Table of Contents

Like Uber, But for Local Governmental Policy: The Future of Local Regulation of the 'Sharing Economy'

Daniel E. Rauch, Yale University - Law School
David Schleicher, George Mason University School of Law

The Core of Copyright: Authors, Not Publishers

Wendy J. Gordon, Boston University School of Law

Disruptive Technology and Securities Regulation

Chris Brummer, Georgetown University Law Center

Appropriate Rules for Managed or Specialized Services

Jon M. Peha, Carnegie Mellon University

Next Generation Privacy: The Internet of Things, Data Exhaust, and Reforming Regulation by Risk of Harm

McKay Cunningham, Concordia University School of Law


Editorial Notes

ERPN is sponsored by the Ewing Marion Kauffman Foundation http://www.kauffman.org/research and will provide an online community for entrepreneurship research from all academic disciplines and the users of that information. SSRN is very pleased to be working with the Kauffman Foundation in this important and growing area of scholarship. In addition to sponsoring the network, Robert Strom, Research and Policy Director at the Kauffman Foundation, will serve as the Network Director and the Foundation is graciously providing free ERPN subscriptions to U.S. universities and not-for-profit institutions for the first year. The list of institutions receiving free subscriptions is available at: http://www.ssrn.com/SiteLic_orgSubscribers.cfm?netid=810024. If your institution is not listed and you would like to request a sponsored subscription, please reply to this email or write to: Management@SSRN.com and include your institution name, URL, and a contact name.


ENTREPRENEURSHIP & LAW eJOURNAL
Sponsored by the Kauffman Foundation

"Like Uber, But for Local Governmental Policy: The Future of Local Regulation of the 'Sharing Economy'" Free Download
George Mason Law & Economics Research Paper No. 15-01

DANIEL E. RAUCH, Yale University - Law School
Email:
DAVID SCHLEICHER, George Mason University School of Law
Email:

In the past five years, “sharing economy� firms like Uber, ZipCar, AirBnB and TaskRabbit have generated both huge market valuations and fierce regulatory contests in America’s cities. Incumbent firms in the taxi, hotel and other industries, as well consumer protection, labor and neighborhood activists, have pushed for regulations stifling or banning new sharing economy entrants. Sharing firms have fought back, using their popularity with consumers and novel political strategies, lobbying for freedom to operate as broadly as possible without government interference. But to date, both participants and observers of these “sharing wars� have relied on an unstated assumption: if the sharing firms win these fights, their future will be largely free from government regulation. Local governments will either shut sharing down, or they will leave it alone.

But this assumption is almost surely wrong. If sharing firms prevail in the current fights over the right to operate (and indications suggest they will), it is unlikely that cities and states ignore them. Instead, as sharing economy firms move from being upstarts to important and permanent players in key urban industries like transportation, hospitality and dining, local and state governments are likely to adopt the type of mixed regulatory strategies they apply to types of firms with whom sharing firms share important traits, from property developers to incumbent taxi operators. Using tools of agglomeration economics and public choice, this Article sketches the future of such policy regimes.

Specifically, local and state governments will adopt some combination of the following policies in addition to insisting on consumer/incumbent protections: (1) subsidizing sharing firms to encourage expansion of services that produce public goods, generate substantial consumer surplus and/or minimize the need for excessive regulation of the property market; (2) harnessing sharing firms as a tool for redistribution; and/or (3) contracting with sharing firms to provide traditional government services. The future of sharing economy regulation will be very different from its present, and the changes will pose profound legal, political and ethical questions for our cities.

"The Core of Copyright: Authors, Not Publishers" Free Download
Houston Law Review, Vol. 52, No. 2, 2014, p. 613
Boston Univ. School of Law, Public Law Research Paper No. 15-01
Boston Univ. School of Law, Law and Economics Research Paper No. 15-01

WENDY J. GORDON, Boston University School of Law
Email:

Copyright largely consists of alienable rights and correlative duties — rights of exclusion given to individuals, and correlative duties not-to-copy imposed on the public. This Article argues that such right/duty pairs arise out of authorial creation. A focus on creation is not very popular at the moment; a growing number of commentators take the position that copyright is “about� making publishing and other dissemination industries more efficient and stronger. The Article encourages the legal community instead to return to the focus that the Supreme Court articulated in Feist Publications, namely, that copyright must serve creative authorship rather than noncreative labor.

The Article explores history, legal doctrine, and economics to investigate whether Congress may, for the purpose of aiding publishers and other disseminator industries, impose on the public a set of duties-not-to-copy others’ speech. In Eldred v. Ashcroft and Golan v. Holder, the Court upheld expansions of copyright even in regard to already-created works, relying in part on the possibility that the legislative expansions might incentivize noncreative dissemination. In each case, the contested statutes eliminated what would otherwise have been a public domain status for the works involved. One argument seemed to be that publishers or entertainment companies might repair and reissue more of their stockpiled films, books, or sound recordings, if they owned or could purchase copyright in them, as compared to how many films, etc., the companies would repair and reissue if the works were in the public domain.

But there are far more old works in circulation than hidden in basement stockpiles. It may be plausible that statutorily restoring or extending copyrights might generate some additional dissemination of affected works. It is far less plausible, however, to imagine that the increase might ever be large enough to match the increased dissemination that would have resulted from the public having liberties to copy those works.

Of even more importance is the issue of relevance: much of the new provisions’ supposed pro-dissemination impact should have been legally irrelevant to the Court. The Article contends that noncreative dissemination provides legitimate grounds for expanding copyright only when the dissemination assists authorial creativity. (So, for example, a new copyright provision might enhance disseminator profit in a manner that also raised the royalties that authors received. Constitutionally speaking, that provision’s only relevant benefits should lie in its ability, if any, to encourage authorial productivity.) An approach that gives more importance than this to dissemination could lead to the one form of copyright ruled out by the Framers, namely, a copyright that lasts forever.

In the economic realm, the Article argues, inter alia, that the significance of Arrow’s information paradox for the economics of authorship (as distinguished from its significance in the economics of inventorship) lies not in encouraging disclosure and dissemination but in encouraging creation of new work; that much of the pro-publisher economic argument either boils down to serving authorship or lacks persuasive power; and that the speech-restrictive powers that copyright confers are far less suitable tools for aiding disseminators than would be more conventional forms of Congressional aid.

On the doctrinal and historical side, the Article shows how the Court in Golan misunderstood the role that “publication� played in federal law prior to the 1976 Copyright Act; the Article presents a descriptive account of early common law copyright that offers a distinctive explanation for the role of publication in state law; and the Article examines the language of the Constitutional clause that empowers Congress to grant federal copyright in the first place. The Article also offers a new explanation of the so-called “distribution right� that empowers copyright owners to sue anyone who unknowingly sells unauthorized copies. All these phenomena are shown to support the view that creativity constitutes the core of federal copyright. Finally, the Article asks whether its creativity-centered viewpoint can be maintained without contradicting the doctrine (which I have long supported) that some acts of noncreative copying and dissemination legitimately deserve shelter under the “fair use� doctrine.

"Disruptive Technology and Securities Regulation" Free Download

CHRIS BRUMMER, Georgetown University Law Center
Email:

Nowhere has disruptive technology had a more profound impact than in financial services — and yet nowhere more do academics and policymakers lack a coherent theory of the phenomenon, much less a coherent set of regulatory prescriptions. Part of the challenge lies in the varied channels through which innovation upends market practices. Problems also lurk in the popular assumption that securities regulation operates against the backdrop of stable market gatekeepers like exchanges, broker dealers and clearing systems — a fact scenario increasingly out of sync in 21st century capital markets.

This Article explains how technological innovation not only “disrupts� capital markets — but also the exercise of regulatory supervision over securities issuances and trading. It argues that an array of technological innovations in speed, interconnectivity and processing power are facilitating what can be understood as the disintermediation of the traditional gatekeepers that regulatory authorities have relied on (and regulated) since the 1930s for investor protection and market integrity. Effective securities regulation will thus require understanding the new market ecosystem, and 20th century administrative processes will have to be upgraded to account for a computerized (and often virtual) market microstructure that is subject to accelerating change. To provide context, the paper examines two basic categories of disruptive innovation: 1) the automated financial services that are transforming the meaning and operation of market liquidity and 2) the private markets — specifically, the dark pools, ECNs, 144A trading platforms, and crowdfunding websites — that are creating an ever-expanding array of alternatives for both securities issuances and trading.

"Appropriate Rules for Managed or Specialized Services" Free Download

JON M. PEHA, Carnegie Mellon University
Email:

In 2010, the Federal Communications Commission recognized a separate class of Internet-related services known as managed services or specialized services, but never defined what these services are. Poorly written rules for managed or specialized services could create a loophole large enough to make a farce of the Open Internet proceeding, or poorly written rules could unintentionally for managed/specialized services could prohibit certain capabilities that greatly benefit consumers. This paper describes how specialized/managed services should be defined, and what rules should and should not apply to specialized/managed services, so as to avoid both of these undesirable outcomes.

"Next Generation Privacy: The Internet of Things, Data Exhaust, and Reforming Regulation by Risk of Harm" Free Download
Groningen Journal of International Law, Vol. 2, Ed. 2, 2014

MCKAY CUNNINGHAM, Concordia University School of Law
Email:

To many, the EU's 1995 Directive has failed. While the global trend toward adopting laws similar to the Directive suggests that many nations value privacy rights, commentators and empirical studies reveal significant shortcomings. The Directive is simultaneously over-inclusive and under-inclusive. It outlaws harmless activities while allowing exceptions that threaten to swallow the rule. Edward Snowden revealed a disrupting example showing that national governments enjoy wide latitude to collect and use personal information under the guise of national security.

The problem of protecting private information is exacerbated by technology that continues to leapfrog. Information privacy is made continually more difficult with each new app and innovation. The Internet of Things is more probable than speculative. Everyday objects — thermostats, garage doors, beer mugs — communicate with the Internet through sensors. Radio-frequency identification is a predicate to computer identification and assimilation of everyday physical objects, enabling the use of these objects to be monitored and inventoried by computers. Tagging and monitoring objects could similarly be accomplished by other technologies like near field communication, barcodes, QR codes and digital watermarking, raising the legitimate argument that informational privacy — at least as envisioned in the 1995 Directive’s absolute terms — is impossible.

Informational privacy cannot be accomplished by declaring it a fundamental right and outlawing all processing of personal information. To legally realize and enforce a privacy right in personal information, incremental, graduated, and practical legislation better achieve the goal than sweeping proclamations that have applications to actions unrelated to the harms associated with the absence of the right. With information privacy in particular, a capacious claim of right to all personal information undermines legal enforcement because the harms attending lack of privacy are too often ill-defined and misunderstood. This paper reviews the shortcomings of the EU Directive, reviews new privacy challenges posed by the Internet of Things, and posits a regulatory regime based on risk of harm.

^top

About this eJournal

Sponsored by the Kauffman Foundation

This eJournal distributes working paper and accepted paper abstracts in subject matters that concern how the law, broadly conceived, impacts entrepreneurship, small business, growth companies, entrepreneurship within large companies, and innovation policy generally.

The eJournal welcomes research not only on topics of regulation and public policy, but also the law of contracts, contract design, and informal relationships and networks that affect entrepreneurs and may substitute for legal contracts. Topic areas include contract design, judicial interpretation and enforcement of contracts, corporate law, partnership law and choice of entity, family businesses, franchising and joint ventures, intellectual property and licensing, small business regulation, securities law, bankruptcy, and social responsibility and sustainability. The Journal welcomes submissions from scholars in finance, economics, sociology, and other disciplines as well as legal scholars.

Editor: Victor Fleischer, University of San Diego

Submissions

To submit your research to SSRN, sign in to the SSRN User HeadQuarters, click the My Papers link on left menu and then the Start New Submission button at top of page.

Distribution Services

If your organization is interested in increasing readership for its research by starting a Research Paper Series, or sponsoring a Subject Matter eJournal, please email: RPS@SSRN.com

Distributed by

Entrepreneurship Research & Policy Network (ERPN), a division of Social Science Electronic Publishing (SSEP) and Social Science Research Network (SSRN)

Directors

ERPN SUBJECT MATTER EJOURNALS

ROBERT STROM
Ewing Marion Kauffman Foundation
Email: rstrom@kauffman.org

Please contact us at the above addresses with your comments, questions or suggestions for ERPN-Sub.