Jan 30, 2011 Michael Froomkinlegalhist
Legal History Section Editors
The Section Editors choose the Contributing Editors and exercise editorial control over their section. In addition, each Section Editor will write at least one contribution (“jot”) per year. Questions about contributing to a section ought usually to be addressed to the section editors.
Professor Kunal Parker
University of Miami School of Law
Professor Christopher Schmidt
Chicago Kent College of Law
Contributing Editors
Contributing Editors agree to write at least one jot for Jotwell each year.
Professor Felice Batlan
Co-Director, Institute for Law & the Humanities
Chicago Kent College of Law
Professor Christina Duffy Burnett
Columbia Law School
Professor Mary Dudziak
Judge Edward J. & Ruey L. Guirado Professor of Law, History & Political Science
University of Southern California Law
Professor Laura F. Edwards
Professor of History
Duke University
Professor Angela Fernandez
University of Toronto, Faculty of Law
Professor Ariela Gross
John B. & Alice R. Sharp Professor of Law & History
University of Southern California Law
Professor Daniel Hamilton
University of Illinois College of Law
Professor Hendrik Hartog
Professor of History
Princeton University
Professor Sophia Z. Lee
University of Pennsylvania Law School
Professor Serena Mayeri
Assistant Professor of Law & History
University of Pennsylvania Law School
Professor Richard J. Ross
Thomas M. Mengler Faculty Scholar
Co-Director, Program in Legal History
University of Illinois College of Law
Professor Allison Brownwell Tirres
DePaul University College of Law
Professor Christopher Tomlins
University of California, Irvine School of Law
Jan 30, 2011 Michael Froomkinlegalhist
Jotwell: The Journal of Things We Like (Lots) seeks short reviews of (very) recent scholarship related to the law that the reviewer likes and thinks deserves a wide audience. The ideal Jotwell review will not merely celebrate scholarly achievement, but situate it in the context of other scholarship in a manner that explains to both specialists and non-specialists why the work is important.
Although gentle critique is welcome, reviewers should choose the subjects they write about with an eye toward identifying and celebrating work that makes an original contribution, and that will be of interest to others. Please see the Jotwell Mission Statement for more details.
Reviews need not be written in a particularly formal manner. Contributors should feel free to write in a manner that will be understandable to scholars, practitioners, and even non-lawyers.
Ordinarily, a Jotwell contribution will
- be between 500-1000 words;
- focus on one work, ideally a recent article, but a discussion of a recent book is also welcome;
- begin with a hyperlink to the original work — in order to make the conversation as inclusive as possible, there is a strong preference for reviews to focus on scholarly works that can be found online without using a subscription service such as Westlaw or Lexis. That said, reviews of articles that are not freely available online, and also of very recent books, are also welcome.
Initially, Jotwell particularly seeks contributions relating to:
We also have a Classics section limited to reviews of works more than 50 years old. We intend to add more sections in the coming months.
References
Authors are responsible for the content and cite-checking of their own articles. Jotwell editors and staff may make editorial suggestions, and may alter the formatting to conform to the house style, but the author remains the final authority on content appearing under his or her name.
- Please keep citations to a minimum.
- Please include a hyperlink, if possible, to any works referenced.
- Textual citations are preferred. Endnotes, with hyperlinks, are allowed if your HTML skills extend that far.
- Authors are welcome to follow The Bluebook: A Uniform System of Citation (19th ed. 2010), or the The Redbook: A Manual on Legal Style (2d Ed.) or indeed to adopt any other citation form which makes it easy to find the work cited.
Technical
Jotwell publishes in HTML, which is a very simple text format and which does not lend itself to footnotes; textual citations are much preferred.
Contributors should email their article, in plain text, in HTML, or in a common wordprocessor format (Open Office, WordPerfect, or Word) to jotwell@gmail.com and we will forward the article to the appropriate Section Editors. Or you may, if you prefer, contact the appropriate Section Editors directly.
Jan 30, 2011 Michael Froomkinlegalhist
The Journal of Things We Like (Lots)–JOTWELL–invites you to join us in filling a telling gap in legal scholarship by creating a space where legal academics will go to identify, celebrate, and discuss the best new legal scholarship. Currently there are about 350 law reviews in North America, not to mention relevant journals in related disciplines, foreign publications, and new online pre-print services such as SSRN and BePress. Never in legal publishing have so many written so much, and never has it been harder to figure out what to read, both inside and especially outside one’s own specialization. Perhaps if legal academics were more given to writing (and valuing) review essays, this problem would be less serious. But that is not, in the main, our style.
We in the legal academy value originality. We celebrate the new. And, whether we admit it or not, we also value incisiveness. An essay deconstructing, distinguishing, or even dismembering another’s theory is much more likely to be published, not to mention valued, than one which focuses mainly on praising the work of others. Books may be reviewed, but articles are responded to; and any writer of a response understands that his job is to do more than simply agree.
Most of us are able to keep abreast of our fields, but it is increasingly hard to know what we should be reading in related areas. It is nearly impossible to situate oneself in other fields that may be of interest but cannot be the major focus of our attention.
A small number of major law journals once served as the gatekeepers of legitimacy and, in so doing, signaled what was important. To be published in Harvard or Yale or other comparable journals was to enjoy an imprimatur that commanded attention; to read, or at least scan, those journals was due diligence that one was keeping up with developments in legal thinking and theory. The elite journals still have importance – something in Harvard is likely to get it and its author noticed. However, a focus on those few most-cited journals alone was never enough, and it certainly is not adequate today. Great articles appear in relatively obscure places. (And odd things sometimes find their way into major journals.) Plus, legal publishing has been both fragmented and democratized: specialty journals, faculty peer reviewed journals, interdisciplinary journals, all now play important roles in the intellectual ecology.
The Michigan Law Review publishes a useful annual review of new law books, but there’s nothing comparable for legal articles, some of which are almost as long as books (or are future books). Today, new intermediaries, notably subject-oriented legal blogs, provide useful if sometimes erratic notices and observations regarding the very latest scholarship. But there’s still a gap: other than asking the right person, there’s no easy and obvious way to find out what’s new, important, and interesting in most areas of the law.
Jotwell fills that gap. We are not be afraid to be laudatory, nor do we give points for scoring them. Rather, we challenge ourselves and our colleagues to share their wisdom and be generous with their praise. We aim to be positive without apology.
Tell us what we ought to read!
How It Works
Jotwell is organized in sections, each reflecting a subject area of legal specialization. Each section, with its own url of the form sectionname.jotwell.com, is managed by a pair of Section Editors who have independent editorial control over that section. The Section Editors are also be responsible for selecting a team of ten or more Contributing Editors. Each of these editors commits to writing at least one Jotwell essay of 500-1000 words per year in which they identify and explain the significance of one or more significant recent works – preferably an article accessible online, but we won’t be doctrinaire about it. Our aim is to have at least one contribution appear in each section every month, although we won’t object to more. Section Editors will also be responsible for approving unsolicited essays for publication.
For the legal omnivore, the ‘front page’ at Jotwell.com contains the first part of every essay appearing elsewhere on the site. Links take you to the full version in the individual sections. There, articles are open to comments from readers.
The Details
Learn more about Jotwell:
Jan 27, 2011 Susan Bandescrim
Aya Gruber,
A Redistributive Theory of Criminal Law,
52 Wm. & Mary L. Rev. 1 (2010), available at
SSRN.
Every time I teach a course in which the role of victims in the criminal justice system comes up, I find myself explaining to my students that crime victims and their families have played a prominent role in the system only since the 1980’s—that it wasn’t always thus. For my students, the reference is akin to a mention of the role of counsel at British common law—something that happened a long time ago and probably won’t be on the exam. In one sense this reaction is accurate—the role of victims in the system is firmly entrenched both in law and in the public perception. The problem is that while the role of victims expands, criminal justice theory stays frozen in the pre-victims’ rights era, with little attention to where victims fit into the adversarial framework or the goals of punishment.
Should victims have a say on whether the defendant is charged with a crime, or on the seriousness of the charges? Should the families of murder victims weigh in on whether the death penalty is warranted? Who should prevail in a conflict between prosecutor and victim, or between the needs of victims and the rights of defendants? What should happen when victims are divided on charging or sentencing issues? It’s hard to give any good answer to those practical questions in the absence of a theory of victims’ role in the criminal process.
Criminal law continues to stick to the standard story that we punish to deter, to exact just deserts or to incapacitate. All these rationales center on what the defendant deserves or on protecting society as a whole. Where the welfare of individual victims fits into that story is rarely specified. Although retributivist scholars have grappled with the question, they’ve had a hard time linking a theory of just deserts with a satisfying account of how much say a particular victim should have over the fate of the offender. Victim-centered goals end up wedged uneasily into retributive frameworks.
Aya Gruber’s article, A Redistributive Theory of Criminal Law, is a bracingly provocative examination of the theoretical bases for victim-centered changes in the law.
Gruber asserts that a range of substantive and procedural doctrines, including felony murder, the attempt-completed crime divide, sentencing reforms keyed to victim harm, and the ability to give victim impact testimony, are best understood as distributive. That is, they are premised on the system’s role in securing equilibrium between punishing the offender and making individual victims whole. Her goal is not to defend this approach, but to describe what has thus far gone unarticulated so it can be evaluated in the light of day.
Gruber points out that criminal law, unlike tort law, lacks the theoretical scaffolding to guide its distributive goals. For example, criminal law, unlike tort law, is unaccustomed to evaluating what is needed to make individual victims whole and how to balance victims’ needs against those of other parties. Two central tenets of criminal law have until recently made such evaluation unnecessary. The first is the principle that the prosecution acts in the name of the people, not on behalf of individual victims. Providing victims with a role in charging and sentencing decisions is in tension with this principle. The second is the principle that every human life is equally precious. Initiatives like victim impact statements in capital cases, which, despite the Supreme Court’s assurances to the contrary, have been shown to encourage the comparative valuation of victims, are at odds with this principle. Assuming that there is a distributive logic to victim-centered initiatives, Gruber raises important questions about where that logic should lead, and how it can be squared with traditional rationales.
In the article’s final section, Gruber considers the cultural, political and emotional forces that have led to the immense success of victim-centered initiatives in criminal cases, and to far less enthusiastic reactions to victim suffering in the tort area, especially with respect to punitive damages. Not all the parallels she draws are convincing, but the comparison is illuminating. She also trenchantly observes that even in the criminal arena, not all victims are considered equal, and that once the criminal law begins to focus on individual victims, it begins to matter tremendously which victims evoke empathy or compassion. She draws fruitfully on her previous work on the criminal justice system’s attitudes toward rape victims to illustrate the influence of stock stories about “true” or “deserving” victims on legal and popular notions of fault, blame and entitlement to compensation. She argues that these stock stories of victimhood are both reinforced and relied upon by policymakers, and that we need to be more attentive to how they are constructed and for whose benefit.
Our criminal justice system has become increasingly punitive in the last several decades. As Gruber’s article reminds us, much of the change has been made in the name of victims, and we ought to look carefully at whether it has, in fact, improved victims’ lives. This is a thoughtful, passionate exploration of the consequences of criminal law theory. I liked it a lot.
Jan 24, 2011 Elizabeth Chamblisslegalpro
John Briton & Scott McLean,
Lawyer Regulation, Consciousness Raising, and Social Science (summary in
Geo. J. Legal Ethics, forthcoming 2011); Christine Parker & Lyn Aitken,
The Queensland “Workplace Culture Check”: Learning from Reflection on Ethics Inside Law Firms (
Geo. J. Legal Ethics, forthcoming 2011).
The American Bar Association Ethics 20-20 Commission should pay some serious attention to Australia. With the Legal Services Act 2007 slated to come into full effect on October 6, 2011, with the licensing of Alternative Business Structures for law practice in England and Wales, all eyes—well, some keen eyes, anyway—have been on the U.K. and its establishment of a regulatory framework for these new organizational forms. But Australia has been regulating “alternative business structures” since 2001, when New South Wales became the first state to allow incorporated law practices (ILPs). Australia’s National Legal Profession Model Bill 2006 includes provisions allowing law firms to have non-lawyer directors and shareholders, and Australia, so far, has the only experience regulating publicly listed law firms. Australia,therefore, has a head start in thinking about the regulation of law practice organizations, whether they be traditional partnerships or alternative, corporate, forms.
Perhaps the most laudable feature of the emerging Australian model is its emphasis on law firm self-assessment and the collaboration this engenders between regulators, researchers, and firms. This collaboration was on full display at the 2010 International Legal Ethics Conference, in a pair of papers analyzing the data on law firm self-assessment, one from a regulatory and the other from a research perspective.
The first was a paper by John Briton, the Queensland Legal Services Commissioner and his colleague, Scott McLean, describing Australia’s strategy for regulating ILPs, which currently make up about 20% of law practice organizations in Queensland and New South Wales (Briton & McLean, p. 5). The centerpiece of the strategy is the move from a reactive, complaint-driven approach to a preventive approach that focuses “not only on lawyers but also on law practices and their management systems and supervisory arrangements—their ethical infrastructure” (pp. 3-4). The primary tool in this preventive, entity-oriented approach is a system of enforced self-assessment by firms through: (1) a requirement that ILPs designate a “legal practitioner director” to be personally responsible for implementing appropriate management systemsin the firm (p. 6); and (2) a requirement that legal practitioner directors conduct self-assessment audits to measure the effectiveness of firm management systems and internal ethics controls. This system of self-assessment is backed up by external audits through web-based surveys and on-site reviews (p. 10). Briton and McLean predict that “this same or a very similar regulatory framework will soon apply to all law practices in Australia.”
Not surprisingly, lawyers initially resisted the requirement of self-assessment—not to mention external audits—fearing that regulators would attempt to dictate one-size-fits-all structures for firms; and some bar groups oppose the extension of self-assessment requirements to traditional law firms (p. 8). In practice, however, enforced self-assessment has proven “hugely successful by any measure” (p. 11). Based on an analysis of data from 631 ILPs, Professor Christine Parker of Melbourne University Law School found that the complaint rate per practitioner per year in ILPs after self-assessment is one third the complaint rate before self-assessment, and one third the complaint rate for practitioners in traditionally structured firms (p. 11). Moreover, firms report that the process of self-assessment is “very useful” and “created robust discussion around the partnership table” (p. 15). As Briton and McLean conclude, “the simple act of requiring a law practice’s principals to take time out to stock-take just how well their management systems and supervisory arrangements support the practice and its people to deliver competent and ethical services—the simple act of prompting them to reflect on the adequacy of their ethical infrastructure—dramatically improves standards of conduct within their practice.” For anyone who doubts this account, the feedback from firms is posted on the Commission’s website.
An additional benefit of enforced self-assessment by law practice organizations is the production of rich, firm-level data for research and scholarship on the profession. The second paper, by Christine Parker and Lyn Aitken of the Queensland Legal Services Commission, shows how useful such data can be for analyzing the dynamics of law firm ethical culture (and subcultures) and testing competing theories of law firm regulation. Parker and Aitken’s analysis is based on data from 15 law firms that participated in the Queensland Legal Services Commission “Workplace Culture Check,” a short, on-line survey of lawyers’ perceptions about the availability and effectiveness of ethics supports within firms (Parker & Aitken, pp. 9-10). Fifteen law firms were invited to participate in the survey and all accepted, yielding 336 lawyer respondents (p. 16).
The most striking finding from Parker & Aitken’s analysis is the difference between junior and senior lawyers’ perceptions of ethics supports within firms and perceptions of their own capacity to raise ethical issues (p. 1). Among junior lawyers, only 44% said that they are always “able to raise ethical issues in confidence,” compared to 75% percent of senior lawyers (p. 25). Junior lawyers were also less likely to know where to turn for ethical advice, and to report that their ethical concerns are given consideration in the firm. Among junior lawyers, less than 40% said that their ethical concerns are always given consideration, compared to nearly 80% of senior lawyers (p. 25). Parker & Aitken consider a number of possible explanations for such differences, including the general tendency of lower-level employees to view their organizations less positively than upper-level employees and managers (p. 26). Such differences, however, are nevertheless important for law firm managers to understand. Thus, as part of the survey, the Legal Services Commission debriefed the 15 participating law firms, in an effort to “encourage critical ethical reflection and discussion” (p. 33). Such collaboration promises to significantly improve both law firm regulation and scholarship on profession.
The U.S. has been slow to regulate—or manage—law firms as entities, even as the average size of law firms has grown exponentially. Opponents fear that the centralization and delegation of specialized management authority will undermine the accountability and authority of individual partners. Currently, only New York and New Jersey provide for entity regulation in their rules of professional conduct. Mounting evidence, however, shows that the designation of in-house compliance specialists and routine self-assessment by law practice organizations has tremendous benefits for law firms and the clients they serve, as well as promoting collaboration between regulators, researchers and firms. U.S. regulators and firms should take notice. If the legal profession is to maintain a credible claim to effective self-regulation, it is time to adopt a proactive, entity-oriented approach, backed up by regulatory authority and rigorous empirical research.
Jan 19, 2011 Louis Michael Seidmanconlaw
Deborah Hellman,
Money Talks but it Isn’t Speech, 95
Minn. L. Rev. — (forthcoming 2011), available at
SSRN.
Is there anything new to say about the constitutionality of campaign finance regulation? Well, actually, there is, and Deborah Hellman says it in her fine new article “Money Talks but It Isn’t Speech.” The significance of Hellman’s article extends beyond the vexed yet tired issue of campaign finance, however. Her work is an important intervention in a central – perhaps the central – problem in modern constitutional law.
To understand what that problem is, we need a brief and necessarily crude overview of twentieth century constitutional history. During the first third of the century, civil liberty rights, to the extent that they existed at all, were closely linked to property and market rights. The reigning ideology treated both as within a private sphere. Liberty was defined as the absence of government intervention, and, at least in principle, there was no distinction between free markets in goods and free markets in speech, both of which were judicially protected by limits on the political branches.
On the conventional account, Franklin Roosevelt’s struggle with, and ultimate victory over, the Old Court ended constitutional protection for property and markets. Property distributions were moved from the constitutionally mandatory sphere to the politically discretionary sphere. On this view, it was at least open to the political branches to treat true economic liberty as necessitating, rather than precluding, government intervention.
The question, though, was what to do about civil liberties. In the famous Carolene Products case, the Roosevelt court provided an answer: Although markets and property entitlements were subject to political regulation, civil liberties were not. In other words, the old ideology equating freedom with the absence of government was preserved in the civil liberties sphere, even as it was abandoned in the economic sphere. In the wake of the Carolene reformulation came a burgeoning of civil liberties protections (always equated with the absence of government) — in particular greatly expanded criminal procedure rights, speech and religious rights, and rights to reproductive autonomy. At the same time, the Roosevelt Court abruptly terminated constitutional protection for private economic arrangements.
By the early twenty-first twentieth century, the Carolene reformulation has begun to fray around the edges. In some areas, the Court has retreated from the protection of civil liberties, and there are hints of renewed interest in economic protection. Yet, by and large, the reformulation has endured. What has endured as well, though, are the tensions at the heart of the reformulation – tensions that should have been apparent from the beginning. Briefly stated, the problem is this: No civil liberty can be exercised in the absence of some sort of property entitlement. For example, it does no good to be secure in one’s home from unreasonable searches and seizures if the government can simply declare that it is no longer one’s home, but instead government property. Similarly, all speech must occur somewhere and use something. If the government is entirely free to shift property entitlements to the somewhere and something, then it is free to control speech as well.
This deep contradiction is right at the surface of the debate over campaign finance regulation. Everyone concedes that political campaigning is free speech in its purest sense. But campaigning costs money. If the Carolene compromise means that the government can control the money, doesn’t it follow that it can control the speech as well?
It is at this point that Hellman’s proposal takes hold. Hellman starts by noticing what seems to be a contradiction in our civil liberties jurisprudence: Some constitutional rights are assumed to entail the right to use money to exercise them, while others are not. For example, the right to own a gun includes the right to purchase the gun. The right to have an abortion includes the right to pay a doctor to perform it. But the right to vote does not include the right to buy and sell votes, and the right to child rearing does not include the right to buy children.
Hellman resolves the contradiction by respecting both halves of the Carolene reformulation. Because markets are not constitutionally protected, the government has discretion to create nonmarket methods for distributing certain goods, even if the goods themselves are constitutionally protected. When it does so, it also has the ancillary power to prohibit the use of money to buy the goods. But when the government chooses to use market methods of distribution, then the other half of the Carolene reformulation takes hold, and it must allow the goods to be purchased.
At first, it may seem that this solution is entirely circular: The government can prohibit the purchase of constitutional goods when there is not a market method of distribution, and there is not a market distribution when the government prohibits the purchase of the goods. Hellman breaks out of the circle by insisting that if there is not a market distribution, then the Constitution demands some other method of distribution. Thus, the government could ban the sale of guns, but if it did so, it would have to have some other (presumably constitutionally adequate) method of getting guns into at least some people’s hands.
It follows from this that campaign finance regulation is permissible if, but only if, the government has decided to distribute the means to speak in political campaigns by a nonmarket mechanism. Hellman is uncertain whether the McCain-Feingold regime satisfies this requirement, but at least it is clear that, under her approach, a system that relied entirely on public financing could also prohibit private contributions.
Does this approach solve the Carolene conundrum? Not entirely. For example, at least in theory, her approach seems to mean that the government could nationalize all newspapers and then distribute them for free. Perhaps she has an argument that avoids this conclusion, but the paper does not present it.
Surely, though, we cannot expect a single doctrinal intervention to solve a fundamental contradiction in constitutional law. At base, the contradiction rests on the impossibility of providing meaningful civil liberties protections in an economic system that produces huge differences in wealth. That contradiction is not going away any time soon.
Jan 17, 2011 Christopher Sprigmanip
Christoph Engel & Michael Kurschilgen,
Fairness Ex Ante and Ex Post: An Experimental Test of the German “Bestseller Paragraph,” available at
SSRN.
It is often said that in the late 20th century, the legal academy took an “empirical” turn with the rise of law and economics. But the word “empirical” is not quite right as a characterization of the direction in which law and economics has nudged the legal academic literature.
Much of law and economics, especially in its early years, involved the application of (often very basic) economic theory to an expanding list of legal issues. The aim was to use an abstract form of economics to reform legal doctrine. That work was more theoretical than empirical, but that isn’t meant as a criticism – many areas of legal doctrine were so badly theorized that even basic economic interventions yielded up valuable insights.
In the last 20 years we have seen a second stage of the law and economics movement, one that has featured the use of continually more sophisticated economic modeling as a way of analyzing legal questions. Some of this work is a direct outgrowth of the first wave of law and economics – i.e., some second–stage work involves the application of more sophisticated (or at least more complex) economic models to abstract legal problems. Another branch of this work, however, is more truly empirical, in that it directs its analysis not primarily to a stylized legal problem, but to data. This form of work suffers from one endemic limitation – the tendency of researchers to pick questions for which data exists or readily can be gathered. Again, this is not meant as a criticism; it is merely a limitation of this branch of otherwise very valuable legal scholarship.
There is a third type of law and economics work that is largely missing from the law reviews and, until relatively lately, from the legal academy generally. And that is a very old form of empiricism – the experiment. What can the experiment offer that the theoretical and data-driven variants of law and economics cannot? With respect to theoretical work, experiments are a necessary complement and check. A theory can be elegant, brilliant, and align with common sense – and it can nonetheless be wrong. Theoretical work is well suited to constructing hypotheses about how the world works. Experimental work is well suited to either confirming or exploding those hypotheses.
With respect to data-driven work, experiments are again necessary, not least as a stopgap when the search for data proves fruitless. Experiments allow us to gain knowledge about questions for which there is little ready data, and experiments also generate data that can be adapted to help answer different questions.
The experimental vein of law and economics is relatively impoverished. One can see this readily in my own primary field, intellectual property. IP scholars are receptive in general to law and economics thinking – not least because the orthodox justifications in the United States for patent, copyright, and trademark law are all explicitly utilitarian. But much of the law and economics work in IP comes from the early Chicagoan vein – i.e., it involves the application of rational choice theory, at a high level of abstraction, to analyze IP rules. This scholarship has been very useful. It has helped to organize a previously messy field. It has helped us to understand where IP rules conduce to economic efficiency, and where they do not. But it’s long past time that we put some of these economic models to the test.
Some in the IP field are beginning that task. Gregory Mandel has conducted experiments to assess the impact on hindsight bias on several aspects of patent law, including claim construction, enablement, and, perhaps most importantly, the assessment of non-obviousness. [See Gregory N. Mandel, Patently Non-Obvious: Empirical Demonstration that the Hindsight Bias Renders Patent Decisions Irrational, 67 OHIO ST. L.J. 1391 (2006), available at SSRN.] Christopher Buccafusco and I have conducted experiments to determine whether IP rights-holders are subject to endowment effects in their licensing transactions. [See Christopher Buccafusco & Christopher Sprigman, Valuing Intellectual Property: An Experiment, 96 Cornell L. Rev. 1 (2010), available at SSRN; Christopher Buccafusco & Christopher Sprigman, The Creativity Effect, forthcoming, Univ. of Chicago L. Rev., available at SSRN]. And Stefan Bechtold of ETH Zurich and a team from the Max Planck Institute have explored how endowment effects impact market transactions driven by group decision-making. [See Stefan Bechtold, et al, The Endowment Effect in Groups With and Without Strategic Incentives, available at SSRN].
We now have a new and very interesting IP experiment, conducted by Christoph Engel and Michael Kurschilgen of the Max Planck Institute. Engel and Kurschilgen are interested in an unusual provision of the German copyright law, the so-called “bestseller paragraph,” under which the transferor (whether by license or sale) of a creative work has a legally enforceable right to an “appropriate” bonus in the event that the work turns out to be very valuable. Here’s the language of the provision, translated from German:
If the owner of a copyright has granted a license such that the fee, in the light of the entire relationship between the parties, is grossly disproportionate with regard to the proceeds from the work, the buyer is obliged to agree, upon the author’s request, to a change in the contract such that the seller receives an additional remuneration, reflecting what is her appropriate share under the given circumstances.
What is the effect of this provision on the behavior of parties to copyright transactions? Economic theory suggests that because buyers can expect to make lower profits when the law contains the bonus provision, versus a law without one, that they should offer less in the initial transaction. And, relatedly, sellers should be willing to accept less, because they know that in the event that a work proves very valuable, they can anticipate some additional payment ex post the deal. But that’s where economic theory runs out. It suggests that deal prices will be lower, but it does not tell us whether the buyer’s maximum bid and the seller’s minimum ask will diverge or converge. And this piece of information is, of course, key, because if bid and ask prices diverge there will be fewer transactions and lower gains from trade, compared to a legal regime without the bonus provision. On the other hand, if buyer and seller valuations converge, then we’ll enjoy a more efficient market, with more deals generating more social surplus. So which is it?
Not unexpectedly, no one has yet sought an answer. That’s probably because the German copyright law’s bonus provision is usually justified not in terms of economic efficiency, but “fairness” – i.e., that justice demands that author/transferors should have a right to additional compensation if the work they have transferred turns out to have unanticipated value. That has always seemed to me an odd view of justice, and one which does not fit with our (or the Germans’) views on the “fairness” of transactions generally. If I sell my house and two years later the city decides to build a lovely public park, in my neighborhood, then the value of my former house may rise substantially but no one contends that I’m due a bonus payment from the lucky buyer. The deal is the deal.
So why the German exception for authors? It is sometimes said that the ultimate market value of creative works is particularly difficult to predict, and so fairness requires some form of ex post adjustment to authors’ compensation when a deal proves particularly rich. The same justification is often advanced for an analogous provision in U.S. copyright law that permits authors have licensed their rights to terminate that license after 35 years and re-capture those rights. But that explanation cannot suffice standing alone, because it is equally an argument for ex post adjustment in favor of buyers when deals prove (as they often do) to be valueless, and yet we never see provisions that are not one-sided in favor of sellers.
A much more important justification observes that sellers often face much more competition than buyers – there are, or at least have been traditionally, many more creators than there are publishers – and so publishers enjoy a degree of oligopsony power that forces prices down below a competitive level. This is a better justification than the first, but it’s still quite weak. If the effect of provisions like the German bestseller clause and the American termination of transfers clause is to force deal prices down – which almost surely happens by some small increment – then the effect of the provisions is to beggar all authors for the purpose of enriching a few fortunate enough to have produced works of enduring value. These successful authors are least likely to be the ones is need of aid. In short, the “fairness” justification for these provisions is less than overwhelming – at least as a matter of abstract economic theorizing.
But abstract theorizing sometimes fails to uncover the truth. Which leads us back to Engel and Kurschilgen, who have designed a clever experiment to test whether the German bonus provision can be justified on either efficiency or fairness grounds. They designed two experimental conditions, which they tested with subjects recruited from the University of Bonn. The first was a baseline condition wherein subjects were randomly assigned to act either as a buyer or a seller. The subjects were each given an initial endowment of 500 “Talers,” or notional monetary units. The subjects were told that they would be transacting over an unnamed commodity. The commodity did not have a certain value, but merely a probabilistic one – there was a 25% chance that it was worth 1700 Talers, but a 75% chance that it was worth only 100 Talers. With this information in hand, the subjects participated in 8 rounds of a four-stage game.
In the first stage of the experiment, buyers were given the opportunity to make an offer to purchase the commodity, based only on their knowledge of the probabilities attending the commodity’s value. In the second stage, the seller is given the choice of accepting or rejecting the buyer’s offer. If the seller rejects, then both buyer and seller keep their initial 500 Talers. If the seller accepts, then the buyer’s offer price is transferred to the seller. In the third stage, a random device determines the value of the commodity – either 100 Talers (75%) or 1700 Talers (25%). The fourth stage is where the experiment gets interesting – in this final stage, each of the parties learn the value of the commodity, and each is given a chance to reduce the other party’s earnings.
Why is this? Because the experimenters wanted to build into the experiment a way for the parties to indicate that they perceived the results of the transaction as “unfair.” Punishment in the experiment is costly – it costs a party 3 Talers for each 1 Taler by which they wish to reduce their counterparty’s earnings. But by giving the parties the power to engage in costly punishment, the experimenters hoped to discover whether the presence of some mechanism – analogous to the German bestseller provision – whereby “unfair” deals can be adjusted ex-post, reduced the rate at which the parties engaged in costly punishment, and thus – by implication – reduced the amount of ex post perceived unfairness.
The second experimental condition built in that ex post adjustment procedure. The experimenters did so by introducing a third player – the “umpire.” The umpire was paid a fixed fee to judge the fairness of transactions, and to adjust unfair transactions ex post. If the value of the commodity in a particular transaction is judged to be 1700 Taler, such that a buyer who paid much less stands to realize a substantial windfall, the possibility of punishment is delayed. First, the umpire makes a secret re-allocation of the value of the commodity between buyer and seller. Then, the buyer is encouraged to make a new offer, which the seller can either accept or reject. If the second offer is rejected, the umpire’s allocation is revealed, and that allocation becomes effective. The parties are then given the opportunity to engage in the same costly punishment as in the first condition.
So, the results. As economic theory predicts, the price at which deals are struck declines by a statistically significant amount in the second condition (104 Talers) versus the baseline (129 Talers) – that is, the presence of a proxy for the German bestseller provision leads to substantially lower deal prices. The number of deals stayed about the same – 98 of 128 rounds resulted in deals in the baseline condition, versus 106 of 128 in the second, or “treatment,” condition. Importantly, bid and ask prices converged in the treatment condition (seller’s ask price declined more than buyers’ bids), suggesting that the presence of the ex post “fairness” mechanism generated a more efficient market by making low offer prices more acceptable to sellers. This is an important finding that economic theory alone could not have generated.
The experiment tells us not only about buyers and sellers, but about umpires – i.e., judges. A large portion of the umpires, who had the same information as the buyers and sellers, appear to have been motivated primarily by ex-post egalitarianism – i.e., they split the profits more or less evenly between buyers and sellers. Surprisingly, they did this even though from an ex ante perspective such a result clearly favors sellers (because only buyers, ex ante, faced the prospect of a real loss).
Finally, the experiment shows that ex post discontent is reduced when a mechanism exists to remedy “unfair” transactions. Angry buyers used punishment more frequently in the baseline condition (21% of the time) vs. in the treatment condition (12%), and they spent more on punishment (10 Taler per round vs. 7 in the treatment condition). Sellers made very little use of punishment in either condition. So the result of the treatment was to reduce buyers’ ex post perceptions of unfairness, while not affecting sellers, who did not perceive unfairness in the first place. This is deeply counterintuitive. It is the sellers who are presumed, in the fairness justification for the German bestseller provision and the analogous American termination provisions, to be the victims of unfairness when transactions prove to be much richer than initially anticipated. But in this experiment, it’s the buyers, not the sellers, who manifest significant feelings of unfairness, and these feelings are reduced by ex post mechanisms designed to transfer value to sellers when deals prove particularly rich.
Why? Because anticipating all of this, buyers in the treatment condition lowered their offers. Because they had accounted for the possibility of value transfer in advance, they discounted what they were willing to pay ex ante. And this, in the buyers’ perspective, was fair.
These are fascinating findings. It is important to emphasize, however, that this one experiment is not a basis for changing policy. The experiment is too stylized, and the data too limited. But that is not to slight what’s been accomplished here. We have now a very valuable and surprising set of findings, accomplished via a methodologically careful and replicable study. It’s time for others to jump in. This study should be run again, and run in variations – perhaps an American academic would like to run a version which more closely models the termination provision of U.S. copyright law? And in a few years, we might have results that can begin to shape a more sensible and scientific copyright policy.
Jan 14, 2011 Frank Pasqualecyber
Jonathan Zittrain, Ubiquitous Human Computing, Phil. Trans. R. Soc. A, vol. 366 no. 1881 3813-3821 (28 October 2008).
A banana usually sells for about 30 cents. On average, the plantation owner gets 5 of those cents; the shipper, 4 cents; the importer/ripener, 7 cents; and the retailer, 13 cents. That leaves one penny for the worker who picked the banana. Fruit economics helps drive the politics of “banana republics:” as the unpaid laborers and netizens at Wikipedia note, such countries are “politically unstable,” “dependent upon” commoditized crops, and “ruled by a small, self-elected, [and] wealthy . . . clique.” Oligarchs at the top set the direction of society; workers merely play the roles assigned them. Truth doesn’t matter much; as Paul Krugman noted, one political party promised voters to save money on gasoline by “building highways that ran only downhill.”
Commentators have begun to wonder if the United States is becoming a banana republic. Nicholas Kristof concludes that “You no longer need to travel to distant and dangerous countries to observe . . . rapacious inequality. We now have it right here at home.” Chronicling endless financial industry shenanigans, critical finance blogger Yves Smith seems to label every third post “banana republic.”
Wasn’t the internet supposed to solve these problems? Wouldn’t a “wealth of networks” guarantee opportunity for all, as prediction markets unearthed the “wisdom of crowds?” It turns out that the net, while mitigating some forms of inequality in the US, is accelerating others. Jonathan Zittrain’s essay “Ubiquitous Human Computing” examines a future of “minds for sale,” where an atomized mass of knowledge workers bid for bite-sized “human intelligence tasks.” Zittrain explores some positive aspects of the new digital dispensation, but the larger lesson is clear: without serious legal interventions, an expansive global workforce will be scrambling for these jobs by “racing to the bottom” of privacy and wage standards. This review explains Zittrain’s perspective, applauds his effort to shift the agenda of internet law, and argues that trends untouched on in Zittrain’s essay make his argument all the more urgent.
Exploitation and Alienation Online
Zittrain argues that assembly line-style “division of labor” is becoming more common in mental tasks, ranging from very simple repetitive recognition exercises (“where is the car in this picture?”) to design competitions (“win $1,000 by drawing a new trademark!”). He states that “We are in the initial stages of distributed human computing that can be directed at mental tasks the way that surplus remote server rackspace or Web hosting can be purchased to accommodate sudden spikes in Internet traffic.”
The resulting distributed labor force offers unparalleled flexibility for CEOs. While they pursue the vaunted “Four Hour Workweek” of Silicon tycoons, they can avoid making any guarantees of wages to employees–or ask for 80 hour weeks suddenly when business picks up. In a globally connected world, the cheapest hands are at the ready to perform what “Amazon’s Mechanical Turk enumerate[s as] ‘HITs’ – human intelligence tasks – for sale one unit at a time, from as low as $0.01.” Once micropayment systems are perfected, pennies from cloud-heaven can rain upon the downtrodden.
Zittrain describes some advantages of this turbocharged division of labor for workers, too. Operators at one company (LiveOps) “can work whenever they like, wherever they like, for as much or as little time as they like.” Whereas the traditional employment relationship was like a marriage, with both parties committed to some longer-term mutual project, the digitized workforce seeks a series of hookups. There are plenty of opportunities for the flexibilized worker.
For those saddled a mortgage ball-and-chain, ubiquitous human computing offers less of a blessing. Aside from a blip of hope in 1990s wage figures, America’s working class has experienced declining compensation since the 1970s. Establishment journalists were among the first of the “knowledge workers” to experience the same fate, as search engines set up a national and global market for news once delivered locally. Since similar trends could soon engulf computerized work generally, Zittrain is right to argue that“[m]inimum wage, maximum workinghours, unionization (or at least the ability to know and contact one’s co-workers)” may need to be revisited. Having discussed “Privacy 2.0” in his book TFOTI, Zittrain also realizes that atomized digital workers need the right to establish a reputation by “building portfolios” if they are to compete effectively for gigs.
Zittrain also worries that “disembodied HITs can deprive people of the chance to make judgments about the moral valence of their work.” We can imagine a worker figuring out CAPTCHAs in the service of an Iranian intelligence agency or Chinese “fifty cent army” which wants to place hundreds or thousands of messages as comments on blogs. The atomized HIT is a way of diffusing responsibility in a world where it is already far too hard to pierce the corporate veil, contest trade secrecy claims, or penetrate shadowy government actions. In response, Zittrain proposes that “harvesters of human mindpower can be encouraged – or perhaps required – to disclose their activities to those who benefit them.” He also proposes that workers have the opportunity to opt out. To do that effectively, some entity will need to audit exactly how a company like LiveOps ranks and rates its workforce; otherwise, opting out could be a false choice that simply speeds one’s way to a blacklist.
Why Legal Scholarship Needs Social Theory
Legal scholarship has traditionally focused on discrete doctrinal areas. In intellectual property law, scholars seek to rationalize copyright, trademark, patent, and related doctrines; “cyberlaw” extends to contract, property, and tort online; and privacy experts confront the welter of common law and statutory limits on the accumulation and disclosure of data. While such specialization may promise to “work the law pure” in particular doctrinal bailiwicks, it also risks a tunnel vision that would reinforce trends that few would endorse upon reflection.
Scholars may provide a great service by recognizing trends that burst the seams of extant doctrine. For example, banking law couldn’t respond to the Panic of 1907 by tweaking extant statutes; it had to struggle fitfully toward an institution like the Federal Reserve. Similarly, reorganization of work through the internet could make swathes of federal and state employment law irrelevant. It also threatens to transform homes and eviscerate “expectations of privacy.” Zittrain does not panic, or sensationalize any of these trends. Rather, he calmly lays out what is happening now, and where it might lead. The paper originated as a presentation at the World Economic Forum 2008 Annual Meeting workshop, “How Science Will Redraw the Business Landscape of the 21st Century,” and Zittrain manages to present a compelling account of how the day-to-day phenomenology of labor, supervision, and monitoring can be technologically transformed.
As Russell Muirhead has argued, employment relations are not “just work,” in the sense of merely applying oneself to get a wage (only work); they ought to be just (in the sense of fair) work. Critical internet scholars like Trebor Scholz and Laura Liu have made this case in the realm of digital labor. Scholz and Liu have focused on the “relationship between labor and technology in urban space, in a context where communication, attention, and physical movement generate financial value for a small number of private stakeholders.” Zittrain recognizes similar dynamics as a problem for cyberlaw, evincing in his work what William Gibson has called the “eversion” of the internet. As Gibson observes, “cyberspace has everted. Turned itself inside out. Colonized the physical.” As the cyber and real become indistinguishable, cyberlawyers will need to influence realms like labor, employment, and consumer protection law. “Ubiquitous Human Computing” is a worthy entrant into these nontraditional cyberfields.
The Tipping Point
Can anything be done? Diagnosing a social problem is a dangerous game: the issue may be either too trivial to care about or too self-reinforcing and pervasive to be addressed. Zittrain’s dilemmas of exploitation and alienation may fall into the latter category. They promise to affect not only the economy, but politics, influencing the “rules of the game” that Zittrain hopes will tame them.
Zittrain mentions in passing the problem of HITs in political campaigns. If a distributed workforce can crack captchas for spammers, they can also plant comments on blogs, or engage in more creative uses of data to influence public opinion. Daniel Kreiss recently observed that campaigning has become data-driven; “223 million pieces of personal information” were “provided to Obama’s millions of online and on-the-ground canvassers” during the 2008 campaign. Data-intensive persuasion will permit new levels of personalization in advertisements, and new demand for a rapid, flexible workforce capable of targeting voters.
The irony of American free speech has reached its apogee in a First Amendment right to lie endorsed by Washington’s Supreme Court, and just about any form of spin and prevarication is allowed in our campaigns. Unlimited corporate spending also makes the collective will formation a crap shoot. Exxon could have deployed 10% of its 2008 profits to outspend every presidential and senatorial candidate running that year. Imagine when such interests use “big data” to slice and dice the electorate, with the aid of “minds for sale.” Impressionable and broke young people might be told they are combing websurfing data to find fellow environmentalists, with their labors really directed to compiling a mailing list of people most likely to be swayed by an ad of Mitt Romney strolling through a meadow. Big data and personalization will allow candidates to send “Save Medicare” ads to worried seniors and “cut entitlements” ads to Tea Partiers. Ubiquitous human computing will try to identify every imaginable subgroup: octogenarians particularly worried about Medicare Advantage Plans, angry young men with no dependents, angry old men who can’t stand Medicare Advantage—you get the picture.
Thus, I have little hope that Zittrain’s vision will do much to influence American working conditions: commoditized HITs are far more likely to accelerate current political trends than to be affected by our politics. Nevertheless, his proposals should have an impact in other, more advanced political systems, whose governments are committed to shaping economic life to human needs, rather than vice versa. And if ubiquitous human computing pushes the US one more step toward banana republicdom, at least Zittrain warned us.
Jan 10, 2011 Solangel Maldonadotrustest
In her 1996 article, The Myth of Testamentary Freedom, Melanie Leslie argues that “many courts do not exalt testamentary freedom above all other principles” and “are as committed to ensuring that testators devise their estates in accordance with prevailing normative views as they are to effectuating testamentary intent.” I have always agreed with this statement, but Bernie D. Jones’s new book, Fathers of Conscience: Mixed Race Inheritance in the Antebellum South (Univ. of Georgia Press 2009), challenges this assertion. In her analysis of appellate cases from the antebellum era, Jones tells the story of white male slaveholders who used trusts and estates law to grant freedom and/or property to their enslaved mixed-race children and their mothers, thereby circumventing the law of slavery. These testators were counting on judges to exalt testamentary freedom above the law, especially in states where slaveholders’ ability to manumit during their lifetime was quite limited.
Although miscegenation was prohibited in the antebellum South, many white men had sexual relations (sometimes consensual, sometimes not) with female slaves and lived openly with Black women and the children they bore. Despite strong disapproval, there was little that society could do to punish privileged white men who breached social norms. However, these men did more than breach social norms when they sought to grant freedom, property, and the legal rights that follow, to mixed-race children and their mothers; their behavior threatened the institution of slavery itself.
Jones’ findings demonstrate that it is quite difficult to predict when judges will uphold testamentary freedom and when they will allow social norms to trump an “unnatural” bequest. Her analysis demonstrates that many judges who supported slavery, some slaveholders themselves, upheld testators’ right to dispose of their property as they wished, despite society’s (and their own) “disgust” at miscegenation. As such, these judges were compelled to grant the enslaved beneficiaries their legacies, including freedom and property. Other judges, however, focused on their communities’ interest in the continued enslavement of Blacks and rejected bequests to slaves as “void as against public policy.” These judges transferred the property the testator intended for his mixed-race children and their mothers to the testator’s white heirs. In these cases, social norms and community interests trumped the individual’s rights to dispose of his property as he wished.
These cases are all the more interesting because the slaveholders were unmarried or widowed men, and most had no “legitimate” children. (Nonmarital children had no legal right to inherit until the 20th century). Thus, their heirs at law were not dependent wives or children, but rather collateral (and sometimes distant) relatives who arguably had no moral claim to the testator’s property. In contrast, the beneficiaries of the wills were the testators’ children and women who shared intimate and sometimes marriage-like relationships with the testators. Thus, these men had a moral duty to care for their partners and children after they were gone, even if they had no legal obligation to do so. Jones’ analysis demonstrates that despite societal opposition to miscegenation, some judges believed that the men had a moral duty to care for their partners and children after death and even admired testators’ attempts to satisfy this duty.
The testators’ white relatives in all of these cases knew that the beneficiaries of the will were the children or intimate partners of the decedent, but that did not stop them from contesting the wills. While some contestants argued that slaves were property and thus, they could not take under the will, others avoided the language of slavery. They claimed to respect testamentary freedom and relied on traditional doctrines such as lack of capacity, undue influence, and duress that purportedly protect that freedom. As Jones illustrates, they portrayed the testators as “vulnerable, old men” coerced by powerful jezebels into bequeathing their property to them and their children.
While I was fascinated by the arguments of the white collateral relatives, I wish Jones had explored the perspective of the creditors which, although I hate to admit it, are somewhat complex. Creditors provided goods and services to slave owners on credit because they had significant estates, including slaves. (Slaves were legally considered property that could be sold to pay the slaveholders’ debts.) When testators bequeathed property and freedom to their enslaved children and their mothers, the remaining assets in the estate were sometimes insufficient to pay the creditors. It is hard to feel any sympathy for creditors who did not get paid since they were arguably complicit in the institution of slavery, but as Jones argues, the enslaved beneficiaries who demanded their legacies were themselves trying to benefit from slavery. Ironically, when the funds in the estate were insufficient to pay the mixed-race children their legacies, other slaves could be sold so that these former slaves could receive their legacies. I wonder whether some creditors were opposed to slavery just like the testators’ mixed-race children and partners, but were simply trying to support their families in a system that they may or may not have had a role in creating.
Researchers have noted that light-skinned African-Americans tend to have higher levels of education and greater wealth than their dark-skinned counterparts. Although this might be the result of ongoing discrimination against darker-skinned persons, Jones’ analysis of these cases suggests that it might be the direct result, at least in part, of the freedom and wealth secured by their mixed-race ancestors in those courts that exalted testamentary freedom. If we trace the descendants of the mixed-race children and compare them to other descendants of slaves who were freed later and did not receive any legacies upon their masters’ death, we might find that the effects of testamentary freedom in the antebellum period continue to reverberate generations later.
Jan 7, 2011 D. Gordon Smithcorp
John Armour et al.,
Law and Financial Development: What We Are Learning from Time-series Evidence (2010), at
SSRN.
In the late 1990s, Rafael La Porta, Florencio Lopez-de-Silanes, Andrei Shleifer, and Robert W. Vishny (“LLSV”) launched a research project examining connections between legal rules governing investor protection and economic development. Working on the assumption that legal rules could be measured and quantified, LLSV purported to demonstrate that common law countries were more protective of outside investors – and, thus, more hospitable to economic development – than civil law countries. In the ensuing years, LLSV and other economists have expanded and refined their work, constructing the grandly named Legal Origins Theory, which holds that legal systems are important determinants of economic development. The influence of Legal Origins Theory is not confined to economics journals, but may be seen in policy reforms through the World Bank’s Doing Business reports.
While many legal scholars have dismissed this work because of its naïve assumptions about law and legal change, especially in early papers, a group of legal scholars at Cambridge University – led by Simon Deakin, John Armour, and Ajit Singh – took Legal Origins Theory seriously. Embracing the assumption that legal rules could be measured and quantified (“leximetrics”), the Cambridge Group produced legally sophisticated datasets on shareholder protection, creditor protection, and labor regulation. In Law and Financial Development: What We Are Learning from Time-series Evidence, published as part of a recent symposium on Legal Origins Theory in the BYU Law Review, four members of the Cambridge Group take stock of what we have learned from those datasets and chart some new directions for future research.
Critics of Legal Origins Theory will not be surprised to learn that the Cambridge Group finds little support for the theory in longitudinal data. While shareholder protections and corporate governance standards have been strengthened worldwide – reflecting the efforts of civil law countries to catch up with common law countries – these legal changes have not resulted in more dispersed share ownership and increased stock market activity, as predicted by Legal Origins Theory. According to Armour et al., these considerable legal reforms suggest that “lock-in through legal origin has not been much of an obstacle to the formal convergence of systems.” More importantly, legal reforms have not led to greater economic development. The authors offer alternative interpretations of their results:
One possible interpretation of our results is that a “one size fits all” approach to corporate governance reforms, stressing elements of British and American practice—the role of independent boards and the market for corporate control—may not be working as intended in civilian and developing systems. Another interpretation is that even in the common law world, shareholder protection can have counterproductive effects, by unnecessarily raising the costs associated with a stock exchange listing.
For those who remain interested in attempts to discern connections between law reform and economic development along the lines suggested by Legal Origins Theory, Armour et al. urge a reconceptualization of the role of legal systems: “legal systems are not the independent, ‘exogenous’ force that legal origins theory takes them to be. Legal systems are, to some degree, ‘endogenous’ in the sense of being shaped by their economic and political environment.”
The work of the Cambridge Group is an important part of the most significant research advance on corporate governance since the advent of law and economics in the 1970s and 1980s. The analysis by the Cambridge Group has called into question many of the central tenets of Legal Origins Theory, but in my view, the more important long-term contributions of this work are twofold: (1) the work has gone a long ways toward legitimating “leximetrics” in studies of comparative corporate governance, and (2) the work has reignited interest in comparative corporate governance, a field that has traditionally suffered from a perceived lack of rigor.
This may seem a bit hyperbolic, but I believe that this work has paved the way for a re-examination of the whole of corporate law from an empirical, comparative perspective. Such work requires more resources than the traditional corporate law scholarship, but the Cambridge Group has demonstrated the power of leximetrics to provide new insights. One can imagine using these techniques to compare various states in the U.S. or various countries in Europe along any dimension of law that might possibly be related to economic development.
