William M. Landes

The economic structure of tort law

Written by a lawyer and an economist, this is the first full-length economic study of tort law--the body of law that governs liability for accidents and for intentional wrongs such as battery and defamation. Landes and Posner propose that tort law is best understood as a system for achieving an efficient allocation of resources to safety--that, on the whole, rules and doctrines of tort law encourage the optimal investment in safety by potential injurers and potential victims. The book contains both a comprehensive description of the major doctrines of tort law and a series of formal economic models used to explore the economic properties of these doctrines. All the formal models are translated into simple commonsense terms so that the math less reader can follow the text without difficulty; legal jargon is also avoided, for the sake of economists and other readers not trained in the law. Although the primary focus is on explaining existing doctrines rather than on exploring their implementation by juries, insurance adjusters, and other real world actors, the book has obvious pertinence to the ongoing controversies over damage awards, insurance rates and availability, and reform of tort law-in fact it is an essential prerequisite to sound reform. Among other timely topics, the authors discuss punitive damage awards in products liability cases, the evolution of products liability law, and the problem of liability for mass disaster torts, such as might be produced by a nuclear accident. More generally, this book is an important contribution to the law and economics movement, the most exciting and controversial development in modern legal education and scholarship, andwill become an obligatory reference for all who are concerned with the study of tort law.

An Economic Analysis of the Courts

IN the folklore of criminal justice a popular belief is that the accused will have his case decided in a trial. Empirical evidence does not support this belief. Table 1 indicates that most cases are disposed of before trial by either a guilty plea or a dismissal of the charges. What factors determine the choice between a pre-trial settlement and a trial? What accounts for the large proportion of settlements compared to trials? How are certain aspects of the criminal justice process such as the bail system and court delay related to the decision to settle or to go to trial? The main purpose of this essay is to answer these questions by means of a theoretical and empirical analysis of the criminal justice system using standard tools of economic theory and statistics.

Judicial Influence: A Citation Analysis of Federal Courts of Appeals Judges

This article uses citations to the published opinions of judges on the federal courts of appeals who had 6 or more years tenure at the end of 1995 to estimate empirically the influence of individual judges. We rank judges on the basis of both total influence (citations adjusted for judicial tenure and other variables) and average influence (citations per published opinion). We also analyze the effects of factors that may be relevant to explaining differences in the influence of individual judges. These factors include both characteristics of the judges (for example, quality of law school, law school performance, sex, race, prior experience, political affiliation) and characteristics of the circuit in which they sit (such as the mix of cases in the circuit). In an appendix, we use citations to the published opinions in each circuit rather than to individual judges to measure the influence of circuits rather than individual judges.

An Economic Study of U.S. Aircraft Hijacking, 1961-1976

ON May 1, 1961 a National Airlines aircraft en route from Miami to Key West was successfully hijacked and diverted to Cuba. Although aircraft hijackings had occurred in Eastern Europe and Cuba prior to that date, this was the first recorded hijacking of a U.S. registered aircraft.1 Seven more U.S. hijackings took place between 1961 and 1967 (see Table 1), followed by an unprecedented increase in the next five years. Between 1968 and 1972, 124 hijackings occurred, leading some observers to proclaim that hijacking had become a national epidemic.2 This surge of hijacking, however, came to an abrupt halt in 1973-one hijacking took place in that year and only ten more occurred in the next three years. A similar pattern of hijackings is

The Influence of Economics on Law: A Quantitative Study

I often say that when you can measure what you are speaking about, and express it in numbers you know something about it; but when you cannot measure it, when you cannot express it in numbers, your knowledge is of a meagre and unsatisfactory kind: it may be the beginning of knowledge, but you have scarcely, in your thoughts, advanced to the stage of science, whatever the matter may be. [SIR WILLIAM THOMSON, LORD

An Economic Analysis of Copyright Law

INTELLECTUAL property is a natural field for economic analysis of law,1 and copyright is an important form of intellectual property. Yet while there are good introductions to the economics of copyright law, and a number of excellent articles on the economics of copying (as distinct from copyright law),2 no article examines the field of copyright as a whole, discussing the evolution and major doctrines in the law from an economic

Indefinitely Renewable Copyright

In this paper we raise questions concerning the widely accepted proposition that economic efficiency requires that copyright protection be limited in its duration (often shorter than the current term). We show that just as an absence of property rights in tangible property would lead to inefficiencies, so intangible works that fall into the public domain may be inefficiently used because of congestion externalities and impaired incentives to invest in maintaining and exploiting these works. Although a system of indefinite renewals could lead to perpetual copyrights or very long terms, this is unlikely. Our empirical analysis indicates that (1) fewer than 11 percent of the copyrights registered between 1883 and 1964 were renewed at the end of their 28-year term, even though the cost of renewal was small; (2) copyrights are subject to significant depreciation and have an expected or average life of only about 15 years; and (3) copyright registration and renewals are highly responsive to economic incentives for the shorter the expected life of a copyright and the higher the registration and renewal fees, the less likely are both registration and renewal. This in turn suggests that a system of modestly higher registration and renewal fees than at present, a relatively short initial term (20 years or so), and a right of indefinite renewal (possibly subject to an overall maximum term of protection of say 100 years) would cause a large number of copyrighted works to be returned to the public domain quite soon after they were created. A further benefit of indefinite renewal is that it would largely eliminate the rent-seeking problem that is created by the fact that owners (and users) of valuable copyrights that are soon to expire will expend real resources on trying to persuade (dissuade) Congress to extend the term.

The Economics of Fair Employment Laws

Twenty-nine states have enacted laws over the past twenty-five years prohibiting discrimination in employment on the grounds of race, creed, color, or national origin, and have created commissions with powers to enforce these laws.1 The orders of agencies administering these laws may be judicially enforced, and failure to comply can result in imprisonment and fines. During this period, more than fifty municipalities have established commissions on discrimination, generally without enforcement powers, designed to supplement the state commissions. Finally, the civil rights bill passed by Congress in 1964 includes an enforceable fair employment law of national scope. Although legislators and civil rights groups have for a long time sought the enactment of new employment laws and the extension of those already on the books, little is actually known about the empirical effects of these

Joint and Multiple Tortfeasors: An Economic Analysis

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Benefits and costs of airline mergers: a case study

This paper provides a methodology to analyze the potential benefits and costs of airline mergers. The methodology is applied to the recent merger between North Central Airlines and Southern Airways -- the superior product created by a merger which increases the amount of single-carrier versus multiple-carrier service. A conditional logit model of travel demand is used to estimate the benefit of the introduction of a superior product. Our analysis of possible costs (in reduced competition) focuses on the definition of the market and the significance of potential competition.