A. Allan Schmid

APPLICATIONS OF SOCIAL CAPITAL THEORY

Experiments and studies were conducted to investigate the role of social capital. Social capital (relationship to others) is a productive asset which is a substitute for and complement to other productive assets. The productivity of social capital leads to the expectation that firms and individuals invest in relationships. Data were collected to answer the following questions: Does the identity (relationship) of trading partners affect selling and buying prices; the acceptance of catastrophic risk; the choice of share or cash leases in agriculture; loan approval; and the banks investment to retain customers? The evidence is in the affirmative.

Law and Economics: An Institutional Perspective

The study of law and economics has as its goal the identification of the instrumental variables and the fundamental issues and processes in the operation of legal institutions of economic significance. This has been an interest of classical political economy since its inception. The contemporary institutional approach has its roots in the work of such economists as Henry Carter Adams on economics and jurisprudence [1], Richard T. Ely on the role of property and contract in the distribution of wealth [2], and John R. Commons on the legal foundations of capitalism [3]. It can also be found in work of such legal scholars as Walton Hamilton [4], Karl Llewellyn [5], Jerome Frank [6], and Roscoe Pound. [7] These scholars constitute a tradition focusing on the interrelation between the processes of the state and the economy, rather than simply an application of economics to law.

Affinity as social capital: its role in development

Abstract One form of social capital is a relationship of affinity and regard among people. The capital metaphor can be useful in identifying processes of investment and disinvestment. Caring can be an economic asset that complements and substitutes for other assets.

Institutional law and economics

Behavioral economics provides one of the foundation for institutional law and economics (ILE). Improvement in predicting the performance of alternative laws will be built on ILE insights into how distribution affects productivity of labor and realization of joint gains. Our understanding of obedience to law as well as other categories of failure to be opportunistic (such as in high exclusion-cost situations) will be better understood from an ILE perspective that investigates learning to supplement specific sanctions.The boundaries of ILE inquiry encompass private property rights, regulation, and public spending and taxation since these are complements and substitutes. Public spending is not a good measure of the size of government, and regulation is not the opposite of freedom in the aggregate. This framework of ILE can usefully be seen as distinctive, even if all of its practitioners do not use the label and several of its propositions are shared with other paradigms. A better label might simply be institutional economics or political economy.

Property Rights in Plants: Implications for Biotechnology Research and Extension

The objective of intellectual property rights is to increase the rate of technological change and the dissemination of knowledge by rewarding the output of research investment (Kintner and Lahr). Asexually propagated plants have been patentable in the United States since 1930 under an amendment to the Patent Act. In recent years, such rights have increasingly been extended to plants and microbes. The 1970 Plant Variety Protection Act extended rights to breeders of sexually propagated plants, except F-1 hybrids. The Supreme Court found microorganisms to be patentable in 1980 Diamond v. Chakrabarty 100 S. Ct. 2204, 2210. A decision by the Patent Office Board of Appeals Exparte Hibberd 227 USPQ 447 (1985) found all plants to be patentable.

The Role of Social Capital in the Industrialization of the Food System

Selfishness of preferences alone will not support the coordination necessary for the industrialization of the food system. Social capital relationships of mutual sympathy (caring) yield socio-emotional goods that are important in the more personal business world of evolving incomplete contracts and alliances involving input suppliers, processors, and labor. Relationships are also critical when consumers are buying image as well as physical products. Management and policy alternatives constitute investment in social capital that can affect opportunism, risk, loyalty, and trust.

Discussion: Social Capital as an Important Lever in Economic Development Policy and Private Strategy

dom accepts that physical capital of machines, plant, and infrastructure is the essence of economic development. Progress and technology are synonymous. Saving became the key and, of course, capitalists were the engine. Capitalists by their grace give us jobs and they are to be coddled with tax cuts and other benefits, by national and local governments. Then we noticed that physical capital measured in dollars and person-hours of work in the aggregate production function did not explain growth in output very well. So we created the concept of human capital. Economists in universities were understandably sympathetic to linking the legitimating capital metaphor to education. This success attracted other previously marginalized scholars who think that social relation-

Public choice in local judicial systems

For their contributions to earlier drafts, acknowledgements are extended to Webb Smathers, Ron Faas, Rod Ziemer and other reviewers.

THE SPARTAN SCHOOL OF INSTITUTIONAL ECONOMICS AT MICHIGAN STATE UNIVERSITY

Heterodox scholarship at Michigan State University (MSU) was influenced by the institutional economics of John R. Commons at Wisconsin. But it was far from monolithic and had many other sources and originality of its own. A case can be made that the center of institutional economics moved across Lake Michigan from Madison to East Lansing and blossomed in the second half of the 20th century with such Wisconsin Ph.Ds as Raleigh Barlowe, Warren Samuels, Allan Schmid, Harry Trebing, and others. Equally important in making MSU a center of institutional economics were scholars from other institutional backgrounds such as Paul Strassmann, economic development; Robert Solo, science and technology; James Shaffer, agricultural marketing and consumer behavior; Nicholas Mercuro, law and economics; and others.

Technology, Labor Interests and the Law: Some Fundamental Points and Problems

The symposium of which this essay is a part deals with technology and law with particular reference to the interests of workers. Perhaps needless to say but nonetheless important, each of the three topics — technology, law and worker in erests — has had a long history of controversy about factual or positive and normative considerations. It is not our intention, and certainly no our expectation, either to resolve the thorny issues involved in the three topics and their interconnections or to solve the difficult, complex and delicate policy problems through some concrete programme or panacea. It is our objective to identify the critical issues, something of what we know about them, and something of what is involved in any effort to work them out. We come, that is to say, neither to propose nor to render complete policy analysis of others’ proposals but to advise as to what is involved, inevitably, in any efforts somehow to reconcile, whether through law or otherwise, the conflicts between technology and labour interests.