cssi/SciSciGPT-SciSciNet huggingface dataset:
The growth effects of sport franchises, stadia, and arenas

This paper investigates the relationship between professional sports franchises and venues and real per capita personal income in 37 standard metropolitan statistical areas in the United States over the period 1969 to 1994. Our empirical framework accounts for the entry and departure of professional football, basketball, and baseball franchises; the construction of arenas and stadia; and other sports related factors over this time period. In contrast to other existing studies, we find evidence that some professional sports franchises reduce the level of per capita personal income in metropolitan areas and have no effect on the growth in per capita income, casting doubt on the ability of a new sports franchise or facility to spur economic growth. We also find evidence that results obtained from estimating reduced-form relationships, a common practice in the literature, are not robust to alternative reduced-form specifications. © 1999 by the Association for Public Policy Analysis and Management.
The Good Fight: The Egocentric Bias, the Aversion to Cognitive Dissonance, and the American Criminal Law

The phrase “cognitive bias” often has negative connotations. It is something to be overcome, thwarted, or, at best, circumvented. In this essay, I suggest that two interrelated cognitive biases — the egocentric bias and the aversion to cognitive dissonance — might instead serve as potential assets for a criminal law practitioner in persuading her constituencies.
Stonewalling, Leaks, and Counter-Leaks: SCOTUS Ethics in the Wake of NFIB v. Sebelius

The United States Supreme Court is the only court in the United States without a clearly defined ethics code. In the wake of the controversy over possible leaks from justices’ chambers following the decision in NFIB v. Sebelius, and in light of legislation recently introduced in Congress, this paper suggests two reforms for the Supreme Court. First, the time has finally come for the Court to adopt a comprehensive Code of Conduct. Second, the Court should alter its current recusal practice – in which decisions are made exclusively by individual justices – and instead resolve disqualification motions by a vote of the full court.
Emerging market bond spreads and sovereign credit ratings: reconciling market views with economic fundamentals

Abstract This paper uses a panel data estimation of a simple univariate model of sovereign spreads on ratings to analyze statistically significant differences between actual spreads and ratings-based spreads. When such deviations are significant, we find that ‘excessively high’ spreads are on average followed by episodes of spread tightening 1 month later rather than credit downgrades. In contrast, observations with ‘excessively low’ spreads are on average followed by rating upgrades 3 months later rather than episodes of spread widening. The paper also illustrates how significant disagreements between market and rating agencies’ views can be used as a signal that further technical and sovereign analysis is warranted. For instance, we find that spreads were ‘excessively low’ for most emerging markets before the Asian crisis. More recently, spreads were ‘excessively high’ for a number of emerging markets.
Parent, Child, Husband, Wife: When Recognition Fails, Tragedy Ensues

This article briefly notes some developments in the law and society of our present age regarding the understanding — the recognition — of marriage, fatherhood, motherhood, and the family. The article warns against a certain casualness, a confusion, perhaps even a certain promiscuity of thought, that has occasionally emerged in the law. Drawing on Sophocles' drama Oedipus the King and on the scriptural narrative of David and Bathsheba, the article investigates what might be called the "moral location" of the activity of recognition. It proposes that recognition of basic family forms is a process with a deep dimension. It apprehends that failure of recognition in such matters may sow the seeds of social tragedy.
A simple model of the commercial lobbying industry

Abstract In this paper we present a model of the behavior of commercial lobbying firms (such as the so-called K-Street lobbyists of Washington, D.C.). In contrast to classical special interest groups, commercial lobbying firms represent a variety of clients and are not directly affected by policy outcomes. They are hired by citizens, or groups of citizens, to act as intermediaries on their behalf with policymakers. In our analysis we address two basic questions: what tasks are commercial lobbying firms performing, and what are the implications of their existence for social welfare? We answer the first part of this question by proposing that commercial lobbying firms possess a verification technology that allows them to improve the quality of information concerning the social desirability of policy proposals. This gives policymakers the incentive to allocate their scarce time to commercial lobbying firms. Essentially, it is this access to policymakers that commercial lobbying firms sell to their clients. To address the question of social welfare we construct a simple general equilibrium model that includes commercial lobbying firms, and compare the equilibrium obtained under market provision of lobbying services to the first best optimum. We find that the market level of lobbying services can be socially either too large or too small, and characterize when each will be the case.
Chandra Grating Spectroscopy of the Seyfert Galaxy Ton S180

We present preliminary results from spectral observations of Ton S180 using Chandra and ASCA. The data confirm the presence of the soft excess, but the Chandra Low-Energy Transmission Grating spectrum reveals it to be broad and smooth rather than resolved into individual emission lines. This excess may represent either a primary or reprocessed continuum component or a blend of broad lines from an ionized accretion disk. The occurrence of a similar feature in five other narrow-line Seyfert 1 galaxies leads us to conclude that this soft X-ray component may be a characteristic of sources accreting at a high rate. The X-ray spectrum shows no evidence for absorption lines, indicating that if gas exists in the line of sight then it is in a very high ionization state or has an extreme velocity distribution. The new ASCA data confirm that the narrow component of the Fe Kα line peaks close to a rest energy of 7 keV, indicating the presence of a significant amount of highly ionized material in the nuclear environs.
The Dimensions of Judicial Impartiality

Scholars have traditionally analyzed judicial impartiality piecemeal, in disconnected debates on discrete topics. As a consequence, current understandings of judicial impartiality are balkanized and muddled. This article seeks to reconceptualize judicial impartiality comprehensively, across contexts. In an era when “we are all legal realists now,” perfect impartiality—the complete absence of bias or prejudice—is at most an ideal, with “impartial enough” becoming, of necessity, the realistic goal. Understanding when imperfectly impartial is nonetheless impartial enough is aided by conceptualizing judicial impartiality in three distinct dimensions: A procedural dimension in which impartiality affords parties a fair hearing; a political dimension in which impartiality promotes public confidence in the courts; and an ethical dimension in which impartiality is a standard of good conduct core to a judge’s self-definition. The seeming contradictions that cut across contexts in which judicial impartiality problems arise, can for the most part be explained with reference to the dimensions those problems inhabit and the constraints under which regulation in those dimensions are subject. Thus, being impartial enough to assure parties a fair hearing in the procedural dimension may or may not be impartial enough to satisfy the public in the political dimension, which may or may not be impartial enough to ensure that judges are behaving honorably in the ethical dimension. Analyzing partiality problems through the lens of the dimensions they occupy not only resolves many of the imponderables that have long plagued the subject, but also reveals a distinct trend, in which impartiality is being transformed from a value traditionally regulated largely by judges and the legal establishment in the procedural and ethical dimensions, to one that is increasingly the province of the political dimension, where it is regulated by the public and its elected representatives. By situating impartiality at the crossroads of judicial procedure, ethics and politics, this article offers a new perspective, not just on judicial impartiality, but also on the role of the American judiciary in the administration of justice and the political process.
Emerging market corporate leverage and global financial conditions

Abstract This paper explores how global financial conditions influence corporate leverage growth in emerging markets (EMs). Using a sample of 800,000 listed and non-listed firms across 28 EMs, we find that accommodative global financial conditions—initially proxied with a measure of U.S. monetary policy—are associated with faster leverage growth. The impact is more pronounced for financially constrained firms, such as small- and medium-sized enterprises (SMEs), and for EMs whose domestic monetary policy is more aligned with that of the United States. The findings suggest that global financial conditions affect EM firms' leverage growth by influencing domestic interest rates and by relaxing corporate borrowing constraints. Finally, leverage increases disproportionately more for firms that are either relatively less profitable or less solvent when global financial conditions become looser.
The New Censorship: Institutional Review Boards

Are federal regulations on Institutional Review Boards - commonly known as IRBs - compatible with the First Amendment? The regulations aim to protect human subjects by creating a system of licensing research. Under this system, universities establish IRBs, and researchers must get the prior permission of an IRB before doing research on human subjects. At first glance, it may seem only appropriate that researchers should get permission before performing research on human beings. The First Amendment, however, prohibits the federal government from imposing a system of licensing speech or the press, and it therefore seems necessary to consider whether the regulations on IRBs are unconstitutional.
John Austin and Constructing Theories of Law

One of the standard criticisms of John Austin’s work is that his portrayal of law, as essentially the command of a sovereign to its subjects, does not fit well with the way law is practiced in many or most contemporary legal systems, or the way that it is perceived by lawyers, judges, and citizens who are participants in those systems. However, contemporary legal theories also seem to fail to fit current practice in significant ways. The question is one of the power of the insights a theory brings, and whether it is worth whatever “distortions” it requires. For one generation, the insights of Austin’s (or Kelsen’s or Raz’s) theory might seem central, and the deviations trivial, while for a later generation, the insights might seem small or hard to accept, while the deviations seem fatal. Theory construction, especially where the theory is not anchored by falsifiable predictions, is often more a matter of persuasiveness, rather than a matter of truth. And if John Austin’s theory seems less sustainable than it once did, that may say as much about us, and what concerns us, as it does about his theory.
Competitive Price Discrimination: The Exercise of Market Power Without Anticompetitive Effects (Comment on Klein and Wiley)

A restaurant in a large city offers a $10 discount on entrees for "early bird" customers who arrive before 6:00 p.m. This pricing policy could reflect the lower opportunity cost of serving customers during off-peak periods, when the table would otherwise go empty. But if early bird customers are more price sensitive than most, the policy could instead (or in addition) constitute economic price discrimination, by which the firm charges a higher pricecost margin to customers whose purchase decisions are, on average, less responsive to price.1 Another restaurant charges higher price-cost margins on wine than on food. If customers who drink wine with dinner linger longer at the table, this pricing policy could reflect the higher opportunity cost of serving a low-turnover customer group. But if customers who drink wine are generally willing to pay more for their meals than customers who abstain, then the policy could instead (or also) be understood as a method of price discrimination by metering the intensity of restaurant table usage.2
Privatization and corruption: Patronage vs. spoils

We examine the issue of privatization of those public goods that can be provided in-house or contracted out. Such privatization appears straightforward, yet history shows otherwise. For example, the private contracting system for street cleaning in 19th-century New York City was a failure, despite the safeguards instituted to ensure competition. The contract system was criticized for corruption, while in-house provision suffered from patronage abuses. We present two variations of the “rotten apple” theory to capture the salient features of the New York experience. The public officials and contractors were both operating under high-powered incentives, which invited opportunism. When players act strategically, the adverse effect of opportunism increases. Since the amounts of spoils can be larger than political contributions, contracting-out ends up being more costly, even though competition promotes productive efficiency. Another advantage of in-house provision is that incentives can be made low-powered by depoliticizing of the system.
Evidence disclosure and verifiability

We explore the notion of “verifiability” by analyzing a simple model of evidence production in contractual relationships with complete information. We characterize implementability in terms of the existence and form of “hard evidence.” We provide results on maximal and minimal evidence production that are, respectively, necessary and sufficient for implementation. We briefl yd iscuss the relevance of our results to actual legal institutions. JEL Classification: C70, D74, K10. The notion of “verifiability”–that a court or other external enforcer can observe a given aspect of a contractual relationship–is at the heart of the contract-theory literature. Economic models of contract generally start with a specification of things considered verifiable and then assume that court-enforced contracts can condition transfers arbitrarily on, and only on, these things. In reality, however, court action is a function not of what can be observed by the court but what evidence is actually presented to the court by the contracting parties. Thus, verifiability critically depends on the parties’ incentives to submit evidence. In this paper, we design a simple model to study how evidentiary incentives influence implementation. We examine contractual settings with complete information and externally enforced monetary transfers. In our model, the players first agree to a contract. Then they engage in productive interaction, which results in the “state” of the relationship. After the state is realized, the players can voluntarily submit evidence to the court, who compels monetary transfers contingent on evidence, as directed by the players’ contract. Evidence is represented as physical documents, the existence of which depends on the state. We study the agents’ incentives to disclose
Agency Conflicts, Investment, and Asset Pricing

Corporations in most countries are run by controlling shareholders whose cash flow rights are substantially smaller than their control rights in the firm. This separation of ownership and control allows the controlling shareholders to pursue private benefits at the cost of outside minority investors by diverting resources away from the firm and distorting corporate investment and payout policies. We develop a dynamic stochastic general equilibrium asset pricing model that acknowledges the implications of agency conflicts through imperfect investor protection on security prices. We show that countries with weaker investor protection have more overinvestment, lower market-to-book equity values, larger expected equity returns and return volatility, higher dividend yields, and higher interest rates. These predictions are consistent with empirical findings. We develop new predictions: countries with high investment-capital ratios have both higher variance of GDP growth and higher variance of stock returns. We provide evidence consistent with these hypotheses. Finally, we show that weak investor protection causes significant wealth redistribution from outside shareholders to controlling shareholders.
The Political Theory Question in Political Science, 1956–1967

Despite the postwar rise of behavioralism in political science, the Review gave surprising prominence to traditional political theory during Harvey C. Mansfield's ten-year term as editor (1956–1965), all the more striking for the prominence of Leo Strauss and his students during the first half of this period. This article considers several factors that help explain the surprising recognition given this subfield and its unexpected bargaining power.
Crowdfunding the city: the end of 'cataclysmic money'?:

By raising money from a large number of people via the internet, crowdfunding offers the promise of a “democratization of finance”. Recently, the crowdfunding of large-scale urban projects appears to have gained traction as a handful of high-profile real estate and infrastructure projects are making headlines around the globe for relying on distributed-network online financing. Instead of their purported promise, this paper argues that large-scale efforts to crowdfund the urban fabric carry all the hallmarks of what Jane Jacobs termed “cataclysmic money”. As such, crowdfunding the city might simply represent the next phase of entrepreneurialism in the financial transformation of urban governance. The main thrust of the argument developed in this paper suggests that it is precisely because of such financialising potential – and the relational importance of money and finance in an urbanised society more generally – that crowd financing might undermine, rather than fortify, the “right to the city” in the sense of Lefebvre. Indeed, the detailed workings of the modern monetary-financial system – from the technical complexity of financial engineering to the institutional architecture of money and the political economy of its regulatory governance – are still insufficiently recognised in much of the public discourse on the social consequences of finance.
Contracts Do Matter: Robust Evidence of an Optimal Level of Legal Formalism in Developing Countries

This paper asks: ‘how do institutions impact household wealth?’ This question is the micro level analogue to the macro question: ‘how do institutions impact economic growth?’ Institutions are exoge...
The Burdens of Benefits

. 3. See STATISTICAL ABSTRACT, supra note 2, tbl.82, at 67 (noting number of American children that live in single-parent households); Nancy E. Dowd, Stigmatizing Single Parents, 18 HARv. WOMEN'S L.J. 19, 21-22 (1995) ("Single-parent families now constitute twenty-six percent of all families with minor children and are the most rapidly growing family form in America.").
Estimating the Tradeoff Between Risk Protection and Moral Hazard with a Nonlinear Budget Set Model of Health Insurance

Insurance induces a tradeoff between the welfare gains from risk protection and the welfare losses from moral hazard. Empirical work traditionally estimates each side of the tradeoff separately, potentially yielding mutually inconsistent results. I develop a nonlinear budget set model of health insurance that allows for both simultaneously. Nonlinearities in the budget set arise from deductibles, coinsurance rates, and stoplosses that alter moral hazard as well as risk protection. I illustrate the properties of my model by estimating it using data on employer sponsored health insurance from a large firm.
Relativistic Diskoseismology. III. Low-Frequency Fundamental p-Modes

We extend our investigation of the normal modes of small adiabatic oscillations of relativistic barotropic thin accretion disks to the inertial-pressure (p) modes. We focus here on the lowest frequency fundamental p-modes, those with no axial or vertical nodes in their distribution. Through a variety of analyses, we obtain closed-form expressions for the eigenfrequencies and eigenfunctions. These depend on the luminosity and viscosity parameter of the disk as well as the mass and angular momentum of the black hole via detailed formulae for the speed of sound. The effect of a torque on the inner edge of the disk is also included. We compare the p-mode properties to those of the g- and c-modes.
Lock Down on the Third Screen: How Wireless Carriers Evade Regulation of Their Video Services

Wireless handsets increasingly offer subscribers a third screen for accessing the Internet and video programming. The converging technologies and markets that make this possible present a major regulatory quandary, because national regulatory authorities seek to maintain mutual exclusivity between regulated telecommunications services and largely unregulated information
Multinational Diversification and Corporate Performance: Evidence from European Firms

We investigate the empirical relationship between accounting based measures of performance and the degree of multinational diversification for a set of European chemical industry firms. We find that for these firms, the degree of multinational diversification is strongly related to superior financial performance. The results hold for each of the three sample years. The findings suggest that multinational firms outperform purely domestic and exporting firms. The results provide strong support for gains from multinational diversification. The results indicate that while greater European unification may have eroded potential benefits of exploiting international capital and product market imperfections, the benefits of firm specific economies of scope and scale as well as managerial and financial synergies are still realised through exports.
Urban squatting with rent-seeking organizers

Abstract This paper extends a new line of research on urban squatting that focuses on the role of the squatter organizer. The model replaces the benevolent organizer in the model of Brueckner and Selod (2009) with competing, rent-seeking squatter organizers, a structure that may offer a realistic picture of many cities in less-developed countries. The analysis demonstrates that, compared to the benevolent case, rent-seeking behavior puts more land in the hands of squatters, leading to greater squeezing of the formal housing market, while extracting more defensive expenditures from each squatter household. Additional results show that competition among squatter organizers has much in common with competition in a traditional industry setting, while illustrating how changes in the squatting climate affect the equilibria.
Cosmopolitan law and time: Toward a theory of constitutionalism and solidarity in transition

This article seeks to confront the contemporary condition in which cosmopolitan law – meant to resonate as something citizens across borders author and live together – instead is increasingly a source of detachment, confusion, and alienation. Taking the European Union’s twin crises of democratic legitimacy and social solidarity as its starting point, the article offers a critique of existing approaches to supranational constitutionalism that are insufficiently responsive to this disenchantment. The article’s purpose, in turn, is to present perspectives from philosophy and legal theory that might promisingly recast, in this new cosmopolitan frame, our thinking about law as a mode of social integration. Specifically, the article’s central claim is that time – as a seldom-examined, yet essential dimension of law – is closely linked to law’s cosmopolitan potential and, concurrently, to the motivational resources for cosmopolitan solidarity. It is through a sensitivity to time – our awareness of the past passing into the present in anticipation of a future – that citizens can meaningfully hold together cosmopolitan law’s dual, ostensibly divergent hopes: shared commitment and self-decentring plurality. Drawing on Seyla Benhabib’s ‘democratic iterations’ and its roots in the work of Jacques Derrida and Robert Cover, the article elaborates the following two concepts: ‘cosmopolitan promise-making’, a diachronic form of cosmopolitan political agency; and ‘cosmopolitan legal narrative’, a set of plural, evolving constitutional interpretations open to mutual engagement over time. These concepts, in temporalizing our understanding of political identity and constitutional law, together serve to underwrite a cosmopolitan legal order without also thinning solidarity’s social and democratic foundations. The article concludes with a critique of the contemporary role of European courts and a concrete vision for the cosmopolitan development of EU jurisprudence. Reinterpreting Article 4(2) TEU as the right to constitutional narrative, the article advances new modalities and normative aspirations for constitutional interpretation beyond the nation-state.
Latin American Presidentialism in Comparative and Historical Perspective

Since the time of Aristotle, comparative scholars have developed various alternative typologies to classify constitutional systems. 1 One paradigmatic scheme focuses on executive–legislative relations. Some systems, 2 we are told, are ―presidential,‖ in which a directly elected president serves a fixed term as both head of state and head of government. Others are ―parliamentary,‖ in which a legislative majority determines who will lead the government and for how long. A third model combines features of the two and is called ―semi-presidential.‖ 3
The Durable Power of Attorney as an Alternative to the Improper Use of Conservatorship for Health-Care Decisionmaking

Mentally competent adult individuals are entitled to make their own decisions. In the event of illness, incapacity, or other misfortune, however, an individual’s ability to make decisions may be impaired. Someone else must act as a substitute decisionmaker. The proper vehicle for identifying that substitute decisionmaker, as well as the scope of his or her authority, is the focus of this article. Inappropriate and unnecessary usurpation of personal decisionmaking power must be avoided and should not be tolerated.
From creativity to innovation

Talent is the bedrock of a creative society. Augmenting talent involves mobilizing culture and tradition, building institutions to increase the stock of human capital, enhance its quality, and instill values favoring achievements and initiative. The productivity of this talent in the form of ideas can be raised by nurturing wikicapital-the capital arising from networks. Translating creativity into innovation is a function of multiple incentives and sustaining innovation is inseparable from heavy investment in research. Finally, the transition from innovation to commercially viable products requires the midwifery of many service providers and the entrepreneurship skills of firms small and large.
Manipulation of Preferences and Relative Utilitarianism

Abstract Given n agents with who wish to divide m commodities, consider the n -person noncooperative game with strategies consisting of concave increasing utility functions, and whose outcomes are the relative utilitarian solution. Any constrained equal-income competitive equilibrium allocation for the true utilities is shown to ba a Nash equilibrium outcome for the noncooperative game. Conditions are presented under which these are the only pure strategy equilibrium outcomes. Journal of Economic Literature Classification Numbers: C72, C78, D71.
Burning Cyberbooks in Public Libraries: Internet Filtering Software vs. The First Amendment

Imagine your local public library, like many of the 15,718 public libraries in the United States,' has adopted the American Library Association's (ALA) Library Bill of Rights, which reflects a strong anti-censorship position.2 Despite this strong "freedom of ideas" creed, however, the local library board, strapped with limited resources, has generally refrained from ordering books or materials deemed sexually explicit or otherwise offensive under community standards. Accordingly, The Anarchist's Cookbook, Madonna's Sex, Mein Kampf, or Hustler cannot be found on any of the shelves. While a few patrons have complained about the board's refusal to order various materials, the city attorney, relying upon Justice Blackmun's language in Board of Education v. Pico, continues to defend the library's right to make "politically neutral" decisions in "choos[ing] one book over another"3 and maintains that the First Amendment is only implicated if the library removes books from the shelves.
Subtle price discrimination and surplus extraction under uncertainty

a b s t r a c t This paper provides a solution to Proebsting’s Paradox, an argument that appears to show that the investment rule known as the Kelly criterion can lead a decision maker to invest a higher fraction of his wealth the more unfavorable the odds he faces are and, as a consequence, risk an arbitrarily high proportion of his wealth on the outcome of a single event. The paper shows that a large class of investment criteria, including ‘fractional Kelly’, also suffer from the same shortcoming and adapts ideas from the literature on price discrimination and surplus extraction to explain why this is so. The paper also presents a new criterion, dubbed the doubly conservative criterion, that is immune to the problem identified above. Immunity stems from the investor’s attitudes toward capital preservation and from him becoming rapidly pessimistic about his chances of winning the better odds he is offered.
Endogenous matching and the empirical determinants of contract form

Empirical work on contracts typically regresses contract choice on observed principal and agent characteristics. If (i) some of these characteristics are unobserved or partially observed and (ii) there are incentives whereby particular types of agents end up contracting with particular types of principals, estimated coefficients on the observed characteristics may be misleading. We address this endogenous matching problem using a data set on agricultural contracts between landlords and tenants in early Renaissance Tuscany. Controlling for endogenous matching has an impact on parameters of interest, and tenants’ risk aversion appears to have influenced contract choice.
The Logic of Legal Remedies and the Relative Weight of Norms: Assessing the Public Interest in the Tort Reform Debate

This article explores the background principles of consistency and proportionality in legal rules and remedies. It identifies the relative strength of the interests of individuals and the public as the key to justifying the remedies available in different areas of law. Understanding the normative guidance of particular legal rules reveals the strength of society's judgment of the interests at stake in different remedies. For example, the principle of consistency generally means that a legal doctrine applying an objective measure of one's interest must apply a like-kind measure to all interests considered, absent some explicit and justifiable basis for different formulations. The article examines the need for consistency in legal disputes and explores the role of the principle of proportionality as a guard against destructive consistency. The natural hierarchy of legal norms inheres in remedies accorded various types of interests - from contract to criminal remedies. It also assesses measurements presented in the current tort reform debate as an application of the norms of consistency and proportionality and examines the failure of arguments advanced in the tort reform debate to include the public interest. The article concludes that identification of individual and collective interests are integral considerations in the debate on tort reform.
Ethics, the National Bioethics Advisory Commission's Report on Research Involving the Mentally Disordered, and Therapeutic Jurisprudence

Over the past several decades much has been written about protecting human participants in biomedical research. This has been especially true of those who suffer from a mental disorder or other debilitating condition which may compromise their ability to give "informed consent" to participate. There have been several presidential commissions appointed to study these questions, the most recent of which is the National Bioethics Advisory Commission, created by President Clinton in October, 1995. In December, 1998, the Commission released its Report and Recommendations relating to "Research Involving Persons with Mental Disorders that May Affect Decisionmaking Capacity." It seems that many authors, including the Commission, try to outdo each other with recommendations for governmental action which increasingly make clinical research more difficult to conduct. The thesis of this article is that this effort is misguided, both because the most stringent regulation does not ensure compliance by the researcher and because many such regulations are, in fact, anti-therapeutic. The author applies the relatively new field of Therapeutic Jurisprudence, i.e., the study of law as a therapeutic agent, to two of the Commission's recommendations and determines that those recommendations are anti-therapeutic and, as such, should not be adopted. The author further recommends that all proposals which have an impact on biomedical research using human participants be subjected to a therapeutic jurisprudence evaluation before recommendations of additional governmental paternalism in this field be proposed.
How Has Nafta Affected the Mexican Economy? Review and Evidence

This paper provides a comprehensive assessment of the impact of NAFTA on growth and business cycles in Mexico. The effect of the agreement in spurring a dramatic increase in trade and financial flows between Mexico and its NAFTA partners, and its impact on Mexican economic growth and business cycle dy-namics, are documented with reference both to stylized facts and recent empiri-cal research. The paper concludes by drawing lessons from Mexico’s NAFTA experience for policymakers in developing countries. The foremost of these is that in an increasingly globalized trading system, bilateral and regional free trade arrangements should be used to accelerate, rather than postpone, needed struc-tural reform.
The Complexity of Modern American Civil Litigation: Curse or Cure?

Originally prepared for the 2007 meetings of the Italian Association of Comparative Law, this paper seeks to excavate the roots of procedural complexity in modern American litigation. Proceeding from the view that there is no accepted definition of complex litigation in the United States, the paper discusses five related phenomena that the author regards as consequential: (1) the architecture of modern American lawsuits and the procedural philosophy that architecture reflects, (2) the volume of litigation and the public and private policies, attitudes and arrangements that affect it, (3) the dynamic nature of, and dispersed institutional responsibility for, American law, (4) the enormous amounts of money at stake in some litigation, and (5) the search for, and the forms of, relevant evidence in modern American litigation, and the impact of science and technology on both. The paper argues that, having opted for equity's approach to the joinder of claims and parties - in part to ensure effective enforcement of rights but also in part to make such enforcement more efficient - Americans have repeatedly turned to the tools of aggregation as a remedy for that success. In doing so, the people responsible for the courts often override the preferences of the parties (and thus the principle of party autonomy), alter the balance of power in litigation, and render trial effectively impossible. In such instances, they are creating complexity where it is not necessary for effective access to court; the stated goal of efficiency may be a delusion, and in any event aggregation can make little pretense to a goal of accuracy as opposed to dispute resolution simpliciter. Moreover, as the Class Action Fairness Act of 2005 suggests, in a federal system the unremitting quest for aggregation may come at a heavy price to individual state autonomy. In sum, taken to the extremes to which Americans appear to be heading, complex litigation appears to be a cure that has become a curse.
Nonprice Competition in “Substitute” Drugs: The FTC's Blind Spot

As the recent case of United States v. Lundbeck illustrates, the Federal Trade Commission's lack of knowledge in medical and pharmacological sciences affects its evaluation of transactions between medical and pharmaceutical companies that involve transfers of rights to manufacture or sell drugs, causing the agency to object to such transactions without solid basis for doing so. This article argues that in order to properly define a pharmaceutical market, one must not just consider the condition that competing drugs are meant to treat, but also take into account whether there are “off-label” drugs that are used to treat a relevant condition, whether drugs actually compete with each other on price or whether they are selected based on their side-effects (or lack thereof), mechanism of action, physician knowledge, and other noneconomic considerations, and finally whether the drugs in question enjoy any patent or nonpatent-based exclusivity that prevents generic manufacturers from entering the market.
Cost-benefit analysis and the environment

In the United States, cost-benefit analysis (CBA) is in the ascendancy. For over twenty years, American presidents have required agencies to perform CBA for major regulations; indeed, they have told agencies to regulate only if the benefits of regulation justify its costs. Congress has also shown considerable interest in CBA, most prominently in the Safe Drinking Water Act, which asks agencies to produce quantitative assessments of both costs and benefits. For their part, federal courts have adopted a series of principles that promote CBA, saying that if Congress has not been clear, agencies may consider costs, take account of the substitute risks introduced by regulation, and exempt trivial risks from governmental control. In its enthusiasm for cost-benefit analysis, the United States provides a sharp contrast to Europe, which has shown intense interest in a quite different organizing principle for environmental protection: the Precautionary Principle. According to the Precautionary Principle, regulation is required even in the face of scientific uncertainty—even if it is not yet clear that environmental risks are serious. A central point of the Precautionary Principle is to recognize the limitations of existing knowledge and to protect against harm that cannot yet be established as such. Cost-benefit analysis and the Precautionary Principle can lead in
Can Mutual Fund Managers Pick Stocks? Evidence from Their Trades Prior to Earnings Announcements

Recent research finds that the stocks that mutual fund managers buy outperform the stocks that they sell (e.g., Chen, Jegadeesh, and Wermers (2000)). We study the nature of this stock-picking ability. We construct measures of trading skill based on how the stocks held and traded by fund managers perform at subsequent corporate earnings announcements. This approach increases the power to detect skilled trading and sheds light on its source. We find that the average fund’s recent buys significantly outperform its recent sells around the next earnings announcement, and that this accounts for a disproportionate fraction of the total abnormal returns to fund trades estimated in prior work. We find that mutual fund trades also forecast earnings surprises. We conclude that mutual fund managers are able to trade profitably in part because they are able to forecast earnings-related fundamentals.
A margin requirement based return calculation for portfolios of short option positions

Purpose – Short option positions carry significant risk of losses well in excess of 100 per cent of the initial option price. Margin requirements associated with such positions are therefore considerable. The purpose of this paper is to develop a methodology for calculating margin requirement‐based option portfolio returns that realistically represent the returns realized by investors, and to demonstrate the effects of this methodology on analyses of option returns.Design/methodology/approach – A methodology is developed for calculating margin requirement‐based short option portfolio returns.Findings – Accounting for margin requirements reduces the returns of simple short option strategies by up to 92 per cent compared to the price return. In long/short portfolio analyses, use of margin requirement returns necessitates additional methodological adjustments to ensure that unwanted volatility risk is properly hedged.Originality/value – The result is a portfolio return that more accurately represents the ret...
Buyer Search Intensity and the Role of the Residential Real Estate Broker

This study examines the impact of the real estate broker on the effectiveness of buyer search by focusing on the linkages between search intensity and the duration of search. How long a buyer searches depends on how sensitive the buyer is to within-period search costs and across-period, sequential search costs. High-income individuals and other homebuyers with high within-period search costs tend to search longer and less intensively. Buyers with high across-period search costs, such as out-of-town buyers, tend to search more intensively. Brokers, by reducing the opportunity costs of within-period search, increase buyer search intensity, which in turn reduces actual search time.
Securitized Markets and International Capital Flows

We study the effect of collateralized lending and securitization on international net and gross capital flows, growth, welfare, and inequality in a two country general equilibrium model with idiosyncratic investment risk. The financial sectors in the two countries, Home and Foreign, differ by the collateral requirement for investment loans, with Home requiring lower margins. In autarky, Home has higher interest rates, which enables more risk sharing through increased state contingency of collateralized loan contracts. Upon financial integration, capital flows from Foreign to Home, leading to lower interest rates, less risk sharing (more inequality), higher investment levels, and economic growth in Home. Despite low growth, Foreign enjoys substantial welfare gains through better risk sharing opportunities. The capital flows are driven by the greater endogenous supply of "safe-enough" assets by Home and the demand for those assets by Foreign.
Markets as a Moral Foundation for Contract Law

III. THE NON-EFFICIENCY CASE FOR MARKETS 193 A. POLITICS 193 B. WEALTH 198 C. VIRTUE 201
Transfer Regulations and Cost Effectiveness Analysis

Recent scholarship on regulatory oversight has focused on cost-benefit analysis of prescriptive regulations--regulations that restrict behavior such as pollution--and their use to cure market failures, and has overlooked the vast number of transfer regulations. Transfer regulations are regulations that channel funds to beneficiaries. These regulations are authorized by statutes that establish entitlement programs like Medicare and Social Security, pay one-time distributions to victims of misfortunes such as natural disasters and the 9/11 terrorist attack, and fund pork barrel spending. Cost-benefit analysis cannot be used to evaluate transfer regulations because all transfer regulations fail cost-benefit analysis; cost-effectiveness analysis, however, can be used to evaluate transfer regulations. Although executive orders appear to require agencies to use cost-effectiveness analysis to evaluate transfer regulations that have a large economic impact, the agencies' record is dismal. Most agencies fail to perform cost-effectiveness analysis, and other agencies perform cost-effectiveness analysis incorrectly. More vigorous Office of Management and Budget and, possibly, judicial review could improve the quality of distributive regulations.
Modular liability rules

Abstract Recent work has discussed and formalized the conditions under which liability rules are superior to property rules in a world with “one-sided” incomplete information. These studies demonstrated how liability rules achieve higher social welfare by harnessing one party's private information about its own valuation to the process of optimally allocating the entitlement between the parties. This article introduces a new family of liability rules hitherto neglected by courts and legal scholars. A regime of modular liability rules is one in which the court applies legal rules for which the traditional liability rules are building blocks; these rules harness both parties’ private information. Whereas in an efficient liability rule 2 (for example) a polluter is granted a call-option to purchase the right to the air (so to speak) with an exercise price that equals the resident's harm, in modular liability rule 6 + 5 (for example) a pair of options, rather than a single one, is allocated; the resident gets a put option to force a transfer of the entitlement (as under rule 6), but the polluter has a consecutive put option to sell the entitlement back to the resident, if he wishes (as under rule 5). Interestingly, the maximizing joint welfare exercise-price equals, in general and for uniform distributions, an amount that is the average of one party's maximum estimated valuation and the other party's minimum estimated valuation. Two paradigmatic worlds of two-sided incomplete information are studied: a symmetric world, in which the court's best estimate of the parties’ private valuations is that they are identically distributed, and an asymmetric world. In the symmetric world, modular liability rules are in some respects more efficient and more fair (exact definitions are discussed in the article) than the conventional liability rules. In the two-sided and asymmetric world, modular liability rules yield higher joint payoffs than regular liability rules if, and only if, the difference between the parties’ means is larger than the difference between their amount of private information (represented by the distribution's support). A practical way to implement these insights in real life situations is offered.
Judging the Next Emergency: Judicial Review and Individual Rights in Times of Crisis

As virtually every law student who studies Marbury v. Madison' learns, Chief Justice John Marshall's tactical genius was to establish judicial review in a case where the result could not be challenged. As a technical matter, Marbury lost, and the executive branch won. As furious as President Jefferson reportedly was with the decision, there was nothing he could do about it, for there was no mandate to defy. The Court's decision offered no remedy for Marbury himself, whose rights were directly at issue, and whose rights the Court found had indeed been violated. But over time, it became clear that the decision was a landmark victory for those who consider judicial review of political-branch action a critical element of a constitutional system. Judicial review on matters of national security frequently follows the Marbury model. It rarely provides relief to the individuals before the Court when the national-security crisis is at its height. As in Marbury itself, the challengers generally lose, and the government generally wins. As a result, the conventional wisdom is that courts function poorly as guardians of liberty in times of crisis. Schenck,2 Korematsu,3 and Dennis,4 from World War I, World War II, and the Cold War, respectively, are a few of the more notorious examples. In those cases, the Court authorized the criminalization of speech during World War I, detention based on race during World War II, and guilt by association during the Cold War.