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 Craig Lerner
Justice Thomas and the late Justice Scalia consistently argued that the original meaning of the Eighth Amendment was to foreclose only those modes or acts of punishment that were considered cruel and unusual at the time the Bill of Rights was adopted. With respect to juvenile criminal responsibility, this would mean that the Constitution contemplated an infancy defense no broader than what existed in 1791. Yet the common law infancy defense, as sketched by originalist judges, seems barbaric. It treated all fourteen-year-olds as adults, and it permitted the imposition of punishment—even capital punishment—on offenders as young as seven.
This Article argues that the common law infancy defense was more nuanced than modern observers often recognize. With respect to misdemeanors, the defense was more broadly applicable than is typical today. Even with respect to felonies, offenders under the age of fourteen could be found liable only after an individualized inquiry as to their capacity to distinguish right from wrong. The eighteenth-century culture and common law had higher expectations of juvenile abilities than prevail today; and not surprisingly, young people proved more mature than modern adolescents, who are told repeatedly that they are frail and vulnerable. This Article speculates on how the original meaning of the Eighth Amendment, assuming it incorporates the common law approach to juvenile responsibility, might be applied to modern conditions, given the diminished maturity of young people. However, the Article questions whether young people today are as immature as advertised; indeed, the study of the common law infancy defense could prompt a reconsideration of contemporary attitudes about the capacities of young people.
By Ross Davies
Thurgood Marshall – the famed civil rights advocate, lawyer, and Supreme Court Justice – was renowned for his storytelling, and this Essay revolves around stories – true stories – told by and about him. It is, therefore, a salute to the man by way of storytelling, in hopes that we may learn a few little lessons – some old, some maybe new – from his life.
Hipster Antitrust Meets Public Choice Economics: The Consumer Welfare Standard, Rule of Law, and Rent-Seeking
By Elyse Dorsey, Jan Rybnicek, Joshua Wright
Hipster Antitrust calls for the outright rejection of the consumer welfare standard as the lodestar of antitrust law in favor of a vague “public interest” test that requires courts and agencies to consider a variety of social and political goals. It also advocates for focusing antitrust primarily upon simplistic and, in some cases, long-rejected, proxies of market performance such as market structure and firm size rather than on assessing actual anticompetitive effects. In short, Hipster Antitrust seeks to dismantle the well-defined, objective, and economics-based approach to antitrust developed through case law for decades, to eliminate the rule of law associated with that approach, and to send antitrust jurisprudence careening back to its Stone Age. It does so while attacking corporate America generally and with rhetorical flourish that nostalgically yearns for a return to the trustbusting days of antitrust’s infancy. A primary theme of Hipster Antitrust is concern with regulatory capture and oversized corporate influence on regulation and market outcomes. We share those concerns. Yet, ironically, by expanding antitrust enforcers’ discretion dramatically and removing institutional safeguards ensuring accountability, Hipster Antitrust would usher in a new era of rent-seeking by corporations hoping to misuse the antitrust laws to gain advantages over competitors. In doing so, Hipster Antitrust regrettably ignores the important lessons of public choice theory and trades the current antitrust regime, which promotes consumer welfare, for one that invariably benefits businesses and maximizes corporate welfare.
Federative Republic of Brazil, Before the Administrative Council for Economic Defense (“CADE”), Draft Guidelines Concerning Antitrust Remedies, Comment of the Global Antitrust Institute, Antonin Scalia Law School, George Mason University
This comment provides recommendations to the Brazilian Administrative Council for Economic Defense (CADE) on Draft Guidelines Concerning Antitrust Remedies, which describe CADE's policies and practices for ordering relief in cases involving structural transactions. The comment commends CADE for publishing the guidelines and for adopting best practices based extensively on accepted international standards. The comment describes why economic analysis suggests flexibility in regard to relief policies, given the wide range of factual possibilities, so that competition is preserved or restored with minimum compliance, administrative, and enforcement costs, and with minimum loss of efficiencies. The comment then identifies several areas where the guidelines could benefit from improved flexibility. These include: (a) a preference for structural remedies, even though behavioral remedies might be preferable in vertical cases; (b) a presumption in favor of an upfront buyer requirement, although such a requirement is usually unnecessary where an effective divestiture package is well defined and qualified buyers are identifiable; (c) a critical stance on remedies requiring monitoring, even though firewalls and other conduct remedies are often successful where circumstances favor them; and (d) a strong presumption against mix-and-match divestiture packages, although such divestiture may be the preferable option in some cases involving multiproduct firms. The comment concludes by encouraging ex-post empirical analysis of merger remedies.
U.S. Department of Justice, Antitrust Division Public Roundtable Series on the Relationship between Competition and Regulation, Third Roundtable – on Anticompetitive Regulations: Comment of the Global Antitrust Institute, Antonin Scalia Law School, GMU
This Comment is submitted to the United States Department of Justice (DOJ), Antitrust Division Public Roundtable Series on Competition and Deregulation, Third Roundtable On Anticompetitive Regulations. The Global Antitrust Institute's Competition Advocacy Program applauds the DOJ for acknowledging the limitations of price regulation and the unintended consequences that can arise when competitive forces are displaced. We discuss three aspects of government price controls to regulate competition: (1) the social costs of price regulation in a market economy, (2) the problematic history of price regulation and its consequences, and (3) examples of modern price regulation and the role of antitrust.
Ranking the Olympians Before U.S. News: When Vanity Fair and The Bookman Told Their Readers Who Really Mattered
By Ross Davies
When were the first law-related rankings published? Answering that question would be like determining when the first baseball game was played. You would have to start by settling fundamental and disputable definitional issues: What is a publication (or what is baseball)? What counts as a ranking (or a game)? And so on. Experts, even those who are most eminently knowledgeable and admirably reasonable, sometimes disagree about such things. Then, if you were to miraculously manage to settle all such matters of meaning, you would have to look everywhere that such a ranking might have been published (or such a game recorded). That is too much. Better to work incrementally – to report ever-earlier sightings as you find them and hope that definitional consensuses grow as unexplored territories shrink. That is the spirit in which I offer this report on two sets of rankings published in the early 20th century.
This essay uses ongoing debates about the remedies available for patent infringement to explore some broader questions about normative legal theory. The essay was written for a festschrift for Richard Epstein. Throughout his career, Epstein has systematically defended classical liberal views about property rights, freedom of contract, and private ordering—like the presumption that a patent holder deserves an injunction against ongoing infringement. When that presumption was called into serious question by the Supreme Court’s 2006 decision in eBay v. MercExchange, Epstein defended the traditional presumption on law and economic grounds. We agree with Epstein that injunctions should be a presumptive remedy for patent infringement. But we have learned from Epstein that foundations matter, and we have reservations about the consequentialist and law and economic grounds on which Epstein defends injunctions in patents and property rights more generally. In this essay, we explain why a Lockean theory of rights supplies a more satisfying foundation for property rights and markets than consequentialist and law and economic foundations.
By Ilya Somin
In his important new book, The Crisis of the Middle-Class Constitution, Ganesh Sitaraman argues that growing economic inequality over the last several decades and the resulting decline of the middle class is “the number one threat to American constitutional government.” He also contends that the American Founding Fathers sought to establish a “middle-class constitution” in which the avoidance of extremes of wealth and poverty would ensure the stability of democratic government. These are bold and provocative claims, but large elements of them fail to withstand scrutiny. Economic inequality is not as serious a threat to our political system as the growing size and complexity of government. These forces make it increasingly difficult for ordinary people to exercise effective control over government—or even to understand what it is doing.
In addition, Sitaraman’s focus on the Founders’ fear of excessive inequality of wealth leads him to ignore their much stronger concern for protecting liberty and property rights, and limiting and decentralizing government power. These latter ideas can help us address the more dangerous elements of our present situation.
While Sitaraman overstates the dangers of inequality, he is right to highlight the perils of declining opportunity for the poor and lower-middle class, and the ways in which the modern state offers all too many opportunities for the wealthy and powerful to enrich themselves at the expense of the public interest. But there are ways to mitigate these problems, while simultaneously reducing the size and complexity of government that have undermined democratic accountability and empowered unscrupulous elites.
By Murat Mungan
Criminals often engage in costly avoidance to lower their probability of being detected and sanctioned. Such avoidance, in turn, affects the optimal enforcement policy. This paper studies the impact of avoidance on a specific type of enforcement policy - the standard of proof. We show that when avoidance is possible the optimal standard of proof is weaker than preponderance of the evidence. This stands in contrast to much of the literature, which shows that non-deterrence costs usually cause the standard of proof to be stronger than preponderance. Our results suggest that it is important not to ignore criminals' secondary behavior when determining the optimal standard of proof.
Since the early twentieth century, labor unions have lobbied federal and state governments to enact and enforce laws requiring government contractors to pay “prevailing wages” to employees on public works projects. These laws, currently active at the federal level and in approximately thirty states, typically in practice require that contractors pay according to the local union wage scale. The laws also require employers to adhere to union work rules. The combination of these rules makes it extremely difficult for nonunion contractors to compete for public works contracts.
Meanwhile, construction unions have been among the most persistently exclusionary institutions in American society. Not surprisingly, in many cases, the history of prevailing wage legislation has been intertwined with the history of racial discrimination. Economists and others argue that prevailing wage legislation continues to have discriminatory effects on minorities today. Union advocates, not surprisingly, deny that prevailing wage laws have discriminatory effects. More surprisingly, they deny that the granddaddy of modern prevailing wage legislation, the federal Davis-Bacon Act of 1931, had discriminatory intent.
Part I of this Article discusses the discriminatory history of the most significant of all prevailing wage laws, the Davis-Bacon Act. As discussed below, Davis-Bacon was passed with the explicit intent of excluding African American workers from federal construction projects, and its discriminatory effects continued for decades.
Part II of this Article discusses the controversy over whether prevailing wage legislation continues to have discriminatory effects. The section begins with a discussion of the empirical literature on the effects of prevailing wage discrimination on minority employment. The section next presents evidence that construction unions continue to discriminate against members of minority groups, albeit much more subtly than in the past. The section concludes by recounting allegations that prevailing wage legislation serves to exclude minority contractors from obtaining government contracts.
Reflections on the 100th Anniversary of Buchanan v. Warley: Recent Revisionist History and Unanswered Questions
In 1917, in Buchanan v. Warley, the Supreme Court invalidated a Louisville residential segregation law, one of a wave of such laws spreading through the United States. Even though Buchanan v. Warley was a dramatic victory for racial equality at a time in American history when anti-black racism was at a post-Civil War peak, with an avowed segregationist occupying the White House, the opinion was largely ignored or misinterpreted until recently. The problem has been that Buchanan does not fit the dominant narrative about the so-called Lochner era Supreme Court. Part I of this article reviews scholarship that has challenged the traditional dismissive view of Buchanan v. Warley over the last twenty years.
Part II of this article suggests various research topics raised by Buchanan v. Warley that should receive more scholarly attention, including: (1) How did African Americans manage to migrate to formerly all-white neighborhoods despite restrictive covenants and other barriers?; (2) To what extent did Buchanan v. Warley reflect a viable alternative civil rights vision to the progressive vision that came to dominate legal discourse?; (3) Under what circumstances judicial intervention on behalf of minority groups is likely to occur, and when it is likely to be successful; and (4) To what extent can early twentieth-century progressivism, as opposed to societal racism more generally, can be blamed for the rise of residential segregation ordinances that led to Buchanan?
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.