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Abstract:
Conscious parallelism typically afflicts oligopolistic industries where firms adopt their business practices based on what other firms are doing, rather than competing for consumers. The most obvious manifestation of conscious parallelism occurs where prices across companies in an industry not only become suspiciously similar, but also change rapidly in strikingly parallel ways the prices of gasoline, airline tickets, and broadband access provide three particularly salient contemporary examples. While this phenomenon might seem obviously and intuitively antithetical to antitrust principles, its punishment has long been problematic to cartel theory. The root of competition law's current weakness lies in the belief that absent an ability to prove explicit collusion among players, conscious parallelism cannot be punished.

This paper argues that the conventional approach to conscious parallelism is unimaginative and anemic. The argument is structured into three parts.

Part I argues that conscious parallelism is undertheorized. Existing policies are based on selective reading of an article written by Donald Turner in 1962. Turner argued that parallel behavior is inherent and rational in oligopolistic industries; as a consequence, some additional evidence suggesting a conspiracy must be brought forward to punish the oligopolists. Except for a spate of research that sputtered out in the mid-1980s, Turner's nearly fifty-year old thesis remains, sadly enough, that state of the art. As a consequence, conscious parallelism goes unpunished.

Part II suggests three different theories through which conscious parallelism might be addressed. First, and most simply, the standard for establishing a conspiracy might be lowered such that an explicit agreement (or "meeting of the minds") not be required. Agreement might be inferred from oligopolists' conduct. In such a way, antitrust laws such as 1 of the Sherman Act or Article 81 of the Treaty Establishing the European Union (EU) might be reinvigorated to address conscious parallelism.

A second path would be to analogize oligopolists' behavior to that of monopolists, thereby invoking anti-monopolization laws such as - 2 of the Sherman Act or Article 82 of the Treaty Establishing the EU. Such an approach is not as unusual as it might first appear. It builds on the notion of "abuse of collective dominant position" in EU competition law, and even the idea of "shared monopoly" that was developed in US antitrust circles in the late 1970s. After all, if one believes that oligopolies inherently tend to consciously parallel behavior, then the structure of the industry should be changed. Indeed, in a neglected portion of his seminal article, Turner himself suggests using anti-monopolization law to restructure oligopolistic markets and thereby avoid conscious parallelism.

Third, government could regulate oligopolistic markets to protect consumer interests. If monopoly and atomistic competition form two poles, one might conceptualize oligopoly as closer to monopoly, then invoke regulatory tools that are used in monopolistic industries. While perhaps controversial, such an approach would take a holistic approach to antitrust and regulation. It also builds on the insights of core theory, which suggests that certain markets prone to high fixed costs (as oligopolistic markets tend to be) do not reach a stable competitive equilibrium. In the language of core theory, they have an "empty core." A robust competition law, a synthesis of antitrust and regulation, might manage the specific portions of oligopolistic industries prone to an empty core and let competition flourish elsewhere.

Finally, Part III of the article explores the political economy of conscious parallelism. While each of the theories explored in Part II evince strong foundations, conscious parallelism remains common. Much of the blame here lies in the deregulatory fervor of the past three decades, led by the Chicago and public choice schools, that have chipped away at the intellectual respectability of robust antitrust enforcement. The challenge in regions with developed antitrust traditions notably the US and the will be to question the laissez-faire assumptions that antitrust has become enamored of.

To be sure, oligopolies are less well understood that monopolistic and atomistically competitive markets. Yet it does no good, except to the oligopolists, to resign oneself to the notion that mainstream thinking in cartel theory is not imaginative enough to address the phenomenon, so we just let it be. Instead, we must begin with the concept that such behavior is dangerous, then find mechanisms in competition policy to grapple with it. As mergers proceed apace and more and more industries consolidate into oligopolies or duopolies, the problem is only bound to get worse.

conscious parallelism, cartel, monopolization, antitrust, competion law

Abstract:
This Article seeks to go beyond cute rhetorical labels to consider what, if anything, postmodernism might mean, and why legal scholars should care. I cover an eclectic mix of characters, from postmodernism's principal theorists to some of its most flamboyant practitioners. I discuss Lyotard and Warhol, Baudrillard and Madonna, Foucault and Venturi, Derrida and Snoop Doggy Dog, Rorty and Gehry, to name just a few. At times, the journey might seem amusing, perhaps even strange. But it is important to remember throughout that one simple question drives the Article: does any of this matter to law, and if so, how should it be applied?

My thesis is that once one clears the underbrush of jargon and pessimism, postmodernism can most usefully be understood as a movement that struggles with how to represent a messy, chaotic world where simple reassuring stories will not do. After discussing postmodernism's attention to the context in which signs and symbols appear and how they are mediated, I develop two main points. First, scattered strands of postmodern legal scholarship might regroup to question how law decontextualizes and mediates power relations. Doing so would enable a more constructive agenda for reform. Second, and more fundamentally, postmodernism offers a chance at mapping new topologies within which to represent reality more accurately and more fully engage in the world in which we live. I emphasize network theory and participatory democracy.

postmodernism, representation, law

Abstract:
Article 82 of the Treaty Establishing the European Community, which prohibits abuse of a dominant position, is the counterpart to the anti-monopolization provisions contained in Section 2 of the Sherman Act. Unfortunately, however, commentators have variously criticized recent applications of Article 82 as outdated, protectionist, inconsistent - and perhaps most damaging of all, based on faulty economics.

This paper takes issue with these critiques to offer support for a robust Article 82. Narrow analyses focused on the provision's language or specific judicial decisions offer little insight. Rather, an appreciation for Article 82 can only emerge through a richer contextual analysis of its historical origins and its regulatory role within a broader policy of European economic integration.

In developing its argument, the paper explores two common myths. The first is that Article 82 pits innovative American businesses against bureaucratic European regulators. The reality, however, is quite different: faced with lax antitrust enforcement at home, American competitors have found it necessary to turn to Europe for redress against monopolistic abuses. A second misperception is that antitrust should espouse a laissez-faire approach toward dominant firms - a mentality that has most prominently led to anemic interpretations of Section 2 of the Sherman Act. This so-called economic approach, however, is based on the faulty premises of Chicago School economics that, among other ills, misdefines consumer welfare, overplays contestability theory, and ignores core theory. It also slights path dependence, network effects, and the anticompetitive dangers of overbroad intellectual property rights.

Sadly, in recent months Europe has begun to fall under the spell of laissez-faire rhetoric as it explores reinterpreting Article 82 to mimic Section 2. The paper concludes by arguing that these new developments, while troublesome, provide a window to debate three basic sets of questions. First, what interests desire a weakening of the law of abuse and dominant position? Second, can Section 2 learn from Article 82, rather than the other way around? Third, and most fundamentally, can Article 82 provide insight into a broader discussion about the goals and methods of antitrust?

antitrust, monopolization, competition law, European Union, international, transnational

Abstract:
The fairness doctrine in corporate law is rhetorically glorious. Courts speak of scrutinizing transactions tainted by self-dealing for entire fairness, intrinsic fairness, and even inherent fairness. In theory, the doctrine should be a boon to shareholder-plaintiffs, especially as contrasted with corporate law's usual tendency to defer to the business judgment of corporate insiders. But in cases where courts discuss the fairness doctrine, how often have plaintiffs actually won‘ Are their meaningful differences in the three articulations of the doctrine, or are the adjectives fancy verbiage‘ Are some fairness cases more important than others in promulgating doctrine‘ While anecdotes abound, precious little empirical research exists to address these questions.

This Article uses a new tool - network analysis - to perform an empirical study of fairness doctrine as developed by the Delaware Supreme Court and the Delaware Court of Chancery. It creates network maps to represent visually the topology of Delaware's fairness jurisprudence, using actual cases as nodes on graphs and interrelationships among cases as arcs connecting the nodes. These maps, along with metrics that describe the characteristics of the network, provide rich data through which to understand fairness jurisprudence more systematically.

Copyright 2008 San Diego Law Review. Article is reprinted with the permission of the San Diego Law Review.

corporate law, network theory, fairness, judicial review

Abstract:
Bringing a monopolization claim under the Cartwright Act is difficult work. This article first explains the possible arguments that one might make in favor of such a claim, then describes why each faces an uphill battle. Second, the article discusses alternatives to the Cartwright Act for bringing a monopolization claim under California law and why each of these attempts is also challenging. The article concludes by considering the reasons for and significance of the lack of a clear monopolization claims under the Cartwright Act.

antitrust, monopolization, Cartwright Act

Abstract:
The law of unincorporated associations is engaged in a misguided march in transforming the duty of loyalty into a contractarian construct. This Article argues that these developments reflect doctrinal confusion, outworn economics, and weak policy.

The Article begins by tracing the evolution of the duty of loyalty in the law of unincorporated associations. It begins with a discussion of the struggle between contractarianism and fiduciary duty in the uniform laws promulgated by the National Conference of Commissioners on Uniform State Laws (NCCUSL). It then shifts gears to the more squarely contractarian, and likely highly influential, Delaware statutes. The current state of the doctrine suggests that precious little is left of the duty of loyalty.

The article then shifts to showing that the transformation is troublesome along three dimensions. First, the move conflates fiduciary with contractual duties, notably weak and nebulous notions of good faith. Second, it deploys outworn economic concepts reminiscent of the neoclassical Chicago School. The economic justifications for contractarianism are based on facile assumptions applied in a static manner; they do not represent real humans interacting in real institutions over time. Third, the move from loyalty to contract brings with it a host of public policy problems: it tries to toss out a well developed legal tradition, downplays the role of trust and morality, and ignores the role positive law can play in shaping norms. In the end, the rise of contractarianism reflects a step backward to nineteenth-century legal formalism and presents the risk that its faulty precepts may spread further into corporate law.

fiduciary duty, duty of loyalty, contract, unincorporated associations

Abstract:
Transnationalism represents a major leap forward in our understanding of events that cross national borders. At the same time, though, the transnational approach is woefully incomplete. Students looking for intellectual coherence are frequently disappointed. And even a cursory glance at news headlines makes it abundantly clear that despite this major conceptual advance, the world has not become any happier. I worry that transnational law has become too optimistic, perhaps even na¿ve, about what it can accomplish.

The argument is structured in three parts. Part I simply seeks to understand what transnational law actually means, by developing a typology that systematizes not only sources of law, but actors engaged in cross-border events. Part II attempts to draw three principal lessons from this reality: (i) transnational law for all of its glamour, is often little more than national law applied to cross-border events; (ii) forays beyond the national have too often been either been ineffectual or perceived as disenfranchising; and (iii) the transnational approach is being hampered by its reliance on liberalism and process theory.

Part III argues for a counterintuitive and ironic proposition: comparatists may provide a path forward for transnationalism. The comparative method presents precisely the tools that lead to a deeper understanding of the similarities and differences among national laws, and between national laws and other constructs such as supranational and international law. Only through understanding this reality can we begin to renew our justifications for the legitimacy of meaningful international law and institutions.

transnational law, international law, comparative law, legal theory

Abstract:
Professor Steven Shavell's Foundations of Economic Analysis of Law offers a monumental overview of the application of economics to law. This book review analyzes the strengths and occasional limitations of Shavell's book, and proceeds in three parts. Part I provides a brief survey of the contents of the book; Part II highlights the book's significant strengths; and Part III provides an assessment of the book.

On the positive side, Shavell has written a lucid text that is accessible yet does not shy away from masterful exposition of complex topics such as externalities, informational asymmetries, and the divergence between private and social welfare. The review's critique, however, focuses on the notion that Shavell unnecessarily cabins welfare economics within a neoclassical and utilitarian box. In placing too much faith in the ability of the tax and transfer system to achieve distributional goals, and in eschewing deontological concerns, he too often ends up resorting to wealth maximization - ironically, the very method he chastises conventional law and economics scholars for adopting.

In the end, Professor Shavell treats readers to an immensely informative, enjoyable, and thought-provoking book. However, had the book not remained wedded to the limits of neoclassicism and utilitarianism it would be even better.

welfare economics, social welfare, law and economics

Abstract:
Despite their seemingly sophisticated economics, existing theories of the firm have made for poor public policy, as witnessed by recurrent crises in corporate governance. This Article identifies and begins to remedy this gap. It argues that to make sense of organizational behavior, the firm needs to be reconceptualized as an entity that evolves norms within a social construct.

Orthodox economic models of the firm remain focused on microanalytic equilibria drawn from assumptions of rationality. Institutional economics persists in erroneously modeling the firm as a series of efficient contracts. Behavioral economics treats the individual, not the firm, as the unit of analysis. Organizational behavioral economics has yet to emerge.

The path forward requires recognition that firms can evolve norms dangerous not only to those outside the organization, but ironically also to those within it. Not only does a norms-based theory of the firm better accord with actual firm behavior, but it pushes law and economics in new directions. Understanding norms as responses to high contracting costs gives institutional economics new tools to address the problem of incomplete contracts; framing norms as collective heuristics helps extend the insights of behavioral economics to organizational entities.

Finally, the Article argues that public law must be deployed as a countervailing force to these dangerous organizational norms. It addresses possible objections that might emerge from contractarians, as well as from scholars who suggest that administrative hierarchy runs counter to the ideals of a participatory democracy. The piece concludes by offering suggestions to begin reform in criminal and corporate law, securities regulation, and antitrust.

Theory of the firm, law and economics, norms, institutional economics, transaction cost economics, agency theory, game theory

Abstract:
The conventional wisdom has been that state law governs internal affairs, and federal law governs disclosure. This reassuring construct, however, has little basis in today's reality. Left alone, states have not provided adequate shareholder protections: state securities laws were historically anemic, and the regulatory reach of state corporate law shrank under a prevailing contractarian ethos. As consequence, beginning in 1933, federal securities laws emerged to regulate many internal affairs. Curiously, however, as federal regulation has grown and become increasingly preemptive over the past decade, it has often decreased shareholder protections. As a consequence, some states have recently reversed course, using newly energized state securities laws to pursue fraud.

The responsibility for regulating the relationship between corporations and their shareholders has thus descended into a welter of confusion. Neither dual federalism nor preemptive federalism has been satisfactory.

In order to begin overcoming this morass, the article draws on new research in the theory of economic regulation. In particular, it proposes that the relationship between corporations and their shareholders operate within the framework of cooperative federalism using a reverse-Erie framework. The federal government would set minimal shareholder protections, but leave implementation and the creation of enhanced standards largely to the states. The article concludes by addressing a number of constitutional issues cooperative federalism might raise, including the creation of federal common law by state instrumentalities, as well as possible non-delegation and anti-commandeering concerns.

securities law, corporate law, federalism, regulatory theory

Abstract:
Professor Keith Hylton provides a timely discussion of the most important doctrines of modern antitrust. Underlying his discussion is the thesis that antitrust can perhaps be best understood through the lens of federal common law. This book review begins by discussing how Professor Hylton's book differs from other books in the field, what topics it covers, and who might profitably read the book. The bulk of the review provides a perspective on the book.

On the positive side, Hylton has written a lucid text that fruitfully analyzes antitrust from both a legal and a traditional economic perspective. The review's critique, however, is two-fold. First, while the book does initially lay out some of the limitations of the neoclassical economic paradigm, it ends up not paying sufficient attention to new research in economics that casts doubt on the plausibility of traditional Chicago School law and economics. Second, Professor Hylton ultimately does not take advantage of several opportunities to critique the limitations of the common law in shaping antitrust and thus suggest how competition law might develop in the future.

In the end, Antitrust Law is an extremely versatile, valuable and highly recommended book. It is an excellent text for readers who wish a cogent description of antitrust as an evolving form of common law, peppered with an insightful discussion of traditional law and economics. Those wishing sustained engagement with cutting-edge economics research or the articulation of a vision for the future of antitrust, however, will be left wanting more. Some readers might wish that Professor Hylton could offer a more critical perspective on neoclassical economics as well as on the limitations of the common law in setting competition policy. Doing so would have permitted him to address head on some of the most vibrant controversies facing antitrust today. Instead, he has preferred to weave a compelling narrative of antitrust's evolution.

antitrust, law and economics, common law

Abstract:
Commentators regularly criticize antitrust for its wobbly intellectual foundations and ineffectual results. To address this malaise, this Article attempts a new path: a systemic deconstruction of antitrust, followed by a reconstruction of the economic and institutional foundations of a new competition law. Paradoxically, saving antitrust will require looking beyond its traditions to incorporate learnings from economic regulation.

First, the piece attempts to link antitrust's modern woes to two root causes: predominantly laissez-faire economics and limited institutions. Influential commentators have falsely defined antitrust's consumer welfare goal according to the strictures of neoclassical price theory, while ignoring antitrust's legislative history. In parallel, they have dismissed valuable modern advances in economics. Institutionally, ex post common law adjudication is ill equipped to set economic policy.

Next, the piece lays the groundwork for its proposal. Taking issue with public choice arguments, it posits that despite antitrust's current failings, government intervention is essential to protecting the integrity of markets. Also, as economic regulation has evolved it no longer makes sense to treat antitrust and regulation as separate bodies of doctrine.

Finally, the Article outlines the economics and institutions of a new competition law. Its economics must rest on empirical and behavioral reality. The goal should be to emulate a monopsonist consumer. Analytical methods must emphasize three elements: structural industry analysis, pragmatic market definitions, and isolation of bottlenecks to competition. A cross-industry Competition Office of limited powers should implement the approach. The ultimate goal is to preserve the integrity of markets; a happy by-product is the reconciliation of antitrust and regulation.

Antitrust, regulation, law and economics

Abstract:
This article discusses The Antitrust Enterprise by Herbert Hovenkamp. While generally praising the book for its refreshing style, its recognition of antitrust's institutional limits, and its efforts to simplify antitrust doctrine, the article ultimately criticizes it as unnecessarily wedded to neoclassical economics. The piece discusses similarities between Hovenkamp's ideas and Chicago school economics, as well as Hovenkamp's apparent skepticism of post-Chicago thinking. Ultimately, the article calls for a more dramatic reimagination of antitrust's role, arguing that neoclassical economics should not be the frontline arbiter of competition policy. Instead, the author urges returning antitrust to its former prominence through the use of distributional and deontological goals, post-Chicago economic methods, and a willingness to contemplate antitrust and regulation as holistic bodies of law.

antitrust, law & economics

Abstract:
This article challenges the conventional wisdom that the Telecommunications Act of 1996 is to blame for the lack of competition in local telephony, and that somehow the federal courts are complicit in this failure. It begins by highlighting the continued importance of local wireline infrastructure and how little competition exists. Moving to the 1996 Act's network disaggregation provisions, the article argues that while the statute itself is sound, the regulations promulgated under it evince basic economic confusion that has harmed not only the incumbent telephone companies, but ironically, the new competitors whom the regulations were designed to help. A new regulatory approach is proposed to overcome the current impasse. The piece next considers provisions to open long distance to local telephone monopolies, and finds again that implementing regulations, not the Act itself, is to blame. A new regulatory paradigm is offered. Finally, the argument shifts to the thorny issue of federalism to find that Congress in fact devised a rather elegant and innovative new scheme that has been misunderstood. The article parts company with most critical commentary to suggest that tossing out the 1996 Act is altogether too draconic - rather the focus of regulatory reform should be to develop regulations that coincide with economic reality.

telephony, telecommunications, regulation, competition, law and economics

Abstract:
The concepts of takings and the tragedy of the commons are familiar to those versed in the legal and economic literature. Only recently has scholarship begun to emerge around their less studied counterparts, givings and anticommons. For the first time, this article attempts to develop and bring together these two emerging areas of legal scholarship using the tools of law and economics.

The focus is to explore how these new concepts, taken together, can create a mechanism with which to explore developments in administrative law. The piece first builds a theoretical argument as to how regulatory largesse can subtly create a right for a small number of entities to exclude others, thereby squelching business competition and social diversity. A variety of examples from telecommunications law, local government law, natural resources law, and intellectual property law adds empirical weight to the argument.

Next, the root causes of this phenomenon are explored. Public choice theory and the public interest rhetoric, while providing valuable insights, cannot offer a satisfactory explanation. Ideas from transaction cost economics and behavioral economics also shed light on why conventional solutions to the dilemma - grouped around the polarities of privatization and public commons creation - are inadequate.

The article concludes by offering an approach with which to reform administrative law. Central to change are reconceptualizations of the public trust doctrine, property versus liability rules, and the public/private distinction.

law and economics, administrative law, givings, anticommons, regulation

Abstract:
Corporate law has become unnecessarily complicated. Despite the proliferation of laws, problems fester and scandals erupt. Something is wrong. This Article seeks to delayer corporate law - to strip it down to its essence - and after doing so, offer concrete suggestions for reform. It is a first step toward a new minimalist architecture for corporate law.

The Article begins by arguing that the core of state corporate law - corporation statutes and fiduciary duties - currently offer precious little protection to shareholders. Contractarianism, manifested through enabling statues, reflects weak economics. Existing fiduciary duties are little more than rhetorical flourish. Rather than reexamine why the core of corporate law is empty, policymakers have instead added a series of layers, most notably securities laws. These reforms, however, merely operate as bandages to recover from the most recent scandal and further obfuscate the hollow core of corporate law.

The bulk of the article offers a fresh path to reform. It draws on emerging paradigms in regulatory theory to argue that substantively, corporate law must reinvigorate fiduciary duties by resetting judicial "standards of review" to match "standards of conduct", while at the same time addressing the behavior of officers, not just directors. Finally, the institutional approach proposed is one of cooperative federalism: the federal government would set minimum standards, but implementation would occur through state courts via a "reverse-Erie" principle.

corporate law, federalism, securities law, regulatory theory

Abstract:
In an attempt to cabin the open-endedness of weasel words, traditional law and economics purports to offer certainty. This article, however, argues that this scholarship deeply misunderstands modern welfare economics and suggests, contrary to the usual economic denigrations of public bureaucracy, that a robust public administrative state is essential to improving social welfare.

The article first argues that the ¿wealth maximization¿ standard of traditional law and economics is fundamentally flawed. It then addresses issues central to the economic literature of social welfare, which have yet to make their way meaningfully into the law and economics discourse. The shift in welfare economics from interpersonal comparisons of marginal utility to ordinal rankings has made the discipline fall under the spell of seemingly intractable theoretical puzzles. Yet, if welfare economics accepts that it is not an exact science, it can begin to outgrow its puzzles and provide useful input to policymakers. Just like lawyers must deal with weasel words, welfare economists must deal with weasel numbers. While both are useful, neither will provide a first-best solution.

The article concludes by suggesting a framework within which to analyze social welfare based on mathematical sets, arguing that since elegant solutions to this social welfare function may not exist, institutional choice becomes paramount. Private contractual ordering does not provide a satisfactory resolution. For their part, majority voting and judicial countermajoritarianism, while essential, have inherent institutional limitations that prevent them from being complete solutions to the puzzle of social welfare. Revamped public administrative law presents a start.

welfare economics, law and economics, social welfare, social choice

Abstract:
This piece takes issue with the conventional wisdom that economic and critical approaches to law are incompatible. It argues that the facile assumptions behind the popular conception of law and economics, as well as the radical assertions characterizing traditional critical legal studies, mask the potential of each approach. Once stripped of this baggage, each reveals rich insights which, when combined, can serve as the basis for a new path. Critical legal economics is an interdisciplinary venture that seeks to apply the discipline of economic thought to prevent utopian speculation, while addressing a series of critical questions-around wealth disparities, information asymmetries, and the like. In its desire to address both the inequalities of neoclassicism and the bureaucracy of the administrative state, critical legal economics is neither strictly contractarian nor progressive in its orientation, but seeks to build on both perspectives. Its ultimate goal must be to fashion incentives that enhance public participation in civic life. The approach offered should thus not merely serve as a tool of social science, but rather can fruitfully inform normative legal discourse.

Law and economics, critical legal studies

Abstract:
This article argues that poor regulation has thwarted competition among cable providers. It begins by laying out the history of cable regulation to show that the regulatory framework was created by a series of ad hoc, often contradictory, policies. It then surveys the markets for video programming and broadband access to show that precious little competition exists today. Moving to an economic analysis of the industry, it highlights the surprising irony that despite years of anti-competitive maneuvering, even the incumbent players are facing financial uncertainty. The paper also proposes a new regulatory paradigm based on economic and technological reality. Finally, it discusses the legal authority to implement such a framework, addressing potential federalism and constitutional issues. The overarching goal is to provide a starting point for a regulatory regime that can benefit not only society and new entrants, but also ironically, incumbents themselves.

cable industry, regulation, competition, law and economics

Abstract:
To understand how boards can serve as both managers and creators of risk, a prerequisite would be to have a satisfactory framework within which to conceptualize board behavior. Unfortunately, such a basic structure is lacking. This chapter explores this curious anomaly and proposes that the intersection of boards and risk can only be understood through a counter-intuitive application of sociological norms. Only once existing misconceptions are set aside can reform follow.

The argument is structured in three parts. Part I explores the limitations of conventional models: neoclassical economics, industrial organization (IO), and institutional economics. It also explores why the behavioral project - whether expressed through behavioral economics or organizational behavior (OB) - is incomplete. Based on the notion of "organizational behavioral economics," Part II then proposes a structure within with to understand board behavior using the concept of norms. Finally, Part III presents suggestions for reform, with an emphasis on enhancements to corporate and criminal law.

boards, risk, norms, behavioral economics

Abstract:
In an era fashionable for its simplistic trashing of the regulatory state, Steven Croley's Regulation and Public Interests provides welcome respite. Croley mounts a valiant defense of regulation. His central argument is straightforward; namely, "that the cynical view of regulation shows far too little attention to the actual processes through which administrative agencies regulate. . . . Once the administrative state is unpacked-once it is considered in light of its procedural complexities-grim conclusions about the inability of regulatory institutions to advance the general welfare give way to more optimistic assessments." (p. 4). This book review argues that while Croley presents a thought-provoking defense of the regulatory state, the nexus he creates between process and welfare is not entirely convincing.

The article proceeds in three parts. Part I offers a brief overview of the book. Part II highlights the significant strengths of Croley's endeavor. Finally, Part III suggests some possible gaps in the book's arguments.

regulation, administrative law

Abstract:
This Article is a follow-up to a previous article, Networks of Fairness Review in Corporate Law (Fairness). After an overview of the fundamentals of the fairness standard and network theory, Fairness deployed network and statistical analyses to conduct an empirical study of the fairness doctrine as articulated by the Delaware Supreme Court and the Delaware Court of Chancery. This initial analysis focused on the fairness standard for one principal reason: it is considered to be the most plaintiff-friendly standard of review, in marked distinction to the well-known business judgment rule (BJR). But there are also four other prominent standards of heightened scrutiny in Delaware jurisprudence, each of which purports to protect plaintiffs beyond the BJR: Unocal/Unitrin with respect to defensive measures in the face of a change-in-control transactions, Revlon in the context of auctioning a change-in-control, Blasius where the shareholder franchise might have been violated, and the Zapata "two-step" which sometimes requires a court to exercise its business judgment in the context of presuit demand. Despite the intuition of commentators that such standards get watered down, they had yet to be explored in a systematic fashion.

Building on the work in Fairness, this Article seeks to perform a network analysis of these heightened standards of review. The discussion is structured into three principal sections. Part I outlines what these standards of review are and what they purport to do. Part II describes the empirical methods used - from data gathering to analysis to the display of results. It culminates in four network maps, one for each standard. Finally, Part III considers the implications of the analysis, with a focus on whether these heightened standards offer more than rhetorical solace to shareholder-plaintiffs.

corporate law, network theory, judicial review

Abstract:
It is difficult to overestimate the importance of Lionel Robbins's Essay on the Nature and Significance of Economic Science (Essay). But how did Robbins make his seminal arguments? And, notwithstanding Essay's extraordinary success, are these arguments sound?

This essay attempts to address these questions in three Parts. Part I attempts to understand Robbins' rhetorical appeal. It argues that the persuasiveness and attraction of his arguments derive largely from an extraordinarily subtle, yet masterful, exposition of a series of beautifully-crafted polarities, each building from the next: material welfare versus scarcity, society versus individual, empiricism versus apriorism, normativity versus positivism, interpersonal comparisons versus ordinal rankings, political economy versus economic science. In each case, Robbins exposes a seeming divergence, then takes sides. He then uses this position as an anchor to make taking a position on the next polarity and seemingly natural and effortless exercise. Put simply, his scarcity-based definition of economics leads him to espouse an individualistic, aprioristic and positivist perspective on economics. This stance then naturally leads to a rejection of interpersonal comparisons of utility. Without the ability to engage in such comparisons, the scope for economic science diminishes considerably. Convenient to the status quo, welfare and social institutions are no longer within the science's purview.

Part II addresses the potential objection that Part I is too crude a depiction of Robbins' position. It argues that, notwithstanding some nuances notably related to Robbins's possible ambivalence around empirical studies, the sequence is essentially accurate.

Finally, Part III proceeds to show that the attractive polarities Robbins has created are flimsy. Moreover, Robbins' too often facile arguments have the ultimate effect of unnecessarily narrowing the boundaries of economics, leading unfortunately to a diminished role for the discipline in public policy. Notwithstanding these criticisms, though, Essay's enduring appeal lies in the issues it so presciently raised.

Lionel Robbins, economic history, microeconomics

Abstract:
There exists much insightful commentary on the commercial speech doctrine. Some of it debates whether its underlying premises can be neatly theorized, or whether a pragmatic approach is more germane. Other scholarship considers the merits of particular applications: for example, whether specific portions of the securities or consumer protectionor food and drug laws pass constitutional muster. Even defining commercial speech has spawned its own small cottage industry.

This Article takes a different approach by discussing the political economy of commercial speech. It asks whether the recent push toward broader protections for commercial speech represents a very sophisticated attempt at putting forth a deregulatory agenda through constitutional rhetoric - a role similar to that the due process and contract clauses occupied nearly a century ago. To the extent that an overly expansive commercial speech doctrine is used to discredit agency regulation, it represents a brilliant attempt to sidestep the deference courts give regulators under Chevron.

The argument is structured in two parts. Part I suggests that two movements, the Chicago school and public choice, have given intellectual legitimacy to the push for expanded commercial speech protections. Unfortunately, however, this agenda is flawed along two major dimensions. First, it glibly conflates commercial speech with core political speech at the heart of the First Amendment. Second, it suffers from a host of facile and untenable assumptions about rational consumers, self-correcting markets, and good corporations versus bad governments. The agenda is to use the First Amendment to sidestep economic regulation, much like the Lochner era relied on Fourteenth Amendment due process claims.

Part II explores six curious anomalies that fuel the agenda described in Part I. These represent leaps of logic that are made seemingly without justification. Puzzles that, conveniently enough, benefit those who wish to grant ever-expansive rights to commercial speech. First, there is an inconsistent willingness to attack certain regulatory regimes, but not others. Second, corporations are simply assumed to have constitutional rights. Third, the rhetoric bizarrely shifts attention away from speakers toward listeners and information. Fourth, there is a permissive attitude toward mixing political with commercial speech, thereby sidestepping even the minimal requirement that commercial speech not be false or misleading. Fifth, there is an unwillingness to ask why a government that can regulate an underlying commercial transaction might not be able to regulate speech promoting that transaction. Finally, there is a strange desire to defer to courts as frontline arbiters of economic policy, thereby sidestepping Chevron deference.

constitutional law, commercial speech, political economy

Abstract:
The traditional debate on governmental regulation has run its course, with economically minded analysts pointing to regulation's inefficiency while those focused on justice purposefully avoid the economic paradigm to defend regulation's role in protecting consumers, workers, and society's disadvantaged. In Rescuing Regulation, Reza R. Dibadj challenges both camps. He squarely addresses the shortcomings of the conventional economic critique that portrays regulation as a waste, and also confronts those focused on justice to marshal economic arguments for public intervention against social inequities and abusive market behavior. Providing novel answers to the questions of why and how to regulate, Dibadj contends that the law and economics paradigm must not remain an apologist for laissez-faire public policy. He also demonstrates how incorporating the latest economics and revamping institutions can help improve our public agencies. Rescuing Regulation not only suggests ways to develop public institutions reflective of a democracy, but also broadly outlines how social science can inform normative legal discourse.

regulation, administrative law, law and economics, antitrust, public policy