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Coase-Sandor Institute for Law and Economics

Annual Report 2012–2013


douglas baird

thomas ginsberg

Message from the Institute Director In the past year, Chicago Law and Economics lost its icon, one of the giants of the field, Nobel Prize Laureate Ronald Coase, who passed away at the age of 103. It was an enormous privilege to know Ronald, as it is to continue building the intellectual tradition so closely associated with his legacy.

julie roin

Ronald’s passing coincided with two major tributes to him, launched while he was still alive. The first, already celebrated at the end of last year, was the naming of the Institute for Law and Economics as the “Coase-Sandor Institute for Law and Economics,” also recognizing an important gift by Richard and Ellen Sandor. The second tribute was the publication of a special issue of the Journal of Law and Economics, celebrating Coase’s work and discussing his contribution to economics and to law. To further recognize Coase’s unique stature, the Institute is publishing a book of personal tributes, written by scholars and practitioners who knew him, sharing individual perspectives on the importance of Coase’s teachings and how they shaped the writers’ careers.

william hubbard

In its second full year of existence, the Coase-Sandor Institute continued to build and expand its Global Law and Economics outreach. In 2013, the second program of the Summer Institute in Law and Economics drew an impressive cohort of 85 professors and scholars, mostly from mainland China. The theme of the two-week program was New Tools in Law and Economics. Now preparing the third annual Summer Institute program, and expanding to other Asian countries including Korea, Japan, and India, Chicago’s international influence in training a new generation of law and economics scholars is greater than it ever was.

Faculty Daniel Abebe

Saul Levmore

Douglas G. Baird

John List

Gary S. Becker

Anup Malani

Omri Ben-Shahar

Jonathan Masur

Lisa Bernstein

Richard McAdams

Message from the Institute Director

1

Anthony Casey

Thomas J. Miles

Introduction

2

Kenneth W. Dam

Edward Morrison

Celebrating Coase’s Legacy

4

Frank H. Easterbrook

Kevin Murphy

Summer Institute in Law and Economics

8

Richard A. Epstein

Randal C. Picker

Levi Distinguished Visiting Jurists

12

Lee Fennell

Eric A. Posner

Conferences

14

Daniel Fischel

Richard A. Posner

Lectures and Workshops

18

Thomas Ginsburg

Julie A. Roin

James Heckman

Andrew M. Rosenfield

M. Todd Henderson

Michael Schill

William H. J. Hubbard

Lior Strahilevitz

William M. Landes

David A. Weisbach

Steven Levitt

Crystal Yang

Contents

Kreisman Initiative

This annual report surveys the large portfolio of activities organized by the Coase-Sandor Institute, under the administrative guidance of its executive director, Joseph Burton. With growing emphasis on empirical scholarship, the law and economics faculty continues to produce cutting edge scholarship in all areas of the law and to inspire hot debates and interdisciplinary symposia. Our flagship journal, the Journal of Legal Studies, saw a change of guards, as long time editor Tom Miles stepped down and Ed Morrison and William Hubbard joined me as co-editors. The Journal continues to be regarded as the gold standard in law and economics scholarship. In addition, numerous events—symposia, workshops, visits by judges, and lectures to students—have pushed the “Chicago” inventory of law-and-economics ideas to more direction than ever.

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Faculty Research

20

Working Papers

23

Journals

23

Student Fellowships and Scholars

24

Training the Next Generation

26

Chicago Unbound

27

Joint Programs

27

Teaching

28

Faculty Profiles

29

Institute Staff

39

History of Law and Economics

41

Omri Ben-Shahar Leo and Eileen Herzel Professor of Law Kearney Director, Coase-Sandor Institute for Law and Economics

omri ben-shahar 1


Introduction The founding of the University of Chicago Coase-Sandor Institute for Law and Economics last year has energized the Law School’s efforts to reclaim and solidify its leadership in the field of law and economics. Conferences, publications, student lectures, panel events, summer school, and other events have put law and economics scholarship front and center. It is an exciting time to be at the Law School—seeing law and economics further integrated into the curriculum, engaging with other fields of law, and with other interdisciplinary fields, as well. It was not that long ago that law and economics and law and philosophy, or law and literature, or law and politics did not have much to say to one another. While this was never the case at Chicago, where interdisciplinary debate has always been key to the scholarly environment, the Coase-Sandor Institute has ensured that these subfields are interacting across the elite law schools in the US and around the world. Not only has the Institute expanded the number of programmatic offerings emphasizing law and economics. It is also successfully becoming an integral part of the Law School’s mission and academic life. The Coase-Sandor Institute aims to broaden the impact of the Law School’s research in law and economics on public policy and law around the world. It seeks to build on Chicago’s reputation as the international epicenter for law and economics. And the Institute leverages that reputation to enter and influence new areas of study and policy, and to reach new audiences. This report provides assurance that the Institute is accomplishing these goals. Earlier this year, the American Law and Economics Association (ALEA) selected the Law School to host the 2014 ALEA Annual Conference. This conference gives us the opportunity to reinforce our reputation as the center of law and economics scholarship and innovation. Furthermore, Douglas Baird, Law School faculty member and former dean, and one of the world’s foremost scholars of bankruptcy and contracts, was elected president of ALEA this year. Chicago continues to be a place where people come to learn law and economics and continues to be the most credible and consistent proponent of law and economics in the world. Chicago’s faculty have always pushed the boundaries of law and economics and have long led their peers in fields as diverse as contract, bankruptcy, antitrust, and intellectual property, where law and economics has always held sway. Add to that the Law School’s emerging importance in public policy scholarship, political science, empirical economics, economic analysis of criminal law, health economics, and administrative law, and the true value of the Coase-Sandor Institute as a catalyst for research and public engagement becomes clear. Three brief examples of books published this year demonstrate the way the Coase-Sandor Institute is having an impact. For example, the publication of The Behavior of Federal Judges: A Theoretical and Empirical Study of Rational Choice (Harvard University Press 2013) was the culmination of a years-long research project under the direction of Judge Richard Posner and Professor William Landes, both of Chicago, with Professor Lee Epstein of USC. The watershed study situates judicial decision making in a labor economics framework: judges as workers responding to incentives. And it has already gotten a sizeable amount of admiring attention in the legal academy in the US and abroad. Furthermore, Douglas Baird’s recent, Reconstructing Contracts (Harvard University Press 2013) has already reinvigorated the classical theory on contract law by giving it a solid footing in law and economics.

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And the forthcoming The Future of Health Care Reform in the United States (University of Chicago Press 2014), in which editors Dean Michael Schill and Anup Malani invite the country’s best legal, medical, economics, and business scholars to opine on the trajectory of post Affordable Care Act health reform in the US, is a lively debate that will certainly influence policy makers and students of health reform for years to come. The Coase-Sandor Institute has supported law and economics research resulting in 172 books, book sections, and journal articles by University of Chicago law and economics faculty. The Institute’s flagship peer-reviewed publications—the Journal of Law and Economics (JLE) and the Journal of Legal Studies—published nearly 1500 pages of original research by the top law and economics scholars in the world. These two journals continue to be among the top three or four law journals, and JLE is still viewed as one of the best economics journals in which to publish original research. JLE, as a joint publication of Chicago Booth School of Business and the Law School, continues to be the gold standard for what interdisciplinary research can be. The Coase-Sandor Institute continues it’s outreach to other institutions with the legendary Law and Economics Workshop, held on Tuesdays throughout the academic year, in which the top scholars from around the globe meet to argue their points of view. In addition to independent scholarly conferences, the Institute collaborates with the University of Chicago Becker-Friedman Institute on multiple conferences per year. With the support of the Institute, nearly 100 scholars have visited the Law School in the past year as participants and speakers. The Institute administers the Law School’s strategy to be the premier training ground for law and economics scholars, supporting 1 JD/PhD student in 2013 and supporting three JSD students in their advanced law and economics studies. With the help of the Kauffman Foundation, the Bradley Foundation, the Scaife Foundation, and the Olin Foundation, the Coase-Sandor Institute has been able to support the JD studies of 12 students during the past academic year. Since August 2013, Crystal Yang (JD/PhD, Harvard 2012) has served as the Olin Fellow, a post doctoral program reserved for the top law and economics faculty job market prospects in the country. Professor Yang will continue at Chicago through the 2014–15 academic year. The Institute builds on Chicago’s judicial decision making scholarship by inviting several federal appellate judges to campus each year. The judges lecture to students, participate in faculty meetings and hold a no-holds-barred faculty workshop wherein they discuss a faculty research paper from the perspective of a federal judge. This program gives faculty a view into the minds and motivations of the federal judiciary. Finally, the Coase-Sandor Institute’s marquee event is the International Summer Program in Law and Economics, now preparing for its third year. The Summer Program (formerly the Summer School) brings faculty members from law schools throughout the world to learn law and economics tools and methods from Chicago’s world-renowned faculty. This past year’s program brought a highly qualified cohort from China, Taiwan, Hong Kong, South Korea, Thailand, Vietnam, France, and Mongolia. The scholars studied together in residence at the law school for two weeks in July, soaking in the rich intellectual atmosphere in Hyde Park and partaking of all the activities the city of Chicago has to offer. We are ever grateful to our supporters, especially to Ellen and Richard Sandor, for what their continued generosity has allowed us to accomplish. And with your continued support, we look forward to maintaining—and extending!—Chicago’s leadership in law and economics and to bringing law and economics to the forefront of legal scholarship around the world.

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Celebrating Coase’s Legacy Ronald H. Coase, Founding Scholar in Law and Economics, 1910–2013

Throughout the 2013–14 academic year, the Law School will honor the legacy of law and economics pioneer and Nobel Prize winning economist Ronald H. Coase. A list of events dedicated to his memory and advancing his scholarship follows:

Ronald H. Coase, who spent most of his academic career at the University of Chicago Law School, died at the age of 102 on September 2nd at St. Joseph’s Hospital in Chicago. He was the oldest living Nobel laureate, according to the Nobel Foundation.

Tribute

Coase helped create the field of law and economics, through groundbreaking scholarship that earned him the 1991 Nobel Memorial Prize in Economics and through his far-reaching influence as a journal editor. He is best known for his 1937 paper, “The Nature of the Firm,” which offered groundbreaking insights about why firms exist and established the field of transaction cost economics, and “The Problem of Social Cost,” published in 1960, which is widely considered to be the seminal work in the field of law and economics. The latter set out what is now known as the Coase Theorem, which holds that under conditions of perfect competition, private and social costs are equal. His intellectual impact continued late into his life, when at the age of 101, he published his final book, How China Became Capitalist, co-authored with former student Ning Wang, PhD’02.

A planned book published by the Law School will present over thirty original essays by Coase’s colleagues, students, collaborators, and friends, presenting their personal tributes to Coase’s work. It will be published in Spring 2014 to mark the one-year anniversary of the Coase-Sandor Institute. The book, Coase’s Legacy, will be distributed to all recipients of the University of Chicago law school record.

Memorial Web site Since his passing, Mr. Coase’s life and work have been memorialized on the Law School’s Web site, the Institute’s Web site, and more recently, on a permanent Web site that will be continuously updated with Coase-related articles, scholarship, and media. http://www.law.uchicago.edu/news/ coaseinmemoriam

“Ronald Coase discovered many of the foundational ideas of modern economics,” said Douglas Baird, the Harry A. Bigelow Distinguished Service Professor of Law, in a 2006 lecture “Coase’s Journey.” Coase was born in a suburb of London in December 1910, the only child of a Post Office telegraphist and his wife. After graduating from the London School of Economics, he held positions at the Dundee School of Economics and the University of Liverpool before joining the faculty of the LSE in 1935. In 1951 Coase migrated to the United States and held positions at the Universities of Buffalo and Virginia prior to coming to the Law School in 1964. Coase was the editor of the Journal of Law and Economics from 1964 to 1982. Among his many books are The Firm, the Market and the Law (1988) and Essays on Economics and Economists (1994).

Content from the Coase-Sandor Institute’s Web page was viewed, re-tweeted, and re-posted to Facebook hundreds of times during the weeks following Mr. Coase’s passing. INFORMATION FOR:  The School 

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Coase’s legacy at the University of Chicago Law School was assured through the generosity of Ellen and Richard L. Sandor, whose gift enabled the Law School to home the Coase-Sandor Institute for Law and Economics in Coase’s honor.

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Ronald Coase, 1910­2013

Coase said in 2012 that his main scholarly talent was to identify solutions that were in plain sight. “I’ve never done anything that wasn’t obvious, and I didn’t know why other people didn’t do it,” he said. “I’ve never thought the things I did were so extraordinary.”

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Past Events Honoring Coase’s Legacy Beijing Symposium on Teaching Law and Economics

Coase shown here with students at the 2012 Summer School Program.

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On September 17, 2013, the University of Chicago Beijing Center hosted a conference in honor of Ronald Coase entitled, “Teaching Law and Economics.” The conference, attended by a roomful of Chinese professors and alumni of the Summer Institute, featured panels of Chinese scholars and Omri Ben-Shahar, who gave tributes to Mr. Coase. The scholars celebrated the legacy of Mr. Coase and discussed how they would integrate law and economics into their teaching and scholarship.

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Chicago’s Best Ideas: Coase’s Idea

Upcoming Events Honoring Coase’s Legacy

On October 22, 2013, Saul Levmore addressed a standing-room-only crowd of law school students and faculty in the Chicago Best Ideas series. He gave students key insights into the meaning of Mr. Coase’s work and said that Mr. Coase’s economic analysis of the law was, in fact, “Chicago’s Best Idea.”

Coase Lecture 2014

As with many of Professor Levmore’s speeches we expect this content to be interesting to our alumni, and video of the event is available on the law school and institute website, http://www.law.uchicago.edu/audio/ by/title/saul_ levmore_coase_s_legacy. We will leverage the law school’s social media to drive views by our alumni and friends. Journal of Law and Economics (JLE) Issue

In the November 2013 issue, the editors of JLE will honor Mr. Coase with a memorial introduction by the editors, accompanied by Mr. Coase’s photograph. The issue will reprint “The Problem of Social Cost,” and “The Federal Communications Commission.”

Held in the Courtroom, the Coase Lecture is attended by all Chicago faculty and the broader campus community. Richard McAdams will present the 2014 Coase Lecture. He received his BA in economics from Richard McAdams the University of North Carolina at Chapel Hill and his JD from the University of Virginia. He clerked for Chief Judge Harrison L. Winter of the US Court of Appeals for the Fourth Circuit and spent three years as an associate with Morgan, Lewis & Bockius in Philadelphia. Professor McAdams teaches primarily in the area of criminal law and procedure. His scholarship focuses on criminal law and procedure, social norms, inequality, and the expressive function of law. He has served on the Editorial Board of the Annual Review of Law and Social Science and the Board of Directors of the American Law and Economics Association.

The Journal of LAW& ECONOMICS VOLUME 56, NUMBER 4

The annual Coase Lecture will provide us an opportunity to reaffirm our commitment to the memory and scholarship of Ronald Coase and to educate the students about his work and its influence on the law and on social sciences. The Coase Lecture will feature Richard McAdams.

Currently, he is finishing a forthcoming book, The Expressive Powers of Law.

NOVEMBER 2013

Summer Institute: Law & Markets

The Problem of Social Cost R. H. Coase

The Summer School will honor Ronald Coase at the annual Opening Banquet, and with panels and speakers throughout the two-week event. The curriculum of the program will focus on Coase’s contributions and their aftermath.

The Federal Communications Commission R. H. Coase On the Design of Leniency Programs Zhijun Chen and Patrick Rey Education, Complaints, and Accountability Juan Botero, Alejandro Ponce, and Andrei Shleifer Labor Laws and Innovation Viral V. Acharya, Ramin P. Baghai, Krishnamurthy V. Subramanian Racial Segregation Patterns in Selective Universities Peter Arcidiacono, Esteban Aucejo, Andrew Hussey, Kenneth Spenner Self-Reporting, Investigation, and Evidentiary Standards Heiko Gerlach International Politics and Import Diversification Sergey Mityakov, Heiwai Tang, Kevin K. Tsui

Ronald H. Coase, 1991 Nobel Prize winner in Economic Sciences

Published for The Booth School of Business of the University of Chicago and The University of Chicago Law School T H E

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U N I V E R S I T Y

O F

C H I C A G O

P R E S S

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michael Schill

International Summer Program In Law And Economics, 2013 Throughout the legal reform process of the past decade, the Chinese legal academy has been influential in directing China’s approach to property rights, contracting, regulation, corruption, and bankruptcy. While rule of law and other western concepts have not gotten much traction in the current legal and political environment in China, the legal academy has turned to law and economics, starting with the mid century essays of Ronald Coase on through the works of today’s Chicago scholars, for a theory and a methodology for scholarly reformist research. Law and Economics is being increasingly embraced with a view to rationalizing the Chinese legal system to reduce the uncertainty and corruption implicit in current legal structure and practice. The Coase-Sandor Institute for Law and Economics has influenced the prevalence of law and economics thinking in China through the International Summer Program in Law and Economics, aimed at legal and economics scholars from China, Taiwan, and Hong Kong. In 2013, the Program included participants from Vietnam, Thailand, and South Korea, as well. The School’s mission was to encourage the foundation and development of a Chinese law and economics movement, a homegrown group of scholars and teachers whose work will create the basis for the transformation of Chinese legal education, and for Chinese legal reform. The Program consisted of five course on the theme, “Tools and Methods of Law and Economics Research,” taught by Chicago’s world-renowned law and economics faculty:

todd henderson

Faculty and students in our 2013 Summer School in Law and Economics

“There’s a lot of room for economic analysis [in China], and the University of Chicago Law School is simply the best place to study this.” richard Epstein

Jun Zhao Professor of International Economic Law Guanghua Law School at Zhejiang University

• Empirical Analysis of the Law, taught by Tomas Miles, Clifton R. Musser Professor of Law and Economics and Walter Mander Research Scholar

richard posner

• New Tools in the Economics Analysis of Competition Law, taught by Randal Picker, James Parker Hall Distinguished Service Professor of Law • Law and Public Choice, taught by Saul Levmore, William B. Graham Distinguished Service Professor of Law

• A conference on food safety is planned at the University of Chicago Beijing Center for June 2014. The conference will feature papers by five Chicago faculty members and nine faculty at Chinese law schools and departments of economics.

• Regulatory Techniques in Consumer Protection Law, taught by Omri Ben-Shahar, Leo and Eileen Herzel Professor of Law and Kearney Director of the Coase-Sandor Institute for Law and Economics • Social Networks, Social Norms, and Behavioral Analysis, taught by Lior Strahilevitz, Sidley Austin Professor of Law

These kinds of collaborations are a major goal of the Summer Program, and Chicago continues to support the development of the Summer Program network throughout the year.

Upon completion of the courses, the participants were awarded letters of completion. Coursework was supplemented by lectures from William Landes, Douglas Baird, Richard Posner, Martha Nussbaum, and Tom Ginsburg, who each addressed legal topics from an interdisciplinary perspective. Additionally, the Program included a two-day symposium during which participants presented their scholarly research papers to the University of Chicago Law School faculty and each other.

richard sandor

In 2012, we reported that several journal issues, a book, and academic conferences had resulted from the learning gained and relationships formed by the International Summer Scholars. Among the important results of the International Summer Program 2013 were • A special issue of the Chinese journal, Law and Social Science. Entitled, “Chicago Law and Economics in China—A tribute to Ronald Coase,” the issue was a collaboration of two Summer Scholar editors, and featured articles written by seven participants in the Summer Program.

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• In October 2013, an academic conference was held on “Teaching and Research of Law and Economics in China,” in Beijing. Chicago faculty and alumni of the Summer Program attended and presented scholarly papers. • A “law and economics” delegation from mainland China, composed entirely of alumni of the Summer Program, will attend the 2013 Asian Law and Economics Society in Taipei in June 2014. The delegation meets regularly to collaborate on papers and to discuss their work.

The International Program in Law and Economics 2014 will be held at the Law School on July 7th18th and will cover “Law and Markets.” It is anticipated that scholars from China, Taiwan, and Hong Kong, Singapore, Japan, South Korea, Thailand, and Vietnam will attend. An International Program targeting legal scholars from Latin America is currently in development, with the goal of providing an intellectual and educational basis for rationalizing policy and law in Latin America.

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In the News

Second Annual Law and Economics Summer School Imparts New Methods to Chinese Scholars By Meredith Heagney Law School Office of Communications September 19, 2013 For the second consecutive summer, Chien Chung Lin traveled from Taiwan to Chicago to participate in the annual Summer School in Law and Economics at the Law School. Lin, an assistant professor at National Chiao Tung University’s law school, wanted to repeat the experience after being part of the inaugural program in 2012. This year, he was one of 83 scholars who visited the Law School for an intensive program from July 8 to 19. The vast majority were Chinese, with a handful from Taiwan, Hong Kong, Thailand, Vietnam, Korea, and even one scholar from France. For all but Lin and one other scholar, it was their first Summer School. The program now has about 150 alumni, when the two cohorts are combined. Lin said he’d even consider coming back for a third or fourth experience because the material has been so useful in his work studying and teaching corporate law. “It’s a very good opportunity,” he said. “It’s always important to know new developments, and empirical studies provide a very useful tool to explore what is really happening in society.” That kind of long-term view is exactly what the Summer School is all about, said Professor Omri Ben-Shahar, Kearney Director of the Coase-Sandor Institute for Law and Economics, which hosts the program. Ben-Shahar isn’t saying that scholars must return for repeat years, though the curriculum and offerings do change every summer. But he does believe that the two-week-long accelerated program in the tools and methods of law and economics is best viewed as a seed for future scholarship. These tools are especially useful in places such as China, where recent economic development has been rapid. Most of the Summer School scholars are accomplished professors in their home countries who are seeking new knowledge to address legal and economic challenges, BenShahar said. Others are PhD candidates or post-PhD fellows. They teach law, economics, political science, and other subjects. “Because they are advanced and sophisticated, they recognize law and economics and the Chicago School as sources that could be really valuable for them,” Ben-Shahar said. “Many of them hope to do for Chinese scholarship what Chicago did for American scholarship.” Learning about law and economics is very useful to Chinese academics, said Ruoying Chen, Assistant Professor at Peking University Law School. She assists the Coase-Sandor Institute in organizing and running the program. Chen is a Chicago graduate, earning an LLM in 2005 and a JSD in 2010. She also has served as a visiting assistant lecturer and an Olin Fellow in Law and Economics.

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The material enhances the scholars’ research and teaching, and it encourages interdisciplinary involvement, which is all too rare in the Chinese academy, Chen said. In a broader sense, she added, “law and economics provides more basis for rational analysis to help with decision-making on a national level, rather than relying on intuition, interest groups, public opinion, or doctrine…we are urged by this new tool to constantly reflect on and evaluate what we’ve done.” Last year’s Summer School has had an impact already, Chen said. Three academic journals in China issued special editions for law and economics papers, largely authored by Summer School contributors. Law and economics scholars met for a few small conferences too. This month, Ben-Shahar will meet with the two classes in Beijing to further encourage their network and scholarship. In July, the latest cohort packed a lot of learning and even a little Chicago sightseeing into their two weeks. They took five courses, which meant they spent four to five hours of each day in class. They took “Empirical Methods in Law and Economics” with Professor Thomas Miles, “New Tools in the Economic Analysis of Competition Law” with Randal Picker, and “Regulatory Techniques in Consumer Protection Law” with Ben-Shahar. Saul Levmore taught “Law and Public Choice,” and Lior Strahilevitz taught “Social Networks, Social Norms, and Behavioral Analysis.” Even when they weren’t in class, the scholars were absorbing ideas. Professor Martha Nussbaum delivered a lecture about the “central human capabilities,” which are rights related to health, emotions, bodily integrity, politics, and employment. Professor Tom Ginsburg gathered with the scholars on a Sunday for a brunch discussion on the role of law in economic development. And Judge Richard A. Posner, a veritable celebrity among many of the scholars for his work in law and economics, gave a talk on the importance of an independent, efficient judiciary, finality in litigation, and consumer protection laws. (He was so popular that one scholar asked him to sign the shoulder of her dress with permanent marker. He obliged.) Later, Posner said that a Summer School on law and economics for Chinese scholars is right to touch on issues of judicial accountability. “Part of modernization is creating an honest, reasonably independent, reasonably competent judiciary with sensible procedures,” he said. “China needs that, as do other countries, such as India and Brazil. These are countries that are growing rapidly economically, and they have lots of political problems and corruption and need help figuring out what to do. Certainly economics is one way to help improve a judicial system.”

Posner’s name came up several times in another Summer School event, a discussion between William Landes and Douglas Baird about the first few generations of law and economics scholarship at Chicago and in the US more broadly. The professors shared stories and laughs, and Baird pointed out to the scholars in attendance that they had a great opportunity at hand. “There were a group of pioneers here who showed how these tools can be applied to legal problems. I was able to apply those tools to other legal problems. And you’re in the position to do the same.” Baird said it must be exciting to do law and economics in China, because it is “an incredibly fertile area with areas of inquiry that are almost completely unexplored. That is exactly where you want to be.” The scholars also visited Wrigley Field for a Cubs game, where Assistant Dean for Graduate Programs Richard Badger explained the rules of baseball. (It isn’t a popular sport in China.) On another day, Levmore and Professor Julie Roin led a large group of scholars on a bike ride up the lakeshore to Navy Pier, where they enjoyed deep-dish pizza. All the scholars met for a banquet at the Quadrangle Club, where Richard Sandor talked about his passion for China and how his life’s work has been inspired by Ronald Coase and law and economics. Sandor, chairman and CEO of Environmental Financial Products LLC and founder of the Chicago Climate Exchange, gave a major gift in February to ensure that the law school remains the leading institution in the field of law and economics. In recognition of his generosity, the Institute for Law and Economics was named for him and his mentor, Coase. Sandor spoke at the banquet about seven weeks before Coase’s death on September 2nd.

“Markets can be used to achieve social objectives. I hope the Coase-Sandor Institute is going to give you the tools to advocate for those things that will help China’s economic development and its health,” Sandor said. Before the banquet, Xiangshun Ding, a professor at Renmin University of China Law School, explained that China is moving from “rule of man to rule of law.” “Rule of law means regulations, rules, norms. It also means market,” he said. “China needs to regulate the economy with more scientific tools. Law and economics is an ideal combination of tools to reach the goal of (moving from) rule of man to rule of law.” The Chinese scholars aren’t the only beneficiaries, Ben-Shahar said. It’s incredibly helpful for him and other American law scholars to interact with their counterparts in other parts of the world. “We gain a lot from this interaction, sharing our ideas and experiences with them and hearing about their work. They have a very interesting set of issues they have to deal with, and they expose our scholarly community to the types of challenges their system poses.” It’s a major opportunity for Chicago Law to be an influence on Chinese academics as the Chinese economy becomes an increasingly crucial player in the global economies of technology and innovation, Ben-Shahar added. “Part of what motivates this program is how much good to the world can come from China being a superpower in the world of ideas.”

2013 Summer Institute Participants


Levi Distinguished Visiting Jurists Edward Levi Distinguished Visiting Jurists Program The Levi Distinguished Visiting Jurists Program brings federal judges to the Law School for two days of lectures and workshops with faculty and students. The Program enables our faculty to interact closely with the judges in a workshop format. This informs their models of judicial decision making and gives faculty insights into the way federal judges think about issues as varied as bankruptcy, judicial confirmations, congressional redistricting, and the economics of immigration policy. Through the generous gift of Jerome Katzin, a 1941 graduate of the Law School, and his wife Miriam, the Program was named this year in honor of Edward Levi, who served as dean of the Law School from 1950 until 1962, when he became the University Provost. Mr. Levi served as president of the University from 1968 until 1975, when he was appointed attorney general of the United States. Part of Levi’s legacy at the Law School was his instrumentality in bringing economics teaching into the classroom. In the 1950s, he jointly taught a very popular course on doctrinal law with Aaron Director, one of the recognized founders of the law and economics movement. This paved the way for the development of law and economics as a discipline. It is fitting that the Visiting Jurists Program be named for him. This year’s Levi Distinguished Visiting Jurists have included: Judge Thomas L. Ambro is a Judge on the United States Court of Appeals for the Third Circuit. Prior to becoming a Circuit Judge in 2000, Judge Ambro received both his BA (1971) and JD (1975) from Georgetown University. He is a past Chair of the Section of Business Law of the American Bar Association and past Editor of The Business Lawyer. He is also a member of the Board of Trustees of the American Inns of Court and a member of the American Law Institute. He visited the Law School on January 23, 2013 to present “Bankruptcy Sept Zero”, a joint paper by Anthony Casey and Douglas Baird.

Judge Gary Scott Feinerman is a United States district judge on the United States District Court for the Northern District of Illinois. Feinerman earned an AB in 1987 from Yale University. He graduated from Stanford Law School with a law degree in 1991. Feinerman joined the Chicago law firm Sidley Austin as a partner, where he worked until becoming a United States district judge in 2010. He visited the Law School on February 6, 2013 to present “Sentencing Law after Booker.”

Judge Thomas B. Griffith was appointed to the United States Court of Appeals for the District of Columbia Circuit in June 2005. A graduate of Brigham Young University and the University of Virginia School of Law, Judge Griffith was engaged in private practice from 1985 to 1995 and again in 1999. Judge Griffith is a Distinguished Lecturer in Law at the J. Reuben Clark Law School at Brigham Young University, where he teaches courses on Presidential Power and Judicial Process. He visited the Law School on February 20, 2013.

Judge Robert D. Sack is a United States Circuit Judge of the US Court of Appeals for the Second Circuit. At the time of his appointment in 1998, he was in private law practice as a partner in the New York office of Gibson, Dunn & Crutcher. Judge Sack received his BA degree from the University of Rochester in 1960 and his LLB degree from Columbia Law School in 1963. Judge Sack was appointed as a Judge of the US Court of Appeals for the Second Circuit in 1998. Judge Sack visited the Law School on April 3, 2013 to present “The Use of Common Law Methodology in the Second Circuit.”

Judge Reena Raggi began her judicial career in 1987 as a Reagan appointee to the federal district court of Eastern New York. She was appointed by President Bush to the US Court of Appeals for the Second Circuit where she has served since 2002. Judge Raggi is a graduate of Harvard Law School, and she clerked for Judge Thomas Fairchild on the Seventh Circuit here in Chicago. She visited the Law School on April 17, 2013 to present “Federal Criminal Sentencing: Trial and Appeal Court Perspectives.”

Judge Margaret McKeown was a White House Fellow in 1980–81, serving as special assistant to the Secretary of the Interior and special assistant at the White House. Judge McKeown serves on the Judicial Conference of the United States Codes of Conduct Committee, the Ninth Circuit Court of Appeals Executive Committee, and the board of the American Judicature Society. She is now Jurist-in-Residence and teaches intellectual property law at the University of San Diego Law School. She visited the Law School on November 12, 2013 to present “Judicial Nominations—Whose Ox Is Being Gored?” Upcoming Levi Distinguished Visiting Jurists for 2014 include Brett M. Kavanaugh (US Court of Appeals, DC Circuit) and Raymond M. Kethledge (US Federal Court of Appeals, Sixth Circuit).

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October 4–5, 2013

A Rational Choice Approach to Judicial Behavior

Conferences 2013-14

In their book The Behavior of Federal Judges, Lee Epstein, William Landes, and Richard Posner challenge the traditional legalist and realist accounts of judging by presenting a labor market theory of judicial behavior. Judges are workers whose behavior is shaped by the conditions and incentives of their employment. Epstein, Landes, and Posner develop predictions from this theory and test them empirically using novel data sets from all three levels of the federal courts–trial, appellate, and the Supreme Court. Their far-reaching examination of judges as labor-market participants includes judges’ aversion to effort, dissent, and reversal; the influence of an individual judge’s ideology and identity as well as that of colleagues; their auditioning for promotion and the norm of conformity. The Chicago conference on The Behavior of Federal Judges will mark the publication of this important book, and the emergence of a field of Judicial Behavior, by presenting stand-alone contributions offering a broad array of perspectives on judicial behavior. It was organized by Omri Ben-Shahar and Thomas Miles and the papers from the conference presentations will be published in the Journal of Legal Studies. October 18–19, 2013

This year we have held several conferences and events that have been based on exploring further topics our faculty have raised in recent books they’ve written. We hope that these events will continue the conversations begun with the publication of the books.

Alfred P. Sloan Foundation Cost-Benefit Analysis for Financial Regulation Government agencies like the EPA frequently use benefit-cost analysis in order to evaluate proposed regulations. By contrast, financial agencies such as the SEC and CFTC rarely use benefitcost analysis and in recent years have seen regulations struck down by the courts because of regulators’ failure to use benefit-cost analysis or flaws in their benefit-cost analyses. The conference explored whether government agencies such as the SEC and CFTC should be required to comply with a benefit-cost analysis when they issue financial regulations, and if so, how that benefit-cost analysis should be conducted. Participants contributed their insights into how valuations of the benefits and costs associated with financial regulation can be calculated, or whether they can. There is no specific body of literature on the benefit-cost analysis of financial regulation. This conference acknowledges first that the complexity of the financial industry, its products, and of its relationships with the government and consumers making regulation very difficult. The Cost-Benefit Analysis for Financial Regulation conference was organized by Eric A. Posner (University of Chicago Law School) and E. Glen Weyl (Department of Economics, University of Chicago) and is funded by the Albert P. Sloan Foundation and the Coase-Sandor Institute for Law and Economics. It was held on October 18 and 19, 2013. Papers developed from presentations at the conference will be published in the Journal of Legal Studies.

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October 23, 2013

Reconstructing Contracts: The Contracts Scholarship of Douglas Baird A panel of leading scholars discussed Douglas Baird’s pathbreaking work on contract law, published in his new book Reconstructing Contracts, at a lunchtime event students were encouraged to attend. Moderated by Omri Ben-Shahar, the panel included Avery Katz, Vice Dean and Milton Handler Professor of Law, Columbia Law School, Stewart Macaulay, Malcolm Pitman Scharp Professor and Theodore W. Brazeau Professor, University of Wisconsin, Madison, Law School, and Ariel Porat, The Alain Poher Chair in Private Law, Faculty of Law, Tel Aviv University. November 15–16, 2013

Economic Foundations of International Law Does economic analysis have a role to play in scholarship on international law? For quite a long time, the answer seemed to be “no,” but over the last decade, economic analysis of international law has gained traction in law schools. This conference, which celebrates the publication of Economic Foundations of International Law by Eric Posner and Alan Sykes, provides an opportunity to debate the relationship between economic analysis and international law. A distinguished group of scholars will present papers on treaties, the law of war, human rights, international organizations, and related topics.

Lars Hansen, 2013 Nobel Prize winner in Economic Sciences attends the CostBenefit Analysis Conference in October.

This conference is organized by the Chicago Journal of International Law and Omri Ben-Shahar and sponsored by the journal and by the Coase-Sandor Institute for Law and Economics. Papers presented at the event will be published in Chicago Journal of International Law, Vol. 15(1) 2014. May 8–9, 2014

American Law and Economics Association Annual Meeting In 2014 we’re bringing the annual meeting of the American Law and Economics Association back to the original home of law and economics, hosted by ALEA president Douglas Baird. The meetings will be held at the University’s downtown Gleacher Center and will attract 300–500 participants, primarily leading academics teaching in law schools, business schools, and economics department, with a strong representation from non-American institutions. The 2014 meeting will also coincide with the awarding of the discipline’s most prestigious prize, The Ronald Coase Medal in Law and Economics. Tom Miles is chairing the submission committee for the conference presentations. The ALEA conference website is www.amlecon.org

saul levmore

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The Kreisman Initiative on Housing Law and Policy

Lectures and Workshops 2013 Coase Lecture

An interdisciplinary group of researchers from the Law School (Edward Morrison, Michael Schill, Lee Fennell, and Eduardo Peñalver), the Harris School, Chicago Booth, and the economics department, studies a range of questions in consumer protection, property rights, mortgage finance, and real estate law from a variety of interdisciplinary perspectives.

The annual Ronald H. Coase Lecture in Law and Economics features a Law School professor delivering a law-and-economics themed talk that presupposes no background knowledge on the topic. Although anyone can attend, the lecture is intended to give 1L students an understandable sense of law and economics’ techniques and subjects.

Over the coming two years, the group’s studies will become part of the Institute’s Kreisman Working Papers Series on Housing, hosted on the D’Angelo Law Library’s Web platform for scholarship, Chicago Unbound. Additionally, the Institute will sponsor conferences on housing policy, including Dodd-­Frank, in Chicago, Washington DC, and/or New York, in order to push Chicago scholarship out to practicing lawyers, policy makers, and regulators. The faculty participants are listed below.

Coase, the 1991 Nobel Prize winner in Economics, joined the Law School faculty in 1964. His groundbreaking paper “The Problem of Social Cost” established what is known now as the Coase Theorem, the idea that the allocation of property rights does not matter for economic efficiency, so long as they are well defined and a free market exists for the exchange of rights between those who have them and those who do not. The 2013 Coase Lecture, “Constitutions as Products,” was presented by Tom Ginsburg, on February 12th, 2013. Ginsburg began his talk by saying he is not a lawyer economist. However, he acknowledged the importance of the tools and thomas GINSBURG methods of law and economics and discussed the ways that the application of techniques developed in the social sciences had revolutionized his area of research. Professor Ginsburg is the nation’s leading comparative constitutionalist. With an enormous data set comprised of digitized characteristics of every known constitution in the world, he looks for statistical evidence of the factors that create successful, stable constitutions, using econometric models. Professor Ginsburg answered questions—including whether the US constitution, at 225 years old the world’s oldest, was a good constitutional model or, rather, an exceptional case—during a lively Q&A with faculty and students from throughout the University community.

Robert Chaskin

Eduardo Peñalver

Lee Fennell

David Pope

Stefano Giglio

Michael Schill

Benjamin Keys

Amit Seru

Jens Ludwig

Amir Sufi

Edward Morrison

Law and Economics Workshop The core of our program is the Law and Economics Workshop series. It is Chicago at its best, the proving ground for new ideas in law and economics. This is where new work is presented, shaped and developed. Students as well as faculty participate in the exchange of ideas. Students who take the workshop as a seminar provide comments on the papers presented and write a research paper using the techniques and concepts gained by attending the workshops. Olin student fellows are required to participate in the workshop.

thomas ginsberg

ANUP MALANI

daniel abebe

DAVID WEISBACH 18

edward morrison

lee fennell 19


Faculty Research The Law School’s faculty has proposed an ambitious research agenda for the Institute. Aided by the Institute’s research associates, the faculty has developed research programs in housing, health care, education, consumer law, antitrust, finance, judicial behavior, regulation, criminal law, and other areas. Below is a description of some of their 2013 projects.

Consumer Protection Professor Omri Ben-Shahar has been appointed the Reporter for the American Law Institute’s Restatement (Third) of Consumer Contracts. The Restatement is a highly legal source, directing American courts how to decide cases involving disputes between consumers and firms. Utilizing the tools of law, economics, and psychology, Ben-Shahar introduces to American consumer protection law a foundation built on an advanced understanding of markets, market failures, and incentives. In addition, Ben-Shahar’s book More Than You Wanted to Know: the Failure of Mandated Disclosure is scheduled to be published in the beginning of 2014. Consumer protection agencies, in the US and in Europe, have scheduled book events to discuss the recommendations of this book.

Environmental Law and Economics In 2012, the Institute marked the publication of an important book by the law school’s Eric Posner and David Weisbach on international climate policy Climate Change Justice. The Institute organized a multi-disciplinary international conference on the book, which was published in 2013 by the Law School’s Chicago International Law Journal. Posner and Weisbach are engaged in a follow up book project, promoting their pioneering view on the design of a global climate change treaty. Professor Weisbach is also working on many projects involving climate change, including a model of the impacts of global warming on economic output and alternative methods of carbon taxation.

Financial Reform A recent conference sponsored by the Coase-Sandor Institute and the Sloan Foundation launched a yearlong project, in cooperation with regulators, to design a set of policies and frameworks for assessing the costs and benefits of financial regulations. The goal is to provide a rational basis for accepting or rejecting financial regulation, and to remove it as much as possible from the political process. The Coase-Sandor Institute provides logistical support to this project, which is drawing substantial interest from regulatory agencies, both in the US and in Europe.

The Law School’s Anup Malani leads both experiments, with funding by the Coase-Sandor Institute, the Becker-Friedman Institute, and the UK Department for International Development, with additional administrative, research, grants management, and data analytical support provided by research associates of the Coase-Sandor Institute. Initiative on the Future of Health Care Reform in the US: This initiative was launched last year at a symposium that brought economists, lawyers and legal academics, public policy stakeholders, and medical doctors together to discuss the Affordable Care Act (ACA) and the ways that future reform might materialize given ACA’s provisions and problems. As a result, the University of Chicago Press has agreed to publish the symposium papers in a book, edited by Dean Michael Schill and Professor Malani, entitled, The Future of Health Care Reform in the United States to be released in Spring 2014. It will strengthen the Law School’s position as a leader for critical thinking in health care. During the coming two years, the Coase-Sandor Institute will sponsor a “Health Care Reform Consensus,” modeled on the Copenhagen Consensus, in which 15–20 of the best scholars in health law and economics will meet to determine the most important reforms for scholarly research and for consideration by policy makers. Conflict of Interest in Medical Research Reporting: The Coase-Sandor Institute provides data analysis and research assistance to a joint Law School/Booth project that examines how conflicts of interest might bias the reporting of medical results in professional journals. Health Innovation and Costs: Research on the ways that health innovation affects (and is affected by) health care costs is underway at the Coase-Sandor Institute. The Law School provides support to this project in the form of research assistance and data analysis. The project, joint with RAND Corporation and Harris School researchers, will continue through this coming spring. Health Care Expenditures and the Macroeconomy: This project examines the influence of macroeconomic forces on health expenditures, pursuing explanations for the puzzling relationship between economic recessions and increases in health care costs. The Coase-Sandor Institute provides research and data analysis assistance to Professor Malani on this project. Financial Health and Physical Well-Being: Professor Edward Morrison examines the connection between personal bankruptcy and medical health. The Coase-Sandor Institute provides full-time research assistance to Professor Morrison in support of his research and recently prepared a federal grant application to fund research on the way that cancer patients’ responses to financial distress.

Health Health Insurance Experiment 1: One of the largest randomized controlled experiments ever conducted in the area of health care policy, this study tests the effectiveness of insurance versus cash transfers and self-insurance in improving financial stability and physical health among the second-poorest quartile of population in India. The experiment, conducted by Professor Anup Malani of the Law School, will be the first of its kind to demonstrate the value of pure insurance, and may assist policy makers with the proper design of health insurance in developing countries.

omri ben-shahar

Health Insurance Experiment 2: The same interdisciplinary international group of researchers led by Professor Malani is planning a second controlled experiment in which the value of the doctor visit coverage, in addition to hospital visit coverage, is assessed. The experiment could provide a rationale for the development of a health insurance market in India.

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Working Papers Judicial Behavior Judicial behavior research has been a core part of the Law School’s legal scholarship for 25 years. Projects with Institute support culminated this year in a book on judicial decision making by Professors R. Posner, Landes, and L. Epstein. The Coase-Sandor institute provides research assistance, data acquisition, and analytical support to several other projects in this area: • A project by Professor Tom Miles assesses the ability of subjective evaluations of judicial decisions to describe the actual quality of those decisions and to motivate the quality of decisions in the future. • Professors Todd and William Hubbard explore the causes, consequences, and predictors of judicial “forgetting,” wherein judges “forget” to comply with statute in their rulings.

thomas miles

• Finally, the Institute supports Professor Morrison’s project examining the how the characteristics of individual judges affect the way they rule on bankruptcy cases, such that borrowers (or creditors) are differentially benefited.

Risk Regulation Several members of the law school’s faculty have authored innovating studies on the regulation of risk. Prominent among these is the work of former Dean Saul Levmore, who is working on the intersection of tort law and public choice theory. Professor Ariel Porat published three articles at the Yale Law Journal on the economic analysis of tort law (two of them co- authored with Saul Levmore and Eric Posner), and is the author of a forthcoming book, Getting Incentives Right. The Coase-Sandor Institute is also hosting a conference in 2014 on risk regulation in China. The conference focuses on the regulation of unsafe food—a high priority problem in China. The conference will include five Chicago professors (Ben-Shahar, Levmore, Jonathan Masur, Jennifer Nou, Dali Yang).

Privacy The Coase-Sandor Institute is placing itself at the forefront of the policy debates over privacy and data protection practices. A future conference on Contracting Over Privacy is organized by Omri Ben-Shahar and Lior Strahilevitz. The Institute is also supporting the research of Matthew Kugler, a law student who has a PhD in Cognitive Psychology, who is studying consumer psychology in the area of information privacy.

A primary activity of our faculty is research. Our two working paper series provides a way to share their initial results and preliminary writings and gain critical feedback. Many of the papers are revised and published in academic journals or books. Our goal is to capture and disseminate as much of this work as possible. This year we disseminated 45 papers in the Coase-Sandor Institute for Law and Economics Working Papers Series online at the Social Science Research Network (www.ssrn.com). In keeping with our commitment to broaden the reach of law and economics, we also make all working papers freely available on the Internet, as part of the Institute’s web presence. A complete list of the papers published since June 2011 is available online at http://www.law.uchicago.edu/lawecon/workingpapers. We have also introduced the Kreisman Working Papers Series on Housing Policy and Law. The working papers are available at the Social Science Research Network and on Chicago Unbound at http://chicagounbound.uchicago.edu/housing_law_and_policy_wp/ The Journal of Law and Economics and the Journal of Legal Studies continue to be the venues of choice for papers in law and economics. In keeping with our efforts to make the most pressing issues of law and economics readily accessible to an ever-expanding audience, both journals are available in online and print versions and through the online services of Westlaw, Lexis-Nexis, JSTOR, and HeinOnline.

Journals Aaron Director founded the Journal of Law and Economics in 1958. One of Ronald Coase’s goals in joining the Law School faculty in 1963 was to use the journal create a bridge between economics and the law to explore how these fields impact each other in business endeavors of all types. The journal is now edited by Dennis W. Carlton, John P. Gould, Richard Holden, Anup Malani, and Sam Peltzman. The Journal of Law and Economics publishes research on a broad range of topics including the economic analysis of regulation and the behavior of regulated firms, the political economy of legislation and legislative processes, law and finance, corporate finance and governance, and industrial organization. The JLE has published some of the most influential and widely cited articles in these areas. It is an invaluable resource for academics as well as those interested in cutting-edge analysis of current public policy issues. The journal publishes quarterly. Recent JLE articles include “Media versus Special Interests” by Alexander Dyck, David Moss, and Luigi Zingales (http://www.jstor.org/stable/10.1086/673216) and “Education, Complaints, and Accountability” by Juan Botero, Alejandro Ponce, and Andrei Shleifer. Richard Posner started the Journal of Legal Studies in 1972. It provides a forum for interdisciplinary research into the operation of legal systems and institutions. Today, the journal is edited by William Hubbard, Edward Morrison and Omri Ben-Shahar. The Journal of Legal Studies emphasizes social science approaches, especially those of economics, political science, and psychology, but it also publishes the work of historians, philosophers, and others who are interested in legal theory. The JLS publishes two regular issues each year and occasionally publishes special issues. Recent JLS articles include “The Law and Policy of Judicial Retirement: An Empirical Study” by Stephen J. Choi, Mitu Gulati, and Eric A. Posner (http://www.law.uchicago.edu/files/file/550eap-retire.pdf) and “What Is Privacy Worth?” by Alessandro Acquisti, Leslie K. John, and George Loewenstein (http://www.jstor.org/stable/10.1086/671754).

Dean Schill with Nobel Prize winner, Lars Hansen 22

Both journals may be accessed online at www.jstor.org. And tables of contents for the journals are available for view at www.law.uchicago.edu. 23


Student Fellowships and Scholars Olin Scholar

Olin Fellows 2013 Adi Leibovitch is a JSD candidate at the law school, where she is a John M. Olin Scholar in Law and Economics and a Russell Baker Scholar. Professor Omri Ben-Shahar and Professor William Hubbard are her faculty advisors; her dissertation, “Context Dependency in Judicial DecisionMaking,” includes both theoretical and empirical elements. Her research in law and economics focuses on behavioral theory, courts and litigation, and criminal procedure. She holds LLB and MBA (both magna cum laude) from the Hebrew University of Jerusalem, MA in Public Policy (summa cum laude) from Tel-Aviv University, and LLM from the University of Chicago Law School. Zhuang Liu is a JSD candidate at the law school. Professor Omri BenShahar, Professor Lior Strahilevitz, and Professor Thomas Miles are his faculty supervisors. His research interests include economic analysis of contract and empirical/experimental study of judicial behaviors. He received his LLB (2009) and Master of Law (2011) from Peking University, and his LLM from the law school (2013).

Hagay Volvovsky is a JSD candidate at the law school, where he is a John M. Olin Scholar in Law and Economics. Professor Omri Ben-Shahar and Professor Lisa Bernstein are his faculty advisers. His research focus on the intersection of law and economics and contracts. In addition to his LLM from the University of Chicago Law School, he holds an LLB and a BA in Accounting from the University of Tel-Aviv Law School and Business School, both with high honors.

Jasmine Vajzovic

Bradley Student Fellows

Rohit Nath

Nathan Jack

Megan O’Neill

Lauren C. Barnett

John Karin

Julia Schwartz

Olin Prize Established in 1986, the John M. Olin Prize in Law and Economics is awarded annually to the outstanding graduating law student in law and economics in the opinion of the Law and Economics Faculty. The recipient will express, through his other work, a dedication to outstanding scholarship and a broad understanding of the functioning of legal and economic institutions, together with historic contributions to human liberty and progress. The 2013 recipient of the Olin Prize is Robert G. Hammond for his paper, “Selling Eminent Domain Exemptions: A Mechanism to Reveal Private Values.”

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William Bucher

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Training the Next Generation

Chicago Unbound

The Law School is unique among its peers in its focus on training the next generation of legal scholars. Several JD alumni of the Law School are among its faculty, including Anthony Casey, Anup Malani, and William Hubbard. And Chicago JD graduates populate the top law school faculties across the country.

The Law and Economics Working Paper Series has become part of a unique new site at the University of Chicago Law School. Chicago Unbound, developed by D’Angelo Law Library and the University of Chicago Law School Communications Department, is an online repository of Law School faculty scholarship and Law School and D’Angelo Law Library publications. Chicago Unbound brings the rich record of scholarship produced at the University of Chicago Law School together into one online platform and makes it accessible to a world audience.

The Coase-Sandor Institute currently supports one JD/PhD (economics) candidate, Maria Macia, who is currently in 2L at the Law School. The Institute’s post doctoral fellowship program attracts the top recent graduates from other outstanding law schools to Chicago, including this year’s fellow, Crystal Yang (Harvard JD/PhD). The Coase-Sandor Institute contributes to student training through its support of three JSD students, who will pursue careers in legal academia. Adi Leibovitch, Zhuang Liu, and Hagay Volvovsky are each recipients of the Institute’s student fellowships. The legendary Law and Economics Workshop provides a training opportunity for JD and graduate students to learn more about the research process, and to participate in the scholarly debate for which the Workshop is so famous. The Institute provides support for JD students to enable them to participate in the Workshop.

Chicago Unbound contains publications of current Law School faculty, selected past Law School faculty, the Public Law and Legal Theory working papers series, the Coase-Sandor Working Papers Series in Law and Economics, Occasional Papers, and the Law School Fulton and Crosskey Lecture series. It includes full-text PDFs of the Law and Economics working papers.

The D’Angelo Law Library is the centerpiece of the Law School’s Laird Bell Quadrangle.

Joint Programs In addition to our partnership with the Becker Friedman Institute, the program has ongoing relationships with organizations all across the University of Chicago campus.

Ethics-Law-Pharmacology Workshop Series For more than 20 years, the Law School and the MacLean Center for Clinical Medical Ethics have been running a year-long university-wide interdisciplinary weekly faculty workshop series. The Law and Economics Program began providing financial support to this program several years ago. This year’s workshops focused on health disparities: local, national and global. This year’s Interdisciplinary Faculty Seminar Series focuses on Ethical Issues in Organ Transplantation.

CHeSS

eric posner

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The Center for Health and the Social Science (CHeSS) is an interdisciplinary research and training center supporting innovative work at the interface of health and the social sciences. CHeSS draws researchers from multiple units of the University including the Biological Sciences Division, Social Sciences Division, Physical Sciences Division, Business School, Harris School of Public Policy, Law School, Social Services Administration, National Opinion Research Center (NORC), and Argonne National Labs. Several research centers from around the University also affiliate with CHeSS. The Center is directed by David Meltzer, MD, PhD, who pioneered its creation.

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Teaching

Faculty Profiles

Economics provides a powerful tool for understanding the types of effects that legal rules can have. It is important that the insights of today’s law and economics scholars are shared with students who will go on to become lawyers and policy makers as well as scholars and teachers. Our faculty have found the use of the tools and techniques of economics useful, no matter the legal topic. Ensuring that the graduates of the Law School have these tools at their disposal is one of the important goals of the program. “Teaching” in this sense is broadly defined; it includes not only classroom instruction but also lectures, workshops and other activities outside the classroom. The Law School offers basic courses in law and economics and corporate finance, as well as a workshop series in law and economics. A list of some of the courses taught by the program faculty is below.

This brief survey of the research projects undertaken by program faculty in 2012–13 gives a sense of the many facets of law and economics, its broad focus, and its commitment to rigorous examination of areas of the law that matter the most. The scholarly output of the Chicago law and economics faculty remains copious. Their books, papers, and articles continue to advance the understanding of a wide range of law and economics topics by renewing debate and reshaping established areas of law, and by establishing new paths in uncharted areas.

Administrative Law

Economic Analysis of the Law

Advanced Contracts: Sales, a Practice Oriented Approach

Executive Compensation

Advanced Issues in Corporate Reorganizations Advanced Law and Economics Antitrust Law Art Law Banking Law Bankruptcy and Reorganization: The Federal Bankruptcy Code Behavioral Law and Economics Business Associations III: Corporate Governance Business Organizations Comparative Legal Institutions Consumer Law Contracts Copyright Corporate Finance

The Federal Budget Health Law International Trade Law Land Use Law and Economics of Natural Resources Markets Law and the Theory of the Firm Patent Law Regulation of Investment Professionals

Daniel Abebe is Professor of Law and Walter Mander Teaching Fellow. He earned his JD from Harvard Law School in 2000. After law school, he clerked for Judge Damon J. Keith of the US Court of Appeals for the Sixth Circuit and later worked as a corporate associate at Cravath, Swaine & Moore LLP in New York City. Mr. Abebe subsequently returned to graduate school to pursue a PhD in political science at the University of Chicago, earning an MA in political science in 2006, and a PhD in 2013. He taught at the Law School as a Bigelow Teaching Fellow and Lecturer in Law before joining the faculty in 2008. Abebe’s teaching and research interests include foreign relations law, public international law, international politics, institutional design in foreign relations, and international relations theory. Recent papers include: One Voice or Many? The Political Question Doctrine and Acoustic Dissonance in Foreign Affairs,” Supreme Court Review, 2013, “Foreign Affairs Federalism: A Revisionist Approach, with Aziz Huq, 66 Vanderbilt Law Review, 2013, “Rethinking the Costs of International Delegations,” University of Pennsylvania Journal of International Law, 2013, “Global Determinants of US Foreign Relations Law,” Stanford Journal of International Law, 2012, “The Flaws of Foreign Affairs Legalism,” with Eric Posner, Virginia Journal of International Law, 2011, “International Agreements, Internal Heterogeneity, and Climate Change: The ‘Two Chinas’ Problem,” with Jonathan Masur, Virginia Journal of International Law, 2010, and “Great Power Politics and the Structure of Foreign Relations Law,” Chicago Journal of International Law, 2009. Abebe is working on projects relating to international water law, Africa and international law, and state capacity in international politics.

Remedies Secured Transactions Technology Policy Torts Trademarks and Unfair Competition

Douglas G. Baird, Harry A. Bigelow Distinguished Service Professor, concentrates his research on corporate reorganizations. His work has changed the way scholars, judges, and lawyers look at bankruptcy law. Baird’s other research interests include intellectual property and contract law. His most recent book is Reconstructing Contracts (Harvard University Press 2013). Recent articles include “No Exit,” Columbia Law Review, 2012 and “Blue Collar Constitutional Law,” American Bankruptcy Law Journal, 2012. Baird is a former Dean of the Law School and is the current president of the American Law and Economics Association.

Workshop: Judicial Behavior Workshop: Law and Economics

Criminal Law

Gary S. Becker, recipient of the Nobel Memorial Prize for Economic Science in 1992, and the John Bates Clark medal of the American Economic Association in 1967, is a University Professor of Economics and Sociology at the University of Chicago and Professor at the Graduate School of Business. He is recognized for his expertise in human capital, economics of the family, and economic analysis of crime, discrimination, and population. Becker’s current research focuses on the analysis of the worldwide boom in higher education, especially for women; old age support; investment in human capital and the family; the value of extending life at old age; and links between technology and human capital investments. Becker participates in a joint blog with Judge Richard Posner, http://www.becker-posner-blog.com/. 28

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Recent papers include “Net Neutrality and Consumer Welfare,” with Dennis W. Carlton and Hal S. Sider, Journal of Competition Law and Economics, 2010 and “The Market for College Graduates and the Worldwide Boom in Higher Education of Women,” with William H. J. Hubbard and Kevin M. Murphy, American Economic Review, 2010. In 2000 he received the National Medal of Science, in 2001 he received the University of Chicago’s Phoenix Prize, the highest honor that the Division of Social Sciences bestows upon a colleague and in 2010 he received the Alumni Medal of the University of Chicago.

Recent articles include “Copyrights in Teams,” with Andres Sawicki, University of Chicago Law Review, forthcoming; “Noise Reduction: The Screening Value of Qui Tam,” with Anthony Niblett, Washington University Law Review, forthcoming; “No Exit? Withdrawal Rights and the Law of Corporate Reorganizations,” with Douglas G. Baird, Columbia Law Review, 2013; “Bankruptcy Step Zero,” with Douglas G. Baird, Supreme Court Review, 2012; “The Creditors’ Bargain and Option-Preservation Priority in Chapter 11,” University of Chicago Law Review, 2011.

Omri Ben-Shahar is the Leo and Eileen Herzel Professor of Law and Kearney Director of the Coase-Sandor Institute for Law and Economics. He earned his PhD in economics and SJD from Harvard and his BA and LLB from the Hebrew University. Before coming to Chicago, he was the Kirkland & Ellis Professor of Law and Economics at the University of Michigan. Prior to that he taught at Tel-Aviv University, was a member of Israel’s Antitrust Court, and clerked at the Supreme Court of Israel. He teaches Contracts, Consumer Law, Sales, Insurance Law, eCommerce, Law and Economics, and Game Theory and the Law. He writes in the fields of contract law, consumer law, and Law and Economics. Ben Shahar is the Reporter for the American Law Institute’s Restatement of Contracts (Third), Consumer Contracts (with Oren Bar-Gill). Recent publications include “Fixing Unfair Contracts,” Stanford Law Review, 2011, “Outsourcing Regulation: How Insurance Reduces Moral Hazard,” with Kyle Logue, Michigan Law Review, 2012, and “Reversible Rewards,” with Anu Bradford, American Law and Economics Review, 2013. Ben-Shahar is the author of More Than You Wanted to Know: The Failure of Mandated Disclosure, with Carl Schneider, published by Princeton Press, 2014.

Kenneth W. Dam is Max Pam Professor Emeritus of American and Foreign Law. Dam devotes his academic energies to applying law and economics principles to international issues. His most recent book, The Law-Growth Nexus: The Rule of Law and Economic Development, was published in 2006. He is working on issues involving the reform of US and European financial regulation, the future of the Euro, and the special characteristics of Chinese financial markets. He teaches a special seminar on those issues. He has spent much of his career in public life, including service as Deputy Secretary in the Departments of both State and Treasury and as executive director of the Council on Economic Policy. He has written several books dealing with such issues as international trade and international monetary reform.

Lisa Bernstein, the Wilson-Dickinson Professor of Law, focuses her research on private and public commercial law. The goal of her research is to better understand merchant reality and the contract administration practices of multiagent firms (and supply chains) to improve public commercial law and adjudicative procedure. She was recently appointed as an International Research Fellow at the Oxford Center on Corporate Reputation. Ms. Bernstein has recently completed a piece on the new Common European Sales Law, an essay on the reasons the UCC is ill-suited to the modern outsourced economy, and a large project relating to how the content of merchant customs is, in fact, proved in court, and on a piece about the ways that the contract administration practices of firm clash with the dictates of contract law. Bernstein has organized numerous conferences on topics ranging from corporate law to internet governance. She is presently co-organizing a conference on Private Ordering to be held at Oxford University next fall. She has served as chair of the AALS Law and Social Sciences Section, the AALS Law and Economics Section, and the AALS Section on Contracts. She has been a member of the board of the American Law and Economics Association, is an advisory board member for the SSRN journal Law, Norms & Informal Order. She has been a referee for many peer review journals and presses including Harvard Press, Oxford Press, Cambridge University Press, The Law and History Review, and others. Ms. Bernstein also teaches divorce law and corporate governance.

Anthony Casey is Assistant Professor at the University of Chicago Law School. Before becoming a professor in 2011, Casey taught at the University of Chicago Law School as a Bigelow Fellow and Lecturer in Law. Before that he was a partner at Kirkland & Ellis, LLP. His practice focused on bankruptcy litigation, corporate governance, and complex class actions. Casey‘s research and teaching interests include corporations, corporate bankruptcy and reorganization, finance, securities regulation, civil procedure, and law and economics.

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Richard A. Epstein is the James Parker Hall Distinguished Service Professor Emeritus of Law and Senior Lecturer at the University of Chicago Law School. Epstein’s recent work has included projects on American constitutional law, the rule of law, the legal regulation of financial markets, property theory, takings, the history of the Progressive Era, intellectual property, as well as short articles and op eds on a range of subjects. His book The Classical Liberal Constitution: The Uncertain Quest for Limited Government was published by Harvard University Press in 2014. Earlier books include Design for Liberty: Private Property, Public Administration and the Rule of Law, Harvard University Press in 2011. Recent articles include The Takings Clause and Partial Interests in Land: On Sharp Boundaries and Continuous Distributions, 78 Brook. L. Rev. 789 (2013); Free Trade and Free Immigration: Why Domestic Competitive Injury Should Never Influence Government Policy, 80 U. Chi. L. Rev. 201 (2013); Harmonization, Heterogeneity and Regulation: CESL, The Lost Opportunity for Constructive Harmonization, 50 Common Market L. Rev. 207 (2013). “The FTC, IP and SSOS: Government Hold-Up Replacement Private Coordination,” with F. Scott Kieff and Daniel Spulber, Journal of Competition Law and Economics, 2012; “Playing by Different Rules? Property Rights in Land and Water,” in Property in Land and Other Resources, Daniel H. Cole and Elinor Ostrom, eds., 2012.

Lee Fennell, the Max Pam Professor of Law and Herbert and Marjorie Fried Research Scholar, joined the University of Chicago Law School faculty in 2007. She previously taught at the University of Illinois College of Law and the University of Texas School of Law and visited at Yale Law School, NYU School of Law, and the University of Virginia School of Law. Her research and teaching interests include property, torts, land use, housing, social welfare law, state and local government law, and public finance. She is the author of The Unbounded Home: Property Values beyond Property Lines, which was published by Yale University Press in 2009, and co- editor (with Richard H. McAdams) of Fairness in Law and Economics, to be published by Edward Elgar. Other recent publications include “Lumpy Property,” University of Pennsylvania Law Review, 2012; “Picturing Takings,” Notre Dame Law Review, 2012; “The Problem of Resource Access,” Harvard Law Review, 2013; “Crowdsourcing Land Use,” Brooklyn Law Review, 2013, and “Partition and Revelation” (with Yun-chien Chang), forthcoming University of Chicago Law Review.

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Daniel Fischel is Lee and Brena Freeman Professor Emeritus of Law and Business, and Senior Lecturer at the University of Chicago Law School. After serving as a visiting professor at the University of Chicago Law School during the 1982–83 academic year, he joined the faculty permanently in January 1984. Mr. Fischel served as Dean of the Law School from 1999 to 2001. His chief interests include corporations, corporate finance, and the regulation of financial markets. He is the author of several books and numerous articles in these fields.

M. Todd Henderson, Professor of Law and Aaron Director Teaching Scholar, studies and teaches in the areas of corporate law, securities regulation, banking regulation, executive compensation, and law and economics. He has forthcoming papers on paying banking regulators for performance, how to better allocate banking regulatory resources using the price mechanism, a public choice account of insider trading prosecutions, and the use of Rule 11 sanctions in federal securities litigation. Additional research focuses on the differences between private and public mechanisms for holding agents accountable for decision making, and the layered nature of federal statutes. Professor Henderson has two books in progress: one on broker-dealer regulation and the other on the future of banking regulation.

Tom Ginsburg is the Leo Spitz Professor of International Law at the University of Chicago, where he also holds an appointment in the Political Science Department. He holds BA, JD and PhD degrees from the University of California at Berkeley. He currently codirects the Comparative Constitutions Project, an NSF-funded data set cataloging the world’s constitutions since 1789. His recent co-authored book, The Endurance of National Constitutions, 2009, won the best book award from Comparative Democratization Section of American Political Science Association. His other books include Judicial Review in New Democracies, 2003, Administrative Law and Governance in Asia, 2008, Rule by Law: The Politics of Courts in Authoritarian Regimes with Tamir Moustafa, 2008, and Comparative Constitutional Law, with Rosalind Dixon, 2011. Before entering law teaching, he served as a legal advisor at the Iran-US Claims Tribunal, The Hague, Netherlands, and he has consulted with numerous international development agencies and governments on legal and constitutional reform.

William H. J. Hubbard is Assistant Professor at the University of Chicago, where he also serves as an editor of the Journal of Legal Studies. His research and teaching interests primarily involve economic analysis of litigation, courts, and civil procedure.

Recent articles include “When to Overthrow Your Government: The Right to Resist in the World’s Constitutions,” with Daniel Lansberg-Rodriguez and Mila Versteeg, UCLA Law Review, 2013; “Getting to Rights: Treaty Ratification, Constitutional Convergence, and Human Rights Practice,” Harvard Journal of International Law, 2013) “The Empirical Turn in International Legal Scholarship,” American Journal of International Law, with Gregory Shaffer, 2012; and “An Economic Analysis of the Pashtunwali,” University of Chicago Legal Forum, 2011.

James J. Heckman is the Henry Schultz Distinguished Service Professor of Economics at the University of Chicago, where he has served since 1973. He is also a Professor of Science and Society at University College Dublin and a Senior Research Fellow at the American Bar Foundation. He is a co- recipient of the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel in 2000. He directs the Economics Research Center in the Department of Economics and the Center for Social Program Evaluation at the Harris School for Public Policy, and Professor of Law at the University of Chicago Law School. Heckman’s recent research focuses on human development and lifecycle skill formation, with a special emphasis on the economics of early childhood. He is also working on the impact of regulation and deregulation in Latin American labor markets. Mr. Heckman is the author of Longitudinal Analysis of Labor Market Data, Law and Employment: Lessons from Latin America and the Caribbean, Inequality in America: What Role for Human Capital Policies?, and numerous articles on labor, education, and civil-rights policies.

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Before joining the faculty in 2011, he clerked on the US Court of the Appeals for the Fifth Circuit, practiced law for five years at Mayer Brown LLP in Chicago, and received his PhD in Economics from the University of Chicago. Recent publications include “Testing for Change in Procedural Standards, with Application to Bell Atlantic v. Twombly” (Journal of Legal Studies 2013), “Another Look at the Eurobarometer Surveys” (Common Market Law Review 2013), and “Optimal Class Size, Dukes, and the Funny Thing about Shady Grove” (DePaul Law Review 2013).

William M. Landes is Clifton R. Musser Professor Emeritus of Law and Economics and Senior Lecturer. His most recent book, The Behavior of Federal Judges: A Theoretical and Empirical Study of Rational Choice, written with Judge Richard A. Posner and Lee Epstein, will be published by Harvard University Press in 2012. His previous book, The Economic Structure of Intellectual Property Law, also written with Judge Richard A. Posner, was published by Harvard University Press in 2003. Recent articles include “Inferring the Winning Party in the Supreme Court from the Pattern of Questioning at Oral Argument,” Journal of Legal Studies, (June 2010), with Lee Epstein and Richard A. Posner; “Why (and When) Judges Dissent: A Theoretical and Empirical Analysis,” Journal of Legal Analysis (2011), with Lee Epstein and Richard A. Posner; and “Measuring Coase’s Influence,” Journal of Law and Economics (November 2011, part 2) co- authored with Sonia Lahr-Pastor.

Steven Levitt is the William B. Ogden Distinguished Service Professor in Economics and the College, and is the William B. Ogden Distinguished Service Professor in Economics and the College, and the Law School at the University of Chicago. He is also a Faculty Research Fellow at the National Bureau of Economic Research and the American Bar Foundation. He studies a wide range of topics including the economic aspects of crime, corruption, sports, and education. He coauthored two books, Freakonomics (William Morrow 2005) and Super Freakonomics (Harper Collins 2009), which take an unusual look at the economics underlying real-life issues. His approach emphasizes asking the right questions and drawing connections. Levitt is a fellow in the American Academy of Arts and Sciences, received the Presidential Early Career Award for Scientists and Engineers from the National Science Foundation in 2000, and the University of Chicago’s Quantrill Award for Excellence in Undergraduate Teaching in 1998. He received the John Bates Clark Medal of the American Economic Association as the most outstanding American economist under the age of 40 in 2003. He was named one of Time magazine’s “100 People Who Shape Our World” in the spring of 2006.

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Saul Levmore is the William B. Graham Distinguished Service Professor of Law. He is a former Dean of the Law School. His recent publications include “The Impending iPrize Revolution in Intellectual Property Law,” 93 Boston University Law Review 139-62 (2013); Harmonization, Preferences, and the Calculus of Consent in Commercial and Other Law, 50 Common Market Law Review 243-60 (2013); and “Asymmetries and Incentives in Evidence Production,” 122 Yale Law Journal 690-722 (2012) (with Ariel Porat). Levmore’s current work deals with whistleblowing, “internality” regulation, threats, and information more generally. Representative titles include “Informants, Barn Burning, and the Public Interest: Loyalty in Law, Literature, and Manly Endeavors; Internality Regulation Through Public Choice” (forthcoming in Theoretical Inquiries in Law); “From Helmets to Inheritance Taxes: Regulatory Intensity, Information Revelation, and Internalities” (University of Chicago Law Review).

Jonathan Masur is Deputy Dean and Professor of Law at the University of Chicago Law School. He taught at the Law School as a Bigelow Fellow and Lecturer in Law before joining the faculty in 2007.

John List is the Homer J. Livingston Professor in Economics, the College, and the Law School. His research focuses on questions in microeconomics, with a particular emphasis on the use of experimental methods to address both positive and normative issues. Much of his time has been spent developing experimental methods in the field to explore economic aspects of environmental regulations, incentives, preferences, values, and institutions.

From May 2002 to July 2003, Mr. List served as Senior Economist, President’s Council of Economic Advisors for Environmental and Resource Economics, where he worked on multinational market institutions to address climate change, the Clear Skies Act, the OMB benefit cost guidelines, and the softwood lumber trade dispute between the US and Canada.

Richard H. McAdams, Bernard D. Meltzer Professor of Law and Aaron Director Research Scholar, came to the University of Chicago Law School in 2007. Professor McAdams teaches primarily in the area of criminal law and procedure. His scholarship focuses on criminal law and procedure, social norms, inequality, and the expressive functions of law. He has served as a member of the Editorial Board of the Annual Review of Law and Social Science and the Board of Directors of the American Law and Economics Association. Recent publications include Fairness in Law and Economics, edited with Lee Fennell, Edward Elgar, 2013; “Libertarian Paternalism, Multiple Equilibria and Temporary Law,” with Tom Ginsburg and Jonathan Masur, University of Chicago Law Review, 2013; “Bill Stuntz and the Principal-Agent Problem in Criminal Law,” in The Political Heart of Criminal Procedure: Essays on Themes of William J. Stuntz, M. Klarman, D. Skeel, and C. Steiker, eds., Oxford University Press, 2012; and “The Focal Point Theory of Expressive Law,” in Encyclopedia of Law and Economics, Francesco Parisi, ed., Edward Elgar, 2012.

Anup Malani is the Lee and Brena Freeman Professor of Law at the Law School and a Professor at the Pritzker School of Medicine at the University of Chicago; a Senior Research Fellow at the Schaeffer Center for Health Policy and Economics at the University of Southern California; a University Fellow at Resources for the Future, Washington, DC; a Research Associate at the National Bureau of Economic Research; and a senior fellow at the Center for Disease Dynamics and Economic Policy. He is also an editor of the Journal of Law and Economics and an associate editor of the Forum for Health Economics and Policy. He is a member of board of directors of the American Law and Economics Association and of the National Advisory Committee of the Robert Wood Johnson Foundation’s Public Health Law Research program. His research interests include law and economics (welfare evaluation of legal rules, empirical methods), health economics (valuing health insurance, medical innovation, regulation of drugs, evaluation of medical trials, control of infectious disease, placebo effects, antibiotic resistance, medical malpractice liability), and corporate law and finance (corporate philanthropy, the role of non- profit firms).

Thomas J. Miles is the Clifton R. Musser Professor of Law and Economics and Walter Mander Research Scholar. His principal research interests are criminal law and judicial behavior. His most recent articles on criminal law are “Does the Community Prosecution Strategy Reduce Crime? A Test of Chicago’s Experience,” American Law and Economics Review, forthcoming 2014; a study of judicial review of Title III wiretaps, entitled “Racial Disparities in Wiretap Applications before Federal Judges,” Journal of Legal Studies, 2013; and a study of the immigration enforcement program Secure Communities, entitled “Policing Immigration,” with Adam B. Cox, University of Chicago Law Review, 2013. His most recent article on judicial behavior is “The Law’s Delay: A Test of the Mechanisms of Judicial Peer Effects,” Journal of Legal Analysis, 2012. Miles teaches first-year criminal law, federal criminal law, securities regulation, and a seminar on canonical ideas in law. Miles is a Faculty Affiliate of the University Chicago Crime Lab and a member of the board of directors of the American Law and Economics Association. He served as a co- editor of the Journal of Legal Studies from 2005 until 2013.

He also is a Research Associate at the National Bureau of Economic Research, a University Fellow at the Resources for the Future, a Research Fellow at IZA (Institute for the Study of Labor), and an Extramural Fellow at the Department of Economics, Tillburg.

His research and teaching interests include administrative law, legislation, behavioral law and economics, patent law, and criminal law. Recent and forthcoming articles include “Well-Being Analysis vs. Cost-Benefit Analysis,” with John Bronsteen and Christopher Buccafusco, Duke Law Journal, 2013; “Raising the Stakes in Patent Cases,” with Anup Malani, Georgetown Law Journal, 2013; “Regulation, Unemployment, and Cost-Benefit Analysis,” with Eric Posner, Virginia Law Review, 2012; and “Costly Intellectual Property,” with David Fagundes, Vanderbilt Law Review, 2012. He is currently working on a book that looks at law and policy through the lens of subjective well-being.

Recent and forthcoming publications include “Raising the Stakes in Patent Cases,” Georgetown Law Journal, “Advertisements Impact the Physiological Efficacy of a Branded Drug,” Proceedings of the National Academy of Sciences, “Economic Epidemiology of Avian Influenza on Smallholder Poultry Farms,” Theoretical Population Biology, “The Role of Ambiguity in Drug Regulation,” Journal of Legal Studies, and “Renegotiation Design through Contract,” University of Chicago Law Review. Malani is also a principal investigator on a large, three-year field experiment on the value of India’s national health insurance scheme, Rashtriya Swasthya Bima Yojna, a study funded by the UK’s Department for International Development, the Neubauer Collegium, the Becker-Friedman Institute, the MacLean Institute, and the Law School.

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Edward Morrison is Paul H. & Theo Leffman Professor of Commercial Law at the University of Chicago Law School. Before joining Chicago, he taught at Columbia Law School, where he was the Harvey R. Miller Professor of Law and Economics. Morrison’s research explores the causes and consequences of insolvency, both consumer and corporate. Current work includes a project testing the causal impact of unexpected health expenditures on bankruptcy filing rates and a series of papers exploring the determinants of homeowner mortgage default decisions. The latter papers have included several policy proposals for addressing the housing crisis in the United States. Morrison described one of these in testimony before the Financial Services Committee of the House of Representatives in 2009. His other scholarship addresses topics such as the effects of creditor conflict on corporate bankruptcy outcomes, the regulation of financial derivatives in bankruptcy, the intersection between bankruptcy law and regulation of systemic market risk, and the dynamics of small business bankruptcy. The Economics of Bankruptcy, edited by Morrison, was published by Edward Elgar Press in October 2012.

Kevin M. Murphy is the George J. Stigler Distinguished Service Professor in Economics, the Booth School, and the Law School. He has been a member of the Chicago faculty since 1983. Murphy’s research has covered a wide range of topics including economic growth, income inequality, valuing medical research, rational addiction, and unemployment. Murphy is the recipient of the 1997 John Bates Clark Medal of the American Economic Association, which is given once every two years to the most outstanding American economist under the age of 40. Murphy was cited for his study of the causes of growing income inequality in the United States between white-collar and blue-collar workers. His findings link the growth in income inequality to growth in the demand for skilled labor. Murphy is also the author of two books and many academic articles. His writing also has been published in numerous mainstream publications including the Boston Globe, the New York Times, the Chicago Tribune, and two Wall Street Journal articles coauthored by Nobel laureate Gary Becker.

Randal C. Picker is the James Parker Hall Distinguished Service Professor of Law and Senior Fellow, the Computation Institute of the University of Chicago and Argonne National Laboratory. Picker graduated from the College of the University in 1980 cum laude with a BA in economics and was elected to Phi Beta Kappa. He received a master’s degree from the Department of Economics in 1982 and a JD from the Law School cum laude in 1985. He is a member of the Order of the Coif. While at the Law School, Mr. Picker was an Associate Editor of the Law Review. After graduation, Mr. Picker clerked for Judge Richard A. Posner of the US Court of Appeals for the Seventh Circuit and spent three years with Sidley & Austin in Chicago. Mr. Picker’s primary areas of interest are the laws relating to intellectual property, competition policy and regulated industries, and applications of game theory and agentbased computer simulations to the law. Recent articles include “The Razors-and-Blades Myth(s),” University of Chicago Law Review, 2011; and “The Google Book Search Settlement: A New Orphan-Works Monopoly,” Journal of Competition Law and Economics, 2009.

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Eric Posner is Kirkland and Ellis Distinguished Service Professor of Law, University of Chicago. His books include Economic Foundations of International Law with Alan Sykes, Harvard, forthcoming; Contract Law and Theory, Aspen, 2011; The Executive Unbound: After the Madisonian Republic, with Adrian Vermeule, Oxford, 2011; and Climate Change Justice, with David Weisbach, Princeton, 2010; He is a fellow of the American Academy of Arts and Sciences.

Julie Roin is the Seymour Logan Professor of Law. She teaches both federal income tax and state and local government and finance courses. Her primary research interest is federal income taxation, in particular its international aspects. Her paper, “Transfer Pricing in the Courts: A Cross-Country Comparison,” was published in 2012 in Fundamentals of International Transfer Pricing in Law and Economics, Springer. “Privatization and the Sale of Tax Revenues,” an article analyzing (among other things) Chicago’s parking meter deal, came out in the June 2011 issue of the Minnesota Law Review. She is currently working on a paper about withholding taxes and tax treaty policy.

Andrew M. Rosenfield, an economist and lawyer is a Senior Lecturer in Law at the University of Chicago Law School where he has taught for the last 25 years. He co- founded Lexecon Inc in 1977 (with Professors Richard Posner and William Landes) and served as its chief executive until its sale in 2000. He currently is a Managing Partner of Guggenheim Partners and co- founder and chief executive officer of TGG Group, which is a leading economics consulting firm. He is a member of the Board of Trustees of The University of Chicago and its Executive Committee and Vice Chairman of the Board of Trustees of the Art Institute of Chicago.

Michael H. Schill is Dean and Harry N. Wyatt Professor of Law. He is a national expert on real estate and housing policy, deregulation, finance, and discrimination. He has written or edited three books and over 40 articles on various aspects of housing, real estate and property law. He is an active member of a variety of public advisory councils, editorial boards, and community organizations. Before joining the faculty of the University of Chicago Law School, Dean Schill was Dean and Professor of Law at the UCLA School of Law, the Wilf Family Professor in Property Law at New York University School of Law, and professor of urban planning at NYU’s Robert F. Wagner Graduate School of Public Service. From 1994 to 2004, Dean Schill served as the director of the Furman Center for Real Estate and Urban Policy. Prior to that, Schill was a tenured professor of law and real estate at the University of Pennsylvania. His book, Property. 7th ed., with Jesse Dukeminier, James Krier and Greg Alexander, was published by Aspen Law and Business in 2010.

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Lior J. Strahilevitz is the Sidley Austin Professor of Law. His primary research interests are in the areas of property law and privacy law. He is the author of Property (8th edition, Aspen 2014) (with Jesse Dukeminier, James Krier, Greg Alexander, and Michael Schill), and Information and Exclusion (Yale University Press, 2011). His recent articles include “Personalizing Default Rules and Disclosures with Big Data,” Michigan Law Review, 2014 (with Ariel Porat); “Toward a Positive Theory of Privacy Law,” Harvard Law Review, 2013; “Absolute Preferences and Relative Preferences in Property Law,” University of Pennsylvania Law Review, 2012; and “Judicial Takings or Due Process?” Cornell Law Review, 2012 (with Eduardo Peñalver).

David A. Weisbach is Walter J. Blum Professor of Law and Senior Fellow, the Computation Institute of the University of Chicago and Argonne National Laboratory. He received his BS in mathematics from the University of Michigan in 1985; a master of advanced study (mathematics) from Wolfson College, Cambridge in 1986; and a JD from Harvard Law School in 1989. Weisbach clerked for Judge Joel M. Flaum of the US Court of Appeals for the Seventh Circuit and subsequently worked as an associate in the law firm of Miller & Chevalier and at the Department of Treasury in the Office of the Tax Legislative Counsel before joining the Chicago faculty in 1998. Weisbach is primarily interested in issues relating to federal taxation and to climate change. His principal research interests include all aspects of federal taxation and related areas of research, such as government budget policy. His book Climate Change Justice, coauthored with Eric Posner, was published by Princeton University Press in 2010. Recent publications include “Discount Rates, Social Judgments, Individuals’ Risk Preferences, and Uncertainty,” with Louis Kaplow, Journal of Risk and Uncertainty, 2011; and “The Regulation of Tax Advice and Advisors,” Tax Notes, 2011.

Crystal Yang is an Olin Fellow and Instructor in Law at the University of Chicago Law School. She received a JD from Harvard Law School magna cum laude in 2013, where she was a John M. Olin and Terence M. Considine Fellow, and recipient of the John M. Olin Prize. She received her PhD in economics from Harvard University in 2013 and was a recipient of a National Science Foundation Graduate Research Fellowship. She earned an AB in economics summa cum laude and AM in statistics from Harvard University in 2008. Her teaching and research interests center around empirical law and economics, particularly in the areas of criminal law and procedure and consumer bankruptcy.

Institute Staff The Staff for the Institue for Law and Economics organizes and plans its activities, publishes it’s journals, and provides research assistance for faculty

Candace Bergeron graduated from Illinois State University in 2010 with a BA in Spanish Language and International Relations. She recently joined the Coase-Sandor Institute as an administrator at the end of last year.

Joseph Burton joined the Coase-Sandor Institute in 2012 as executive director. Prior to that, he worked as the Director of Research and Operations at the Center for Population Economics at the Chicago Booth School of Business, where he managed federal research grants. He holds an MBA from Chicago Booth, and a master’s degree in public policy and BA in political science from Brigham Young University.

Maureen Callahan has worked at the University of Chicago since 1990, first as an editorial assistant at Modern Philology, then as a manuscript editor in the Journals Division of the Press. She worked as a senior manuscript editor at the Astrophysical Journal and has been the managing editor of the Journal of Law and Economics and the Journal of Legal Studies since 1997. She has a BA in English and is pursuing a master’s degree in Library and Information Science.

Albert Chang is a data professional for the Institute. He graduated from the University of Chicago in 2012 with an SB in Mathematics with Specialization in Economics. While in college, he took part in a summer REU (research experience for undergraduates) in the math department and also worked as an RA at the Becker Center at Chicago Booth. Albert knows econometric techniques, has experience with statistical software, and understands many of the methodologies used in empirical economic research. He is continuing his studies to improve his understanding of economic theory.

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Marjorie Holme has been with the Law School for 13 years as administrator for law and economics activities. She enjoys the ever changing tasks the job requires. Prior to coming to the Law School, she worked at Booth School of Business as Managing Editor for the Journal of Accounting Research and in the Department of Economics with the Journal of Political Economy. Before joining the university community, she worked in advertising and publishing. She has a degree in graphic art and design from the University of Illinois at Chicago.

Sharon Jennings graduated from the University of Chicago in 1989 with a BA in History. She started as a Manuscript Editor at the University of Chicago Press Journals Division that same year and moved to the Astronomy Group in 1996, where she became Chief Manuscript Editor in 2001. She served as the Journals Division Typesetting Systems Manager from 2003 to 2012, when she joined the Law School as the Production Editor for the Journal of Law and Economics and the Journal of Legal Studies.

Kevin Jiang is a research professional for the Institute. Prior to joining the Coase-Sandor Institute of Law and Economics, he worked as a research assistant for the Rand Corporation in Washington DC, working in applied microeconomics and statistics. He graduated from the University of Chicago in 2012 with an AB in Economics and a minor in Statistics. He plans to continue his studies in Econometrics and Microeconomics.

Charles Zhang graduated from the University of Chicago in 2012 with a BA in economics. Prior to working at the Institute, Charles was a research assistant to Professor Hoyt Bleakley, at Chicago Booth. He has an interest in both development economics and political economy and plans to pursue an advanced degree in economics. Charles is knowledgeable in economic research methodology. He saw a need for learned programmatic data retrieval (i.e. scraping), taught himself about the tools for this research, and is now applying these skills to faculty research projects. Scraping allows empirical researchers to not only gather data more accurately and efficiently but also create extremely large and unique data sets for analysis.

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History — What Is Law and Economics? Law and Economics at Chicago The origins of law and economics at Chicago can be traced to 1933, the year in which economists Henry Simons and Aaron Director both offered courses in economics at the Law School. In 1939, Henry Simons became the first economist to be appointed to a law school faculty. Aaron Director joined the Law School faculty in 1946 and began the Program in Law and Economics. During Aaron Director’s tenure, workshops at the Law School became the cauldron in which new ideas were tested and developed. Many important papers in law and economics were first vetted in a workshop at Chicago, including Ronald A. Coase’s “The Problem of Social Cost.” At the start of that workshop in 1960, a vote was taken on whether Coase was in error and the vote was 20 to 1 against Coase. As George Stigler explained later, “If Ronald had not been allowed to vote, it would have been even more one-sided.” At the end of the evening another vote was taken, and there were 21 votes in Coase’s favor and none against. Ronald Coase became the program director in 1964. Today, the general principles of law and economics are better understood than ever before, but much work remains to be done. The behavior of individuals cannot easily be reduced to a single algorithm; account must be taken of imperfect information and the possibility of strategic behavior to understand how any group will respond to a legal rule. Even in a field such as antitrust, that has been a focal point for scholarship for many years, there are still new insights to be made. New advances in economics itself, especially in game theory, make subjects such as predatory pricing as interesting and as controversial as ever. In his monumental Economic Analysis of Law, first published in 1973, Richard A. Posner shows how one can explain much of the common law by the use of economic principles. Posner has since published dozens of books and hundreds of articles in law and economics. Many of these were written with William Landes, an economist who joined the Law School faculty in 1974. Richard Epstein joined the faculty in 1973. His work on tort law and the law of eminent domain has revolutionized the way that scholars think about the proper limits of government regulation and the virtues of private ordering. All remain active participants in the program today. Joining Coase, Epstein, Landes, and Posner are a diverse group of scholars who share a common interest in using the tools of economics to understand legal institutions and their effect on the way people behave. They explore many areas of the law, including antitrust, intellectual property, bankruptcy, corporate law, and procedure.


The University of Chicago The Law School Coase-Sandor Institute for Law and Economics 1111 East 60th Street Chicago, Illinois 60637 773.702.0220 http://www.law.uchicago.edu/Lawecon/index.html This report primarily reflects the activities of the program and program faculty between July 1, 2012 and July 30, 2013.


Coase-Sandor Institute Annual Report 2012-2013