Saul Levmore

The Promise of Prediction Markets

The ability of groups of people to make predictions is a potent research tool that should be freed of unnecessary government restrictions.

Two Stories about the Evolution of Property Rights

This article shows that for virtually every move toward privatization or, moving in reverse, toward the reopening of access to property, there are conflicting explanations. One is transaction‐cost based and optimistic, while the other implicates interest groups and arouses suspicions rather than celebrations. It will normally be difficult to know which explanation is more fitting. Examples range from highways, to intellectual property rights, to tennis courts, and then to licensing regimes. These examples draw attention to the possibility of an evolutionary path that runs from a commons to private property and then back to a commons. The normative ambiguity inherent in the dual stories about change infects most property right transformations, including the simplest cases of newly emerged property rights. The presence of competing stories creates problems for normative judgments about secure private property and about government intervention that opens or restricts access.

Property¿s Uneasy Path and Expanding Future

How has law come to its present state and where is it going? These are two obvious questions to ask on the occasion of a great Law Schools Centennial. In this Essay, I direct these questions at property rights, a centerpiece of the law and economics revolution that has itself been an important part of this last century of ideas. The law and economics literature has advanced the optimistic view that property rights have evolved in a way that promotes economic efficiency.1 I suggest that alongside the conventional and optimistic view, which is essentially transaction cost, or efficiency, based, there is an alternative and skeptical view that is interest group, or politically, driven. And if it is true that the evolution of property rights up to the present time is capable of conflicting explanations, then there is the question of predicting the future of property rights and, as we will see, the future of intellectual property in particular. Part I begins by exploring two distinct stories about the evolution of property rights. Part II then applies the two evolutionary stories to assess the future of intellectual property rights. I suggest that we should expect interest group pressures to generate an expansion of intellectual property rights, perhaps even to include protection for abstract ideas. These expanding rights will shape much of our legal system in the coming years. The conclusion adds some hopeful comments about the limits of interest group politics.

Bargaining with Double Jeopardy

Virtually every burden of proof is influenced by a rule regarding relitigation. In criminal law, the prosecutor is prevented from repeatedly drawing from the urn, as it were, by the double-jeopardy rule, which reinforces the beyond-a-reasonable-doubt standard. We suggest that if law were to permit defendants to waive double-jeopardy protection, private and social benefits might follow. The benefits derive from the likelihood that prosecutors—like most people who can take a test but once—overinvest in preparation. Somewhat similarly, though far afield, deficit spending by a legislature might be linked to the fact that spending proposals that are rebuffed can be retested or revisited. We contemplate offering defendants the option of waiving their double-jeopardy protection in anticipation of reduced prosecutorial investment. Innocent defendants might then be more likely to waive, in which case there will be socially beneficial sorting of defendants.

Voting Paradoxes and Interest Groups

This paper offers the conjecture that interest groups act where there are cycling majorities or other aggregation anomalies. The claim is that instability attracts political activity. This simple conjecture suggests a link between voting paradoxes, or puzzles of aggregation, and questions about why some interest groups succeed while others do not. Interest groups are seen as exploiting the opportunities offered by aggregation anomalies either by influencing procedure or by bargaining their way into successful coalitions. The link between instability and interest‐group activity also bears on such normative questions as whether interest‐group activity is likely to have disparate corrupting influences on legislative or judicial or direct (popular) decision making.

Ruling Majorities and Reasoning Pluralities

This article takes on the puzzle of why many appellate courts insist on an outright (but simple) majority decision as to the immediate outcome or disposition of a case, while tolerating a plurality decision as to the precedential message, or reasoning, attached to a case. Somewhat similarly, pluralities are respected in many political settings but then not, for example, in legislative assemblies. The argument builds both on the Condorcet Jury Theorem and on the problem of dealing with voting paradoxes, or cycles. It links decision rules with the likelihood of cycling and the danger of misconstruing majority decisions.

Internality Regulation Through Public Choice

Abstract Much health and safety regulation can be understood as the product of political coalitions between two groups. The first, consisting of persons with self-control issues, enlists the government as an intermediary. The second either expects to benefit from the success of the first, or anticipates gains from a tax imposed on the first group’s behavior. A political entrepreneur might plausibly turn these groups’ preferences into law. This public choice perspective on regulation provides a positive explanation of why it is more likely that a legal system will engage in some health and safety programs than in others. The important break from the conventional view of regulation, as something that either controls externalities or is imposed paternalistically, is in advancing the idea that the government is an intermediary deployed by those who want help. Internalities, associated with collective action problems or with time inconsistent preferences, deserve equal billing. The discussion considers smoking regulation and other health and safety regulation, and then contrasts these with anti-obesity efforts where private contracting is a more feasible means of controlling internalities, and where political coalitions are less likely

Harmonization, Preferences, and the Calculus of Consent in Commercial and Other Law

The European Union is exploring a move toward harmonization in the form of a common commercial code (CESL), with some mandatory provisions especially with respect to consumer law, but alsoincorporating a large dose of business-to-business law that would be optional at the enterprise, rather than jurisdictional, level. This paper begins with the question of when harmonization is preferable to diversity, and not just with respect to commercial law. It tackles the problem from the perspective of the median voters in jurisdictions, some of which have similar preferences and some not. It introduces the ability of a stable and like-minded group to impose external costs on others, and then also on the ability of like-minded players to benefit by favoring central decisionmaking rather than local authority and local preferences.

Intellectual Property and Legislative Innovation

Intellectual property law is motivated by the idea that innovation requires encouragement with property rights or other rewards. Law seeks to spur innovation in the private sector with copyrights, patents, and other devices, but none of these encourage innovations in lawmaking itself. As in the private sector, a first-mover advantage or harmonization among jurisdictions could influence the rate of innovation in lawmaking, though not necessarily in an optimal way. This chapter examines various kinds of lawmaking in order to evaluate the likelihood of optimal innovation. It takes account of constituents’ likely preference for free-riding on other jurisdictions’ experiments. Lawmakers, in turn, have reason to take a wait-and-see approach so as not to be associated with unsuccessful disruptions. The analysis examines lawmakers’ incentives and draws on several examples, including the design of healthcare systems, the legalization of same-sex marriage, and school reform. In many settings, lawmakers seem to be assigned the task of execution rather than innovation; if lawmakers are best understood as ‘assemblers’ of constituents, consensus, and ideas developed elsewhere, then it is noteworthy that this sort of activity in the private sector is (also) not encouraged by intellectual property law. The discussion includes the roles that prizes and inter-jurisdictional alliances might play in encouraging innovative lawmaking. It suggests that small-scale experimentation is easier in the private sector than in the public sphere, and this too likely affects the rate and thus timing of legal innovation. Keywords: innovation, intellectual property, harmonization, incrementalism

Interest groups and the durability of law

At any given point, lawmakers and interest groups benefit if the laws they pass are long-lived, or durable. The quest for durability explains some kinds of licensing, but a more important conclusion is that it explains a preference for spending programs, rather than mere regulation. Expenditures create endowment effects, to be sure, but spending programs are especially appealing to their beneficiaries when they bring about physical assets that future lawmakers will have no reason to dismantle. In an earlier era, the quest for durability might have generated overinvestments, as monumentalist rulers sought to leave their marks. In modern times, durability can be obtained through social programs as well as construction projects. In some settings durable projects can be reversed with targeted taxes, but recapturing previously awarded benefits is more difficult. Keywords: durability, interest groups, retroactivity, public goods, clawbacks