Antony W. Dnes

The Regulation of the United Kingdom Electricity Industry: An Event Study of Price-Capping Measures

The privatization of United Kingdom utilities after 1979 established a regulatory regime based around price capping rather than return capping. This innovation was intended to provide a predictable framework that encouraged efficiency. An event methodology was used to examine stock market reaction to the main regulatory announcements affecting 12 Regional Electric Companies from flotation to 1995. The results indicate that the regulatory announcements were only a minor contributor to the persistent abnormal returns observed. The low connection between regulatory events, efficiency changes and abnormal returns at company level lead to a conclusion that the initial structural and control frameworks dominated the regulatory framework.

The reform of academic tenure in the United Kingdom

Abstract In this paper, we examine the reform of academic tenure in the United Kingdom (UK) after the 1988 Education Reform Act. 1 We test the hypothesis that softening tenure encourages incumbent academics to consolidate their hold on academic life [ Carmichael (1988) ]. We also assess the economic significance of the English and American case law on tenure, because an understanding of the legal aspects of tenure is required to identify the possible effects of tenure reform. The years after passage of the Act provide an interesting natural experiment, as the broad effect of the legislation was to soften, though not to remove, tenure in British universities. 2 We can find support for the Carmichael hypothesis prereform but do not believe that the Act caused incumbent academics to consolidate their hold on senior posts after the reform. Tenure implies that the holder of a post cannot be removed from it except for good cause, usually based on gross moral turpitude or gross incompetence. Such removal is historically characterized by a costly procedure governed by organizational statutes, as shown in Hines v. Birkbeck College . 3 In the United Kingdom, academic tenure has been associated with open-ended contracts of employment and often had a particularly hard form before 1988. In the United States, where it has often been possible to dismiss academics for financial reasons by abolishing whole departments, tenure has taken a softer form (although often harder to obtain) and can still be held to exist even when an employment contract is of a fixed term as long as it is renewable. 4 The details of universities’ tenure statutes have always varied between institutions, in both the United Kingdom and United States, which is often overlooked. “Before 1988, could your university make academics redundant by giving notice and paying statutory redundancy pay, or was it extremely hard to sack academics—having to buy them out or use arguments based on gross moral turpitude or incompetence?”

Hostages, marginal deterrence and franchise contracts

Abstract In this paper, I examine the nature of hostages in long-term contracts. The definition of a hostage is improved relative to the rents attached to a contract. In addition, I show that hostages need to reflect marginal deterrence (fitting the crime) and operate similarly to the same principle in the criminal law. Some empirical observations are presented from franchise systems and support the marginal-deterrence hypothesis.

Applications of economic analysis to marital law: concerning a proposal to reform the discretionary approach to the division of marital assets in England and Wales

Abstract In this paper, I apply the economic analysis of law to examine recent proposals in England and Wales for the reform of the law affecting financial settlement after divorce. The starting point is an examination of the wide discretion currently afforded to the courts and the impact this has on incentives for divorcing parties and their legal representatives. Two specific reforming measures have been proposed to reduce this judicial discretion. First, a mathematical formula, such as a rebuttable presumption to divide equally the whole pool of assets upon divorce—a form of community property—could be used. It would be applied in the absence of agreement between the parties dividing assets, as in many countries in continental Europe. Second, legal enforceability could be accorded to prenuptial agreements, again after a continental pattern. Broadly, I conclude that changing to community property and enforceable agreements should be welfare improving but would need to be forward looking and applied to marriages, rather than divorces.

Contracts for Legal Aid: A Critical Discussion of Government Policy Proposals

In this paper, we examine the UK governments proposals for the reform of legal aid, which are based on block franchising. We identify several potential incentive-compatibility problems mainly concerned with the possibility of chiseling on quality after contracts are awarded or with supplier control of access to legal aid. Our suggestions for improving the scheme are based around awarding vouchers for legal aid.