Category Archives: Law and Economics
Duffie and Wang, ‘Smart Contracting in Network Markets’
ABSTRACT For bilateral bargaining in network markets, we show that holdup is eliminated when contracts are atomically settled with smart contracts. Applications include over-the-counter trading networks, purchases requiring third-party financing, and other multi-agent markets in which pairs of agents bargain bilaterally over terms that could potentially affect their outside-option values in negotiations with other firms. […]
Martimort, Poudou and Thomas, ‘Optimal Contracts under Moral Hazard, Adverse Selection and Limited Liability’
ABSTRACT This paper studies optimal contracting between a risk-neutral buyer and a risk-neutral, limited-liability seller facing both adverse selection and moral hazard. Even when effort and production are separable, the optimal contract combines features of pure screening and pure moral hazard models. Screening distortions are mitigated, and effort serves as a screening tool. Efficient agents […]
Paulo Barrozo, ‘Capitalism and Jurisprudence’
ABSTRACT In our time, an amorphous and undertheorized notion of capitalism is the target of jurisprudential antipathy. Capitalism is indicted as the creator of ills and as the inhibitor of equality, freedom, truth, justice, democracy, human flourishing, planetary life, peace, and more. Among natural law and critical legal theorists in the United States, only liberalism […]
Jonathan Barnett, ‘The Free Content Illusion’
ABSTRACT Peer-to-peer file sharing in the early 2000s destabilized traditional content markets and associated business models that rely on preserving control over the use of creative assets. Academics and other commentators widely argued that robust forms of intellectual property rights had been rendered largely obsolete in a digital environment of low production and distribution costs. […]
Liu and Lin, ‘Commercialise or Sleep? Capturing Value from Patenting’
ABSTRACT We develop a sequential model to examine patent litigation, acquisition, and commercialization decisions in innovative industries. The model focuses on potential intellectual property disputes among two patent-holding firms with overlapping technologies and a non-patent-owning producer. We highlight the role of the belief gap, defined as the difference between the patent owner’s and other market […]
Lora, Benítez-Rueda and Rueda-Sanz, ‘Property Informality and Its Effect on Rural Land Prices in Colombia’
ABSTRACT This study investigates the impact of property informality on rural land prices in Colombia. It utilizes data for 16 land size categories for a fifth of Colombia’s municipalities. It employs the Gaussian copula approach to overcome endogeneity issues. The main finding is that an exogenous variation of property informality significantly reduces rural land prices […]
Glynn Lunney, ‘Copyright, Incentives, and Popular Music Composition’
ABSTRACT The rise of file sharing and the subsequent collapse in sales of recorded music offer a rare glimpse into a counterfactual world where copyright, for a time, was weakened. Comparing creative output before and after this exogenous shock allows us to test empirically whether incentives to copyright owners were correlated with creative output. In […]
Parisi and Bix, ‘Fairness in contract law: an impossibility theorem?’
ABSTRACT Scholars have long debated whether contract law should prioritize maximizing efficiency and social welfare or, instead, prioritize justice, fairness and other deontological values. The debate is partly prescriptive (what should we try to do with contract law rules) and partly conceptual (how should we understand contract law). This article surveys central positions in this […]
Anna Chadwick, ‘Towards a Legal Theory of Price’
ABSTRACT A new wave of legal scholarship has challenged the dominant neoclassical account of price formation, demonstrating that prices are not formed according to its prescripts and do not perform the task of economic coordination in line with its axioms. As opposed to emerging from voluntary exchanges between private actors, prices on this alternative reading […]
Peter O’Loughlin, ‘The Limits of Behavioral Law and Economics’ Predictive Power’
ABSTRACT Behavioral economics’ most severe criticism is that it lacks a coherent theory for predicting when irrationality will govern decision-making. BE is often therefore identified as a body of anomalies residual or exceptional to rational choice theory. This Article answers the question of why this is the case and does so by distinguishing between two […]