cssi/SciSciGPT-SciSciNet huggingface dataset:
'Steel in the Ground': Greening the Grid with the iUtility

As the United States addresses climate change through carbon reduction strategies, it must focus on the two major parts of our energy portfolio - oil and electricity. Electricity is a central focus because over one-half of all electricity generated is derived from coal-burning power plants, which are notoriously dirty. Other cleaner and renewable sources of electricity, such as wind and solar power, are available. However, over the last hundred years, the electricity industry has been constructed to serve large-scale, centralized and capital-intensive coal and nuclear plants.There are good economic reasons for building large power plants. Economies of scale can keep consumer costs down as well as reap profits for utility shareholders. Unfortunately, large coal plants also produce the carbon dioxide that contributes to global warming. A further misfortune is that the infrastructure for transmitting and distributing large scale electricity favors precisely those coal plants that have become problematic. In short, any climate change strategy must reform the electricity infrastructure so that more environmentally sensitive resources can come online and contribute to our nation's electricity needs.The green electricity grid, then, plays an important role in refashioning our energy future. The green grid can increase our use of clean and renewable resources, reduce carbon emissions, increase the use of smart technologies, and contribute to energy security. In order to achieve these goals, the electricity industry and its regulation must be changed significantly, as this Article advocates. Further, the Article argues that the new regulation of the electricity industry can become the model for the next generation of government regulation more generally as the old style of command and control regulation gives way to technological innovation and new forms of shared governance among industry and its consumers, as well as regulators.
Domestic Violence, Character, And Social Change In The Welfare Reform Debate

This article addresses the recently discovered connection between domestic violence and welfare dependency.“ Empirical research among welfare populations shows that over 50% of women receiving welfare are or have recently been battered, and that partner abuse is a major reason for the continuing poverty of many women. The question the author asks and begins to answer is why this connection has not previously been identified or publicized by either the battered women’s movement or the anti-poverty movement, and what the challenge may be to both movements as they attempt to address it in the context of welfare reform. The author argues that the connection has not been previously addressed because of the somewhat conflicting ideologies underlying both movements. The battered women’s movement is defined in part by its strong moral denunciation of male abusers and assertion of the victimization of women by men. The anti-poverty movement is reluctant to demonize half of the poor population, particularly in light of the conservative welfare reformers’ emphasis on ”character“ as the main cause of poverty. The article argues that we must – and can – find a way to synthesize the feminist emphasis on interpersonal justice and morality with the anti-poverty movement’s recognition of the larger social causes of poverty. The perspectives of both movements must be enlarged to recognize the multiple layers of victimization which poor women and men endure; and both movements will be revitalized by this cross-fertilization.
What drives the valuation premium in IPOs versus acquisitions? An empirical analysis

Using a hand-collected data set of private firm acquisitions and IPOs, this paper develops the first empirical analysis in the literature of the “IPO valuation premium puzzle,” which refers to a situation where many private firms choose to be acquired rather than to go public at higher valuations. We also test several new hypotheses regarding a private firm's choice between IPOs and acquisitions. Our analysis of private firm valuations in IPOs and acquisitions indicates that IPO valuation premia disappear for larger VC backed firms after controlling for various observable factors affecting a firm's propensity to choose IPOs over acquisitions. Further, after controlling for the long-run component of the expected payoff to firm insiders from an IPO exit, we find that the IPO valuation premium vanishes even for larger non-VC backed firms and shrinks substantially for smaller firms as well. Our Heckman-style treatment effects regression analysis demonstrates that the above results are robust to controlling for the selection of exit mechanism by firm insiders based on unobservables. Our findings on private firms' choice between IPOs and acquisitions can be summarized as follows. First, firms operating in industries characterized by the absence of a dominant market player (and therefore more viable against product market competition) are more likely to go public rather than to be acquired. Second, more capital intensive firms, those operating in industries characterized by greater private benefits of control, and those which are harder to value by IPO market investors are more likely to go public rather than to be acquired. Third, the likelihood of an IPO over an acquisition is greater for venture backed firms and those characterized by higher pre-exit sales growth.
Consolidation and market structure in emerging market banking systems

This paper examines the evolution of market structure in emerging markets banking systems during the 1990s. While a significant process of bank consolidation has been taking place in these countries, reflected in a sharp decline in the number of banks, this process has not systematically been associated with increased concentration as measured by standard indices. Moreover, econometric estimates based on the Panzar and Rosse (1987) methodology suggest that overall, markets have not become less competitive in a sample of eight European and Latin American countries. Lowering barriers to entry, such as allowing increased participation of foreign banks, appears to have prevented a decline in competitive pressures associated with consolidation.
Analyst Following and Credit Ratings

This paper examines the relation between financial (equity) analyst following and default risk, which we proxy by issuer credit ratings. We hypothesize that analyst following reduces default risk because of both the monitoring and the informational roles of financial analysts. Using a large sample of firms, we find evidence consistent with this conjecture. In particular, we find that analyst following is negatively related to a firm's default risk (credit rating). The effect of analyst following on credit ratings is less pronounced for firms with a superior information environment and stronger controls. Similarly, the effect of analyst following on a firm's credit rating is lower when analysts' information quality is poor. Our results are robust to controlling for several factors including the endogenous relation between credit ratings, institutional holdings, and analyst following. Our study documents important spillover effects of financial (equity) analysts to the debt market.
Quasi-Hyperbolic Discounting and the Existence of Time-Inconsistent Retirement

The decision about how much to save for retirement is likely to be dependent on when an individual plans to be retired, and vice versa. Yet, the established literature on hyperbolic discounting and life-cycle saving behavior has for the most part abstracted from choice over retirement. Two notable exceptions are Diamond and Koszegi [1] and an important follow-up study by Holmes [2], which demonstrates that time-inconsistent retirement timing is impossible when saving behavior is explicitly modeled in a stylized three-period setting. In this paper, we build upon the framework of Diamond and Koszegi [1] and Holmes [2] by generalizing the assumptions about initial income and assets. We show analytically and via simple numerical examples that time-inconsistent retirement can exist in a three-period life-cycle model of consumption and saving.
Anonymity in Cyberspace: What Can We Learn from John Doe?

This Article examines the evolution of the law governing libel suits against anonymous “John Doe” defendants based on Internet speech. Between 1999 and 2009, courts crafted new First Amendment doctrines to protect Internet speakers from having their anonymity automatically stripped away upon the filing of a libel action. Courts also adapted existing First Amendment protections for hyperbole, satire, and other nonfactual speech to protect the distinctive discourse of Internet message boards. Despite these positive developments, the current state of the law is unsatisfactory. Because the scope of protection for anonymous Internet speech varies greatly by jurisdiction, resourceful plaintiffs can make strategic use of libel law to silence their critics. Meanwhile, plaintiffs who are truly harmed by cybersmears will find little effective recourse in libel law. Though disheartening, the current state of the law may be a testament to the difficulty of balancing speech and reputation in the Internet age.
Insurance and the Limits of Rational Discrimination

In recent years, the insurance industry has come under attack for engaging in "discriminatory" practices against minorities. Critics assert that black applicants for insurance are often charged higher rates than white applicants, or are even denied certain kinds of insurance altogether. l In response, insurance companies offer the following defense: any difference in rates between racial groups simply reflects the underlying riskiness of the average white and black applicant in society. In other words, insurance companies suggest that they have a perfectly rational reason to discriminate against minorities. On average, minorities are more expensive to insure.2 The profit-making objective of this kind of "rational discrimination"3 distinguishes it from bigotry or "irrational discrimination."4
Boards, Auditors, Attorneys and Compliance with Mandatory SEC Disclosure Rules

We survey the empirical literature on the determinants of firms' compliance with mandatory SEC disclosure rules. We begin with a discussion of the role of boards of directors, public accounting firms, and corporate attorneys in the preparation and review of mandatory disclosures. We then organize current research into three broad types of variation in compliance: completeness, timeliness and readability. Our review highlights three interesting areas for future research: (1) studies that examine the relations between completeness, timeliness and readability within the same research design; (2) studies that assess whether boards of directors, public accounting firms and corporate attorneys view disclosure compliance as a general firm policy; and (3) studies that investigate the influence of corporate attorneys on mandatory disclosure, as well as studies of disclosure issues that require collaboration between auditors and corporate attorneys. As a first step to address the latter agenda, we provide new empirical evidence regarding the impact of corporate attorneys on disclosure compliance. Copyright © 2013 John Wiley & Sons, Ltd.
Is culture a determinant of financial development

This article investigates the missing link in the literature – whether informal institutions, or what is known as culture, can affect the level of financial development for a country? Our hypothesis stresses that the cultural dimensions of a country can have an impact on its financial set-up. We consider multiple dimensions of culture, identified in the literature by Tabellini (2008), to test our hypothesis. As culture evolves in the form of greater trust, control and other traits, individuals' attitudes towards financial market change, and they engage in greater financial transactions. This, in turn, leads to better financial development. Using quantile estimation technique for a cross section of 90 countries, we find that culture significantly influences the level of financial development. To ensure the robustness of our findings we use Hofstede's cultural dimension – ‘Uncertainty Avoidance Index’ (UAI) – as an alternative measure for culture. Our results hold for multiple measures of financial development.
Precedent: What It Is and What It Isn't; When Do We Kiss It and When Do We Kill It?

The doctrine of precedent is everyone's dragon. If facts in the putative precedent are identical with or reasonably similar to those in the compared case, the precedent is recognized as legitimate, and it is applied. In such cases, all of us -- student and professor, lawyer and judge, commentator and philosopher -- consider it merely, as the Italians say, "un dragonetto" (a small dragon). But if the material facts in the compared case do not run on all fours with the putative precedent, the doctrine becomes "un dragone," or, to give equal time, "una dragonessa" (a full grown, ferocious dragon). Wrestling with such a dragon can be the most difficult and controversial job in the judging business. I realize that literature on how to deal with this dragon abounds. Undeterred, I make bold to mount my charger, draw my lance, and gallop into the lists to volunteer some advice on how to tweak the dragon's tail. Perhaps the dragon will prove too elusive, or I too bold or too meek, but ever persistent I will press on, hoping to tame this dragon. I bring with me experience, not only as a judge, to be sure, but also as one who has explored and meandered in the judicial process thicket, seeking trails to understand what it is all about. First I will discuss some definitions of precedent and the overarching doctrine of stare decisis. I the will explore what I call the four different models of precedent. From this I will move to a consideration of precedent as a method of classification containing varying degrees of abstraction. This will lead to a study of inductive reasoning, including both generalization and analogy, taking freely from my book Logic For Lawyers: A Guide to Clear Legal Thinking. I wrap it up with some views of precedential vitality, and close with the distinction between precedent and persuasive authority. PDF scan posted with permission of the Pepperdine Law Review.
Price Formation and Liquidity in the U.S. Treasury Market: The Response to Public Information

The arrival of public information in the U.S. Treasury market sets off a two-stage adjustment process for prices, trading volume, and bid-ask spreads. In a brief first stage, the release of a major macroeconomic announcement induces a sharp and nearly instantaneous price change with a reduction in trading volume, demonstrating that price reactions to public information do not require trading. The spread widens dramatically at announcement, evidently driven by inventory control concerns. In a prolonged second stage, trading volume surges, price volatility persists, and spreads remain moderately wide as investors trade to reconcile residual differences in their private views. How DO FINANCIAL MARKETS FORM PRICES and provide liquidity when information arrives? Efforts to address this issue have led to an extensive microstructure literature on equity markets, and to a lesser extent on the foreign exchange (FX) market. Relatively little work has focused on the U.S. Treasury market, however, in spite of its importance in its own right and the advantages it offers as an alternative testing ground for microstructure hypotheses.
Estimation of nonlinear models with mismeasured regressors using marginal information

We consider the estimation of nonlinear models with mismeasured explanatory variables, when information on the marginal distribution of the true values of these variables is available. We derive a semi-parametric MLE that is shown to be consistent and asymptotically normally distributed. In a simulation experiment we find that the finite sample distribution of the estimator is close to the asymptotic approximation. The semi-parametric MLE is applied to a duration model for AFDC welfare spells with misreported welfare benefits. The marginal distribution of the correctly measured welfare benefits is obtained from an administrative source. Copyright © 2010 John Wiley & Sons, Ltd.
Innovation adoption and collective experimentation

Abstract I study learning about an innovation with costly information acquisition and knowledge sharing through a network. Agents situated in an arbitrary graph follow a myopic belief update rule. The network structure and initial beliefs jointly determine long-run adoption behavior. Networks that share information effectively converge on a consensus more quickly but are prone to errors. Consequently, dense or centralized networks have more volatile outcomes, and efforts to seed adoption should focus on individuals who are disconnected from one another. I argue that anti-seeding, preventing central individuals from experimenting early in the learning process, is an effective intervention because the population as a whole may gather more information.
Lotteries in student assignment: An equivalence result

This paper formally examines two competing methods of conducting a lottery to assign students to schools, motivated by the design of the centralized high school student assignment system in New York City. The main result of the paper is that single and multiple lottery mechanisms are equivalent for the problem of allocating students to schools in which students have strict preferences and the schools are indifferent. In proving this result, a new approach is introduced that simplifies and unifies all the known equivalence results in the house allocation literature. Along the way, two new mechanisms—Partitioned Random Priority and Partitioned Random Endowment—are introduced for the house allocation problem. These mechanisms generalize widely studied mechanisms for the house allocation problem and may be appropriate for the many-to-one setting such as the school choice problem.
Does executive portfolio structure affect risk management? CEO risk-taking incentives and corporate derivatives usage

Abstract This paper extends the investigation of the effect of managerial motives on hedging policy. I utilize a proxy variable that incorporates CEO incentives to increase risk relative to incentives to increase stock price. The variable is directly measured using observed characteristics of CEO portfolios of stock and option holdings. Furthermore, CEO risk-taking incentives are modeled as a choice variable to eliminate the simultaneity bias of modeling risk-taking incentives as an exogenous variable. If modeled as a simultaneous system of equations, a strong negative link between CEO risk-taking incentives and the amount of derivative holdings exists. This result is consistent with the notion that derivatives are used for hedging purposes. Both the characteristics of stock and option holdings are important in determining cross-sectional differences in corporate derivative holdings.
Value of Multinationality: Internalization, Managerial Self‐interest, and Managerial Compensation

In this paper, we examine the impact of managerial self-interest on the value of multinationality. Since agency theory also suggests that a divergence between the interests of managers and shareholders can be aligned by effective managerial incentive, we also examine the effect of managerial compensation on the value of multinationality. Our results show that for high-Q (Tobin’s Q > 1) firms, investors do not associate the spending of free cash flow on multinationality with the problem of overinvestments. For high-Q firms, it is also found that the value of multinationality can be enhanced by effective managerial incentives. For low-Q firms (Tobin’s Q < 1), it is found that the concern of managerial self-interest overwhelms the benefits of internalization, making multinationality a value-decreasing event. For low-Q firms, managerial compensation is also ineffective in promoting value-enhancing foreign direct investments.
Balanced baskets: a new approach to trading and hedging risks

A basket is a set of instruments that are held together because its statistical profile delivers a desired goal, such as hedging or trading, which cannot be achieved through the individual constituents or even subsets of them. Multiple procedures have been proposed to compute hedging and trading baskets, among which balanced baskets have attracted significant attention in recent years. Unlike Principal Component Analysis (PCA) style of methods, balanced baskets spread risk or exposure across their constituents without requiring a change of basis. Practitioners typically prefer balanced baskets because their output can be understood in the same terms for which they have developed an intuition. We review three methodologies for determining balanced baskets, analyze the features of their respective solutions and provide Python code for their calculation. We also introduce a new method for reducing the dimension of a covariance matrix, called Covariance Clustering, which addresses the problem of numerical ill-conditioning without requiring a change of basis.
National Versus International Mergers and Trade Liberalization

This paper uses an endogenous merger formation approach in a concentrated international oligopoly to examine the effects of trade liberalization on the nature of merger incentives (national vs. international). The effects of unilateral trade liberalization on a country’s industry structure are found to be depending on the other country’s trade policy regime. If the other country practices free trade, unilateral liberalization by a country yields international mergers whereas if it practices a restrictive trade policy, national mergers arise. As trade gets bilaterally liberalized, the resulting equilibrium market structure is the one with international mergers. These results fit well with the fact that global trade liberalization has been accompanied by an increase in international merger activity. Among equilibrium market structures, international ones are found to be preferable from a welfare point of view. As a result, social and private incentives become aligned together as trade gets liberalized.
Alien Tort Litigation: The Road Not Taken

When the Second Circuit decided in Filartiga v. Pena-Irala that the Alien Tort Statute (ATS) provided a federal forum for international human rights claims, no one would have predicted that thirty-three years later in Kiobel v. Royal Dutch Petroleum Co. the Supreme Court would use the presumption against extraterritoriality to limit those claims. This essay recounts some of the doctrinal developments in alien tort litigation during the intervening thirty-three years. After Filartiga, courts faced a choice whether to apply international law as the rule of decision, or the law of the place where the tort occurred. Courts chose the international law road, with U.S. law providing the cause of action and the rules for damages. The Supreme Court ratified this choice in Sosa v. Alvarez-Machain, clarifying that the cause of action came not from the ATS itself but from federal common law. In the battles over aiding and abetting liability that followed, plaintiffs argued that federal common law should govern just about every issue of ATS litigation except the initial violation of international law, while defendants and the Bush Administration argued that the presumption against extraterritoriality should apply to the federal common law cause of action, the position the Supreme Court accepted in Kiobel. This essay argues that the early decisions to apply international law rather than the lex locus delicti as the rule of decision in alien tort litigation ultimately provided the doctrinal hook for the Supreme Court to restrict alien tort suits with the presumption against extraterritoriality. It also glances briefly down the road not taken.
Litigation Costs, Budget Impacts, and Cost Containment Strategies: Evidence from California Cities

Litigation costs are straining many municipalities' budgets and creating more uncertainty and flux in their annual budgetary processes. A 1996 mail survey of California cities conducted by the League of California Cities, to which 210 cities (45 percent) responded, shows that the level of litigation-driven budgetary strain is intensifying. The budgetary impacts of litigation have been quite substantial, no matter whether measured in terms of overall impact, percent increase, frequency and magnitude of budget amendments, actual dollar costs, or the tendency to settle cases just to save money. Population size makes a lot of difference in the level and type of impact as well as the cost containment strategies implemented by a city. Generally, the larger the city (and the more diverse), the greater the strain litigation costs have put on the budget. A higher percentage of big cities (over 100,000) than smaller ones blame rising costs on police liability, personal injury, civil rights, tort, Americans With Disabilities Act, Fourteenth Amendment and Fourth Amendment claims. Frivolous cases are a problem for cities of all sizes. So, too, are the rising incidences of rights-related cases being filed against cities by their own employees as well as private individuals. This trend will likely increase as the nation's population ages and diversifies ethnically and racially.
A Profession, If You Can Keep It: How Information Technology and Fading Borders are Reshaping the Law Marketplace and What We Should Do About It

Technology is changing the way we do business. It has made cross-border trade in goods and services easy. Capital is finding ways to profit from the law business. Lawyers strive to serve clients wherever they need help, including outside their jurisdiction of admission. These changes not only affect how American law firms work, they challenge our system for licensing and regulating lawyers. The traditional geocentric model for regulating the bar, based on physical place of practice, is unstable today because lawyers can practice physically in many places and (virtually) in every place, yet no place in particular.
Legislative bargaining with teams

Abstract We study legislative bargaining with two person teams versus individuals. Teams come closer to the predictions of the stationary subgame perfect equilibrium, passing minimum winning coalitions (MWCs) more often and having significantly more proposer power. The increase in proposer power results from increased numbers of MWCs, along with increased proposer power within an MWC. We investigate the driving forces behind teams coming closer to the theoretical predictions. The results favor their greater insightfulness as opposed to being more aggressive or more selfish.
Two Federally Subsidized Health Insurance Programs Are One Too Many: Reconsidering the Federal Income Tax Exclusion for Employer-Provided Health Insurance in Light of the Patient Protection and Affordable Care Act

Section 106 of the Internal Revenue Code (I.R.C.) provides a federal income tax exclusion for the value of employer-provided health insurance. This decades-old provision was enacted for the primary purpose of increasing the incidence of health insurance in the United States. Since its adoption, scholars have advanced a number of additional policy considerations in support of preserving this exclusion. The enactment of the Patient Protection and Affordable Care Act (ACA), however, will result in a significant overhaul of the American health care system. As a result, a reexamination of I.R.C. § 106 is warranted. This Note argues that the ACA has rendered each of the policy considerations in support of I.R.C. § 106 largely irrelevant, inapplicable, or generally less compelling— whereas the arguments in favor of repeal now seem all the more convincing. Nevertheless, policymakers should stop short of outright repeal because of a number of drawbacks that may prove unavoidable. Consequently, this Note proposes a middle ground that instead calls for significant reform. Converting the exclusion into a progressive, refundable tax credit would largely accomplish the goals sought by repeal, while still avoiding the negative repercussions that total repeal may engender.
The Little Engine That Could: The Success of the Stewardship Contracting Authority

For decades, environmentalists have resented the manner in which United States Forest Service personnel have managed the national forests. Similarly, local forest communities have often found themselves in conflict with the Forest Service. A temporary and experimental measure, enacted by Congress in the FY 1999 Omnibus Appropriations Act, exhibits significant potential to resolve these conflicts by improving the Forest Service's ecological administration of the forests and repairing its tattered relationship with local forest communities. This legislative action, which merely changed the manner in which the Forest Service is permitted to contract for goods and services with the public, has quietly been altering the culture within the Forest Service and the landscape that the Forest Service manages. Referred to by Congress as "Stewardship Contracting," the legislative authority is, unfortunately, temporary. This article argues that the Stewardship Contracting Authority has been so successful in fulfilling its legislative purpose that Congress should make the authority permanent and encourage the Forest Service to increase the use of stewardship contracts.
Constitutional Myopia: The Supreme Court's Blindness to Religious Liberty and Religious Equality Values in Town of Greece v. Galloway

It is difficult to analyze a Supreme Court decision that is as fundamentally misguided and unpersuasive as last term’s decision in Town of Greece v. Galloway, the case upholding state-sponsored prayers before town board meetings. In attempting to do so in this article, I critically evaluate the Court’s repeated failures to adequately address the serious religious equality and religious liberty issues presented in this case. With regard to religious equality concerns, for example, the Court all but completely ignores the town’s discrimination in favor of established organized churches and against minorities with too few adherents to organize a congregation in the town, nonaffiliated spiritual residents of the community, and nonreligious residents. Even worse, the Court suggests that allowing low level functionaries to develop informal and imprecise criteria to determine who should be invited to offer prayers at board meetings without adopting a policy or providing any guidance on how these decisions should be reached somehow immunizes the town from serious constitutional scrutiny. Instead, I argue that this lack of guidelines and policy itself should be understood to violate the First Amendment because it so obviously increases the risk of biased and discriminatory conduct.The Court’s discussion of plaintiffs’ religious liberty concerns is even more untenable. Plaintiffs argued that if a government official or deliberative body has the discretionary authority to make decisions that will seriously impact the needs and interests of individuals or small groups of citizens, it is intrinsically coercive for those officials to ask these citizens to engage in a religious exercise such as a prayer before they submit their arguments or petitions to government decision-makers. In order to reject these claims, Justice Kennedy describes an understanding of social reality that is difficult to believe and impossible to share. Perhaps most egregiously, Kennedy’s analysis treats prayer as if it is some kind of abstract ceremonial activity instead of what it is for most Americans – a personal, meaningful communication between the individual and G-D. The article concludes with a discussion of the possible implications of this decision for the constitutional protection of religious liberty and equality in other contexts and circumstances.
True Believers at Law: National Security Agendas, the Regulation of Lawyers, and the Separation of Powers

Ideological agendas distort the deliberation required for sound legal advice about national security. Elite government lawyers after September 11 advanced a theory at the expense of context, labeling legal constraints as “lawfare” against American interests. The lawfare critics failed to recognize that legal constraints can empower decisionmakers by reinforcing reputational and other long-term values. They also failed their history test, ignoring the lessons of presidents from Jefferson to Kennedy who rejected a rigid adherence to ideology in the national security realm. By discounting context, the construction of the lawfare paradigm produced dire results, including the torture memos drafted by the Justice Department’s Office of Legal Counsel (“OLC”) and the destruction of CIA interrogation tapes. Unfortunately, this elevation of ideology over context has failed to yield adequate remedies. Tort litigation, exemplified by Jose Padilla’s recent lawsuit against former OLC attorney John Yoo, risks Copyright  2008 by Peter Margulies. * Professor of Law, Roger Williams University School of Law B.A. Colgate, 1978, J.D. Columbia Law School, 1981; send comments to pmargulies@rwu.edu. I thank our superb reference librarian, Emilie Benoit, for her expert assistance, and Kathleen Clark, Lawton Cummings, Hal Gerber, Bob Gordon, David Pozen, Dan Richman, Ellen Saideman, Mark Shulman, Bill Simon, and participants at a workshop at St. John’s University School of Law and a roundtable sponsored jointly by the American Association of Law Schools Professional Responsibility section and Fordham Law School for comments on previous drafts.
Export Pricing Behavior of Manufacturing: A U.S.: Japan Comparison

The pricing behavior of U.S. and Japanese manufacturers is compared by using domestic and export price data and a framework of markup over cost. Major export industries in Japan have higher productivity growth and lower pass-through coefficients than American exporters, who tend to price to domestic cost. Japanese firms seem to price-discriminate between domestic and export markets. Although pass-through of major Japanese exports declined in the 1980s, evidence on the statistical significance of the change is mixed.
Comment: Experts who don't know they don't know

Sadly, the conclusion reached by Green and Armstrong (2006) – that experts should not be used for predicting the decisions that people will make in conflicts – comes as no surprise. Decades ago, Armstrong himself taught us that expertise beyond a minimal level does not improve judgmental accuracy across a variety of domains (Armstrong, 1980). More recently, Tetlock (2006) drove home the point in a study of hundreds of political experts who made thousands of forecasts over many years. Like Green and Armstrong (2006), Tetlock (2006) found that that expert forecasts were frequently inaccurate. In a nod to Armstrong’s previous work, Tetlock (2006) suggests that avid readers of the New York Times should be able to predict political events as well as highly trained experts.
Legislative Review and Party Differentiation in Coalition Governments

Multiparty governance requires compromise and this compromise can lead to electoral losses. I argue that coalition members are motivated to differentiate themselves from their cabinet partners to mitigate potential electoral losses resulting from voters perceiving them as not rigorously pursuing their core policy positions or not possessing strong policy stands. I test this argument with original data on the scrutiny of over 2,200 government bills gathered from three parliamentary democracies incorporating information on voter perceptions of partisan ideology and parties’ policy preferences as derived from their manifestos. I find that coalition partners that are perceived as more similar will amend one another’s legislative proposals more vigorously in an effort to differentiate in the eyes of the electorate—to protect their brand—and therefore provide evidence for “pure” vote-seeking behavior in the legislative review process. Furthermore, these original data provide answers to several open questions regarding the policy motivations of cabinet parties in legislative review and the role of committee chairs and external support parties on policy outcomes.
To Each According to ... ? Markets, Tournaments, and the Matching Problem with Borrowing Constraints

We compare the performance of markets and tournaments as allocative mechanisms in an economy with borrowing constraints. The economy consists of a continuum of individuals who differ in their initial wealth and ability level. These must be assigned to a continuum of investment opportunities or inputs of different productivity. With perfect capital markets matching is efficient under both mechanisms. Markets, however, generate higher aggregate consumption because of the waste associated with the production of signals under tournaments. When borrowing constraints are present, tournaments dominate markets in terms of matching efficiency and, for sufficiently powerful signalling technologies, also in terms of aggregate consumption.
Do Juries Add Value?: Evidence from an Empirical Study of Jury Trial Waiver Clauses in Large Corporate Contracts

We study jury trial waivers in a data set of 2,816 contracts contained as exhibits in Form 8-K filings by reporting corporations during 2002. Because these contracts are associated with events deemed material to the financial condition of SEC-reporting firms, they likely are carefully negotiated by sophisticated, well-informed parties and thus provide presumptive evidence about the value associated with the availability of jury trials. A minority of contracts, about 20 percent, waived jury trials. An additional 9 percent of contracts had arbitration clauses that effectively preclude jury trials though the reason for arbitration clauses need not specifically relate to juries. We explore three groups of factors to explain the pattern of jury trial waivers: (1) contract-specific factors: the subject matter of a contract, a measure of its standardization, choice of law, and choice of forum, (2) contracting-party factors: domestic versus international status, place of business, place of incorporation, attorney locale, and industry, and (3) factors external to the contracts and parties: perceptions of jury fairness in the forum specified in the contract and the relative length of jury and bench trial queues in that forum. Contract type is significantly associated with jury trial waivers. For example, over 50 percent of security agreements and over 60 percent of credit commitments waived jury trials. In contrast, 5 percent of employment contracts, 2 percent of bond indentures, and 3.5 percent of pooling service agreements waived jury trials. The presence of a forum selection clause, greater contract standardization, and perceived fairness of juries are significantly associated with jury trial waivers. Over 80 percent of the contracts designating Illinois as a forum contained jury trial waivers whereas less than half the contracts designating New York as a forum, and only about one-third of the contracts designating California, Texas, or Florida as a forum, contained waiver clauses. Jury trial waivers were not more common in international contracts. Our results suggest that, contrary to a widespread perception about the alleged inadequacies of juries in complex business cases, sophisticated actors may perceive that juries add value to dispute resolution.
Government finance in the wake of currency crises

We address three questions: (i) Can classical models be reconciled with the fact that many crises are marked by high rates of depreciation and small increases in seignorage revenue? (ii) What are the implications of different financing methods for post-crisis rates of inflation and depreciation? (iii) How do governments pay for the fiscal costs associated with currency crises? To study these questions we use a general equilibrium model in which prospective government deficits trigger a currency crisis. We then use our model in conjunction with fiscal data to interpret government financing in the wake of three recent currency crises: Korea (1997), Mexico (1994) and Turkey (2001).
On the distributional effects of trade policy: Dynamics of household saving and asset prices

Abstract This paper studies the effect of trade liberalization on inequality. We develop a theoretical framework that generates economy-wide distributions of wealth and income for different levels of trade protection. The model unambiguously determines the effect of liberalization on inequality; and rationalizes why larger inequality can be the outcome of a welfare enhancing policy, as households reduce their buffer savings when liberalization lowers the price of food. The framework reconciles the increase in inequality, the fall in the value of land, and farmers’ opposition to freer trade, that have featured in different liberalization episodes. We also present empirical support for the model’s predictions.
Was Westphalia ‘all that’? Hobbes, Bellarmine, and the norm of non-intervention

Recently, historians of the international system have called into question the significance of the Treaties of Westphalia in 1648 as the moment when the international system formed. One of their primary arguments is that the non-intervention norm typically associated with Westphalian notions of sovereignty developed much later. This paper will examine the early 17th-century debates over the right of the Pope to depose monarchs in the defense of spiritual matters. I read Part III and Part IV of Hobbes’ Leviathan in its intellectual context to see how his theory of sovereignty was partially developed to support a theory of non-intervention. This reading leads to two important contributions to current political science debates. First, it refutes the growing consensus that non-intervention developed as an aspect of sovereignty only in the late 18th and early 19th century. Second, the paper addresses current attempts to assert a right of humanitarian intervention. By exploring similarities between these recent debates and those between Bellarmine and Hobbes in the 17th century, I offer a fresh perspective on what is at stake in current claims to international community.
Pre-school enrollment: An analysis by immigrant generation

There has been minimal research on the pre-school enrollment of immigrant children. Using 1990 U.S. Census data, this paper investigates pre-school enrollment of child immigrants, those who immigrated as children and the U.S.-born children of immigrants. The analysis is conducted using probit analysis. Pre-school enrollment is found to vary systematically with parental characteristics (income and education), immigrant generation, number of siblings, mother’s labor supply and country of origin. Among the foreign-born, differences in pre-school enrollment are analyzed by country of origin. Among the U.S.-born children of immigrants pre-school enrollment is greatest among those with both parents foreign born.
Who Facilitated Misreporting in Securitized Loans

This paper examines apparent fraud among securitized nonagency loans using three indicators: unreported second liens, owner occupancy misreporting, and appraisal overstatements. We find that around 48% of loans exhibited at least one indicator of misrepresentation. Surprisingly, misreporting is similar in both low and full documentation loans and is associated with a 51% higher likelihood of delinquency. Two-thirds of loans with unreported second liens had the same originator issuing both the first and second lien. Misrepresentations in MBS pools can explain substantial cross-sectional differences in future losses. Losses were predictable and initiating from apparent fraud by MBS underwriters and loan originators.
Predicting Restorability of Incompetent Criminal Defendants

U.S. courts frequently require forensic examiners to offer opinions concerning the likelihood that criminal defendants found incompetent to stand trial can have their competence "restored" through treatment. Yet no jurisdiction has established legal guidelines for testimony concerning restorability, and several authors have suggested that mental health professionals cannot accurately predict whether treatment to restore competence will succeed. This study asked whether reliable information that is consistently available at the time of examination might support empirically grounded opinions about the likelihood of restoration. Using records from all 351 inpatient pretrial defendants who underwent competence restoration at a state psychiatric hospital from 1995 through 1999, I evaluated whether several types of information that are reliable and that could consistently be made available to forensic examiners--including evaluees' demographic characteristics, diagnoses, symptom patterns, criminal charges, number of prior public sector hospitalizations, and cumulative prior length of stay (LOS)--would predict outcome of restoration efforts. I modeled the probability of successful restoration using logistic regression equations, and evaluated the equations' predictive accuracy using k-fold cross-validation and receiver operating characteristic (ROC) analysis. Lower probability of restoration was associated with having a misdemeanor charge, longer cumulative LOS, older age, and diagnoses of mental retardation, schizophrenia, and schizoaffective disorder. Although the overall rate of successful restoration for felony defendants was 75 percent, logistic equations allowed selection of subgroups with high predicted probabilities of restoration (>90%) and low probabilities of restoration (<35%). In cross-validation simulations, predictive equations had ROC areas of 0.727 for all defendants, and 0.735 for felony defendants. These findings provide scientific support for testimony that two types of incompetent evaluees have well-below-average probabilities of being restored: chronically psychotic defendants with histories of lengthy inpatient hospitalizations and defendants whose incompetence stems from irremediable cognitive disorders (such as mental retardation). Nonetheless, courts may still deem low probabilities of success to be "substantial" enough to warrant attempts at restoration.
Reading Justice Brennan: Is There a "Right" to Dissent?

While there is a great deal of literature addressing the pros and cons of dissenting judicial opinions, no one has asked whether judges in a multi-judge court have a "right" to dissent. A "complete" right to dissent would include not just rights to (a) privately express one's disagreement to one's colleagues; and (b) have the fact that one does not join a majority opinion publically noted; but also (c) a right to have a written expression of one's dissenting rationale published in company with the majority's opinion. Justice Brennan delivered a wonderful "Defense of Dissents" in 1985 (Hastings Law Journal); not surprisingly, perhaps, so has Justice Scalia (Journal of Supreme Court History, 1994). This essay is introductory to a reprint of Justice Brennan's lecture, celebrating the Hastings Law Journal's 50th anniversay. The essay suggests that the constitutional foundation for a "right to dissent" may be found in the First Amendment (discussing "compelled silence" cases), as well as in the core meaning of the Article III terms "court" and "judge." More historical investigation needs to be done on the historical understanding of judges and their ability to issue dissents. Moreover, a "right to issue a dissenting opinion" does not necessarily imply a "right to defy precedent." The concepts are separable, perhaps properly so. Nevertheless, the constitutional claim for a right to dissent is not insubstantial. The essay includes a brief discussion of current judicial disciplinary charges that have been filed against a California appellate judge, Presiding Justice J. Anthony Kline, because he dissented from a majority judgment compelled (he conceded) by California precedent. Those charges should be dropped. (In August 1999 the charges against Justice Kline were in fact dropped with the Commission on Judicial Performance stating that judges "must be able to [dissent] free from fear of discipline for the free expression of their ideas.")