We develop a model where products liability trials provide information to consumers who are not parties to the litigation. Consumers use this information to take precautions against dangerous products. A critical assumption is that consumers cannot differentiate between firms that have never...

This paper develops a repeated game model of the choice of doctrinal form by a higher court. Doctrine can take any point along a continuum from more determinate, rule-like legal commands to more flexible, standard-like directives. In deciding a case, the Supreme Court not only decides on a...

We quantify and study state-level economic policy uncertainty. Tapping digital archives for nearly 3,500 local newspapers, we construct three monthly indexes for each state: one that captures state and local sources of policy uncertainty (ΕPU-S), one that captures national and international...

We model claim resolution and reputation-building by an agent who cannot be fired and whose wages cannot be changed. The agent decides the merits of a claim for relief or allocation of government benefits. On appeal, the appellate body observes a partial picture of the claim. Despite a lack of...

This article examines the impact of four types of law-related uncertainty on the utility of risk-neutral agents. We find that greater legal or factual uncertainty makes agents worse off if enforcement is targeted (meaning that greater deviations from what the law demands lead to a greater...

The paper reconsiders an old question in law and economics: will firms prefer to rely on legal sanctions or market sanctions as a means of committing to provide high quality goods? In the model, legal sanctions are expensive to deploy because of litigation costs, whereas market sanctions are...