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  Stare Decisis

  Lewis A. Kornhauser

  Stare decisis—‘keep to what has been decided previously’—refers to important aspects of the role of precedent in Anglo-American adjudicatory practice that distinguish that practice from adjudicatory practice in civil law countries. ‘Precedent’, which exists in every legal system, refers to the body of decided cases in a legal system. Different legal systems, however, treat precedent in radically different ways. An opinion of the Supreme Court of the United States, for example, generally discusses many of its own prior decisions at length and rests its decision on some of them; an opinion of the Cour de Cassation, the highest civil court in France, by contrast, will not even mention its own prior decisions. This difference in the style of opinions parallels, at least in theory, the different role of precedent in legal reasoning in the two systems. Civil law systems in theory give no effect to precedent; while common law systems such as those in the United States and England give substantial effect to it. In these Anglo-American systems, stare decisis names the obligation that, phrased broadly, requires a judge, in resolving case A (call it ‘Instant Case’), to adhere to the decision of the previously decided case B (call it ‘Prior Case’), even when the judge would otherwise have substantial reason to decide Instant Case differently. Though judges, lawyers and commentators generally agree on this broad characterization of stare decisis, they disagree widely in the specification of its details. These disagreements prevent easy summary of the jurisprudential debates as well as render the economic modeller's task more difficult. The causes of the disagreement, however, merit enumeration because they offer some insight into the practice. The following discussion of stare decisis thus begins with an enumeration of the causes of disagreement over the characterization of stare decisis. I then isolate some key features of the practice that may provide a starting-point for analysis and understanding. Finally, I consider some difficulties confronted in the economic modelling of stare decisis.

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  Wealth Maximization

  Lewis A. Kornhauser

  A great deal of economics is about law - the functioning of markets, property rights and their enforcement, financial obligations, and so forth - yet these legal aspects are almost never addressed in the academic study of economics. Conversely, the study and practice of law entails a significant understanding of economics, yet the drafting and administration of laws often ignore economic principle. The New Palgrave Dictionary of Economics and the Law is uniquely placed by the quality, breadth and depth of its coverage to address this need for building bridges. Drawn from the ranks of academics, professional lawyers, and economists in eight countries, the 340 contributors include world experts in their fields. Among them are Nobel Laureates in economics and eminent legal scholars. The New Palgrave Dictionary of Economics and the Law will become a benchmark for reference of the highest quality.

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  Joint and Several Liability

  Lewis A. Kornhauser and Richard L. Revesz

  The law and economics analysis of the comparison of joint and several liability with non-joint (several only) liability focuses on the relative incentives for deterrence and for settlement generated by the two rules. Part I provides a brief background of the legal regimes. Parts II and III compare, respectively, the deterrence and settlement effects of the two rules.

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  Regulation of Hazardous Waste

  Lewis A. Kornhauser and Richard L. Revesz

  This essay focuses on three issues that are central to a law and economic analysis of the regulation of hazardous wastes: the choice between ex ante and ex post instruments for transmitting incentives, the extension of liability to several types of parties, and the impact of the liability regime on land transactions. To set the stage for this discussion, the essay begins with a brief description of the legal regime in the United States under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), popularly known as the Superfund statute. This background is useful because a great deal of the essay focuses on the design of liability rules, and because the Superfund statute has provided a model for the European Union's proposed directive on civil liability for damage caused by waste, and for liability regimes in many European nations. The essay does not consider issues that are common to most regulatory programmes, such as the valuation of benefits or the choice of discount rates, and does not dwell on issues common to most liability regimes, such as the consequences of joint and several liability.

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  Regulation of Hazardous Wastes

  Lewis A. Kornhauser and Richard L. Revesz

  This essay focuses on three issues that are central to a law and economic analysis of the regulation of hazardous wastes: the choice between ex ante and ex post instruments for transmitting incentives, the extension of liability to several types of parties, and the impact of the liability regime on land transactions. To set the stage for this discussion, the essay begins with a brief description of the legal regime in the United States under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), popularly known as the Superfund statute. This background is useful because a great deal of the essay focuses on the design of liability rules, and because the Superfund statute has provided a model for the European Union's proposed directive on civil liability for damage caused by waste, and for liability regimes in many European nations. The essay does not consider issues that are common to most regulatory programmes, such as the valuation of benefits or the choice of discount rates, and does not dwell on issues common to most liability regimes, such as the consequences of joint and several liability.

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  Sovereign States and Vengeful Victims: The Problem of the Right to Punish

  Neil MacCormick and David W. Garland

  ‘Revenge,’ said Bacon, ‘is a kind of wild justice’. Is justice then no more than revenge tamed? Or, to put the question less figuratively, how does and should the criminal justice process relate to the sense of injury or grievance felt by those who are in one form or another victims of criminal misconduct? In what interest and for whose sake is punishment imposed by the State on convicted criminals? Is public justice to be considered as something set apart from the vindication of private right, or is it simply one form of process that human beings have devised for protecting the rights each of them has as an individual? These questions have a sharp contemporary point in view of the prominence given by the media nowadays both to the injuries suffered by victims, and to the demands of victims and their families for punishment stiff enough to assuage the sense of grievance or resentment they actually feel. No doubt this demand of victims for satisfaction is locally attuned to the penal conventions of a country’s culture. In the USA only the death penalty will do, in the United Kingdom nothing less than life imprisonment, in the Netherlands, the victim demands a long sentence of 10 years . . . But amidst such local variations, the questions posed here have a resonance throughout ‘Western’ societies of the late twentieth century.

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  Bank Mergers and American Bank Competitiveness

  Jonathan R. Macey and Geoffrey P. Miller

  In this paper we attempt to elaborate on the observation that “the common environmental feature that underlies mergers and acquisitions throughout the U.S. economy is increased competition.” Motivating this paper is the sharp contrast between the high cost of bank mergers and acquisitions and the large number of such transactions. The existing legal rules and regulations that govern bank mergers and acquisitions make such transactions very costly. The legal environment dramatically increases the transaction costs of mergers and acquisitions and especially of hostile takeovers in the field of banking.

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  Class-Based Affirmative Action: Lessons and Caveats

  Deborah C. Malamud

  A resource for teachers, scholars, and students, providing an extended introduction to the issue; reprints of significant cases and briefs; congressional testimony and other primary documents; and a selection of scholarly articles. The three volumes explore in turn affirmative action before constitutional law from 1964 to 1977, the apparent resolution of the issue by the US Supreme Court from 1978 to 1988, and judicial reaction from 1989 to 1997. Together they trace the major lines of intellectual and legal arguments originating outside the Supreme Court that have proved persuasive to future decision makers.

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  A Riposte Form in The Song of Deborah

  Geoffrey P. Miller

  The Song of Deborah in the Book of Judges records a stunning victory won by a coalition of Israelite tribes under Deborah and Barak over a powerful army led by the Canaanite Sisera (Judg. 5.1-31). The Song is widely viewed as among the most ancient of all the biblical material; by its own terms, it describes a period early in the history of the Israelite occupation of the Promised Land, a time when, there being 'no king.. .in Israel' (Judg. 19.1), the common life of the tribes was organized under a loose confederacy under the guidance of 'judges'—inspired leaders who would rise up to rescue the Israelites when they faced aggression from other peoples. Deborah was one of these judges—and, unusually, a woman. This paper analyzes the Song of Deborah as a riposte form in a literature influenced by norms of honor. A riposte was a form of retaliation against an insult circulated in the culture by a rival group. Characteristic of the riposte is the fact that the insult could not simply be denied or ignored, because its substance had achieved widespread credibility in the broader culture. The riposte deals with this problem by accepting part of a stereotype as true, but reversing the honor-value of the attribution and returning the insult, with interest, to the group from which it originated. Riposte forms can be found at several points in the early biblical texts, and thus may represent a rhetorical form that has not been fully recognized by critical analysis. This paper proposes that the Song of Deborah responds to a negative stereotype about the people of the hill country of Canaan (i.e. the Israelites) that may have enjoyed popularity among their city-dwelling neighbors (i.e. the Canaanites). The stereotype was to the effect that the hill people lacked social graces and refinement, and that their women behaved like men. This appears to be a common cultural stereotype that people of the towns and the plains have used against the uncouth hill people in other times and places. The Song of Deborah accepts the essential attributes of the stereotype, but reverses their honor value by demonstrating that it is good to have nature on your side, that cultural refinement is an empty promise when stacked up against wily resourcefulness, and that any group should be glad to be led by women when the result is a victory as spectacular as the one secured by Deborah and her general. The Song then returns the insult to sender: the sophisticated war machine of the Canaanite forces is swept away by the forces of nature that are allied with the Israelites, and the Canaanite commander is feminized, raped, and vanquished by a woman allied with the Israelite forces. This paper is structured as follows. Part I discusses some of the prior literature on Judges, and argues that the characterization of the story as a riposte is new in the literature. Part II outlines a theory of verbal feud and places the riposte form within a broader typology of honor stories. Part III illustrates the nature of the riposte in the Song of Deborah. I end with a brief conclusion.

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  Banking Crises in Perspective: Two Causes and One Cure

  Geoffrey P. Miller

  To paraphrase Tolstoy, every banking crisis is a crisis in a different way; every period of good fortune in banking is fortunate alike. So it might appear from reading the many well-informed and thoughtful accounts of banking disasters in widely different economic systems, some of them contained in this volume. Yet the apparent divergence of crises and convergence of periods of stability may be illusory. We are interested in the causes of crises because we want to avoid their recurrence, and we investigate in detail the particular features of individual episodes. We pay less attention to the distinguishing features of periods of banking stability.

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  Class Actions

  Geoffrey P. Miller

  A class action is a procedural device for aggregating relatively large numbers of similar claims in a single judicial proceeding. Class actions are used for all sorts of cases involving multiple plaintiffs or defendants, including matters as diverse as mass torts, securities fraud cases, consumer protection litigation, civil rights cases, and much else besides. Although class actions of one form or another have been recognized in a number of common law countries, and are beginning to appear in civil law systems, only in the United States have such proceedings been widely recognized. Indeed, class actions have become a major part of the US litigation landscape, although there does not appear to be a precise quantification of the scope of class litigation as compared with other, more traditional lawsuits. This essay, accordingly, will concern itself with class action practice in the United States.

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  On The Advantages of Defined Contribution Plans: Commentary on Ghilarducci

  Geoffrey P. Miller

  Teresa Ghilarducci's paper on social investing by pension funds l calls for greater union involvement in pension fund management, and favors social investing of the sort advocated by Assistant Labor Secretary Olena Berg. I believe that the paper presents interesting and valuable insights, but that it is ultimately unpersuasive as a brief for reform of U.S. pension policy. In making her case, Professor Ghilarducci contrasts two economic models of pension fund investing, one which she refers to as the "finance" model and the other as the "contract" model. The finance model, which Professor Ghilarducci associates with the work of John Langbein, draws on the Efficient Markets Hypothesis (EMH), the theory of portfolio investing, and the Capital Asset Pricing Model (CAPM) to derive concrete policy prescriptions about the governance of pension fund assets.

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  Political Structure and Corporate Governance: Some Points of Contrast Between the U.S. and the U.K.

  Geoffrey P. Miller

  When viewed against the backdrop of corporate governance systems worldwide, the similarities between England and the United States are more pronounced than the differences. Unlike in Germany, with its emphasis on the two-tier board system and worker participation in management, English and American corporations operate under a unitary board system and do not favor employee codetermination. And unlike in Japan, with its keiretsu system of informal corporate groups cemented by cross holdings of stock, English and American corporations operate under a regime of explicit contracts and free-standing firms. Unlike most other countries in the world, including Germany and Japan, English and American corporations are not usually locked into financing relationships with lead banks. English and American corporations are unique in the world, or nearly so, in the degree to which they turn to impersonal securities markets for financing rather than to banks. While it is relatively easy to identify salient differences between the English and U.S. systems and the rest of the developed world, it is more difficult to identify major contrasts within the Anglo-American world itself. Yet such differences do exist, although they are often matters of degree rather than kind. In this paper, I consider two areas of difference: rules on derivative litigation and those on corporate takeovers. It turns out that England has a more robust and less regulated takeover market than the United States, while the U.S. is more permissive towards derivative litigation. These differences can be viewed as reflecting alternative approaches to controlling agency costs in the Berle-Means corporation. In England, agency costs are controlled by the threat or reality of a hostile takeover bid in which incumbent managers are replaced if they fail to maximize the value of a firm's assets. In the United States, where hostile takeovers have been severely restricted, the derivative action has attained greater prominence as a management control device. Although there is some plausibility to the theory that the systems reflect alternative approaches to the same public policy problem, this view is not entirely satisfactory. As it has evolved in the United States, the derivative action is not an effective means for ensuring managerial competence. Derivative lawsuits based on alleged mismanagement are extraordinarily difficult to win. The derivative lawsuit is most effective in dealing with cases of self-dealing or illegality, but these are not, or at least are not usually, the sorts of managerial behavior against which the hostile takeover is directed. Thus, the derivative lawsuit and the hostile takeover are not substitutes for one another in a public policy sense. An alternative theory might be that the distinctions between England and the United States stem from political differences. Yet, at least at first glance, this seems somewhat puzzling. We might assume, based on a review of U.S. takeover law, that incumbent corporate managers are calling the shots. Such a view, however, cannot easily explain the relative vibrancy of derivative litigation in the United States, as compared with England. Incumbent managers do not like derivative litigation because they are often the defendants, and even if they are not defendants, the derivative lawsuit threatens their authority to manage the corporation. A political explanation of the evidence must, therefore, be based on a more complex theory than one based solely on the power of incumbent management. The thesis of this paper is that a more satisfying account can be provided when differences in political structure are taken into account. In the United States, where corporate law is dominated by state governments, the political forces aligned against hostile takeovers are quite potent, generating legislation and judicial decisions that have suppressed takeover activity. In England, with its more unitary system, the political forces play out differently, and the system accordingly generates rules more accommodating to unfriendly takeovers. With respect to derivative litigation, the differences stem largely from the political influence of the organized bar. Because the English system does not recognize contingency fees, there is little constituency in the organized bar pushing for liberalization in the rules governing derivative litigation. Thus, incumbent managers, who are generally hostile to derivative litigation, exercise a great deal of control over the scope of the remedy in that country. In the United States, in contrast, the recognition of contingency fees and the "common fund" doctrine permitting attorney compensation out of the amounts generated for the benefit of the corporation have created a strong interest group within the organized bar that favors a relatively liberal scope for the remedy. Because the organized bar is usually quite influential in the design of corporate rules, it has been able to ensure a relatively wide ranging derivative remedy despite the remedy's unpopularity among corporate managers. Differing political dynamics again help to explain differences in legal institutions. This paper is organized as follows. Part I contains a brief summary of U.S. and English takeover law. Part II describes some of the differences in the law related to derivative litigation. Part III argues that the differences between England and the United States stem, at least in part, from the different political structures in which they arise. I end with a brief conclusion.

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  Help and Beneficence

  Liam B. Murphy

  Which people are we morally required to help, and to what extent? In a world where the basic needs of many millions remain unmet, this is a philosophical question of great practical urgency. A minimal position is that while it is always praiseworthy to help someone, we are morally required to help only those to whom we stand in some special relation. In addition to the objections that it is too minimal, this view faces difficulties in accounting for emergency cases, in which once could, for example, save a stranger’s life at little cost to oneself. More stringent views that place no restrictions on the range of people to be helped do not have these difficulties; they do, however, raise the intractable problem of how much we must sacrifice for the sake of others.

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  Reductionism and Antireductionism

  Thomas Nagel

  Reductionism is the idea that all of the complex and apparently disparate things we observe in the world can be explained in terms of universal principles governing their common ultimate constituents: that physics is the theory of everything. Antireductionism comes in two varieties: epistemological and ontological. Epistemological antireductionism holds that, given our finite mental capacities, we would not be able to grasp the ultimate physical explanation of many complex phenomena even if we knew the laws governing their ultimate constituents. Therefore we will always need special sciences like biology, which use more manageable descriptions. There may be controversy about which special sciences cannot be replaced by reduction, but that there will be some is uncontroversial. Ontological antireductionism holds, much more controversially, that certain higher-order phenomena cannot even in principle be fully explained by physics, but require additional principles that are not entailed by the laws governing the basic constituents. With respect to biology, the question is whether the existence and operation of highly complex functionally organized systems, and the appearance of self-replicating systems in the universe, can be accounted for in terms of particle physics alone, or whether they require independent principles of order.

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  Asset Restructuring and Union Bargaining

  Edward B. Rock and Michael L. Wachter

  In both the union and non-union sectors, firms restructure their assets and production, deciding continuously whether to make or buy an input (the subcontracting decision), as well as whether to continue or to exit a product line. The principal difference in the legal requirements applicable to restructuring in the union sector is the National Labor Relations Act’s (NLRA) obligation to bargain over the ‘terms and conditions of employment’. This has raised the legal question of when, in an asset restructuring, there is a duty to bargain with the union. The question has significance for asset restructuring in both the union and nonunion sectors because the regime of explicit contracting encouraged by the NLRA provides our clearest window into the less easily identified patterns of implicit contracting that prevail in the substantially larger nonunion sector. In this essay, we use labour economics to elucidate the nature of the question, the competing concerns, and, finally, to provide a positive theory of the law. In part I, we describe the problems raised by the restructuring of production through subcontracting and asset sales, and describe, in highly stylized form, the principal types of cases that arise. In part II, we summarize the current state of the law as it applies to these common types of cases. Then, in part III, we analyse the economic logic of the legal doctrines by summarizing the relevant economic analyses and applying them to the principal types of cases that arise.

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  Notes from the Aftermath

  AnnJanette Rosga and Margaret L. Satterthwaite

  From what stance can one comment critically on memoir? Our position as political-intellectual daughters of the feminist movement—heirs to all that is good, bad, and undecidable in this legacy—seems at once overdetermined and difficult to name. The pieces in this volume seem to us to represent much of the full spectrum of our inheritance. There is much here we’ve found inspiring; even more, humbling. And a fair amount that makes us cringe, as perhaps only true daughters can—those who are both indubitably of this heritage and yet/still outside of it. For each of us, a defining feature of our entry into feminism was that it occurred ex post facto. We weren’t there. We studied feminism-as-critiqued. The “third wave”—marked chiefly by the decentering of the unmarked (hence, white and middle-class) Woman—was well underway by the time we reached college in 1986, as was the conservative “backlash.” Many of the contributors here are in conversation with this panoply of critics. Much of the prose exudes varying degrees of longing to correct the record, but the critiques themselves are here too: perhaps this is feminism’s most enduring strength and its bane, a relentless self-criticality. For us, this volume offers us an account of our debts; it complicates that “straw woman,” the seventies feminist, and it challenges us to find an adequate measure of our own places in this history.

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  Discovery

  Daniel L. Rubinfeld

  The process by which disputes are resolved varies substantially with and between common law and civil law countries. It should come as no surprise, therefore, to learn that the means by which plaintiffs and defendants obtains and disseminate information also vary widely from country to country. While much of the literature on the economic analysis of legal disputes (reviews in Cooter and Rubinfeld 1989) involves informational issues, relatively little emphasis has been placed on the exchanges of information that occurs after a suit has been filed and before a trial has begun. This essay focuses entirely on pre-trial discovery, with particular emphasis on the US Federal Rules of Civil Procedure. It is important to stress from the outset that the extensive nature of discovery in the US is by no means typical of other common law, or most civil law, legal systems. The extensive variation in discovery practices is no doubt due in substantial part to differences in the legal environments in which discovery operates. These factors include (i) whether the system is adversarial, as in the US, or inquisitorial, as in most European countries; (ii) whether there is substantial reliance on juries as triers of fact, as in the US but not England; (iii) whether there is substantial fee shifting from losing to winning parties, as in the UK and parts of Continental Europe but not in the US; and (iv) whether the underlying culture relies heavily on attorneys, and relies on the court system to encourage the provision of information to resolve disputes, as in the US, but not in Japan. Langbein (1985) has undertaken a comparative analysis of the German and US legal systems, but a more complete comparative analysis awaits further research. Whether the legal system is civil or common law, whether it relies on juries or judges, and whatever the financial incentives the parties face, the lessons that one learns from the study of pre-trial discovery in the US will have broad implications for other common and civil law systems, and vice versa. Ideally, discovery enables each side to become informed about the other’s legal arguments and the facts upon which they are based. Failure to respond fully and candidly to these requests can provoke a variety of sanctions by the court. As a whole, procedural laws are designed to enable each side to discover the other’s legal arguments and the facts upon which they are based, but not to abuse the process while doing so. Discovery in the US has been controversial as it has developed over the past sixty years, from the reforms of the federal rules of evidence in the 1930s through a number of very recent reforms involving mandatory discovery. Cooter and Rubinfeld (1994) summarize the debate concerning the value of discovery and its potential abuse. A reading of the relevant literature suggests that there are five purposes of discovery: (1) to increase the probability of settlement; (2) to increase the fairness and accuracy of settlements; (3) to improve the accuracy of trials; (4) to filter complaints better in order to terminate meritless disputes; and (5) to lower the transaction costs of resolving disputes. The next part of this essay reviews these five uses, while the final section focuses on discovery abuse and some of the policy reforms that have been proposed to eliminate that abuse.

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  Contingent Fees

  Daniel L. Rubinfeld and Suzanne Scotchmer

  A contingent fee is a contractual arrangement between a client and an attorney in which the attorney’s fee depends on the outcome of the case. Such fee arrangements can take many different forms, each of which creates a different type of risk-sharing arrangement. Perhaps the most common is the linear fee schedule, in which the client agrees to pay the attorney a fixed percentage of any monetary benefit (either settlement or trial judgment) that the client receives or is awarded. In many such fee arrangements, the attorney pays the client’s expenses during the legal process, with the knowledge that these funds are not likely to be reimbursed if the client is unsuccessful; as a result, the linear arrangement may be seen as a fixed initial payment plus a percentage of the monetary benefit that is received subsequently. Nonlinear fee arrangements are also quite common, typically appearing in the form of a schedule in which the contingency percentage decreases with the magnitude of the monetary benefit. Other forms of ‘nonlinearities’ may also be seen as contingent fee arrangements, as when the percentage received by the attorney depends on whether the case is settled or tried (Hay 1977), or on the amount of effort (hours billed) that the attorney makes (Miller 1987). Finally, it is not uncommon for clients to agree to pay certain expenses and hourly fees for law firm associates, while offering a contingency arrangement in exchange for an agreement by the partners not to bill their time. Contingent fees have been controversial throughout legal history. In the United States they are commonly used by the plaintiff’s bar and occasionally by the defence bar. Kakalik and Pace (1986) report a US survey in which 96 percent of individual plaintiffs’ attorneys in tort litigation brought the cases on contingency, but 95 percent of defendants’ attorneys work for an hourly wage. Contingent fees are prohibited or substantially restricted, however, in many other common law and civil law legal systems. Until recently, West Germany and Spain were the only civil law systems with contingent fees. However, in 1995 a variant of a contingent fees system was instituted in England. Under the English conditional fee arrangement, if a case is lost the attorney pays all the plaintiff’s costs. If the case is won (or there is a settlement) the attorney receives her hourly fees plus a mark up which cannot exceed 100 percent (see CONDITIONAL FEES IN BRITAIN). The historical reluctance of England to institute contingency fees gives a flavour of the concerns that have historically supported such market restrictions elsewhere. Dover (1986) traces the roots of the English prohibition to the medieval era in which citizens’ legal disputes became instruments of a power struggle between the feudal nobility and the crown. He interprets the long-standing English disallowance of contingent fees as arising from a desire to discourage litigation. Others see the prohibition as a means of protecting uninformed clients with poor bargaining power from the grips of unethical or economically unscrupulous attorneys. In the United States, where litigation is widespread, contingent fees are seen by many as not only benign but also as a necessary means to provide all citizens, especially those with limited means, with access to the legal system. From a free market perspective, a compelling argument is needed to justify a restriction on contractual arrangements between principals (clients) and agents (attorneys). Yet many countries have such restrictions, and numerous attempts (some successful) have been made in various states in the US to limit the use of contingent fees. This essay focuses on the normative question of whether the restriction of fee arrangements in economically efficient. We seek, therefore, to evaluate the arguments for prohibition, and to sketch out the circumstances under which the gains from prohibition outweigh the benefits that the freedom to contract is likely to bring to both parties. The law and economics literature on contingency arrangements is almost entirely directed to the positive question of what fee arrangements are best from the point of view of the parties in litigation: the client and the attorney. Disturbingly, a question that is left almost untouched is the one that motivates the social interest in fee arrangements: the effect of such arrangements on ‘social welfare’, broadly defined to incorporate deterrence, litigation costs and the interests of other potential plaintiffs, defendants and attorneys. A related question is how fee arrangements between clients and attorneys affect the adjudication process, with a view toward the ultimate objective of how they affect the probability that offenders are convicted or determined to be liable, and nonoffenders acquitted or found not liable. And, of course, the social calculus must also account for the social resources spent on litigation. In addition to evaluating these normative questions we will attempt to find economic explanations for some empirical regularities: why do plaintiffs’ attorneys work most frequently on a contingency basis, while defendants’ attorneys do not? Why are contingency fees more common in some types of tort litigation than others? In focusing on economic efficiency, we realize, of course, that we are deemphasizing important non-economic perspective such as equity and justice. Besides being concerned about deterrence and the minimization of litigation costs, courts care about the ability of potential plaintiffs to file suit and to be fairly reimbursed for any harm they have suffered (see, for example, Birnholz 1990). In Section I, we outline the nature of actual fee arrangements. In Section II, we discuss positive issues, focusing primarily on the moral hazard implications of various fee structures. Section III treats other positive issues – adverse selection and other behaviour that result when there is asymmetric information between attorneys and clients. In Section IV, we return to the larger normative question of whether restrictions on fee arrangements are warranted. Section V conclude with a brief summary.

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  Weak Legal Consciousness as Invented Tradition

  Frank K. Upham

  In this paper I challenge the conventional wisdom that weak legal consciousness is a historical attribute of the Japanese people. Very few people anywhere enjoy conflict, and when a dispute becomes unavoidable, most people prefer to resolve it as amicably and quickly as possible. The Japanese are no exception, but to the extent that contemporary Japanese are unusual in their preference for informal dispute resolution, it is not because they lack a history of conflict or litigation. Like other societies, Japan has a rich history of formal law and litigation. What is often lacking in the Western language literature on Japanese law, however, is a knowledge of this history and a recognition of the choices of “tradition” open to contemporary Japanese culture. The paper is divided into specific and general parts. In the former I describe a dispute in Hozu village that first arose in the Tokugawa period (1802), recurred twice in the Meiji period (1871 and 1888), and was resolved in the middle Shōwa period (1962). I pay particular attention in this narrative to the procedures chosen by the parties and find that they were more likely to choose litigation or its equivalent in the earlier instances of the dispute than they were in the later. In the general part, I contrast these choices to the view that Japanese naturally prefer informal, consensual means of dispute resolution to the formality and contentiousness of litigation to a greater degree than people in other industrialized societies. Not an ineluctable legacy of the distant past, the contemporary strength of this “tradition,” I contend, is the product of a series of conscious political choices by elites beginning in the early twentieth century. Official action to suppress litigation has been standard practice throughout most of Japanese history, but as the Hozu dispute and general court statistics illustrate, it was not until after World War II that government efforts achieved a dramatic and seemingly permanent decrease in litigation rates. Although accompanied by the rhetoric of a traditional preference for consensus and harmony, present litigation rates are at least as attributable to official efforts to discourage litigation as to the preferences of individual Japanese. The history of the Hozu dispute is illustrative, if not in itself probative, of the continuing tendency of Japanese to look to formal processes to resolve their disputes and of the relatively recent success of the government in discouraging this tendency and strengthening what Kawashima Takeyoshi called Japan’s “weak legal consciousness.” The Hozu conflict originated in a complex struggle between wealthy farmers and their small farmer tenants. The aspect that interests us concerns the proper utilization of the village commons and the degree of access enjoyed by village Burakumin, who had become allied with the landlords. The conflict thus implicated both social status and land ownership, perhaps the two most important legal issues in Tokugawa Japan, and was representative of the status litigation that occurred throughout the period. Although conflicts over status and land were not the most numerous disputes in Edo Japan—by far the largest number of lawsuits concerned the repayment of debts—they were treated with the greatest concern by the authorities. Control of land mean wealth and power, and a stable social hierarchy was the goal of Edo law and political ideology. The Burakumin occupied the lowest rung of the hierarchy, but disputes over their status vis-á-vis small farmers were no more distinctive than disputes brought by small farmers over the status privileges of wealthy farmers or complaints by villagers over a headman’s abuse of the privileges of his office. In this important sense the Hozu litigation was typical of how Japanese citizens and authorities dealt with the issues of most fundamental importance in them.

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  Hobbes: Truth, Publicity and Civil Doctrine

  Jeremy Waldron

  Philosophers on Education provides the most comprehensive history of philosphers' views and impacts on the direction of education, from Plato to Dewey. As Amelie Oksenberg Rorty explains in describing a history of education, we are essentially describing and gaining the clearest understanding of the issues that presently concern and divide us. Philosophical reflection on education has usually been directed to the education of rulers, to those who are presumed to preserve and transmit—or to redirect and transform—the culture of sociey, its knowledge and values. Every historical era is marked by a struggle among claimants to that power. It is only late in the history of liberal democracies that educational policy was formulated for and directed toward autonomous individuals who structure their own lives. The contributors to this collection recognize that history remains actively embedded and expressed in society's beliefs and practices, and that the study of the history of philosophy mandates reflection on its implications for education. The all new essays are written by some of the finest contemporary philosophers: Elizabeth Anderson, Annette C. Baier, Frederick B. Beiser, Eva T. H. Brann, M.F. Burnyeat, William Galston, Daniel Garber, Peter Gay, Alvin I. Goldman, Moshe Halbertal, Tova Hartman Halbertal, Simon Harrison, Barbara Herman, Genevieve Lloyd, Alasdair MacIntyre, Richard W. Miller, Roy P. Mottahedeh, Adam Phillips, Philip L. Quinn, C.D.C. Reeve, Patrick Riley, Amelie Oksenberg Rorty, Emma Rothschild, Alan Ryan, Richard Schacht, Josef Stern, Richard Tuck, Thomas E. Uebel, Jeremy Waldron, Allen Wood, Paul Woodruff, Jean S. Yolton, John W. Yolton, Zhang LoShan (pseudonym).

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  Humility and the Curse of Injustice

  Jeremy Waldron

  Why has affirmative action become the lightning rod for conflicts over racial inequality in the United States? Have color-blind legal and political doctrines intensified or ameliorated America’s racial divisions? Race and Representation: Affirmative Action invites readers to enter a debate on a matter of the greatest moment for American universities, politics, and public life. Focusing on the politically driven decision of California’s governor and Board of Regents to end affirmative action at the University of California, as well as on the subsequent enactment of an amendment to the California Constitution prohibiting the state from engaging in affirmative action, and on court decisions in Texas using the federal Constitution to prohibit affirmative action at universities, contributors to this volume incisively assess the current state of the tumultuous affirmative action controversy.

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  Is Coleman Hobbes or Hume (or Perhaps Locke)?

  Jeremy Waldron

  Analyzing Law offers an important selection of the most influential and challenging work now being done in legal theory. A central focus of the essays in this work is the contribution of the well-known philosopher Jules Coleman to the various topics which are covered by the contributors.

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  Liberalism

  Jeremy Waldron

  Liberal political philosophy explores the foundations of the principles most commonly associated with liberal politics: freedom, toleration, individual rights, constitutional democracy and the rule of law. Liberals hold that political organizations are justified by the contribution they make to the interests of individuals, interests which can be understood apart from the idea of society and politics. They reject both the view that cultures, communities and states are ends in themselves, and the view that social and political organizations should aim to transform or perfect human nature. People have purposes of their own to pursue, either economic or spiritual (or both). Since those purposes do not naturally harmonize with one another, a framework of rules may be necessary so that individuals know what they can count on for their own purposes and what they must concede to the purposes of others. The challenge for political philosophy, then, is to design a social framework that provides this security and predictability, but represents at the same time a safe and reasonable compromise among the disparate demands of individuals.

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  Neutrality, Political

  Jeremy Waldron

  The principle of political neutrality, which requires the state to remain neutral on disputed questions about the good, is an extension of traditional liberal principles of toleration and religious disestablishment. However, since neutrality is itself a contested concept, the principle remains indeterminate: is it, for example, a requirement of neutral reasons for legislation (or neutral legislative intentions) or is it a more exacting requirement of equal impact in so far as legislative consequences are concerned? The answer must surely reflect the deeper values that are used to justify the neutrality principle. This raises further problems, however. If the principle is based upon certain value commitments – such as the importance of equality or individual autonomy – then it cannot require us to be neutral about all values. It requires some sort of distinction between principles of right (of which neutrality is one) and conceptions of the good (among which neutrality is required). Critics believe that liberal principles of right are symptomatic of a deeper liberal bias in favour of individuality as a way of life. Perhaps liberals should embrace this point, and accept that the neutrality they advocate is quite superficial compared to the depth of their own value commitments.