See also the News feed of working papers as they are released.
Bound print copies of George Mason School of Law’s working paper series on law and economics are available in the Law Library. The bound set often includes initial drafts of papers. Search Mason’s Classic Catalog to locate a working paper.
Recent Working Papers:
By James Cooper
Governments and firms often use committees of experts to help them make complex decisions, but conflicts of interest could bias experts’ recommendations. We focus on whether financial ties to drug companies bias FDA drug advisory committee (AC) members’ voting on drug approval recommendations. We find little significant evidence that AC members vote in their financial interests. We find stronger evidence that experts’ characteristics such as expertise level or associations with advocacy groups drives voting tendencies (biases) either for or against approval. We show that a Congressional Act that effectively excluded financially-conflicted AC members resulted in a sharp drop in average AC member expertise, and an unintended increase in approval voting. Our results have implications for the popular goal of eliminating financial conflicts from all medical decisions. Eliminating conflicts could sharply reduce the level of expertise of the decision makers and lead to unexpected voting tendencies.
Some scholars have argued that the phenomenon known as common ownership, which refers to an investor's simultaneous ownership of small stockholdings in several competing companies, is anticompetitive and prohibited by the U.S. antitrust laws. These proponents target in particular large investment managers, such as those that administer actively managed and passive index mutual funds owned by individual investors, and call for the divestiture of trillions of dollars of equities.
We believe the argument for antitrust enforcement against common ownership is misguided. First, proponents conflate management by investment managers and economic ownership by individual account holders and therefore incorrectly attribute allegedly anticompetitive conduct to the investment managers. Second, proponents substantially overstate the validity and strength of the existing empirical work purporting to show common ownership causes anticompetitive harm. Third, proponents overstate their legal case, both by relying upon inapplicable cross ownership cases and by stretching the holdings of those cases. Shorn of puffery, proponents rely on little more than the "plain meaning" of the statutes and the hotly contested empirical results. Fourth, at bottom proponents concerns are with either conscious parallelism, which is not illegal, or anticompetitive conduct that, if proven, could be addressed using established antitrust doctrines applicable to hub-and-spoke conspiracies and the anticompetitive exchange of information.
United States Department of Justice, Antitrust Division Public Roundtable Series on the Relationship Between Competition and Regulation, Second Roundtable -- On Consent Decrees
The Comment outlines the basic economic analysis that applies to agency consideration of whether to resolve cases by consent decree or by litigation. It describes past experience with government antitrust decrees that required modification or termination due to the passage of time or significant changes in the affected markets, as well as certain decrees whose effectiveness in serving antitrust objectives was questionable even at the time of initial entry. The Comment points out certain dangers to the consumer interest in vigorous competition that are associated with excessive agency reliance on consent decrees, and recommends institutional vigilance as a safeguard against such dangers. Finally, the Comment notes the continuing potential value of so-called conduct remedies, as distinct from structural remedies, particularly in the context of vertical acquisitions, while recognizing that structural remedies are properly accepted as the preferable mode of relief, especially in cases involving horizontal acquisitions.
By Ilya Somin
We can enhance development by making it easier for people to “vote with their feet” between jurisdictions. Few, if any, policy reforms can achieve such enormous increases in economic growth and opportunity. Foot voting is, in several crucial respects, a better mechanism of political decision-making than ballot-box voting. Foot voters generally have better incentives to acquire relevant knowledge and use it more wisely—than ballot box voters do. Empowering foot voters enhances development by enabling citizens to move to areas with greater job opportunities, and incentivizing regional and local governments to adopt pro-development policies in order to compete for residents and businesses. Even greater gains can be achieved by expanding opportunities for foot voting across international boundaries, through immigration. Constitutional structures can be designed in ways that maximize the benefits of foot voting and minimize potential costs.
U.S. law requires federal regulators to perform cost-benefit analysis of new rules proposed to correct market failure. As Coase convincingly showed decades ago, the inefficiencies of market failure can be usefully attributed to the costs of transacting. This essay proposes a novel and relatively simple complement to traditional cost-benefit analysis where market participants face transaction costs sufficiently low that direct bargaining or competitive market forces will drive them toward efficiency. The Coasean approach requires regulators to identify the relevant parties, the economic good they seek to exchange, and the nature of the transaction cost equilibrium that inhibits them from capturing all possible gains from trade. A rule is justified under this approach only if the regulator can show it is likely to reduce transaction costs. Facing lower transaction costs, the parties will adjust their private arrangements to correct inefficiencies and increase the gains from trade. There is no need for the regulator to quantify and weigh total costs and benefits. This is information the parties—the men and women “on the spot”—are best able to identify on their own.
By Ronald Cass
Together with the better-known Chevron deference rule, the doctrine articulated in Auer v. Robbins two decades ago—which makes reasonable administrative constructions of ambiguous administrative rules binding on courts in most circumstances—has become a focal point for concerns about the expanding administrative state. Auer deference, even more than Chevron deference, enlarges administrative authority in ways at odds with basic constitutional structures and due process requirements. Objections to Auer have given cogent reasons why courts should not grant deference to administrative interpretations merely because an agency’s rule is unclear. The most commonly voiced objections, however, do not explain why Congress should be disabled in all instances from granting administrators discretionary authority over rule-interpretation—even in settings not raising serious risk of partiality or unfair surprise in administrative construction.
Examining the relationship between statutorily-directed deference and constitutional-structural principles clarifies the essential underlying objection to Auer and the limits of that objection. When Congress by law confers discretionary authority that does not exceed its constitutional power to delegate functions to an administrator, courts should respect that assignment of authority unless it violates other specific constitutional commands.
Yet, when delegations are at most only arguably consistent with the Constitution, extending deference—especially expanding deference as Auer does in successive determinations—exacerbates delegations’ difficulties.
A reinvigorated non-delegation doctrine would solve the major Auer problem directly, and elimination of Auer-like deference would be clearly preferable to retaining the doctrine in its current form. Short of that, demanding that the statutory basis for deference is clearly articulated—that Congress plainly convey authority for administrators to exercise discretion at the second level of administrative rule implementation as well as the first level of more direct statutory implementation—would provide a modest first step in cabining problems associated with constitutionally questionable delegations of law-making authority. Those who embrace the rule of law, whether advocates or opponents of the modern administrative state, should support that step.
The Japan Patent Office (JPO) Guide to Licensing Negotiations Involving Standard Essential Patents, Comment of the Global Antitrust Institute, Antonin Scalia Law School, George Mason University
The GAI submitted comments in response to a public consultation by the Japan Patent Office (JPO) regarding its Draft Guide for SEP (standard-essential patent) Licensing Negotiations. The GAI comments encouraged the JPO to acknowledge the platform characteristics of standard-setting organizations (“SSOs”), which link technology innovators directly with technology implementers, and to recognize the key role of SSOs in determining how patents necessary to the provision of standardized products and services should be licensed. The comment also asked the JPO to accept that substantial flexibility is necessary for SSOs and parties engaged in SEP licensing, in light of the wide variation in technologies, standards, and the competitive conditions prevailing in affected markets.
By Todd Zywicki
F.A. Hayek focused on many traditional economic questions, and also made important contributions to law and economics. His framework differed from Kaldor Hicks efficiency and the wealth maximization norm common among neoclassical law and economics scholars. But he talked about how the common law evolves and helps shape economic outcomes. Underlying this approach was Hayek’s conviction that the essence of law is not created by the state, but rather preexists in the conventions and understandings within a community. Hayek argued that the role of the judge in a common-law system is to discover the law in the imminent consensus of norms and expectations. Hayek’s work has many implications for positive analysis and normative discussions of what judges should or should not do. To Hayek, the primary purpose of the law is not a wealth maximization problem, but to provide a stable institutional framework in a dynamic world that enables individuals to plan and coordinate.
By Adam Mossoff
This chapter, written for the forthcoming monograph A History of Intellectual Property in 50 Objects, discusses the scientific, technological, and social context of Samuel F.B. Morse's invention of the telegraph in the 1830s in New York City. Morse’s invention was called the “Lightning Line” and he was called the “Lightning Man,” because of its use of electricity to operate an electro-magnet in making tics on a strip of paper—the dots and dashes also invented by Morse to use on his telegraph and eponymously called Morse Code. Lightning is an apt metaphor if only because it captures perfectly the communications revolution sparked by Morse’s invention, which is still occurring today via the Internet (its undersea fiber optic cables follow the same paths of the telegraph cables first laid in the 1850s). In making possible instantaneous communication of all information the world over, the telecommunications revolution wrought by Morse’s telegraph has impacted everything—industry, commerce, education, and even the English language. In its survey of this wide-ranging impact of Morse’s telegraph, it brings some added color to a man and his invention that most patent lawyers know only via a lawsuit that resulted in a famous Supreme Court decision in 1851, and that many others today know only as the creator of Morse Code.
By Nelson Lund
Martin H. Redish, a distinguished federal courts and constitutional law scholar, has written a remarkable book-length defense of judicial supremacy. Alarmed by the work of academics whom he sees as dangerously loose cannons—including Bruce Ackerman, Larry Kramer, and Michael Stokes Paulsen—Redish seeks to reestablish a “formalist traditional model” that takes the written Constitution seriously. This model, which is emphatically not originalism, treats the “prophylactically insulated judiciary [as] the beating heart of the structural brilliance that defines American constitutionalism.”
After defending his claim that the Supreme Court rightly enjoys supremacy in the interpretation of the written Constitution, Redish draws a number of novel inferences about its implications. Unlike the President and other executive officials, for example, judges may be impeached only for criminal behavior, and then only if the conduct threatens the integrity of the judicial role. The Constitution requires that state judges be granted life tenure. The judiciary has the constitutional power and obligation to assure that Congress does not deceive the electorate as to the manner in which its legislation alters the preexisting legal, political, social, or economic topography. The Fifth Amendment repealed the Suspension of Habeas Clause in Article I.
Even if one doubts that the Supreme Court should or ever will accept the arguments Redish makes, readers of his book will be forced confront proposals that they surely would not have conjured on their own.
Two-hundred and forty years ago America spoke itself into existence as a nation with a Declaration that proclaimed the inalienable rights of individuals and the just foundation of government. That foundation, Lincoln told us, was a government of, by, and for the people. And what he meant was a government of, by and for the American people.
Lincoln always put America first. So too did John Adams. When he presented his credentials as the first American ambassador to Great Britain, George III observed that Adams was not thought to be especially fond of France. “I must avow to your Majesty,” replied Adams, “I have no Attachments but to my own Country.” To which the King answered, “An honest Man will never have any other.”
And that was what Donald Trump pledged, in his Inauguration Address. “From this day forward,’ he announced, “a new vision will govern our land. From this moment on, it's going to be America First.”
When Hobbes announced that philosophy must be rooted on the definition of words, he meant to leave theology and metaphysics in the dustbin. We lawyers, especially criminal lawyers, have a different reason for insisting on the clarity provided by definitions. If a person is to be charged with a crime, it’s important that he know just how he has transgressed. Otherwise, he’ll not know how to avoid the law, and too much discretion will be given to prosecutors to pursue private vendettas or to criminalize political differences. The latter is a special concern when it comes to the crimes of political corruption.
To philosophers, all this might seem like that old television show, Woodworking with Mr. Chips, the carpentry of putting abstract ideas into action. To which the lawyer might respond, if you can’t put them into action what’s the point? Asking how corruption might be penalized also helps bring collateral concerns to mind. When it comes to pubic corruption, for example, the legislator or judge is required to measure the public’s concern for public integrity against other interests, such as the liberties citizens should be permitted to enjoy in a democratic society. That’s an insight that has eluded not a few theorists, including Robespierre. Without the guillotine, he said, virtue is impotent. “Terror is nothing but prompt, severe, inflexible justice; it is therefore an emanation of virtue.”
Philosophers might therefore find it useful to attend to the way in which lawyers and judges have struggled to define corruption. Philosophers might of course come up with a different, more expansive idea of corruption, since the criminal penalties imposed on the corrupt public official argue for a narrower definition of corruption at law. But even then, the lawyer’s tools are squarely within the traditions of analytic philosophy, after the difference in sanctions is recognized. Above all, one should want to resist the kind of philosophizing based on little more than free floating intuitions, in which everything might be corruption, or nothing too. Like a swimmer who finds himself enveloped by a squid’s cloud of ink, formless, unbounded and murky, the lawyer struggles for clear water clarity.
The election of Donald Trump has exposed, for all to see, the poverty of American conservative thought. Yet even now conservative thinkers seem none the wiser. Their frozen-fixed principles remain unchanged, and they gauge Trump according to how he well comports with them. Even Trump’s supporters, for the most part, have failed to understand just what explains Trump’s victory, and the revolution in conservative thought behind it.
The four pillars of the Trump movement, themes that resonated with his supporters and which were largely ignored by conservative intellectuals, were mobility, jobs, religion and nationalism. What they gave us was a very different party, one that is socially conservative and economically liberal or middle of the road, the polar opposite of the libertarian’s social liberalism and economic conservatism.
By Helen Alvaré
This “dissent” was produced for a book project organized by Professor Jack Balkin of Yale Law School. Each participant was assigned a role to play on the subject of “What Obergefell Should Have Said.” In my role as a dissenting Justice, I offered a “children’s well-being” lens on the question of the legalization of same-sex marriage.
During the national debate over same-sex marriage, in both legal and cultural milieux, the subject of children was often raised but poorly explored. This dissent fully states the argument for children as the most important part of the argument for maintaining marriage as opposite-sexed. Such an argument should have been embedded all along within family law, but was rather often expressed only sociologically or psychologically.
The dissent demonstrates first that prior to same-sex marriage, every Supreme Court opinion, and the vast majority of state marriage laws, understood marriage recognition as a legal tool for managing the consequences of heterosexual romantic pairings. In short, marriage encouraged romantically-involved opposite-sex couples to channel procreation into marriage given children’s long-run needs for stability and care from their parents. This comported with family law’s default position:, children are the vulnerable parties requiring priority care from both parents and the state.
In the face of a federal constitutional right to same-sex marriage, however, the general welfare of children cannot any longer ground any state’s marriage recognition law. Instead, Americans are given to understand that the state has no special interest in linking children with their mother and father or kin.
Second, the dissent articulates the conflict between the Casey v. Planned Parenthood substantive due process formula, and broadly accepted standards for finding unemumerated constitutional rights outside of sexual expression cases. It also shows how the Casey formula fails to account for, and even clashes with, children’s rights or interests in identity, in liberty, and in fashioning the meaning of their own lives.
Finally, this dissent responds to the often heard legal (and cultural) accusation that only animus against homosexuals could account for the resurgence of a children’s welfare position within the same-sex marriage debate. To the contrary, there were emerging signs that law and culture were beginning to learn from their mistake of overlooking children. Pertinent legal reforms showcase this. It is also a troubling argument that uses past carelessness or ignorance regarding children’s interests as a warrant for more of the same.
Now We Know Better: A New Legal Framework on Sex to Better Promote Autonomy, Equality, Diversity, and Care for the Poor
By Helen Alvaré
Over especially the last 50 to 60 years, US laws and policies concerning the sexual relationships between men and women have more consciously articulated a need to pursue social justice according to the categories of autonomy, equality, diversity and care for the poor. These categories are admirable on their face and responsive to the times in which they emerged. They are particularly well-suited to the history of discrimination against women and African Americans in the US. They were strongly influenced, inter alia, by the development of contraceptive technology and an array of social welfare initiatives, the rise of feminism and civil rights, and a growing belief in the importance of sexual happiness. The laws and policies designed to achieve these goals, however, are currently insufficient. They relied on various presumptions about human preferences and behaviors, children’s needs, and the relationship marketplace — especially among the poor — which proved inadequate or false. Consequently while these categories remain relevant and important, US law and policy concerning sexual relationships need to be updated and rebalanced in order to achieve progress toward equality, autonomy, diversity and care for the poor.
United States Department of Justice Antitrust Division Public Roundtable Series on Competition and Deregulation, First Roundtable on State Action, Statutory Exemptions and Implied Immunities, Comment of the Global Antitrust Institute
This comment is submitted in connection with the first session of the Antitrust Division’s Public Roundtable Series on Competition and Deregulation, focusing on statutory exemptions, implied immunities and the State Action doctrine, scheduled for March 14, 2018. The Global Antitrust Institute’s (GAI’s) Competition Advocacy Program commends the Division for inviting discussion on these important issues. The GAI submission reviews the key economic considerations that should guide resolution of the main issues that arise when claims of implied immunity and/or the State Action defense are asserted by those accused of antitrust violations. To improve the public accountability of state government for anticompetitive regulatory policies, the GAI recommends that State Action immunity be restricted or withdrawn when state regulations impose most of their anticompetitive effects on non-residents.
By Eric Claeys
In contemporary American legal scholarship, scholars debate how best to conceive of and analyze property. Some scholars maintain that property rights can only be conceived of as bundles of rights, others that property rights consist of rights to exclude, and still others that property constitutes an institution realizing a wide range of different and incommensurable values. This Article offers a different conceptual and analytical perspective. It argues that property concepts resemble in important respects the concepts that represent clocks, keys, money, and other artifacts. Like other artifacts, property rights are created to perform characteristic functions. Those functions give prominent property rights and concepts their structure.
The Article applies that insight to Anglo-American property law. It studies two prominent and complementary concepts in property law. One is the concept representing absolute ownership of an ownable resource; the other is the concept representing easements, riparian rights, and many other proprietary interests strong enough to be called “rights” but still considerably weaker than the rights associated with ownership. These rights and others can be explained and reconciled to one another as instances of property concepts structured to perform a common artifact function. That function is the facilitation of people’s reason-based interests in using resources. The Article identifies the elements for the ownership-based and the more capacious concepts of property. And it shows how these function-oriented concepts apply to: property in land; aerial trespass disputes; appropriative rights; tenancies in common; mortgages; covenants running with the land; the defense of custom for trespass to land; nuisance; and basic principles of common carriage or public accommodations law.
Dominican Republic’s Resolution on Cartel Leniency, Comment of The Global Antitrust Institute, Antonin Scalia Law School, George Mason University
This comment is submitted in response to the Dominican Republic National Commission for the Defense of Competition’s (“Procompetencia”) public consultation on the Proposed Regulation for the Establishment of a System for Reduction of Sanctions for Cooperation in Cartel Investigations. The Global Antitrust Institute’s Competition Advocacy Program commends Procompetencia’s transparency, its recognition of the economic harm inflicted by cartels, and its willingness to establish a leniency program. The comment provides a number of specific suggestions to enhance the effectiveness of the proposed Regulation, including adjustments to the available sanction discount levels provided to successful leniency applicants, and by limiting to a reasonable minimum the requirements for applicants to obtain a “marker” or “bookmark” that would be issued by Procompetencia to indicate whether and to what extent leniency may be available to such applicants.
Procompetencia’s Regulations for the Processing of Commitment Proposals by Economic Agents, Comment of the Global Antitrust Institute, Antonin Scalia Law School, George Mason University
This comment is submitted in response to the Dominican Republic National Commission for the Defense of Competition’s (“Procompetencia”) public consultation on the Proposed Regulation for Considering Proposed Settlements by Firms in Investigations Based on the General Law for the Defense of Competition. The Global Antitrust Institute’s Competition Advocacy Program commends Procompetencia’s transparency, and its willingness to clarify the requirements and procedures for consideration of settlement proposals by firms subject to investigations by Procompetencia. The comment provides several specific suggestions to improve the flexibility of the requirements and the efficiency of the process for negotiating such settlements. The comments ask Procompetencia to limit certain proposed restrictions on the circumstances in which settlement offers may be considered, and to take care that the relief negotiated is in full accord with sound antitrust economics and that such relief remain within the scope of that which could be obtained under the organic competition law in fully contested proceedings.
By Neomi Rao
Congress currently operates in the shadow of the administrative state. This Article provides a modern reconsideration of why Congress still matters by examining the “collective Congress” within the text, structure, and history of the Constitution. Like the unitary executive, the collective Congress is a structural feature of the Constitution’s separation of powers. With deep roots in political theory, the Framers created a representative and collective legislature that would provide a legitimate mechanism for bringing together the nation’s diverse interests to most effectively pursue the common good. To fully realize the benefits of collective lawmaking, the Constitution insists on the double exclusivity of the legislative power: only Congress can exercise legislative power, and Congress possesses only legislative power. The Constitution ties the ambitions of representatives and senators to Congress as an institution by prohibiting members of Congress from exercising the executive or judicial powers. This structure supports the members’ fiduciary responsibilities to the people, minimizes corruption, and reinforces the independence and integrity of the lawmaking power.
Understanding the principles of a collective Congress provides a framework for analyzing a range of separation of powers questions, particularly those arising from the delegation of legislative power to administrative agencies. Quite simply, presidential control of administration cannot replace congressional control of legislation. Congress remains relevant in our complex modern society because it provides a unique form of accountability for ascertaining and pursuing the public good, preserving the rule of law, and protecting individual liberty. The collective Congress provides a powerful conceptual framework for understanding the scope of the Constitution’s “legislative power” and how Congress may exercise it. The administrative state blurs the line between the executive and legislative powers. The collective Congress sharpens that line and helps explain why Congress still matters in our system of government.