to fight over and give up pursuit of the leader, knowing he will defend his lead. The increasing portion of the inverted-U reflects changes in firm’s investment policy functions, whereas the decreasing portion arises from the industry transiting to states with fewer firms and wider quality gaps. Allowing market structure to be endogenous yields different results compared to extant work that fixes or exogenously varies the market structure.
War and the Corporation

Recent events have confirmed human society’s commitment to building the social institutions needed for peace. It is becoming clear that these institutions will have to include business corporations.
Estimating Demand for Local Telephone Service with Asymmetric Information and Optional Calling Plans

In this paper, I study the theoretical and econometric implications of agents' uncertainty concerning their future consumption when a monopolist offers them either a unique, mandatory nonlinear tariff or a choice in advance from a menu of optional two-part tariffs. Agents' uncertainty is resolved through individual and privately known shocks to their types. In such a situation the principal may screen agents according to their ex ante or ex post type, by offering either a menu of optional tariffs or a standard nonlinear schedule. The theoretical implications of the model are used to evaluate a tariff experiment run by South Central Bell in two cities in Kentucky in 1986. The empirical approach explicitly accounts for the existence of informational asymmetries between local telephone users and the monopolist, leading to different, nested, econometric specifications under symmetric and asymmetric information. The empirical evidence suggests that there exists a significant asymmetry of information between consumers and the monopolist under both tariff regimes. All expected welfare components failed to increase with the introduction of optional tariffs for the estimated value of the parameters. Copyright 2002, Wiley-Blackwell.
Cutting class to play video games

Abstract Video games represent a class of new leisure activity that makes use of advances in information technology. These increasingly popular pastimes can crowd out time spent on other activities. I exploit week-to-week variation in video game popularity to identify variation in video game playing time likely due to changes in game quality rather than to individuals selecting into gaming. I find that when video game sales increase, students spend more time playing games, and less time attending class and doing homework. Differential effects for college students and those with lower incomes indicate large effects for these groups. Newly developing ICT based pastimes, such as use of online social media, could have similar effects.
"Persuading Crowds: Mindset, Learning, and Influence Mechanisms in Crowdfunding Campaigns"

Persuasion is fundamental to resource acquisition for entrepreneurial ventures. We examine how and why entrepreneurs strategically combine various persuasion mechanisms as they attempt to acquire r...
From Deficit Delusion to the Fiscal Balance Rule: Looking for an Economically Meaningful Way to Assess Fiscal Policy

Notwithstanding its widespread use as a measure of fiscal policy, the government deficit is not a well-defined concept from the perspective of neoclassical macro economics. From the neoclassical perspective the deficit is an arbitrary accounting construct whose value depends on how the government chooses to label its receipts and payments. This paper demonstrates the arbitrary nature of government deficits. The argument that the deficit is not well-defined is first framed in a simple certainty model with nondistortionary policies, and then in settings with uncertain policy, distortionary policy, and liquidity constraints. As an alternative to economically arbitrary deficits, the paper indicates that the “Fiscal Balance Rule” is one norm for measuring whether current policy will place a larger or smaller burden on future generations than it does on current generations. The Fiscal Balance Rule is based on the economy's intertemporal budget constraint and appears to underlie actual attempts to run tight fiscal policy. It says take in net present value from each new young generation an amount equal to the flow of government consumption less interest on the difference between a) the value of the economy's capital stock and b) the present value difference between the future consumption and future labor earnings of existing older generations. While the rule is a mouth-full, one can use existing data to check whether it is being obeyed and, therefore, whether future generations are likely to be treated better or worse than current generations.
An Increased Role for the Department of Education in Addressing Federalism Concerns

The No Child Left Behind Act of 2001 (NCLB) is overdue for reauthorization, and prior attempts at reauthorization have failed because of political controversy surrounding the Act, particularly the extent of the federal role in education. But whether this role is detrimental is debatable. Federalism, the interaction of state governments with the federal government, often involves trade-offs between state and federal power, where courts try to draw limits on federal power. The Act does not fit squarely into lines traditionally drawn. Yet the field is ripe with new theories of federalism. How a refined view of federalism should influence legislators looking to reauthorize the Act has not been adequately addressed in the literature.After examining the history of federalism concerns related to education, this article argues that the traditional institutions for addressing these concerns -- legislative and judicial -- are inadequate. This article suggests that Congress should give greater responsibility to the Department of Education to better balance state and federal concerns regarding education reform.
The effect of enforcement on timely loss recognition: Evidence from insider trading laws $

Abstract I use the first-time enforcement of insider trading laws in sixteen countries as a shock to enforcement and examine its influence on timely loss recognition ( TLR ). Consistent with greater enforcement increasing the usefulness of accounting information in contracts and thereby the demand for higher quality reporting, insider trading enforcement is associated with a significant increase in TLR . No such increase is detected in neighboring non-enforcing countries. In addition to documenting how shocks to enforcement influence financial reporting outcomes, this is also the first study to extend the Khan and Watts (2009) measure of accounting conservatism to a cross-country setting.
The Impact of State Rainy Day Funds in Easing State Fiscal Crises During the 1990–1991 Recession

This article examines the degree to which rainy day funds eased the fiscal stress experienced by states during the 1990–1991 recession. In the first section, a state fiscal policy of neutrality over the business cycle is used as a benchmark for evaluating the use of budget stabilization funds. The next section looks at data from the last three recessions to see how recessions have affected the taxes and expenditures of states. A measure of degree of fiscal stress experienced by each state during the 1990–1991 recession is then calculated. These results are used to empirically investigate the impact of explicit state rainy day funds in easing state fiscal stress. Next, the article examines whether states that had rainy day funds in 1989 were more likely to have less fiscal stress, and whether the specific deposit and withdrawal provisions of these funds made a difference.
Critical Accounting Policy Disclosures

To increase investor awareness of the sensitivity of financial statements to the methods, assumptions, and estimates underlying their preparation, the Securities and Exchange Commission (SEC) proposed that firms include disclosures about critical accounting policies (CAPs) in their 10-Ks. Using a large sample of CAP disclosures from SEC filers, we provide evidence on the extent to which CAP disclosures correlate with existing financial statement information, provide new information, and corroborate theories of voluntary disclosure. We also consider the interaction among disclosures, finding limited support for disclosure decisions following a portfolio rather than an account by account approach.
Tax Authority as Regulator and Equity Holder: How Shareholders' Control Rights Could Be Adapted to Serve the Tax Authority

The tax authority stands in two distinct positions vis-a-vis each taxpaying firm. First, the tax authority promotes the government’s interest as regulator. Second, the tax authority serves a revenue raising function, which is accomplished through a right to share in firms’ income. That right to share in firms’ income is similar to that possessed by the firms’ shareholders. But while the economic rights of shareholders and the tax authority show profound similarities, the control rights afforded to the latter take a drastically different form from those afforded to the former. Unlike a shareholder, the tax authority cannot vote for representatives on the board of directors, cannot threaten management with a transfer of its interest to those more able to impose discipline, and can not align management’s interests with its own by sharing a portion of tax receipts with them. Moreover, directors and officers do not owe the tax authority fiduciary duties that minimize agency costs for other interest holders. Having identified that shareholders and the tax authority have similar economic interests in a firm, but that the latter lacks control rights possessed by the former, this paper considers three questions. First, does the tax authority need distinct control rights? Though shareholders as fellow equityholders will likely further the tax authority’s revenue raising goals, they are unlikely to compromise those revenue goals when they conflict with regulatory aims. Accordingly, the tax authority does need its own control rights. Second, if the tax authority requires its own control rights in each firm, why not grant it the same rights as those traditionally possessed by shareholders? A series of alternative designs to the contemporary tax system are proposed that adapt safeguards afforded to shareholders to serve the tax authority, such as allowing the tax authority to appoint directors, auction its tax receivables, share tax receivables with management, and benefit from fiduciary duties. The desirability of each of these adjustments is explored. The third question is, given that the tax authority lacks the control rights provided to shareholders, how are its distinct interests protected? The paper explains how a contoured mandatory dividend in favor of the tax authority functions as a substitute safeguard, which in addition to financing government projects and furthering its other regulatory goals provides the government with a series of levers that may be used to influence risk profiles across
Globalization and Legal Knowledge: Implications for Comparative Law

Globalization brings laws and legal cultures into more direct, frequent, intimate, and often complicated and stressed contact. It influences what legal professionals want and need to know about foreign law, how they transfer, acquire, and process information, and how decisions are made. We might expect the field of comparative law, therefore, to be replete with efforts to comprehend globalization and its impacts on law and to develop strategies for dealing with them. If the central objective of comparative law as a discipline is to “know” foreign law, then these issues should be central to its project. So far, however, comparatists have paid relatively little attention to these influences and their implications. In this Article I identify cognitive and communication issues created by globalization, and I suggest ways in which comparative analysis can address these issues. My central claim here is that globalization calls for increased attention to goals and methods that have been either neglected or little developed in comparative law studies. Specifically, globalization demands development of more sophisticated tools for structuring and interpreting foreign legal knowledge, and it requires more attention to the processes by which legal information is acquired, processed, and transferred.
Economic Freedom, Financial Crisis and Stock Volatilities in Emerging Markets

This paper explores how equity market volatilities are related with the Index of Economic Freedom for 22 emerging countries over 1995-2010 by considering the impacts of financial crisis. Consistent with theory, we find the overall economic freedom index and its components exert significant impacts on equity market volatilities. Specifically, the index components within the categories of regulatory efficiency (such as business freedom and monetary freedom) and limited government (fiscal freedom, and government spending) exhibit strong and significant explaining powers to the stock market volatilities. However, the other index components within the categories of rule of law and open markets are not significant. In addition, the stock market volatilities are significantly higher when the country confronts either one of the currency crisis, inflation crisis, stock market crash, debt crisis, or banking crisis. The results are consistent across different levels of inflation and wealth in emerging markets.
When Web Pages Influence Choice: Effects of Visual Primes on Experts and Novices

This article extends the idea that priming can influence preferences by making selected attributes focal. Our on-line experiments manipulate the background pictures and colors of a Web page, affecting consumer product choice. We demonstrate that these effects occur for both experts and novices, albeit by different mechanisms. For novices, priming drives differences in external search that, in turn, drive differences in choice. For experts, we observe differences in choice that are not mediated by changes in external search. These findings confirmed that on-line atmospherics in electronic environments could have a significant influence on consumer choice.
Is Warren Buffett's Commentary on Accounting, Governance, and Investing Practices Reflected in the Investment Decisions and Subsequent Influence of Berkshire Hathaway?

ABSTRACT: We examine (1) whether the accounting, governance, and investing practices of Berkshire Hathaway investees are consistent with Warren Buffett's public statements on what constitutes good accounting, governance, and investing practices and (2) whether these practices are associated with Berkshire's initial “selection” or Buffett's subsequent “influence.” Compared to control firms, we find that Berkshire investees are highly likely to follow Buffett's investment philosophy, somewhat likely to follow his preferred accounting, disclosure, and compensation policies, but unlikely to follow the board-related governance practices that we can measure. Second, we find some evidence that the business practices of future Berkshire investees are more aligned with Buffett's beliefs in the pre-investment period compared to control firms. Third, we find relatively modest evidence that investees improve a few of their business practices subsequent to Berkshire's initial investment. However, and overall, Buffett ...
Capital Structure Decisions in the Insurance Industry: Stocks versus Mutuals

Mutual insurers generally face higher costs of raising new capital than stock insurers. Other things being equal, the higher costs of raising capital should cause mutual insurers to have higher ex ante target capital to liability ratios than stock insurers. Mutual insurers' capital ratios also should be more sensitive to income than capital ratios for stock insurers and therefore adjust more slowly toward their long-run targets. We provide evidence concerning these issues using aggregate time series data for stock and mutual insurers during 1984–1999 and a large panel data set during 1991–1998. Our regressions provide strong evidence that annual changes in capital to liability ratios are more sensitive to income for mutual insurers than for stock insurers. We also provide evidence that mutual insurers' capital ratios are on average higher than those for stock insurers after controlling for several factors that could influence capital ratios.
TARP’s dividend skippers

Most of the banks receiving capital injections from the Troubled Asset Relief Programme (TARP) issued preferred stock to taxpayers. This paper presents the factors that affect publicly traded banks’ ability to pay the scheduled TARP preferred stock dividends. Smaller banks with weaker capital ratios and more problem loans are significantly more likely to suspend payments of their bailout dividends.
Bringing Social Class to the Diversity Challenge.

We need, says the author, to stop pretending that class doesn't exist and begin to critically consider it as rigorously as we do race and gender.
Does audit market concentration harm the quality of audited earnings? Evidence from audit markets in 42 countries

Audit regulators around the world have expressed concern over market dominance by Big 4 accounting firms and the potential adverse effect it may have on the quality of audited financial statements. We use cross-country variation in the audit market structure of 42 countries to examine two separate aspects of Big 4 dominance: (1) Big 4 market concentration as a group relative to non–Big 4 auditors; and (2) concentration within the Big 4 group in which one or more of the Big 4 firms is dominant relative to the other Big 4 firms. We find that in countries where the Big 4 (as a group) conduct more listed company audits, both Big 4 and non–Big 4 clients have higher quality audited earnings compared to clients in countries with smaller Big 4 market shares. In contrast, in countries where there is a greater concentration within the Big 4 group, we find that Big 4 clients have lower quality audited earnings compared to countries with more evenly distributed market shares among the Big 4. Thus concentration within the Big 4 group appears to be detrimental to audit quality in a country and of legitimate concern to regulators and policymakers. However, Big 4 dominance per se does not appear to harm audit quality and is in fact associated with higher earnings quality, after controlling for other country characteristics that potentially affect earnings quality.
The Political Cost of War Mobilization in Democracies and Dictatorships

Recent research concludes fighting or losing an interstate war is not costlier for democratic leaders than dictators, which implies most of our institutional explanations for differences in conflict behavior across regime type rest on empirically tenuous assumptions. I argue military mobilization, a fundamental but often overlooked aspect of war, should be costlier for democrats than dictators. Waging interstate war is associated with higher military spending and, often, lower social spending. Variation across regime type in the representation of the general public, civilian elite, and military in leaders’ winning coalitions should make democrats more likely than dictators to lose power given wartime patterns of government spending. This argument finds support during the period from 1950 to 2001. My findings provide microfoundations for a number of existing empirical results and suggest that differences in the conflict behavior of democracies and dictatorships should be largest when waging war requires a ...
Chief Judge Melvin Shortess: A Pencil Sketch from Life

Chief Judge Melvin Shortess. Speech delivered on the occasion of the retirement of Chief Judge Melvin Shortess, Louisiana First Circuit Court of Appeal.
Accountability of State and Non-state Actors for Human Rights Abuses in the “War on Terror”

The decisions regarding detainees in the so-called "war on terror" - Hamdi, Padilla, and Rasul - leave a number of questions unresolved. This essay focuses on one question in particular: What happens when terrorists are detained not by U.S. authorities, but by private contractors hired by U.S. authorities? Domestically and internationally, we are seeing an increasing turn to private contractors performing what we might think of as core governmental functions. Accordingly, it is vital to consider to what extent private actors involved in the treatment of detainees in the war on terror can be held accountable for their actions. Although in the domestic context many scholars argue that privatization leads to a dramatically reduced scope of accountability, we may not be able to translate that conclusion to the international sphere because the baseline is different; accountability is actually very difficult to achieve under international law with respect to either state or private actors. Although there are not many avenues to hold private actors accountable, there are some possibilities, which will be discussed in this essay. In particular, this essay suggests that human rights lawyers and scholars should consider not only accountability through the vehicle of suits to enforce international law norms, but also suits to enforce ordinary municipal law.
Do upgrades matter? Evidence from trading volume

Abstract Prior researchers document no significant abnormal returns around upgrades of credit ratings, suggesting upgrades convey no new information. These studies are limited by lack of data, liquidity screens, and ambiguous predictions. We extend the literature using trading volume. Because trading volume is highly non-normally distributed (especially bond market volume), we derive a new, more powerful nonparametric test statistic that can be used in other applications. Abnormal volume is significant in the stock and bond markets around upgrades and downgrades. Some abnormal volume is attributable to credit ratings-based regulations. Controlling for other effects, we find evidence that upgrade announcements contain information.
The Challenges of Using Citizen Reporting to Improve Public Services: A Field Experiment on Solid Waste Services in Uganda

Author(s): Buntaine, Mark T; Hunnicutt, Patrick; Komakech, Polycarp | Abstract: Abstract Governments around the world are investing in technologies that allow citizens to participate in the coproduction of public services by providing monitoring and feedback, but there is little evidence about how these initiatives affect the quality of public services. We implemented a large-scale field experiment that involved organizing 50 citizen reporters in each of 100 neighborhoods across Kampala, Uganda, to provide weekly reports to the municipal government about the delivery of solid waste services via an SMS-messaging platform, resulting in 23,856 reports during the 9-month study period. Citizen reporting did not reduce informal waste accumulation as targeted, which would indicate improvements to formal services. Using our observations as participants in the development and deployment of the reporting platform and interviews with staff at the government agency receiving the citizen reports, we show how the public generated inconsistent information that did not fit existing decision-making processes. We generalize lessons from this field experiment by explaining how coproduction involving information sharing through information and communication technologies is likely to affect public services based on the alignment of citizen-produced data with the information problems managers face; the search costs of detecting public services failures; the quality of citizen-produced data; and the operating costs of citizen-reporting platforms.
Market Culture: How Rules Governing Exploding Offers Affect Market Performance

cerning when offers can be made, accepted, and rejected. Examining such markets suggests it is difficult to establish a thick market at an efficient time if firms can make exploding offers, and workers cannot renege on early commitments. Laboratory experiments allow us to isolate the effects of exploding offers and binding acceptances. In a simple experiment, we find inefficient early contracting when firms can make exploding offers and applicants’ acceptances are binding. (JEL C91, D40, D81)
Ashcroft v. Iqbal Crashes Rule 8 Pleading Standards on to Unconstitutional Shores

Over the course of the last two centuries, the realities of modern civil litigation and the traditional interpretation of the Seventh Amendment have been on a collision course. The recent Supreme Court Opinion in Ashcroft v. Iqbal, heightening the pleading standards under Rule 8, is the point of impact. The thesis of this Article is that while the Iqbal Opinion fails even to acknowledge a potential conflict with the Seventh Amendment, the decision interprets Rule 8 in a manner that is unconstitutional when measured against the traditional interpretation of the Seventh Amendment.