cssi/SciSciGPT-SciSciNet huggingface dataset:
Accounting Information, Investor Sentiment, and Market Pricing

One of the most significant empirical findings of the behavioral finance literature is that investor sentiment affects asset prices. Baker and Wurgler (2006) finds that shares of certain firmsâthose that are difficult to valueâare more affected by shifts in investor sentiment. We examine whether the accounting information of firms that are inherently difficult to value can mitigate sentiment-related mispricing. Our findings indicate that sentiment-related mispricing is in fact diminished in the subset of firms with high-quality accounting information. To better understand how accounting information mitigates stock market mispricing, we examine whether sentiment affects the choices made by sell-side stock analysts. When sentiment is high, analysts issue more favorable recommendations for firms that are more difficult to value, even though these firms appear to be overpriced and exhibit negative subsequent abnormal stock returns. However, this behavior is concentrated in the subset of difficult-to-value firms with low-quality accounting information.
When the Same Prime Leads to Different Effects

Research on priming effects has shown that primes with widely shared associations (i.e., stereotypes) affect the subsequent behavior of people in consistent ways (i.e., acting stereotypically). In this article, we present two experiments that show that the same primed construct can have different effects on the subsequent choices of different groups of people. These differences in effects are attributable to the groups having different prime associations. These results highlight the importance of understanding unique, personal associations to primes and suggest that segmentation is also important for predicting nonconsciously influenced choices.
Conditions for successful data assimilation

[1] We show, using idealized models, that numerical data assimilation can be successful only if an effective dimension of the problem is not excessive. This effective dimension depends on the noise in the model and the data, and in physically reasonable problems, it can be moderate even when the number of variables is huge. We then analyze several data assimilation algorithms, including particle filters and variational methods. We show that well-designed particle filters can solve most of those data assimilation problems that can be solved in principle and compare the conditions under which variational methods can succeed to the conditions required of particle filters. We also discuss the limitations of our analysis.
Experimental Constraints on the Fatigue of Icy Satellite Lithospheres by Tidal Forces

Fatigue can cause materials that undergo cyclic loading to experience brittle failure at much lower stresses than under monotonic loading. We propose that the lithospheres of icy satellites could become fatigued and thus weakened by cyclical tidal stresses. To test this hypothesis, we performed a series of laboratory experiments to measure the fatigue of water ice at temperatures of $198$ K and $233$ K and at a loading frequency of $1$ Hz. We find that ice is \textit{not} susceptible to fatigue at our experimental conditions and that the brittle failure stress does not decrease with increasing number of loading cycles. Even though fatigue was not observed at our experimental conditions, colder temperatures, lower loading frequencies, and impurities in the ice shells of icy satellites may increase the likelihood of fatigue crack growth. We also explore other mechanisms that may explain the weak behavior of the lithospheres of some icy satellites.
Long-Term Contracts and Short-Term Commitment: Price Determination for Heterogeneous Freight Transactions

This paper considers a class of contracts in which parties write detailed, long-term performance obligations that leave one or both parties with broad discretion to terminate the agreement on short notice with little or no penalty. I argue that formal contracts may be valuable, even where trade involves little or no relationship-specific investment and termination is the only remedy, as a way of economizing on the cost of determining prices for a series of heterogeneous transactions. Evidence from a survey of truck drivers shows both the general structure of contracts between freight carriers and drivers and the manner in which hauls are priced to be consistent with the goal of economizing on renegotiation costs.
An Option for Lemons?: The Fair Value Option for Liabilities During the Financial Crisis

We test for the presence of adverse selection among firms adopting the fair value option for liabilities (FVOL) embedded in Statement of Financial Accounting Standards (SFAS) 159 during the financial crisis. The FVOL is a controversial accounting choice because it allows firms to increase earnings when credit quality deteriorates. We find that firms with higher credit risk, lower profitability, and negative abnormal stock returns are more likely to adopt the FVOL, and that these firms exhibit negative abnormal stock returns over 1- to 3-year horizons after adoption. We conclude that adverse selection occurs among adopters. Although these findings suggest that the FVOL reduces comparability and information transparency, they also imply that accounting choice can be a valuable tool for standard setting because it can induce firms to reveal their type.
Executive pay and “independent” compensation consultants

Abstract Executive compensation consultants face potential conflicts of interest that can lead to higher recommended levels of CEO pay, including the desires to “cross-sell” services and to secure “repeat business.” We find evidence in both the US and Canada that CEO pay is higher in companies where the consultant provides other services, and that pay is higher in Canadian firms when the fees paid to consultants for other services are large relative to the fees for executive-compensation services. Contrary to expectations, we find that pay is higher in US firms where the consultant works for the board rather than for management.
Capital inflows: Macroeconomic implications and policy responses

Abstract This paper examines the macroeconomic implications of and policy responses to surges in private capital inflows across a large group of emerging and advanced economies. In particular, we identify 109 episodes of large net private capital inflows to 52 countries over 1987–2007. Episodes of large capital inflows are often associated with real exchange rate appreciations and deteriorating current account balances. More importantly, such episodes tend to be accompanied by an acceleration of GDP growth, but afterwards growth has often dropped significantly. A comprehensive assessment of various policy responses to the large inflow episodes leads to three major conclusions. First, keeping public expenditure growth steady during episodes can help limit real currency appreciation and foster better growth outcomes in their aftermath. Second, resisting nominal exchange rate appreciation through sterilized intervention is likely to be ineffective when the influx of capital is persistent. Third, tightening capital controls has not in general been associated with better outcomes.
Household Leverage and the Recession

We study a model where households use home equity to finance consumption expenditures and we analyze the macroeconomic consequences of a credit crunch triggered by tightening lending standards.
Four Signal Moments in Whistleblower Law: 1983-2013

This contribution to the 30th anniversary symposium of the Hofstra Labor and Employment Law Journal identifies four signal legal changes in the law governing whistleblowers between 1983 and 2013. Three of these are well known and easily identified -- the amendments to the federal False Claims Act enacted in 1986, the Sarbanes-Oxley whistleblower protection scheme enacted in 2002, and the Dodd-Frank securities fraud whistleblower bounty program enacted in 2010. Equally important may prove the Deficit Reduction Act of 2005 (actually enacted in 2006), which created an unusual carrot for state law whistleblower reward and protection reform. After discussing the impact of each signal change, I discuss the future of whistleblowing -- with national security whistleblowing, internal corporate programs, on-line whistleblowing, and continued doctrinal development being important developments to watch.
Improving Economic Sanctions in the States

Economic sanctions in the U.S. justice system have acquired newfound attention from the public and policymakers across the country in recent years. As states reconsider excessively severe sentences for low level offenders captured in the justice system, there is a renewed interest in using alternatives to incarceration – including economic sanctions – to further penal policy while avoiding the high costs of incarceration. This development lies in tension with the reality that many defendants cannot afford even minimal economic sanctions and instead accrue criminal justice debt. Policymakers are only just starting to engage with substantive solutions to this problem. The American Law Institute finds itself at the forefront in considering these realities as it completely restructures the Model Penal Code’s approach to economic sanctions. This Article discusses the American Law Institute’s new approach in the context of the competing interests that make determining an appropriate economic sanctions policy perspective difficult. It highlights the ways that this policy reform strikes a balance between the competing goals before proposing practical measures to build upon this new approach. The Article also discusses how broader trends in criminal justice policy could prevent the improvements envisioned by the Code’s revised approach. Ultimately this Article argues that using economic sanctions in a way that is productive and proportionate – like other punitive policies in the states – requires changing the way we punish for more than just cost-saving reasons. The revised Model Penal Code makes great strides in this direction, but more can, and must, be done.
The illegality of abortion in Mexico.

Although Article IV of the Mexican Federal Constitution guarantees reproductive freedom and does not explicitly prohibit abortion most states in Mexico forbid it entirely or with limited exceptions. Estimates on the annual number of abortions in Mexico vary from a low of 850000 to a high of 1.5 million; this latter number is usually the estimate of international and nongovernmental organizations. Each year more than 150000 women are treated in public hospitals for complications from abortions and abortion attempts. The precise number of abortions and maternal injuries and deaths that result from abortions performed in Mexico is difficult to estimate because of the illegality of the procedure. Women face from six months to five years in prison for having or performing an abortion themselves. Lisa Remez sums up the difficulty of attempting to quantify an illegal practice: “How does one accurately measure and describe something that is not registered and that officially does not occur because it is prohibited by law and condemned by prevailing cultural values?” The statistics alone qualify abortion as a serious public health issue; regardless regular public debate seems to result only from high-profile incidents. The recent experience of a thirteen-year-old raped girl hounded by Church and governmental officials to not have the legal abortion to which she was entitled galvanized pro-choice activists to promote the decriminalization of abortion. For many Mexican citizens this year-long struggle brought into sharp relief the reality of the reproductive lives of many Mexican women and girls. The Church and pro-life activists have only made abortion a major issue when it appears that groups advocating decriminalization have made legal and political advances; anti-abortion demonstrations are not as common or frequent as they are in the United States. (excerpt)
Pension buyouts: What can we learn from the UK experience?

This paper analyses the UK market for Defined Benefit (DB) pension buyouts and considers its implications for the USA. A DB pension fund buyout refers to a transaction in which a pension plan sponsor pays another company a fee to take over the assets and liabilities of the pension plan. Using various qualitative methodologies, this paper traces the evolution of the buyout from a transaction for insolvent plan sponsors to a transaction for solvent plan sponsors with funded pensions. While certain types of solvent buyouts have fallen out of favour, such as non-insured buyouts, this paper concludes that buyouts of the insured variety have a bright future. The increasingly burdensome nature of the DB pension plan will sustain this market over the long term. As such, this paper contributes to our understanding of the future prospects for employer-sponsored DB pensions, and how they will contribute to retirement income over time.
Long-term care and family bargaining

We present a structural model of how families decide who should care for elderly parents. We use data from the National Long-Term Care Survey to estimate and test the parameters of the model. Then we use the parameter estimates to simulate the effects of the existing long-term trends in terms of the common but untested explanations for them. Finally, we simulate the effects of alternative family bargaining rules on individual utility to measure the sensitivity of our results to the family decision-making assumptions we make.
Investor perceptions of the earnings quality consequences of hiring an affiliated auditor

The Sarbanes–Oxley Act (SOX) requires that firms wait 1 year before hiring an individual employed as a member of the external audit team. SOX’s intent is to reduce the perceived loss of auditor independence due to affiliated hiring. SOX also requires fully independent audit committees and disclosure of directors with financial expertise. Using a sample of financial executive hires during the pre-SOX period, we find that earnings response coefficients (ERCs) decline following hires of individuals recently employed by the firm’s external auditor, but ERCs do not decline following hires not recently employed by the external auditor. We also find smaller ERC declines following affiliated hires for firms with audit committee compositions consistent with subsequently imposed SOX requirements. Further investigation using measures of earnings quality suggests that differences in ERC changes are attributable to perceived, rather than real, changes in earnings quality following affiliated hires.
Technology Growth and Expenditure Growth in Health Care

In the United States, health care technology has contributed to rising survival rates, yet health care spending relative to GDP has also grown more rapidly than in any other country. We develop a model of patient demand and supplier behavior to explain these parallel trends in technology growth and cost growth. We show that health care productivity depends on the heterogeneity of treatment effects across patients, the shape of the health production function, and the cost structure of procedures such as MRIs with high fixed costs and low marginal costs. The model implies a typology of medical technology productivity: (I) highly cost-effective “home run” innovations with little chance of overuse, such as anti-retroviral therapy for HIV, (II) treatments highly effective for some but not for all (e.g. stents), and (III) “gray area” treatments with uncertain clinical value such as ICU days among chronically ill patients. Not surprisingly, countries adopting Category I and effective Category II treatments gain the greatest health improvements, while countries adopting ineffective Category II and Category III treatments experience the most rapid cost growth. Ultimately, economic and political resistance in the U.S. to ever-rising tax rates will slow cost growth, with uncertain effects on technology growth.
Estimating the cross-sectional market response to an endogenous event: Naked vs. underwritten calls of convertible bonds

Abstract The literature on conditional event studies advocates the use of endogenous switching models to analyze cross-sectional variation in the stock market's response to corporate announcements of endogenous events. This paper proposes the use of a flexible Bayesian Markov chain Monte Carlo (MCMC) approach for estimating such models. The Bayesian MCMC approach offers several advantages over the Heckman–Lee two-stage estimation approach. In particular, analysis of the “treatment effect” (the difference between the observed and counter-factual outcomes) controls for the endogeneity of the firm's choice. As an application, the paper examines the market's response to naked and underwritten calls of convertible bonds. The paper reports evidence that the market's response to calls of convertible bonds is correlated with the private information partially revealed by the firm's choice of call type. However, although the average treatment effect associated with an underwritten call is negative, it is not significantly different from zero.
The Journalism Ratings Board: An Incentive-Based Approach to Cable News Accountability

The American establishment media is in crisis. With newsmakers primarily driven by profit, sensationalism and partisanship shape news coverage at the expense of information necessary for effective self-government. Focused on cable news in particular, this Note proposes a Journalism Ratings Board to periodically rate news programs based on principles of good journalism. The Board will publish periodic reports and display the news programs’ ratings during the programs themselves, similar to parental guidelines for entertainment programs. In a political and legal climate hostile to command-and-control regulation, such an incentive-based approach will help cable news fulfill the democratic function of the press.
Informed Repurchases, Information Asymmetry and the Market Response to Open Market Share Repurchases

This paper relates informed repurchases to firm information asymmetry. We propose a new measure of informed repurchases, which is based on causality tests relating repurchase information to firm re...
An empirical investigation of coalitional bargaining procedures

Abstract Models of government formation processes in multi-party democracies are usually highly sensitive to the rules that govern the selection of formateurs (i.e. the parties selected to propose a potential government). The theoretical literature has focused on two selection rules: selection proportional to seat share, and selection in order of seat share. In this paper, we use a new data set on government formations in 11 parliamentary democracies to empirically assess which selection rule most closely approximates the data. We find that while there is little empirical support for selection in order of seat share, proportional selection fits the data well. However, we also find that a simple alternative that combines the insights of the two selection rules outperforms both of them in their ability to explain the data.
Functorial tropicalization of logarithmic schemes: the case of constant coefficients

The purpose of this article is to develop foundational techniques from logarithmic geometry in order to define a functorial tropicalization map for fine and saturated logarithmic schemes in the case of constant coefficients. Our approach crucially uses the theory of fans in the sense of Kato and generalizes Thuillier's retraction map onto the non-Archimedean skeleton in the toroidal case. For the convenience of the reader many examples as well as an introductory treatment of the theory of Kato fans are included.
The Secret Life of Legal Doctrine: The Divergent Evolution of Secondary Liability in Trademark and Copyright Law

A. TRACING THE ORIGINS OF SECONDARY LIABILITY 1366 B. COMPARING VICARIOUS LIABILITY IN TRADEMARK AND COPYRIGHT LAW 1369 1. The Nature of the Relationship 1370 a) Principal-Agent Requirements in Trademark Law 1370 b) The Right and Ability to Supervise in Copyright Law........1373 2. The Notion of Financial Benefit 1374 a) Direct Financial Benefit in Trademark Law 1374 b) Expanding Notions of Financial Benefit in Copyright Law1375 3. Differences in Vicarious Liability Doctrine in Practice 1377 C. COMPARING CONTRIBUTORY LIABILITY IN TRADEMARK AND COPYRIGHT LAW 1378 1. Actual and Imputed Knowledge 1379 a) The Scope of Imputation in Trademark Law 1379 b) Imputed Knowledge, Active Inducement, and the Sony Safe Harbor in Copyright Law 1382 2. Material Contribution: Relationships Suitable for Contributory Liability 1388 a) The Direct Control Requirement in Trademark Law 1389 b) The Attenuated Notion of Control in Copyright Law .........1391
The Politics of Court Budgeting in the States: Is Judicial Independence Threatened by the Budgetary Process?

Judicial independence in American politics has been hailed as a means of preserving individual liberty and minority rights against the actions of the majoritarian branches of government. Recently, however, legal professionals and scholars of the courts have begun to question the magnitude of judicial independence, suggesting that budgeting and finance issues pose a threat to judicial independence. This article explores whether state judiciaries are being threatened on this front by soliciting the perceptions of key state officials. Using surveys of court administrators, executive budget officers, and legislative budget officers in the states, we examine three aspects of the politics of judicial budgeting: competing for scarce resources, interbranch competition, and pressure to raise revenues. The survey responses suggest that, in a substantial number of states, judicial independence has, at times, been threatened by interbranch competition and pressures to raise revenues.
Catering effects in corporate dividend policy: The international evidence

This study tests for the international presence of dividend catering across a sample of twenty-three countries. We find evidence of catering among firms incorporated in common law countries but not for those in civil law nations. Catering persists even after controlling for the effect of the firm’s lifecycle. We conclude that when the legal regime and its accompanying set of investor protections permit, investors force dividends from managers, but they also attempt to extract such payouts indirectly by placing a high value on dividend paying firms. The relative failure of civil law firms to cater might be explained by idiosyncratic behaviors in the consumption of the private benefits of control or a lack of interest in responding to temporary market misevaluations of their equity.
Evidence on the effects of bank competition on firm borrowing and investment

Abstract This paper presents evidence on the financial and real effects of bank competition using a large panel of privately held firms. I trace the firm-level impact of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994, which increased the competitiveness of U.S. banking markets. Following the deregulation, newly formed firms used significantly less external debt, were smaller, and realized higher returns on assets, consistent with their investing less due to greater financial constraints. These effects diminish as firms age, ultimately reversing sign. The differential impact that banking market reforms may have on newer and more established firms is underscored.
MacCrate Goes to Law School: An Annotated Bibliography of Methods for Teaching Lawyering Skills in the Classroom

This bibliography compiles law review articles that explore the possibility of law professors integrating more practical skills training into traditional law school courses. The bibliographic entries are organized based on the ten fundamental lawyering skills outlined in the MacCrate Report. These lawyering skills are problem solving, legal analysis and reasoning, legal research, factual investigation, communication, counseling, negotiation, litigation and alternative dispute resolution procedures, and organization and management legal work. By distinguishing and examining scholarly legal articles that purport to incorporate lawyering skills training in traditional law school courses, the bibliography identifies potential lawyering skills that are ripe for discussion or in need of development for particular subjects within the law school curriculum. The bibliography also provides law professors information on how to incorporate skills training into substantive and other nontraditional, skills-related courses. With better teaching, everyone wins — the profession, teachers, and most of all, students.
Dignity and sexuality: Claims on dignity in transnational debates over abortion and same-sex marriage

Dignity’s meaning is famously contested. This essay explores competing claims on dignity in late twentieth-century debates over abortion and in the first decisions on the constitutionality of abortion legislation that these debates prompted. Advocates and judges appealed to dignity to vindicate autonomy, to vindicate equality, and to express respect for the value of life itself. Appeals to these distinct conceptions of dignity are now appearing in debates over the regulation of same-sex relations. Analyzed with attention to competing claims on dignity, we can see that in the debate over same-sex relations, as in the debate over abortion, a crucial question recurs: Do laws that restrict non-procreative sexuality violate or vindicate human dignity? Agonists who hold fundamentally different views about sexuality share an allegiance to dignity, enough to fight for the authority to establish dignity’s meaning in debates over sexual freedom. Today, as in the 1970s, dignity’s meaning is being forged in cross-borders conflict over dignity’s sex.
The Methodology of Legal Philosophy

Legal philosophy, certainly in the Anglophone world and increasingly outside it, has been dominated for more than a half-century by H.L.A. Hart’s 1961 book The Concept of Law (Hart 1994 [the 2 nd edition]). Unsurprisingly, then, methodological debates in legal philosophy typically scrutinize either one of two (related) methodological claims in Hart’s classic work. The first is that his theory is both general and descriptive (Hart 1994: 239). The second is that his theory is an exercise in both linguistic analysis and descriptive sociology (Hart 1994: vi). What do these two claims reveal about Hart’s theoretical ambitions and methodological commitments?
Enlightenment and enchantment: Technology and moral limits

Abstract This essay places C.P. Snow's The Two Cultures in a particular intellectual context that points to important recent developments in the interdisciplinary discourse of applied ethics, particularly bioethics and its critical response to biotechnology. It also recasts the problem of the two cultures into a more fundamental question about the ethical governance of science—can we, should we, and will we in time finally bring about the end of the Faustian imperative of technocracy, and bridle unlimited consumption and economic growth based on depletion of finite fossil carbon and the ecologically destructive effects of its use?
Do food stamps cause obesity?: Evidence from immigrant experience

I use changes in immigrant eligibility for food stamps under the 1996 federal law and heterogeneous state responses to set up a natural experiment research design to study the effect of food stamps on Body Mass Index (BMI) of adults in immigrant families. I find that in the post-1996 period food stamps use by foreign-born unmarried mothers with a high school or lower education was 10 percentage points higher in states with substitute programs than in states that implemented the federal ban. However, this increase in FSP participation was not associated with any statistically significant difference in BMI. I find that FSP participation was associated a statistically insignificant 0.3% increase in BMI among low-educated unmarried mothers.
The New Challenge to Native Identity: An Essay on “Indigeneity” and “Whiteness”

This essay suggests that the current challenges to Native 'indigeneity' respond to the perception that 'privilege' and 'status' have attached to the racial and cultural identity of Native peoples in recent years through various 'special' legal rights. This article suggests that, with respect to indigenous peoples, the discourse of 'whiteness' requires analysis within a global, as well as national context. This article examines four areas within which there is an active debate over 'indigenous status': political rights under international human rights law; cultural rights under international human rights law; rights to land and to ancestral human remains under domestic law; and rights to genetic resources. The root issue within each of these areas is who 'owns' Native identity - political, cultural,ancestral, genetic - and what role does the concept of 'indogeneity' play in these assertions of 'ownership'? The article concludes by suggesting that Native cultural sovereignty, including tribal law and tribal epistemologies, will have an important role in asserting and maintaining Native rights to tangible and intangible tribal resources.
Auditor Litigation Risk and the Number of Institutional Investors

SUMMARY We investigate whether auditors are sensitive to litigation risk related specifically to having greater numbers of institutional investors that hold the common stock of a given client. Our findings suggest that audit fees are higher when the number of institutional investors holding stock in the company is greater. Additional tests corroborate our inference that the association between audit fees and the number of institutional investors is related to litigation risk. The importance of improving our understanding of auditors' sensitivity to factors that increase litigation exposure is highlighted by the number and magnitude of lawsuits filed against auditors relating to the audits of public clients.
Railway Mergers and Railway Alliances: Competition Issues and Lessons for other Network Industries:

Freight railway enterprises in both Europe and North America are in the process of significant restructuring, with EC policy changes dictating new ownership, organization, and cooperation arrangements in Europe and a series of major mergers having already led to highly concentrated regional markets in the U.S. and Canada. Mergers, alliances, and organizational changes may raise important and complex issues regarding the level of competition facing goods shippers, with differing implications depending on the differing institutional contexts. This paper examines the competitive consequences of these developments in Europe and North America and suggests some lessons for other network industries.
Inflation responses to commodity price shocks – How and why do countries differ?

This paper relates the inflationary impact of commodity price shocks across countries to a broad range of structural characteristics and policy frameworks over the period 2001–2010, using several approaches. The analysis suggests that economies with higher food shares in CPI baskets, fuel intensities, and pre-existing inflation levels were more prone to experience sustained inflationary effects from commodity price shocks. Countries with more independent central banks and higher governance scores seem to have contained the impact of these shocks better. The effect of the presence of inflation targeting regimes, however, appears modest and not evident during the 2008 food price shock. The evidence suggests that trade openness, financial development, dollarization, and labor market flexibility do not significantly influence the way in which domestic inflation responds to international commodity price shocks.
Contingent Claims Analysis and Life-Cycle Finance

This paper explores the application of contingent claims analysis (CCA) to two important issues in life-cycle finance: investing for retirement, and deciding when, if ever, to switch careers. Contingent claims analysis is a methodology that grew out of the option pricing theory of Fischer Black, Robert C. Merton, and Myron Scholes. They derived the option pricing model by showing that there is a self-financing dynamic trading strategy that replicates the payoffs from a call option. In the absence of transaction costs, the law of one price and the force of arbitrage imply that the cost of the initial replicating portfolio is the price of the option. That same approach applies to any derivative security or contingent contract based on traded assets. For every dynamic trading strategy, there exists an equivalent contingent contract. In reality, most investors face substantial transactions costs and cannot trade even approximately continuously, as is done in the theoretical models. But in a modern, well-developed financial system, the lowest-cost transactors may have marginal trading costs close to zero, and can trade almost continuously. Thus, the lowest-cost producers of contingent contracts can approximate reasonably well the dynamic trading strategy, and in a competitive environment
An Empirical Analysis of the Signaling and Screening Models of Litigation

We present an experimental analysis of the signaling and screening models of litigation. In both models, bargaining failure is driven by asymmetric information. The difference between the models lies in the bargaining structure: In the signaling game, the informed party makes the final offer, while in the screening game the uninformed party makes the final offer. We conduct experiments for both models under a common set of parameter values, allowing only the identity of the party making the final offer to change. We find the anomalous behavior to be more common in the signaling game, but the frequency of this behavior diminishes in the later rounds of the experiment. Across both games, in the later rounds of the experiment over 90% of offers are consistent with the theory. Having the right to make the offer raises a player’s expected payoffs, but by much less than is predicted by theory. Dispute rates across the two games are approximately equal.
ENVIRONMENTAL DELIBERATIVE DEMOCRACY AND THE SEARCH FOR ADMINISTRATIVE LEGITIMACY: A LEGAL POSITIVISM APPROACH

Recent scholarship suggests that legitimizing environmental lawmaking will require a breach of the administrative apparatus by democratization of a particular kind, namely the inclusion of greater public discourse within the context of administrative decisionmaking and more meaningful civic self-determination. In this article, I examine this claim through the lens of modern legal positivism. It is argued that legal positivism provides the tools necessary to test for and identify the specific structural deficiencies that undermine the legitimacy of the administrative state as a lawmaking institution, and more importantly, to determine what legal changes to agency practice and procedure must be implemented to correct those deficiencies. I reject, however, that the appropriate rule of recognition to measure bureaucratic legitimacy in the American system is the U.S. Constitution. Instead, it is proposed that legitimacy of the administrative state ultimately relies on fashioning rulemaking procedures to address American’s innate distrust of official power. My own view of such a reformed regulatory state is one where regulators continue to function as the technical and scientific experts, and in making policy determinations weigh the expert knowledge with the informed opinion of electorate and peer officials in the political branches of our government. TABLE OF CONTENTS INTRODUCTION 2 LEGAL POSITIVISM AND THE LEGITIMACY OF (ENVIRONMENTAL) ADMINISTRATIVE LAW 9 The Foundations of Modern Legal Positivism 9 H.L.A. Hart‘s Rule of Recognition 12 Background 12 First v. Second Order Application 14 The Internal Point of View Theory 15 Testing Fidelity to the Rule of Recognition: A Legal Positivist Account for the Ineffectiveness of Environmental Administrative Law 16 EDD AND AMERICAN VALUES: DOES IT SATISFY THE RULE OF RECOGNITION? 23 The Promise of Environmental Deliberative Democracy 23 The Rule of Recognition in the United States (Second-Order Uncertainty) 27 Reconciliation: EDD and The Rule of Recognition 32 EDD: A LEGAL POSITIVIST PROPOSAL 33 * Assistant Professor of Law and Director of the Environmental Law Clinic, University of Denver, Sturm College of Law. I want to thank Justin Marceau, Christopher Brown, and Sarah Coleman for their very insightful comments; and to Sarah April and Katherine Johnston for their diligent research and editing.
The Sarbanes-Oxley Act: Federalizing Norms for Officer, Lawyer,and Accountant Behavior

In response to a number of corporate scandals, the federal government enacted the Sarbanes-Oxley Act of 2002. The Act creates a framework for the oversight of the accounting profession and its practices by the government, imposes a number of certification requirements on corporate officers, restricts a number of corporate practices involving trading of securities by and loans to corporate officers, imposes reporting duties on lawyers, and provides protection for employees who disclose violations of law by corporate officers or directors. This paper explores some of the changes made by the Act in a practice context by discussing the way the Act might affect behavior in a number of business situations: people considering the offer of a position as a corporate officer; accounting firms seeking to perform audit and other functions for a corporate client; restrictions of loans to officers, including advances of fees pursuant to indemnification agreements; the adoption of financial codes of ethics; obligations of lawyers to report evidence of wrongdoing; the obligations of management to implement internal accounting and disclosure systems and to disclose wrongdoing; and protections for employees reporting wrongdoing; the new criminal penalties for wrongdoing by corporate insiders. The relationship of the provisions of the Act to state corporate law and the Act's inconsistencies, traps for the unwary and unanswered questions are also explored.
Driven into Society: Philosophies of Surveillance take to Streets of New York

The problem of terrorism has heightened the need for security. The need for improved security has led officials at all levels of government to consider, and to implement, surveillance programs. In 2002, the New York City Police Department (NYPD) created a Counterterrorism Bureau. The Bureau’s Lower Manhattan Security Initiative of networked surveillance has been controvesial. Civil libertarians and privacy advocates have raised concerns. What is the fate of privacy with the massive use of surveillance cameras and other monitoring technology in America’s premier city? In response to concerns about the program, in February 2009, the NYPD issued proposed voluntary Public Security Privacy Guidelines. The Guidelines were weak on genuine privacy protection restrictions. They were an inadequate instantiations of the “fair information practice” ideals reflected in US federal privacy statutes and in the data protection laws of Canada and the EU. If the NYPD is going to operate on the basis of privacy guidelines, it needs guidelines that articulate for the police themselves and for the affected public why privacy in public places matters. The starting point could be Rousseau’s notion that pervasive surveillance opens the door to the misery of perpetual judgment. Not everything the NYPD says it is doing seriously affects privacy interests, but those interests need to be specifically understood; and intrusive policies need to be justified beyond the broad assertion that there is no expectation of privacy in public places and non intimate activities. New York could be a model for other municipalities how to take privacy seriously when observation imposes the Rousseavian burdens and when security seems essential.
A Note on Trend-Spotting in the Case Law

This note, largely a comment on an article by Robert Hillman, describes and contrasts two models of legal evolution. The orthodox view holds that legal evolution occurs through the active effort of judges. An alternative view models legal evolution as the outcome of the trial selection process - i.e., the process through which disputes are selected for trial rather than settled. This note critiques the orthodox view and explores implications of the trial selection model. I find the empirical evidence inconsistent with the orthodox view.
The Value Relevance of the Foreign Translation Adjustment

The study presents an economic analysis of the foreign translation adjustment and empirically examines the association between change in firm value and the foreign translation adjustment for a sample of manufacturing firms. The study shows that, for firms in the manufacturing sector, the translation adjustment is associated with a loss of value instead of an increase in value. This result stems from the fact that, for firms in the manufacturing sector, the accounting rules governing foreign currency translations generally produce results opposite to the economic effects of exchange rate changes.
Costly information, entry, and credit access

Abstract Using a theoretical model that incorporates asymmetric information and differing comparative advantages among lenders, this paper analyzes the impact of lender entry on credit access and aggregate net output. The model shows that lender entry has the potential to create a segmented market that increases credit access for those firms targeted by the new lenders but potentially reduces credit access for all other firms. The overall impact on net output depends on the distribution of firms, the relative costs of lenders, and the cost of acquiring information. The model provides new insights into the evidence regarding foreign lenders' entry into emerging markets.
Persons Pursuing Goods

John Finnis's powerfully and deservedly influential modern classic, "Natural Law and Natural Rights," expounds a theory of law and morality that is based on a picture of "persons" using practical reason to pursue certain "basic goods." While devoting much attention to practical reason and to the goods, however, Finnis says little about the nature of personhood. This relative inattention to what "persons" are creates a risk - one that Finnis himself notices - of assuming or importing an inadequate anthropology. This essay suggests that the "new natural law" developed by Finnis suffers in places from the inadvertent adoption of (or, more likely, acquiescence in) a flawed anthropology - an anthropology under the thrall of modern individualistic commitments. To explain this suspicion, the essay discusses three difficulties (or so they seem to me) in Finnis's natural law theory - difficulties in accounting for the basic good of friendship, for obligations we owe to others, and for legal authority. These difficulties may seem disconnected, but the essay suggests that they may all reflect an inadequate anthropology - one that Finnis does not embrace, exactly (in fact, I suspect that he would reject it) but that is pervasive today and that in places may affect his theorizing.
Silent Workers, Disappearing Rights: Confidential Settlements and the Fair Labor Standards Act

The Fair Labor Standards Act (“FLSA”) sets minimum wages and maximum hours for the nation’s workers. Nevertheless, employers steal billions of dollars each year from low-wage workers. This article argues that a faithful reading of the FLSA requires courts to bar confidential settlements of claims brought under the statute. A rule against confidentiality would make public a significant amount of information about wage theft. That information is a prerequisite to encouraging individual workers to enforce their rights and to generating broader public awareness about the epidemic of wage theft that low-wage workers face.
The Role of Technology in Small Firm Diversification

Sophisticated technologies are finding applications in an ever-growing number of products, from medical devices to children's toys. As high-technology applications proliferate, their use and development is no longer associated only with large companies, universities, and national laboratories. Many small companies compete on the basis of high technology products, processes and materials. While small companies have long been recognized as fertile ground for developing new technologies, little recognition has been given to the important role they play in transferring technologies between industries. This article therefore describes the central role that technology played in the diversification efforts of nine New England defense contractors. One of the study';s key findings is that successful firms relied upon their existing technical and management capabilities to obtain a sustainable competitive advantage in their new civilian markets. The article also describes a number of other factors that contributed to the success of their diversification efforts.
Appellate Discretion and Sentencing After Booker

When the Supreme Court in United States v. Booker rendered the United States Sentencing Guidelines advisory, most analysts initially predicted that federal sentencing would be invigorated by a “surge of judicial discretion.” Many defense attorneys and members of the news media hailed the decision a victory for criminal defendants, while others celebrated Booker for its emancipation of district court judges from the tyranny of the Guidelines. Less explored in Booker’s immediate aftermath was how the decision would affect the courts of appeals’ review of district court sentencing decisions. What has resulted is pri-
The Market for News

We investigate the market for news under two assumptions: that readers hold beliefs which they like to see confirmed, and that newspapers can slant stories toward these beliefs. We show that, on the topics where readers share common beliefs, one should not expect accuracy even from competitive media: competition results in lower prices, but common slanting toward reader biases. On topics where reader beliefs diverge (such as politically divisive issues), however, newspapers segment the market and slant toward extreme positions. Yet in the aggregate, a reader with access to all news sources could get an unbiased perspective. Generally speaking, reader heterogeneity is more important for accuracy in media than competition per se.
Friends in high places: Amity and agreement in Alsatia

Aristotle, in his Ethics , argued that good legislators should pay more attention to friendship than to law. Common law, however, has trouble with friendship and has historically taken the view that agreements between friends are unenforceable for lack of intention to create legal relations. The roots of this presumption against amicable agreements lie in theology and antique ecclesiastical case law. Those sources are reviewed here and it is argued that seemingly progressive decisions that accord cohabiting friends legal recognition as spouses have the paradoxical effect of depriving them of contractual capacity. They join traditionally married couples in the ‘amity’ of the household which case law defines as an Alsatia outside of law. It is argued that such a consequence is both unintended and undesirable.
A Nonparametric Joint Assortment and Price Choice Model

The selection of products and prices offered by a firm significantly impacts its profits. Existing approaches do not provide flexible models that capture the joint effect of assortment and price. We propose a nonparametric framework in which each customer is represented by a particular price threshold and a particular preference list over the alternatives. The customers follow a two-stage choice process; they consider the set of products with prices less than the threshold and choose the most preferred product from the set considered. We develop a tractable nonparametric expectation maximization (EM) algorithm to fit the model to the aggregate transaction data and design an efficient algorithm to determine the profit-maximizing combination of offer set and price. We also identify classes of pricing structures of increasing complexity, which determine the computational complexity of the estimation and decision problems. Our pricing structures are naturally expressed as business constraints, allowing a mana...