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Working Papers
When presented in full-text, working papers available
on the George Mason School of Law site are in Adobe's
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The Law School's Working Papers in Law & Economics are also available
from the Social Science Research Network (SSRN).
Below is information about the most recent papers published in our
working papers series. Additional information about
the working papers series can be found on the following
pages.
Recent Working Papers
Daubert’s Debut: The Supreme Court, the Economics of Scientific Evidence, and the Adversarial System
(no. 07-49)
In Daubert v Merrell Dow Pharmaceuticals, Inc., the Supreme Court replaced the prevailing rule of evidentiary admissibility for scientific testimony with a new standard. Under the older Frye rule, admissibility was determined by whether the expert's views enjoyed "general acceptance." Under Daubert, the trial judge will simply determine whether the expert's testimony is sufficiently "scientific" to be admitted. This article argues that the Daubert approach is economically superior because it reduces the incentives for external interest groups to influence the content of admitted testimony. The article also considers more general proposals to displace adversary party control of evidentiary presentation with more active judicial supervision or with other external constraints. The article concludes that such external constraints are unnecessary and would probably be socially undesirable.
No Armistice at 11: A Commentary on the Supreme Court’s 1993 Amendment to Rule 11 of the Federal Rules of Civil Procedure
(no. 07-48)
Since 1938, the Supreme Court has supervised the development of procedural rules for the federal courts by a system of committees that now operate under the Judicial Conference of the United States. In 1993, for the first time in the history of that process, the Court promulgated several new rules proposed by the committee system without endorsing the content of the rules. One of the 1993 amendments seeks to reduce the costs of "satellite" litigation under Federal Rule of Civil Procedure 11, which governs the imposition of sanctions for filing frivolous suits in the federal courts. Using a game-theoretic model, Professors Kobayashi and Parker show that the new Rule 11 is likely both to increase the rate of frivolous filings, and perhaps more importantly, to increase the rate at which litigants invoke Rule 11 to challenge their adversaries' pleadings. As a result, both the volume and cost of "satellite" Rule 11 litigation is likely to increase, rather than decrease, contrary to the expressed intention of the Amendment's drafters. The authors argue that this outcome suggests the need for more rigorous supervision of the rulemaking process by the Supreme Court.
Did the Corporate Criminal Sentencing Guidelines Matter? Some Preliminary Empirical Observations
(no. 07-47)
This paper presents an empirical analysis of the Federal Sentencing Commission's 1991 guidelines for imposing criminal sentences on corporations convicted of federal crimes. Despite the Sentencing Commission's announced intentions of raising and restructuring corporate fines, we generally find no statistically significant change in the level or structure of corporate monetary penalties imposed under the guidelines during 1992-95, as compared with baseline data taken from preguideline cases sentenced in 1988, after controlling for the harm attributed to the criminal offense. In an extension of that analysis, we find a marginally significant change in the relationship between corporate penalty levels and the presence of individual codefendants charged together with the corporation in the direction of attenuating that relationship in the postguidelines era. We discuss the implications of these findings from the perspective of the limited role played by corporate criminal sentencing determinations in the overall public law enforcement effort.
Revisiting the Fable of Reform
(no. 07-46)
The modern campaign finance fable has its root in progressive political arguments. Advocates placed great faith in the management by experts of social problems, and the application of scientific principles to politics. For campaign finance reform, this meant the study of campaigns, the diagnosis of corruption and the prescription of legislative remedies. To sustain this idea over time, as it turns out, required a fable. That fable justified past reform efforts as calculated, measured and reasonable remedies, prescribed by Congress (or legislators, or regulators) after careful examination of political ailments. As new symptoms arise, the fable taught that lawmakers (or regulators) are justified in revisiting the diagnosis, unfettered by judicial interference or constitutional constraint.
In the Supreme Court's 1957 majority opinion in United States v. UAW-CIO, known more commonly as Auto Workers, Justice Frankfurter added the necessary history to makes the reform fable work. Subsequent campaign finance decisions lean heavily on this account of the reasonable and measured history of campaign finance regulation. Judges rely on the decision's expression of "history" to justify deference to regulatory judgments.
This Article corrects and supplements the history in Auto Workers. It examines in detail the specific events Frankfurter cited in the opinion. It shows how the opinion avoided political context and truncated legislative history. What emerges from a more complete account of the history is a messy, complicated record, dictated by political opportunism. At each step, reform is a way to capitalize on public sentiment (against the Sugar Trust, or John L. Lewis, as we shall observe) and restrict political rivals' access to financial resources, using little debated legislative vehicles and parliamentary skill.
If Congress's credibility as a source of reform is derived from a mistaken view of its record, then judges may be too willing to accept Congress's rationalizations for legislative choices. If, out of misplaced respect for a fable, courts allow enforcement of laws that burden political activity, citizens and activists outside the bubble of Congressional protection risk disproportionate punishment for exercising political rights. Correcting the flawed historical premise, and setting courts to the task of evaluating closely all these laws, would go some distance to restoring proper checks upon campaign legislation. Courts, legislators, and lawmakers need to understand history. Especially in campaign regulation, where high purpose can conceal self-interest, it does no good to adopt a fable as history, or adapt history to a fable.
Guns, Crime, and Academics: Some Reflections on the Gun Control Debate
(no. 07-45)
This comment on Thomas Marvell's "The Impact of Banning Juvenile Gun Possession" analyzes Marvell's empirical findings and their policy implications for gun control legislation. While Marvell's article stresses the absence of any finding favorable to juvenile gun bans, this comment points out that the statistical results actually support the stronger finding that some of the juvenile gun bans are associated with a statistically significant increase in homicides nationwide. Under either finding, the juvenile gun bans are welfare reducing because of the inherently costly nature of conventional gun control legislation. The concluding discussion argues that the failure to draw appropriate policy conclusions from methodologically sound findings on controversial subjects such as gun control undercuts the value of academic research as compared with competing influences in the public debate.
Evidence: General Economic Analysis
(no. 07-44)
The economic analysis of evidence law is relatively less developed than other areas of the law and economics literature, notwithstanding this subject's close relationship to other well-developed areas, most notably the economic analysis of procedural rules. This chapter first will develop some of the general issues raised by the economic analysis of evidence within the Anglo-American tradition of adversarial presentation. We will then proceed to consider the existing literature on specific topics in the law of evidence and related problems of pre-trial discovery and trial error.
The Private Society and the Liberal Public Good in John Locke's Thought
(no. 07-43)
This Article interprets John Locke's mature writings on politics, ethics, and philosophy to identify his teachings on liberal freedom of association. The conventional wisdom probably holds that Locke propounds a theory of toleration specific to the church-state problem--not a comprehensive theory of associational freedom. In reality, Locke defends religious toleration as one particular application of a much more encompassing theory of associational freedom. Presumptively, in Locke's account, private associations enjoy the rights to associate on whatever terms they want, to set and to enforce their own policies, and to control their own membership. But private associations lose this presumption of freedom if they promote common opinions antithetical to respect for life, property, family, and the other the material interests on which the Lockean commonwealth focuses. More controversially, private associations also lose this presumption if they propagate opinions inconsistent with the common political opinions a Lockean political order inculcates to reinforce the moral conditions for liberalism.
Although this Article is primarily interpretive, it does defend Locke's position enough to make it clear why that position is worth interpreting. To that end, the Article shows why Locke's defense of associational freedom accords more with our experiences and observations than do deontological accounts of associational freedom by John Rawls and Robert Nozick. Also to that end, the Article suggests how Locke's position may protect associational freedom more and less than contemporary practice. On one hand, Lockean associational freedom gives the political community wide latitude to bar and expel seditious associations. Here, Locke's account presents a tougher-minded theory of liberalism than theories influential in modern law and practice. On the other hand, Locke's account provides strong reasons for giving associational freedom immunity from public anti-discrimination policies. Here, Locke's account explains the public-private distinction in greater depth than modern law and practice.
Civil Procedure: General Economic Analysis
(no. 07-42)
The economic analysis of civil litigation has focused on the action of the litigants and on the effects of substantive and procedural rules on their behavior. This chapter focuses on the economic analysis of procedural rules and how these rules alter the incentives of the litigants to file, settle and litigate disputes. Such procedural rules affect the private costs and benefits of litigation through altering the net expected value and loss faced by the plaintiff and defendant. Procedural rules also affect the social costs and benefits of litigation by affecting the both the direct and error costs of litigation. The analysis in the chapter is organized around the US Federal Rules of Civil Procedure, and in reverse chronological order to reflect the economic analyses use of backwards induction to examine civil litigation. Topics examined in depth include sequencing rules, rules that affect the capitalization of litigation over parties and claims, the rules of discovery, and juries.
The Roberts Court and the Chicago School of Antitrust: The 2006 Term and Beyond
(no. 07-41)
The U.S Supreme Court issued four antitrust decisions this term (the most it has issued since the 1989-1990 term) and seven cases over the past two years. The antitrust activity level of the Roberts Court thus far has exceeded the single case average of the Court prior to the 2003-2004 term by a significant margin. What can be said of the Roberts Court’s antitrust jurisprudence? This article examines the quartet of Supreme Court decisions issued during the 2006-2007 term in an attempt to identify and characterize the antitrust philosophy of the Roberts Court. I argue that the Roberts Court decisions embrace the Chicago School of antitrust analysis and predict that the antitrust jurisprudence of this Court will increasingly reflect this influence.
Procedure in American and European Law: A General Economic Analysis
(no. 07-40)
This paper seeks to develop a general view on the economic analysis of procedural law (including civil, criminal, administrative, and arbitral procedure, and the law of evidence), with particular emphasis on comparing institutional differences between American and continental European legal systems.
The principal theoretical idea developed is that procedural law can function as either a complement to or a substitute for rules of substantive law, or both simultaneously. Therefore, the economic analysis of procedural law can not be separated entirely from the underlying substantive policy. Further consequences are that procedural rules can not be studied solely in terms of the conventional "expected value" model of litigation, or solely in terms of the conventional legal desiderata of "just, speedy, and inexpensive" adjudication. Litigation can be either too expensive or too inexpensive, in the latter case by inducing inefficient substitution away from optimal ex ante contracts or optimal ex ante substantive rules of law. In the economic analysis, it is the combination of both substantive and procedural rules that determine the ultimate efficiency properties of a legal system. Furthermore, agency cost and public choice problems are important to assessing those properties.
These ideas are applied to describe and critique the existing law-and-economics literature on two major topics: (1) the provision of law enforcement, including private versus public enforcement and civil versus criminal enforcement; and (2) the structure of procedural rules as influencing the costs, expedition, accuracy, and procedural fairness of adjudications. Under both topics, features of European and American procedural systems are compared.
NAFTA meets the American Torts Process: O'Keefe v. Loewen
(no. 07-39)
The systematic bias against out-of-state defendants in American tort law is acutely illustrated in the important Mississippi case, O'Keefe v Loewen. This case, which resulted in the bankruptcy of the Canadian defendant, has itself become an international cause celebre because of the NAFTA challenge it has spawned. In this article, the factual backdrop of the case is described, the NAFTA challenge analyzed, and the implications of the challenge for tort reform are discussed.
Economics of Evidence and Proof
(no. 07-38)
In the Anglo-American common law legal system, the law of evidence regulates the fact-finding phase of the adjudication process, primarily by specifying the content and form of information that a litigant (or anyone else, including a judge) may present to factual decision-makers, which is referred to as the "admissibility" question. There is no law of "proof" per se, but there are doctrines that specify burdens of proof in both of two senses. First, the burden of production identifies the party required to come forward with evidence on a particular fact in dispute. Second, the burden of persuasion is the degree of certainty by which the finder of fact must decide, ranging from a simple preponderance of evidence through various intermediate levels to "beyond a reasonable doubt."
Outside of common law legal systems, there is no separate body of evidence law as such. In those nations following the civil law system, the fact-finding process largely is left to the discretion of the judge. This comparative distinction reflects deeper institutional differences across legal traditions.
Avoidance Costs in Optimal Penalties
(no. 07-37)
This paper develops the point that avoiding a legal prohibition is not free, but rather involves "avoidance costs" that must be considered in determining an optimal public law enforcement policy. While obvious in an organizational context, the point is completely general. In the case of individuals, there are more subtle types of avoidance costs in the form of lost opportunities for productive activity, which are difficult to observe directly but may have a very significant aggregate effect on social welfare. Therefore, the significance of avoidance costs extends to all types of potential offenders and offenses. The existing literature does not explicitly consider the problem of avoidance costs in determining optimal enforcement, and in some instances offers solutions that depend critically on the implicit assumption that avoidance costs are zero. If avoidance costs are considered, the optimal enforcement policy is affected in certain circumstances. In particular, the policy of setting expected penalties equal to the violator's gain, in order to reduce public enforcement costs, is shown to be sub-optimal even where it can be assumed that violators' gains are always less than the external harm created by the violation. More generally, the existence of avoidance costs and their dependence on the expected penalty level explains why optimal penalties always should be based on external harm, and never on the violator's gain.
D.C.’s Handgun Ban and the Constitutional Right to Arms: One Hard Question?
(no. 07-36)
The District of Columbia forbids almost all civilians to possess handguns in their own homes. Rifles and shotguns are permitted, but they must be kept unloaded and either disassembled or secured with a trigger lock, making them useless for self defense. The D.C. Circuit recently held that this statute violates the Second Amendment.
One way to attack the D.C. Circuit decision is to argue that the Second Amendment protects the private possession of weapons only to the extent necessary to preserve in civilian hands a stock of weapons suitable for use while serving in the militia. Rifles and shotguns would be the most obviously useful weapons for militiamen to bring with them from home, and the D.C. statute permits civilians to possess rifles and shotguns, along with the ammunition these weapons require. Why does this not satisfy the Second Amendment?
This superficially plausible defense of the District’s statute was not adequately refuted in Judge Silberman’s opinion for the D.C. Circuit. This article demonstrates, largely but not exclusively on the basis of a careful linguistic analysis of the Second Amendment, that such a defense of the District’s statute is untenable.
Does Blight Really Justify Condemnation?
(no. 07-35)
This article asserts, contrary to existing law, that blight condemnation is inconsistent with the fundamental distinction between eminent domain, which arrogates private goods for public use, and the police power, which protects the public from harm. When conditions on a parcel constitute a threat to public health and safety, the landowner should be ordered to abate. If the owner is unable or unwilling to do so, the dangerous condition should be abated by government under its police power. The cost of abatement should be treated as a betterment assessment, which become a lien on the land and, if unpaid, should result in a foreclosure sale. Thereafter, the land could be redeveloped by the purchaser or its designee.
One practical result of abatement and foreclosure is that an owner has an incentive to abate, or to sell to a neighbor or redeveloper who would abate, perhaps in combination with abatement on other nearby parcels similarly situated. Should the parcel go through foreclosure, its redeveloper is selected through a transparent process of competitive bidding. This likely would reduce unjustified blight condemnation resulting from rent seeking manifested through political favoritism towards selected redevelopers. Also, re-channeling redevelopment through market actors would reduce grandiose and wasteful redevelopment schemes.
Punitive Damages and the Supreme Court: A Tragedy in Five Acts
(no. 07-34)
This is a critique of Supreme Court jurisprudence concerning punitive damages. The author claims that the Supreme Court erred in the first of its recent treatments of punitive damages, and that this error has been compounded, resulting in a possibly incoherent state of current law. The various episodes in this jurisprudence are discussed in turn.
Postponing the 2007 “Restyling” Amendments to the Federal Rules of Civil Procedure: A Letter to Members of the Judiciary Committees of the House and Senate
(no. 07-33)
I write to urge the Members of the House and the Senate to enact legislation postponing the effectiveness of pending amendments to the Federal Rules of Civil Procedure. Without intervening Congressional action, these amendments will take effect on December 1 of this year pursuant to 28 U.S.C. § 2074(a). I recognize that this is an extraordinary request, but this year's pending amendments also are extraordinary, as they will completely re-write each and every provision of the Civil Rules for the first time in their 70-year history. More fundamentally, they adopt a novel concept of rule interpretation – what one of the proponents calls "clarity without change" – that is antithetical to our jurisprudence and likely to produce disarray in the procedural system.
There is a substantial body of opinion, in which I join, that the proposed amendments are likely to produce a material degradation of civil justice in our federal courts by imposing enormous burdens of transitional cost, in exchange for little or no benefit. Perhaps more importantly, there is no indication that the judicial rulemaking committees have fully considered the potential consequences of these sweeping changes. For these reasons, the Congress should provide itself the opportunity to study these proposed rules – and the process and concepts that produced them – before they take effect.
last updated:
May 17 2005
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