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Claim Durability and Bankruptcy’s Tort Problem

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Bankruptcy has a tort problem. Chapter 11 predictably subordinates the claims of tort and other involuntary creditors to those of financial lenders, a fact which encourages firms to rely excessively on secured debt and discount the interests of those they might incidentally harm. For this reason, many scholars have advocated changing repayment priorities to move […]

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Legal Analysis, Policy Analysis, and the Price of Deference: An Empirical Study of Mayo and Chevron

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A huge literature contemplates the theoretical relationship between judicial deference and agency rulemaking. But relatively little empirical work has studied the actual effect of deference on how agencies draft regulations. As a result, some of the most important questions surrounding deference—whether it encourages agencies to focus on policy analysis instead of legal analysis, its relationship […]

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Footloose with Green Shoes: Can Underwriters Profit from IPO Underpricing?

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Why are green shoe options used in initial public offerings (IPOs)? And why do underwriters usually short sell an issuer’s stock in connection with its IPO? Are underwriters permitted to profit from these trading positions? Scholars have long argued that underwriters use green shoe options together with short sales to facilitate price stabilizing activities, and […]

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Collaborative Governance Under the Endangered Species Act: An Empirical Analysis of Protective Regulations

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Recent conservation and administrative law scholarship emphasizes the need for potential legal adversaries to work together. Stakeholders and regulators can pool their political capital, money, property, expertise, and legal leverage to achieve more than could be accomplished through mere mechanical implementation of statutory commands. Most commentators associate collaboration with programs promoting fuzzy objectives to engage […]

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Reviewing Administrative Review

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In the largest system of federal adjudication—Social Security disability adjudication—outcomes depend more on the randomly assigned judge than on the strength of the case. Does the administrative appeals process use resources effectively to reduce that arbitrariness and limit the discretion of administrative law judges? If not, how and why does it fail? These are empirical […]

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The Separation of Voting and Control: The Role of Contract in Corporate Governance

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The default rules of corporate law make shareholders’ control rights a function of their voting power. Whether a director is elected or a merger is approved depends on how shareholders vote. Yet, in private corporations shareholders routinely alter their rights by contract. This phenomenon of shareholder agreements—contracts among the owners of a firm— has received […]

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The Essential Role of Empirical Analysis in Developing Law and Economics Theory

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Throughout its history, the development of theoretical law and economics has depended on, and been shaped by, empirical analyses of law. Theoretical law and economics scholars cannot draw persuasive positive or normative conclusions about legal rules unless the models employed accurately capture the factors affecting people’s responses to legal rules. Models thus must accurately describe […]

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The Economics of Class Action Waivers

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Many firms require consumers, employees, and suppliers to sign class action waivers as a condition of doing business with the firm, and the U.S. Supreme Court has endorsed companies’ ability to block class actions through mandatory individual arbitration clauses. Are class action waivers serving the interests of society or are they facilitating socially harmful business […]

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Economic Analysis in Law

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This Essay explores the relationship between normative law and economics and legal theory. We claim that legal theory must account for law’s coerciveness, normativity, and institutional structure. Economic analyses that engage these features are an integral part of legal theory, rather than external observations about law from an economic perspective. These analyses, or economic analysis […]

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Remixing Resources

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This Essay argues for an approach to resource access that connects rather than separates questions of efficiency and distribution. It proceeds from the premise that putting together the most valuable combinations of resources—including human capital—is of central and increasing normative importance. Structuring law to facilitate these combinations should be a primary task for property scholars […]