cssi/SciSciGPT-SciSciNet huggingface dataset:
"Stranger than Fiction": Taxing Virtual Worlds

Virtual worlds are increasing in commercial importance. As the economic value of computer-generated spaces soars, questions of how to apply our tax law to transactions within them will inevitably arise. In this Article, Professor Leandra Lederman argues for federal income tax treatment that reflects the differences between “game worlds” and “unscripted worlds,” arguing that the former should receive more favorable tax treatment than the latter. Specifically, she argues that transactions in game worlds such as World of Warcraft should not be taxed unless the player engages in a real-market sale or exchange. By contrast, in intentionally commodified virtual worlds such as Second Life, federal income tax law and policy counsel that in-world sales of virtual items be taxed regardless of whether the participant ever cashes out.
Mass Layoffs and CEO Turnover

We investigate the relationship between layoff announcements and CEO turnover over a 31-year period. We find that layoffs significantly increase CEO turnover in the following year, and, in some time periods, CEO changes are strongly positively associated with layoff announcements two years earlier. We proceed to show how this relationship has changed over time, and offer several possible explanations. Finally, we find strong evidence that layoffs that are associated with negative stock price reactions are much more likely to lead to CEO turnover than those associated with positive stock price reactions, especially in the earlier years in our sample.
Are bankruptcy's trials vanishing? if so, who cares?

This essay reviews the competing claims in the American Bankruptcy Law Journal’s “Vanishing Trials” symposium. The essay concludes the contributions to the symposium are not as disparate as they might at first appear. One must distinguish between the level of contentiousness in a legal system and the mechanisms by which the system resolves disputes in those proceedings that become contentious.
Principles of Internet Privacy

The definition of privacy developed by Brandeis and Warren and Prosser, and effectively codified by Alan Westin in 1967 - the claim of individuals, groups, or institutions to determine for themselves when, how, and to what extent information about them is communicated to others - worked well in a world in which most privacy concerns involved physical intrusions (usually by the government) or public disclosures (usually by the media), which, by their very nature, were comparatively rare and usually discovered. But that definition's exclusive focus on individual control has grown incomplete in a world in which most privacy concerns involve data which we inevitably generate in torrents as go through our lives in an increasingly computerized, networked environment, and which can be collected and used by virtually anyone, usually without us knowing anything about it. Few of us have the awareness and expertise to consider trying to control all of the data we generate, few of us have the time or, frankly, even the incentive to attempt to do so, and the sheer volume of data, variety of sites where they are collected and used, and economic incentive for doing so would make the attempt laughably futile. This is not to suggest that individual control should not be part of our understanding of privacy, but rather that it can no longer reasonably be considered the only part. This article identifies principles that should undergird the government's efforts to protect privacy and craft privacy norms, and then contrast the application of those principles in particular settings identified by Professor Paul Schwartz in his article Internet Privacy and the State.
Character and Context: What Virtue Theory Can Teach Us about a Prosecutor's Ethical Duty to Seek Justice

A critical issue facing the criminal justice system today is how best to promote ethical behavior by public prosecutors. The legal profession has left much of a prosecutor’s day-to-day activity unregulated, in favor of a general, catch-all admonition to “seek justice.” In this article the author argues that professional norms are truly functional only if those working with a given ethical framework recognize the system’s implicit dependence on character. A code of professional conduct in which this dependence is not recognized is both contentless and corrupting. Building on the ethics of Aristotle and modern philosophers Alasdair MacIntyre and Bernard Williams, the author argues that virtue theory can help bridge the gaps in prosecutorial ethics where other forms of moral reasoning fail. The author analyzes three especially difficult ethical problems frequently confronted by prosecutors in the field. He demonstrates not only that the Model Rules of Professional Conduct and the ABA Criminal Justice Standards fail to answer any of these complex questions, but also that future attempts to more closely regulate how prosecutors should act in any of these nuanced situations are unlikely to succeed. The author argues that honesty, fairness, courage, and prudence are the primary virtues that citizens have a right to expect of their public prosecutors. He then demonstrates how these four key virtues might provide important guidance to conscientious prosecutors striving to do what is right. The author concludes by offering several insights into how the field of virtue ethics might inform both the structure and organization of government law * Associate Professor, Boston College Law School. I thank my colleagues Judy McMorrow, Ray Madoff, and Paul Tremblay for their thoughtful comments on an earlier draft, and my students Joshua Gallitano, Martha Wilson-Byrne, and Robert Frederickson for their capable and energetic research assistance. CASSIDY_FINALREAD 1/18/2007 10:43:02 AM 102 N O T R E D A M E L A W R E V I E W [VOL. 82: 2 offices, and the manner in which individual prosecutors working within these offices might perceive and fulfill their professional roles.
Does Anyone Really Want a Parliament of Man

This is a review-essay of historian Paul Kennedy's recent history of the UN and global governance, The Parliament of Man. It offers a critical look at Kennedy's account of the development of the UN as the gradual, if fitful, progress of the United Nations towards global governance under an order of liberal internationalism - the slow triumph of international institutions and law over the the anarchy of international power politics among sovereign states. The essay argues that what Kennedy views as the gradual movement toward global governance by the UN, or international institutions of any kind, in the truly crucial matters of international security is actually an artifact of US hegemony, which offers the world a set of global public goods and minimal order. The extra-UN provision of these global public goods by the United States provides the otherwise missing exit from the classic problem of collective security - insincere promising, defection, and free-riding. The essay argues that Kennedy is essentially a "Whig historian" - positing a progress to history based around notions of global governance. It urges that the embrace of democratic sovereignty, with robust multilateralism among sovereigns, as an ideal political position, over internationalist global governance premised upon an indefinitely receding future in which universal, utopian, international organizations and law will overcome and replace sovereignty. Meanwhile, the "decline of the US" thesis and rise of multipolarity, celebrated by many as leading to a more just global order, should in fact give great pause, because a multipolar world is a more competitive, not more cooperative world. And the "universal" values of human rights might turn out, in retrospect, to have been far less a condition of international organizations and law and far more a benefit of US hegemony.
'Twas Four Weeks before Christmas: Retail Sales and the Length of the Christmas Shopping Season

Abstract I study the effect of the length of the Christmas “shopping season” on aggregate retail sales. I find a statistically significant increase in per-capita retail sales in November and December (combined) of approximately $6.50 per additional day over the relevant range.
"Marbury" in Mexico: Judicial Review's Precocious Southern Migration

Scholars agree that the United States Supreme Court did not discover the general judicial review aspects of Marbury v. Madison (1803) until nearly a century later in 1895. This article reveals that the Mexican Supreme Court, relying heavily on U.S. constitutional sources and quoting Marbury, discovered this aspect of the case more than a dozen years earlier than the United States Supreme Court. In attempting to construct United States-style judicial review for the Mexican Supreme Court in the 1880s, Ignacio Vallarta, president of the court, read Marbury in a way that preceded this use of the case in the United States. Using this surprising fact as a central example, this article makes several important contributions to the field of comparative constitutional law. The work demonstrates that through constitutional migration, novel readings of constitutional sources can arise in foreign fora. In an era when the United States Supreme Court may be accused of parochialism in its constitutional analysis, the article addresses the current controversy surrounding the Court's recent use of foreign sources. In discussing Vallarta's constitutional thought, the work makes contributions to the terminology of constitutional migration, to the historiography of Mexican constitutionalism, and to questions of common law and civil law approaches to constitutional decision making. It concludes that Mexico's precocious use of Marbury profoundly affected Mexican legal development and may serve as an example of the usefulness of comparative constitutionalism.
Cyclic $A_\infty$ structures and Deligne's conjecture

First we describe a class of homotopy Frobenius algebras via cyclic operads which we call cyclic A∞ algebras. We then define a suitable new combinatorial operad which acts on the Hochschild cochains of such an algebra in a manner which encodes the homotopy BV structure. Moreover we show that this operad is equivalent to the cellular chains of a certain topological (quasi)operad of CW–complexes whose constituent spaces form a homotopy associative version of the cacti operad of Voronov. These cellular chains thus constitute a chain model for the framed little disks operad, proving a cyclic A∞ version of Deligne’s conjecture. This chain model contains the minimal operad of Kontsevich and Soibelman as a suboperad and restriction of the action to this suboperad recovers the results of Kontsevich and Soibelman [Math. Phys. Stud. 21, Kluwer Acad. Publ., Dordrecht (2000) 255–307] and Kaufmann and Schwell [Adv. Math. 223 (2010) 2166–2199] in the unframed case. Additionally this proof recovers the work of Kaufmann in the case of a strict Frobenius algebra. We then extend our results to the context of cyclic A∞ categories, with an eye toward the homotopy BV structure present on the Hochschild cochains of the Fukaya category of a suitable symplectic manifold.
Broadband adoption and content consumption

Abstract We explore how broadband access drives changes in the quantity and diversity of consumption of online content by using panel data that describes household Internet usage before and after broadband adoption. Our data suggests that on average, broadband adoption increases usage by over 1300 min per month. We also find that information consumption becomes more evenly distributed within the population, driven in part by post-adoption usage gains of almost 1800 min per month among individuals who were in the lowest usage quintile before adopting broadband. After adopting broadband, this pre-adoption lowest-usage quintile consumes content in greater quantities than users in neighboring quintiles, passing both the second and third quintiles in terms of absolute usage. This suggests that these users may have had strong preferences for high-bandwidth content that was too costly to consume in a narrowband environment. We also show that broadband adoption increases the variety of content that users consume although many of these gains appear to be associated with an increase in the variety of sites visited within previously visited content categories rather than an expansion in the types of content consumed.
Naming, Identity, and Trademark Law

As the process of creation in the age of digital media becomes more fluid, one pervasive theme has been the desire for attribution: from the creator’s perspective, to receive credit for what one does (and to have credit not falsely attributed) and from the audience’s perspective, to understand the source of material with which one engages. But our norms of attribution reflect some inconsistencies in defining the relationship among name, identity, and authenticity. A blog post by a writer identified only by a pseudonym may prove to be very influential in the court of public opinion, while the use of anonymous sources by established journalists may be viewed as unethical. Supreme Court jurisprudence both touts the benefits of anonymity and decries it as a barrier to the free flow of information. In the commercial realm, consumers file suit when the memoir they have purchased turns out to be largely fiction but seem far less concerned when a company emerges from a public relations disaster with a new name, leaving its old one to the dustbin of history. This conflicted response may be further complicated by the fact that we think about names in a very personal way, as a core part of our identity. But names are not, strictly speaking, our identity - they are merely symbols of our identity that denote a particular set of characteristics at a particular time. Indeed, as naming theory tells us, the denotative function of a name is what makes a word a name at all. It is for this reason that an individual or a corporation can adopt a new name without being accused of fraud and why a company can sell products under more than one trademark. Naming law - whether the law of personal names or the law of trademarks - tends to reflect these principles of naming theory. In large part, the law focuses on a name or mark’s denotative effect, interfering only when confusion or changes to the essential nature of the referent renders the name’s identifying function uncertain. And, indeed, in the instances when the law is inconsistent with naming theory - attempting to regulate the connotations associated with names rather than their denotative function - we might question whether it is achieving an appropriate goal. Confining naming law to this important but limited function achieves a balance between respecting the autonomy of individuals and entities to choose the names with which they represent themselves to the public and ensuring that such choices do not significantly frustrate the flow of information that allows the public to engage in decision making.
Circling around the Confrontation Clause: Redefined Reach But Not a Robust Right

This brief essay comments on the Supreme Court's consolidated 2006 decisions in Davis and Hammon, interpreting Crawford's requirement that testimonial statements offered in criminal trials be subject to confrontation.
Compensating Power: An Analysis of Rents and Rewards in the Mutual Fund Industry

The allegations of malfeasance in the investment management industry - market timing, late trading, revenue sharing, and several others - involve a broad range of mutual fund operations. This Article seeks to explain the common source of these irregularities by focusing upon a trait they share: the practice of investment advisers' capitalizing upon their managerial influence to increase assets under management in order to generate greater fees from those assets. This Article extends theories of executive compensation into the context of investment management to understand the extraction of rents by mutual fund advisers. Investment advisers, as collective groups of portfolio managers, interact with the boards of trustees of mutual funds in ways analogous to the dealings of business executives with corporate boards of directors. In this setting, the managerial power hypothesis of executive compensation provides a useful paradigm for understanding distortions in arm's-length bargaining between investment advisers and fund boards, as well as limitations of the market's ability to ensure optimal contracting between those parties.
Tax Rates and Corporate Decision-making

Tax Rates and Corporate Decision Making John R. Graham Duke University john.graham@duke.edu Michelle Hanlon Massachusetts Institute of Technology mhanlon@mit.edu Terry Shevlin University of California, Irvine tshevlin@uci.edu Nemit Shroff Massachusetts Institute of Technology shroff@mit.edu July 2016 Abstract: We survey companies and find that many use incorrect tax rate inputs into important corporate decisions. Specifically, many companies use an average tax rate (the GAAP effective tax rate, ETR) to evaluate incremental decisions, rather than using the theoretically correct marginal tax rate. We find evidence consistent with behavioral biases (heuristics, salience) and managers’ educational backgrounds affecting these choices. We estimate the economic consequences of using the theoretically incorrect tax rate and find that using the ETR for capital structure decisions leads to suboptimal leverage choices and using the ETR in investment decisions makes firms less responsive to investment opportunities. This paper is the winner of the American Accounting Association 2015 FARS Midyear Meeting Best Paper Award. We thank John Barrios for sharing data on the LinkedIn profiles of our survey respondents. We appreciate helpful comments from Robin Greenwood (the editor), two anonymous referees, Mary Barth, James Chyz, Bryan Cloyd, Russ Lundholm, Lil Mills (discussant), Richard Sansing, Joel Slemrod (discussant), seminar participants at the Baruch College, Columbia Law School, INSEAD conference, International Institute for Public Finance (IIPF) Annual Congress (Dublin), MaTax Conference in Germany, Stanford Summer Camp, University of California, Davis, University of Tennessee, and Virginia Tech University. Thanks to the following people for helpful comments on the development of survey questions: Jennifer Blouin, Merle Erickson, Ken Klassen, Ed Maydew, Peter Merrill, Lil Mills, Sonja Rego, Richard Sansing, Stephanie Sikes, Joel Slemrod, and Ryan Wilson. We also appreciate the support of PricewaterhouseCoopers (especially Peter Merrill) and the Tax Executives Institute (especially Tim McCormally) in asking firms to participate and in reviewing the survey document. We are grateful for the discussions with several tax executives about their role in their company. Finally, each author is grateful for the financial support of the Fuqua School of Business, Paton Accounting Fund at the University of Michigan, MIT Junior Faculty Research Assistance Program, and the Paul Merage School of Business at the University of California-Irvine. All errors are our own.
International Labour and Environmental Standards Agreements: Is This Fair Trade?

Labour and environmental standards agreements are two contentious proposals that have contributed to the failure of the WTO to launch a new round of trade liberalisation discussions and have prevented the US President from obtaining fast-track negotiating authority. Proponents of the agreements have been able to win substantial political support by arguing that standardised rules on labour practices and environmental regulations is the only way to assure that international trade remains fair. Although there are widespread demands for ‘fair trade,’ there remains a lack of understanding as to what fairness means exactly. Recently, a comprehensive catalogue of fairness principles was presented by Suranovic (2000). This paper will analyse the proposals for labour and environmental standards with respect to these fairness principles in order to characterise how fairness is used by supporters of these policies. The paper will also show that by using different fairness principles, opponents of these policies can argue that these same policies are unfair. The fact that reasonable notions of fairness can be applied by both opponents and proponents of these agreements highlights difficulties with fairness, per se, as a useful guide to policy. The paper uses this contentious issue to highlight the conceptual difficulties of proposals for fair trade.
Rule Creation in a Political Hierarchy

Principal-agent relations are replete in politics; politicians are agents of electorates, bureaucrats are agents of executives, lower courts are agents of upper courts, and much more. Commonly, principals are modeled as the rule-making body and agents as the rule-implementing body. However, principals often delegate the authority to make the rules themselves to their agents. The relationship between the lower federal courts and the Supreme Court is one such example; a considerable portion of the law (rules) is made in the lower federal courts with the Supreme Court serving primarily as the overseer of those lower courts’ decisions. In this article, we develop and test a principal-agent model of law (rule) creation in a judicial hierarchy. The model yields new insights about the relationship among various features of the judicial hierarchy that run against many existing perceptions. For example, we find a non-monotonic relationship between the divergence in upper and lower court preferences over rules and the likelihood of review and reversal by the Supreme Court. The empirical evidence supports these derived relationships. Wider implications for the principal-agent literature are also discussed.
Flat extensions of abstract polytopes

We consider the problem of constructing an abstract (n​+​1)-polytope Q with k facets isomorphic to a given n-polytope P, where k ≥ 3. In particular, we consider the case where we want Q to be (n​−​2, n)-flat, meaning that every (n​−​2)-face is incident to every n-face (facet). We show that if P admits such a flat extension for a given k, then the facet graph of P is (k​−​1)-colorable. Conversely, we show that if the facet graph is (k​−​1)-colorable and k​−​1 is prime, then P admits a flat extension for that k. We also show that if P is facet-bipartite, then for every even k, there is a flat extension P|k such that every automorphism of P extends to an automorphism of P|k. Finally, if P is a facet-bipartite n-polytope and Q is a vertex-bipartite m-polytope, we describe a flat amalgamation of P and Q, an (m​+​n​−​1)-polytope that is (n​−​2, n)-flat, with n-faces isomorphic to P and co-(n​−​2)-faces isomorphic to Q.
Short-run and long-run consumption risks, dividend processes, and asset returns

We examine the implications of short-run and long-run consumption risks on the momentum and long-term contrarian profits and the value premium in a unified economic framework. By introducing time-varying firm cash flow exposures to the short-run and long-run shocks in consumption growth, we find the otherwise standard intertemporal asset pricing model goes a long way toward generating the momentum and long-term contrarian profits and the value premium. The model also reproduces the size effect, the pairwise correlations between the profitabilities of these investment strategies, and the performance of the standard CAPM and the consumption CAPM in explaining these well-documented return behaviors.
Human Welfare, Not Human Rights

Human rights treaties play an important role in international relations but they lack a foundation in moral philosophy and doubts have been raised about their effectiveness for constraining states. Drawing on ideas from the literature on economic development, this paper argues that international concern should be focused on human welfare rather than on human rights. A focus on welfare has three advantages. First, the proposition that governments should advance the welfare of their populations enjoys broader international and philosophical support than do the various rights that are incorporated in the human rights treaties. Second, the human rights treaties are both too rigid and too vague—they do not allow governments to adopt reasonable policies that advance welfare at the expense of rights, and they do not set forth rules governing how states may trade off rights. A welfare treaty could provide guidance by supplying a maximand along with verifiable measures of compliance. Third, the human rights regime and international development policy work at cross-purposes. Development policy favors the poorest states, while the human rights regime condemns the states with the worst governments: unfortunately, the poorest states usually have the worst governments. Various possible welfare treaties are surveyed.
When Do Bidders Purchase a Toehold? Theory and Tests

Most of the theoretical literature on tender offers has been devoted to illustrating the positive effects of the toehold on the bidder's profits. Empirical research, however, shows that a high proportion of bidders do not trade on the target's shares prior to the tender offer announcement. This paper presents a model in which the bidder trades in the open market before announcing a tender offer and the incumbent shareholders form beliefs about the rival's quality given the order size. Market liquidity allows the potential bidder to partially hide her trade, and thus insiders are not able to ascertain whether an increase in volume indicates toehold acquisition. Stock price prior to the announcement date and market perception about the probability of a takeover are therefore contingent on players actions. We show that in some situations no trade will be optimal, and a negative relationship between takeover premium and toehold size arises. Interestingly, stock liquidity and initial stake are positively related. Our results also provide a theoretical basis for the observed pre-bid stock price dynamics. In particular, we show that the ratio between price runup and bid premium is increasing in the toehold size. The model's implications are then tested with a sample including tender offers in the US and the UK, estimating a bivariate generalization of the tobit model. We find a broad support for the model and significant differences across countries. We show that toeholds and probability of an acquisition are negatively related, and that companies in which the appropriation of private benefits of control is more
The Roberts Court and the Environment

During the October 2008 Term, the Supreme Court decided five cases that raised issues of environmental law and the environment was the loser in each case. While it may be difficult to characterize the decisions of the Roberts Court, generally, as “pro-environment” or “antienvironment,” a couple themes consistently appear in the Court’s decisions. First, in most of the environmental cases, the Court has adopted a position advocated or defended by a federal, state or local government when governmental interests are at issue. Second, in all of the cases that implicate federalism concerns, the Court has rendered decisions that favor States’ rights, regardless of whether the decisions are beneficial to, or harmful to, the environment. Finally, while the Court continues to rely primarily on textualism to interpret statutes, the Court has not relied on textualism to support its decisions in most of the cases that have been harmful to the environment.
Power and the Third World: Toward a Realist Political Economy of North-South Relations

By introducing questions of power into the study of North-South relations, the recent books by Jeffrey Hart and Stephen Krasner fundamentally challenge the prevailing orthodoxy of dependency and world systems theory. Power and bargaining, these two authors tell us, matter both analytically and practically. Yet, in each study the origin, nature, and role of power is problematic. If Realism is to provide an effective alternative to economistic approaches to international political economy it must derive specific interests from the concepts of power and the international distribution of power. I also argue that the New International Economic Order is part of a larger class of mercantilist strategies employed by various countries at particular moments in history to redress politically important economic imbalances. What is unique about the present North-South conflict is its multilateral character.
The role of the Chinese police in methadone maintenance therapy: a literature review.

Abstract Background The behavior of police is an important factor in drug users' access to preventive and therapeutic health services. In China, opiate users must be registered and approved by police before accessing methadone maintenance treatment (MMT). Methods We conducted a literature review to identify studies reporting original data about the influence of Chinese drug policing activities on MMT access and outcomes. Searches were conducted in PubMed, the Law Journal Library of HeinOnline, the Social Science Citation Index and China Academic Journals of CNKI for empirical studies conducted in China and published in academic journals between 2005 and April 2012. Results The initial literature search retrieved 276 records, of which 85 were included in the review and 191 were excluded. The majority of the included papers were single-clinic observational studies. These studies reported that: (1) fear of incarceration deterred users from initiating and continuing MMT; (2) the rates of MMT referral by police were considerably lower than those by drug user peers and by community and the media; (3) police sending users to compulsory detoxification (DETOX) and reeducation through labor (RTL) centers contributed to higher rates of MMT patient dropout; (4) arrests in and around MMT clinics were not uncommon; (5) cooperation between local police and public health agencies was difficult to achieve; and (6) a limited number of trial programs were conducted to refer detainees in DETOX to MMT clinics after release, but the outcomes were not promising. Conclusion Reviewed studies report drug policing practices that appear to be impeding MMT access and reducing successful treatment outcomes. Research focusing on the nature, prevalence and severity of these effects is urgently needed. Health and public security officials in China should review and reform policies and practices of registering, monitoring, and incarcerating drug users.
Ideological Voting on the National Labor Relations Board

[National Labor Relations Board Chairman Guy] Farmer acknowledged that the Board was a "political animal" and had been "since its inception." It was not that someone in the White House would tell a Board how to decide specific cases, Farmer said, but a member appointed to the Board felt pressure to implement the '"philosophy that he thought his administration wanted him to project on the Board. "'
Do Delaware CEOs get fired

Abstract Critics have charged that state competition in corporate law, which Delaware dominates, leads to a “race to the bottom” making management unaccountable. We argue that Delaware corporate law attracts firms with particular financial and governance characteristics. We find that Delaware attracts growth firms in industries with more takeover activity. Delaware firms have smaller boards, and their directors are paid more and serve on more boards. In addition, Delaware firms attract greater institutional ownership. We also provide a bottom-line test of the race-to-the-bottom hypothesis by examining forced CEO turnover. After controlling for differences in firm characteristics, we find that firms incorporated in Delaware are more likely to terminate CEOs. We also find that that termination decision is less sensitive to poor performance. Overall, we see no clear pattern supporting the “race to the bottom” hypothesis.
Organizational Design and Control across Multiple Markets: The Case of Franchising in the Convenience Store Industry

ABSTRACT: Many companies operate units that are dispersed across different types of markets, serving significantly divergent customer bases. Such dispersion is likely to compromise headquarters' ability to control local managers' behavior and satisfy the needs of different customer types. In this study we find that market‐type dispersion is an important determinant of the delegation of decision rights and the provision of incentives. Using a sample of convenience store chains, we show that market‐type dispersion is positively associated with the degree of franchising at the chain level as well as the probability of franchising a given store within a chain. Our results are robust to alternative definitions of market‐type dispersion and to other determinants of franchising such as the stores' geographic dispersion. Additional analyses suggest that chains that do not franchise cope with market‐type dispersion by decentralizing operations from headquarters to their stores and providing their store managers hi...
Alertness, local knowledge, and Johnny Appleseed

Anderson and Hill argue that property rights entrepreneurs, driven by non-replicable Kirznerian alertness, identify unowned and unpriced attributes of a resource and capture rents to those resources by limiting access to them. I argue that alertness is non-replicable, but it is also not random. Kirzner’s analytical framework emphasizes an individual’s local knowledge and subjective interpretative schema. Incorporating these concepts and emphasizing two types of local knowledge, about social and commercial conditions, explains why some people are alert to profit opportunities and others are not. This implies that economic restrictions are more detrimental to entrepreneurship than previously understood. I provide evidence by examining Johnny Appleseed’s successful nursery business.
Child care subsidies and child development

Abstract Child care subsidies are an important part of federal and state efforts to move welfare recipients into employment. One of the criticisms of the current subsidy system, however, is that it overemphasizes work and does little to encourage parents to purchase high-quality child care. Consequently, there are reasons to be concerned about the implications of child care subsidies for child development. In this paper, we provide a systematic assessment of the association between subsidy receipt and a wide range of child outcomes. Drawing on rich data from the Early Childhood Longitudinal Study, we document a negative relationship between child care subsidies and child development. In particular, our results suggest that subsidy receipt in the year before kindergarten is associated with lower reading and math test scores and greater behavior problems at kindergarten entry. Some of these negative effects persist until the end of kindergarten. A potential explanation for the poorer outcomes is that subsidized children are more likely to receive intense exposure to low-quality child care.
Reforming Lawyers into Irrelevance?: Reconciling Crisis and Constraint at the Office of Legal Counsel

A Predator drone attack in Pakistan and the "enhanced interrogation techniques" that the Bush administration used on suspected terrorists have at least one thing in common: legal advice. While advice given the Obama administration on drones has received only a partial airing, disclosure that lawyers in the Justice Department’s Office of Legal Counsel (OLC) authorized coercive interrogation after 9/11 has ignited a wide-ranging debate on reform and accountability. However, the volume of calls for reform has exceeded consideration of the competing values at stake. Some reformers stress the need to combat a climate of impunity with formal sanctions such as disbarment and damages. Advocates of structural reform, such as Bruce Ackerman, view sanctions as small change, and urge OLC’s makeover as an adjudicative body. Veterans of OLC reject these dramatic steps. They caution that structural changes could threaten the separation of powers. Structural changes could also detach OLC from its clients in the executive branch, transforming it into a stately mansion that requires too much maintenance to use. OLC veterans urge more measured changes, including greater transparency and a renewed commitment to stare decisis. After assessing these reform proposals, this paper suggests a model of dialogic equipoise to shape both the substance of OLC opinions and OLC’s deliberative process. While a structural makeover would actually weaken the rule of law, OLC resembles a court in its need to conserve institutional capital with two audiences: the legal community and the President. OLC can issue opinions that authorize robust responses to national security and humanitarian crises, if the President seeks ratification of executive action. To conserve OLC’s institutional capital, the model caps legal advice that expands presidential power. Just as courts preserve institutional capital with devices such as standing, mootness, and political questions, a cap will prompt OLC to marshal its institutional capital for those occasions when no alternatives will do the job.
The use of alternative work arrangements by the jobless: Evidence from the CAEAS/CPS

Alternative work arrangements (AWAs), such as contracting, consulting, and temporary work, have been criticized as providing only atypical, even precarious, employment. Yet they may also allow workers to locate suitable job matches. Exploiting data from four Contingent and Alternative Employment Arrangement Supplements to the Current Population Survey, we investigate the initial job-finding strategies pursued by the unemployed. Within the narrow window offered by the data, we find that unemployed workers who become reemployed are more likely to find work in AWAs than in regular, open-ended employment. When we evaluate the use of AWAs against unemployment, there is also evidence that the jobless are entering AWAs as pathways out of their initial labor market state.
Creditor Control and Conflict in Chapter 11

We analyze a sample of large privately and publicly held businesses that filed Chapter 11 bankruptcy petitions during 2001. We find pervasive creditor control. In contrast to traditional views of Chapter 11, equity holders and managers exercise little or no leverage during the reorganization process. 70 percent of CEOs are replaced in the two years before a bankruptcy filing, and few reorganization plans (at most 12 percent) deviate from the absolute priority rule to distribute value to equity holders. Senior lenders exercise significant control through stringent covenants, such as line-item budgets, in loans extended to firms in bankruptcy. Unsecured creditors gain leverage through objections and other court motions. We also find that bargaining between secured and unsecured creditors can distort the reorganization process. A Chapter 11 case is significantly more likely to result in a sale if secured lenders are oversecured, consistent with a secured creditor-driven fire-sale bias. A sale is much less likely when these lenders are undersecured or when the firm has no secured debt at all. Our results suggest that the advent of creditor control has not eliminated the fundamental inefficiency of the bankruptcy process: resource allocation questions (whether to sell or reorganize a firm) are ultimately confounded with distributional questions (how much each creditor will receive) due to conflict among creditor classes.
A first look at online reputation on Airbnb, where every stay is above average

Judging by the millions of reviews left by guests on the Airbnb platform, this trusted community marketplace for accommodations is fulfilling its mission of matching travelers with hosts having room to spare remarkably well. Based on our analysis of ratings, we collected for millions of properties listed on Airbnb worldwide, we find that nearly 95% of Airbnb properties boast an average star-rating of either 4.5 or 5 stars (the maximum); virtually none have less than a 3.5 star-rating. We contrast this with the ratings of roughly 700,000 hotels, B&Bs, and vacation rentals worldwide that we collected from TripAdvisor. We find that hotel and B&B average ratings are much lower—3.8 and 4.1 stars, respectively—with much more variance across reviews. TripAdvisor vacation rental ratings are more similar to Airbnb ratings, but only about 85% of properties have an average rating of 4.5 or 5 stars. We then consider properties cross-listed on both platforms. For these properties, we find that even though the average ratings on Airbnb and TripAdvisor are more similar than hotels and B&Bs, proportionally more properties receive the highest ratings (4.5 stars and above) on Airbnb than on TripAdvisor. Moreover, there is only a weak correlation in the ratings of individual cross-listed properties across the two platforms. Finally, we show that these differences are consistent when considering data from two different time periods: 2015 and 2018.
Industry Dynamics of Offshoring: The Case of Hard Disk Drives†

Abstract This paper uncovers a novel pattern of offshoring dynamics in a high-tech industry, and proposes a structural model to explain it. Specifically, the hard disk drive industry (1976–1998) witnessed massive waves of entry, exit, and the relocation of manufacturing plants to low-cost countries, in which shakeouts occurred predominantly among home firms and almost all survivors were offshore firms. I build and estimate a dynamic offshoring game with entry/exit to measure the benefits and costs of offshoring, investigate the relationship between offshoring and market structure, and assess the impacts of hypothetical government interventions. (JEL D24, D43, F14, L13, L24, L63, O14)
Doping Control, Mandatory Arbitration, and Process Dangers for Accused Athletes in International Sports

Elite athletes who compete in the Olympics and other international sporting competitions undoubtedly train intensely at their sport. These athletes devote much of their lives and their physical, mental, and financial resources to reach the level of participating in top international sporting competitions. Athletes competing in this select arena understand that they must abide by the rules of their sport and competition. The mandatory rules governing participation in international sporting competition encompass much more than what happens among competitors on the field, court, or race course. As a condition of participating in international sporting competition, athletes generally waive rights to judicial recourse in their national courts and agree to mandatory arbitration of disputes regarding eligibility or discipline to the Court of Arbitration for Sport (CAS). 1 Further, athletes must comply with the strictures against doping under the World Anti*6 Doping Code (Code) and are subject to regular and random drug testing, in and out of competition. 2
Modes of cooperative R&D commercialization by start‐ups

This study empirically examines the determinants of heterogeneous firm-level cooperative R&D commercialization strategies. While the volume of interfirm collaboration has increased dramatically in recent decades, the determinants of firm-level choices among alternate modes of such cooperative activity remain relatively understudied. We develop a conceptual model of factors determining collaborative mode choice at the organizational portfolio level. These factors include the firm-level appropriation environment, in which deal-level choices have portfolio-level spillover implications, as well as governance capabilities developed by the firm over time. Using a random sample of innovating biotechnology start-ups, we assemble a firm-year panel dataset that aggregates transaction-level collaboration data to the firm-year level, allowing us to characterize firms' portfolios of collaborative deals. We find broad empirical support for our model, suggesting that a firm's appropriation environment and governance capabilities strongly influence portfolio-level collaboration mode choices. In addition, we explore the implications of governance capability development, finding that experience with particular modes, as well as deviations from existing capabilities, impact firm valuation. Copyright © 2009 John Wiley & Sons, Ltd.
Economic Growth in a Cross-Section of Nonindustrial Countries: Does Colonial Heritage Matter for Africa?

The paper investigates the effects of Sub-Saharan African colonial heritage on economic growth in a sample of nonindustrial countries. An empirical Solow growth model is specified in a way that allows an examination of whether or not growth in Sub-Saharan Africa reflects a legacy of extractive colonialization strategies, motivated by a hostile disease environment that resulted in extractive growth-retarding institutions that persisted after independence. Parameter estimates suggest that the partial effects of extractive institutions engendered by a twentieth century colonial heritage account for approximately 30% of the growth gap between the former colonies in Sub-Saharan Africa and other nonindustrial countries.
The career prospects of overeducated Americans

In this paper we analyze career dynamics for US workers who have more schooling than their peers in the same occupation. We use data from the NLSY79 combined with the CPS to analyze transitions into and out of overeducated employment, together with the corresponding effects on wages. Overeducation is a fairly persistent phenomenon at the aggregate and individual levels, with 66% of workers remaining overeducated after 1 year. Overeducation is not just more common but also more persistent among blacks and low-AFQT individuals. Further, the hazard rate out of overeducation drops by about 60% during the first 5 years spent overeducated. However, the estimation of a mixed proportional hazard model suggests that this is attributable to selection on unobservables rather than true duration dependence. Lastly, overeducation is associated with lower current as well as future wages, consistent with scarring effects.
The Term Limits Case

The idea of term limits for elected government officials is hardly new. States have imposed term limits on their own elected officials from the time of our Nation's founding. This political movement has produced one major constitutional amendment relating to national office - the Twenty Second Amendment, which limits the office of President to two four-year terms. Attempts by a substantial number of states to alter the qualifications for members of Congress, however, have encountered resistance by the courts. Indeed, at the time U.S. Term Limits was argued, no appellate court had endorsed any state effort, either by legislation or state constitutional amendment, to place limits on the number of terms that U.S. Senators or Representatives may serve. Until recently, it appeared that courts and scholars were virtually unanimous in believing that the Constitution is unambiguous in establishing the fixed and exclusive qualifications for members of Congress relating to age, citizenship, and residency, and that only a constitutional amendment could alter those requirements.
ICT capital and employment of information workers: are they related?

This paper examines the relationship between information and communication technology (ICT) related capital assets and employment of information workers in the private non-farm sector of the US economy. The results from our empirical analysis based on annual data for 59 industries from 2002 to 2007 indicate that, after controlling for relative wages of information workers and other industry-specific factors, an increase in net stock of ICT capital assets decreases the employment of information workers. This finding suggests that the effects of ICT capital assets on the employment of information workers through ICT-enabled business process innovations such as automation and outsourcing dominate over the complementarity effects on high-skilled information workers. Of the three main categories of ICT assets, communications equipment provides more definitive evidence of reducing the employment share of information workers.