Preventive law enforcement increases social welfare by hindering the infliction of criminal harm, but produces inconvenience costs to the general public, because it requires interfering with the acts of innocents as well as attempters. This article shows that the optimal amount of investment in...

We analyze the interactions between social norms, the prevalence of regulated acts, and policies. These interactions are impacted by people's inability to directly observe actors' behavior. Norms are ineffective incentivizers when acts are committed either very frequently or very infrequently,...

Economic analyses of antitrust institutions have thus far focused predominantly on optimal penalties and the design of substantive legal rules, and have largely ignored the standard of proof used in trials as a policy tool in shaping behavior. This neglected tool can play a unique role in the...

Reputational sanctions and stigmatization costs share many things in common. In particular, wage reductions in the labor market caused by stigmatization (Rasmusen (1996)), and profit reductions in commercial markets caused by reputational losses due to a firm's previous wrong-doings (Iacobucci...

Existing literature on the contract law doctrine of duress identifies a number of tests to determine conditions under which a contract can be voided. No article provides a specific and formal economic analysis on the link between rent-seeking and the conditions under which allowing a defense of...

This Article presents a simple theory and model of the effects of political uncertainty on the market for IPOs. Our model generates four central predictions: (i) increased political uncertainty reduces the frequency of IPOs; (ii) firms that choose to conduct an IPO during periods of political...

Criminalizing an act that provides weak signals about a person's productivity and character can dilute the stigma attached to having a criminal record. This reduces the deterrence of serious crimes that do provide strong signals regarding the offender's character. Over-criminalization occurs...

A great concern with plea-bargains is that they may induce innocent individuals to plead guilty to crimes they have not committed. In this article, we identify schemes that reduce the number of innocent-pleas without affecting guilty individuals' plea-bargain incentives. Large compensations for...

Issuing and enforcing prescription drug patents requires courts and legislatures to strike a delicate balance. A patent gives drug manufacturers a legal, if temporary, monopoly on sales of a drug; this encourages manufacturers to engage in costly research and development of new medicines. But...

Reward theory, which represents the conventional economic view, suggests that the optimal strength of patents depends on a use-creation tradeoff; the inevitable production of dead-weight losses in the ex post market for the invention for the purpose of fostering technological progress. This paper...