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Secret Liens and the Financial Crisis of 2008
Simkovic, Michael - 2009
This article explains the roots of financial crises in one of the oldest and most fundamental problems of commercial law: hidden leverage. Common law courts wrestled with this problem for centuries and developed a time - tested solution: the doctrine of secret liens. If the debtor becomes...
Persistent link: https://www.econbiz.de/10012765487
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The Effect of Risk on Legal Valuation
Rhee, Robert J. - 2015
model to legal valuation, and a small but growing body of scholarship endorses this concept. However, option theory is not …
Persistent link: https://www.econbiz.de/10012750556
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Exploiting Plaintiffs through Settlement: Divide and Conquer
Che, Yeon-Koo; Spier, Kathryn E. - In: Journal of Institutional and Theoretical Economics (JITE) 164 (2008) 1, pp. 4-23
This paper considers settlement negotiations between a single defendant and N plaintiffs when there are fixed costs of litigation. When making simultaneous take-it-or-leave-it offers to the plaintiffs, the defendant adopts a divide-and-conquer strategy. Plaintiffs settle their claims for less...
Persistent link: https://www.econbiz.de/10005582012
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An advice game with reputational and career concerns
Tsuyuhara, Kunio - In: Economics Bulletin 32 (2012) 4, pp. 3480-3487
I analyze a two-period advice game in which the decision maker chooses to retain or replace the advisor after the first period. The potential replacement creates career concerns for the advisor and thus creates incentives to misinform the decision maker. When the career concern is sufficiently...
Persistent link: https://www.econbiz.de/10011278705
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Reputation-Driven Industry Dynamics
Vial, Bernardita; Zurita, Felipe - Instituto de Economía, Facultad de Ciencia Económicas … - 2013
price-takers. Entrants have an endogenous reputation uE. In the steady-state equilibrium, uE is the lowest reputation among …
Persistent link: https://www.econbiz.de/10010774072
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Giving Gossips Their Due: Information Provision in Games with Private Monitoring
Gazzale, Robert - EconWPA - 2005
The ability of a long-lived seller to maintain and profit from a good reputation may induce her to provide high quality … share it with the community and acquire a reputation for gossiping. Reputations function in tandem: sellers provide high … made public, while information holders share their information as a reputation for doing so results in higher effort from …
Persistent link: https://www.econbiz.de/10005118597
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Asbestos and Mass Torts with Fraudulent Victims
Hylton, Keith N. - 2008
Deterrence and compensation goals should be distinguished, and compensation priorities should change in response to the deterrence goal. This has immediate implications for the problem of handling marginal and fraudulent claims in asbestos litigation. Where the deterrence goals come to the...
Persistent link: https://www.econbiz.de/10012772894
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Probability, Policy and the Problem of Reference Class
Rhee, Robert J. - 2015
This short paper focuses on the problem of reference class in evidentiary assessment as it relates to probability and weight of evidence. The reluctance to inject mathematical formalism into the factfinding function is justified. Objective probability requires a reference class from which a...
Persistent link: https://www.econbiz.de/10012750370
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Overruling and the Instability of Law
Shleifer, Andrei; Gennaioli, Nicola - National Bureau of Economic Research (NBER) - 2007
We investigate the evolution of common law under overruling, a system of precedent change in which appellate courts replace existing legal rules with new ones. We use a legal realist model, in which judges change the law to reflect their own preferences or attitudes, but changing the law is...
Persistent link: https://www.econbiz.de/10005085092
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Assuring Adequate Deterrence in Tort: A Public Good Experiment
Eisenberg, Theodore; Engel, Christoph - Max-Planck-Institut zur Erforschung von … - 2012
To explore damage rules’ deterrent effect, we use a public good experiment to tailor allowable punishment to rules used in actual civil litigation. The experimental treatments are analogous to: (1) damages limited to harm to an individual litigant, (2) damages limited to harm to a group...
Persistent link: https://www.econbiz.de/10010541291