Faculty Bibliography

The stock market generates less wealth than it appears. We show that total shareholder return (TSR), the standard measure of stock investor performance, substantially exaggerates returns earned by these investors in aggregate, and thus by most investors. The main reason: from investors’ collective perspective, dividends cannot be reinvested in public equity, as TSR assumes, but only in other lower-yielding assets. In addition, TSR is inflated by well-timed repurchases and equity issuances that merely transfer value among investors. We put forward another measure–"all-shareholder return" (ASR)–which better captures the wealth generated by the stock market for investors. We estimate that the ASR equity premium is 17 to 73% lower than the TSR-implied equity premium, depending on the investment alternative. We also estimate that the wedge between ASR and TSR is primarily driven by the reinvestment effect. However, over time, the reinvestment effect declines while the timing effect of cash flows increases, consistent with rising stock issuances and buybacks.

In this Essay in remembrance, Professors Larisa G Bowman, Esme Caramello, and Nicole Summers grieve the loss of Chief Justice Ralph D. Gants: a past, present, and future champion for housing justice. Housing as an area of unmet civil legal need occupied his final thoughts; he called it "the greatest access to justice challenge of our lifetime." This Essay charts Chief Justice Gants's evolution in becoming a champion for housing justice. Part I discusses his early housing-related judicial opinions as well as the exposure to housing issues he gained as Co-Chair of the Massachusetts Access to Justice Commission. Part II covers his time as the Chief Justice, reviewing some of his seminal opinions related to housing issues and his advocacy for broad changes across the entire Massachusetts court system, such as expansion of the Housing Court, that would increase access to justice for low-income litigants. Finally, in Part III, this Essay ends with Chief Justice Gants's leadership during the COVID-19 crisis. He paid close attention and threw his full weight behind the cause because he believed that the legal system, with reform and ingenuity, could deliver justice in housing.

This Article demonstrates that constitutional provisions rarely if ever have uniquely correct “original public meanings” that are sufficiently determinate to resolve disputed constitutional cases. As public meaning originalism (“PMO”) ascends toward a position of dominance within the Supreme Court, both practitioners and critics should recognize the limited capacity of historical and linguistic facts to settle modern issues. To understand successful constitutional communication, this Article argues, requires a distinction between “minimal” original public meanings, which either are entailed by language and logic or are otherwise noncontroversial, and the richer and more determinate meanings that originalists often purport to discover. When the Constitution says that each state shall have “two Senators,” “two” means two. By contrast, when members of the Founding generation disagreed about the meaning of a constitutional provision—as they frequently did—the idea of a uniquely correct and determinate more-than-minimal meaning that existed as a matter of linguistic and historical fact is chimerical. Judges can of course reach determinate conclusions, but seldom can those dispute-resolving conclusions be ones of simple historical fact. Insofar as practitioners of PMO—including Justices of the Supreme Court—purport to discover more-than-minimal original public meanings that provide determinate resolutions to contested cases, skepticism is in order. The problem with claims about more-than-minimal original public meanings is conceptual, not epistemological. Although public meaning originalists speak of “evidence” establishing the historical validity of disputed claims about original public meanings, they have no adequate account of what, exactly, the evidence is supposed to be evidence of. Beyond historical facts about who said and believed different things at particular times, there is no further, diversity-transcending fact of an original public meaning that extends beyond minimal and noncontroversial meanings. After identifying the conceptual limitations of public meaning originalism, this Article examines the resulting challenges for both theorists of PMO and for originalist and nonoriginalist Justices alike. It also draws lessons concerning the nature of and necessary conditions for successful constitutional communication across generations.

Patterns of population health are keen reflections of structural inequities in societies, yet they are rarely subject to the requirements of democratic justification that other systemic inequalities provoke. Nor are health systems generally subject to societal scrutiny regarding fidelity to normative commitments of dignity and equality. Increased recognition of social determinants of health has challenged the narrow biomedical view of health as a stochastic phenomenon. More recently the sweeping devastation of the COVID-19 pandemic has laid bare structural injustices across many democracies, which contributed to widely disparate rates of infection and mortality.

The large American corporation faces ever-rising pressure to pursue a purpose that’s more than just for shareholder profit. This rising pressure interacts with sharp changes in industrial organization in a way that has not been comprehensively analyzed and is generally ignored. Firms’ capacity to accommodate pressure for a wider purpose is rising as well. Three changes are most relevant: the possibility of declining competition, the counter-possibility that what seems to be a competitive decline is really increasing winner-take-all competition, and the possibility that the ownership of the big firms has concentrated (even if the firms themselves have not) and thereby diluted competitive zeal. Consider competitive decline: In robustly competitive economies, firms cannot deviate much from profit maximization for expensive corporate purpose programs unless expanded purpose bolsters profitability (by branding the firm positively for consumers or by better motivating employees, for example). In economies with slack competition, in contrast, monopolistic and oligopolistic firms can accommodate purpose pressure, sometimes even expensive purpose pressure, from the profits they garner above what a competitive firm requires. In simplistic form, purpose can pressure such firms to redirect their excess profit from shareholders to stakeholders—to customers, employees, or the public good—in ways that firms in strongly competitive industries cannot. By most accounts, competition has been declining in the United States. By some accounts, it has declined precipitously. That decline suggests three possibilities: One—the central thesis of this Article— purpose pressure has greater potential to succeed if competition has declined or rents have otherwise grown; in competitive markets, the profit-oriented purpose-pressured firm has no choice but to refuse the purpose pressure (or to give it only lip service), while in monopolistically-organized industries, the purpose-pressured firm has more room to maneuver. Two, the normative bases undergirding shareholder primacy, although still strong, are less powerful in monopolistic markets. Three, declining corporate competition and rising corporate profits create a lush field for social conflict inside the firm and the polity for shareholders and stakeholders to seek a share of those profits. The result can infuse basic corporate governance with social conflict. This new, or expanded, field for conflict can contribute to and exacerbate our rising political and social instability. Expanding purpose pressure is one manifestation of this conflict.

O texto é a parte de um conteúdo conferência Conferência ministrada em 7 de dezembro de 2016 no IV Fórum Nacional de Direito e Infraestrutura, realizado pelo Instituto Brasileiro de Estudos Jurídicos da Infraestrutura (IBEJI), em parceria com o Conselho Regional de Engenharia e Agronomia do Estado de São Paulo (CREA-SP). Examinam-se as estratégias de desenvolvimento ocorridas na história do nosso país para mostrar que precisamos organizar uma nova estratégia, condição vital para resolver a questão da infraestrutura. Assim, delineia-se um método para esta nova estratégia, juntamente com a descrição das condições sociais, políticas e intelectuais para a sua criação. São propostas várias ideias, como a criação de uma “produtividade inclusiva” e a qualificação e democratização da economia em relação à produção e à oferta, aliada a uma revolução na natureza da educação. Além disso, explicam-se as qualidades necessárias a uma política de infraestrutura: agnosticismo em relação aos setores da economia, capilaridade social e fortalecimento da federação. Por fim, mas não menos importante, delineiam-se os componentes necessários para o encaminhamento de uma estratégia nacional de desenvolvimento: forte investimento público, cooperação e coordenação entre os estados e o setor privado, e o papel fundamental dos juízes para fazer o detalhamento jurídico dos modelos necessários à organização. esta nova política de infraestrutura (imaginação institucional).

Book review of Until I Am Free: Fannie Lou Hamer’s Enduring Message to America by Keisha N. Blain.

This article proposes that the U.S. Senate adopt a “popular-majoritarian cloture rule,” under which a motion to close debate and proceed to a final vote would carry if but only if supported by a majority of Senators who collectively represent a larger share of the population than those Senators in opposition. This rule, which would be a constitutional exercise of the Senate’s power to set the rules of its proceedings, would make the body more democratic and more functional, and would be preferable both to the current filibuster rule and to simple majority rule.

Would the outcome in Dobbs put originalism in doubt?

To compare post-operative vocal outcomes of a voice rest regimen versus no voice restrictions following micro-laryngeal surgery for benign glottic lesions.

We live in a period in which liberalism is under considerable pressure.Can poems be liberal? Baudelaire’s Enivrez-Vous captures something essential about the most appealing forms of liberalism, and about its underlying spirit (captured, in different ways, by John Stuart Mill, Walt Whitman, and Bob Dylan as well): its insistence on freedom of choice, on the diversity of tastes and preferences, and on human agency. The poem is liberal in its exuberance – its pleasure in its own edginess, its defiance, its sheer rebelliousness, its sense of mischief, its implicit laughter, its love of life and what it has to offer. It is the opposite of dutiful. It is far more exuberant than Mill’s On Liberty, but it is exuberant in the same way.

This chapter, prepared for the 2021 Annual Heckerling Institute on Estate Planning, examines the law and economics of environmental, social, and governance (ESG) investing by a trustee. Trustees of pensions, charities, and personal trusts invest tens of trillions of dollars of other people’s money subject to a sacred trust known in the law as fiduciary duty. Recently, these trustees have come under increasing pressure to use ESG factors in making investment decisions. ESG investing is common among investors of all stripes, but many trustees have resisted its use on the grounds that doing so may violate the fiduciary duty of loyalty. Under the “sole interest rule” of trust fiduciary law, a trustee must consider only the interests of the beneficiary. Accordingly, a trustee’s use of ESG factors, if motivated by the trustee’s own sense of ethics or to obtain collateral benefits for third parties, violates the duty of loyalty. On the other hand, some academics and investment professionals have argued that ESG investing can provide superior risk-adjusted returns. On this basis, some have even argued that ESG investing is required by the fiduciary duty of prudence. Against this backdrop of uncertainty, this chapter examines the law and economics of ESG investing by a trustee. We differentiate “collateral benefits” ESG from “risk-return” ESG, and we provide a balanced assessment of the theory and evidence about the possibility of persistent, enhanced returns from risk-return ESG.We show that ESG investing is permissible under American trust fiduciary law if two conditions are satisfied: (1) the trustee reasonably concludes that ESG investing will benefit the beneficiary directly by improving risk-adjusted return; and (2) the trustee’s exclusive motive for ESG investing is to obtain this direct benefit. In light of the current theory and evidence on ESG investing, we accept that these conditions could be satisfied under the right circumstances, but we reject the claim that the duty of prudence either does or should require trustees to use ESG factors. We also consider how the duty of loyalty should apply to ESG investing by a trustee if such investing is authorized by the terms of a trust or the beneficiaries, or is consistent with a charity’s purpose, clarifying with an analogy to whether a distribution would be permissible under similar circumstances. We conclude that applying the sole interest rule (as tempered by authorization and charitable purpose) to ESG investing is normatively sound.The chapter is based on Max M. Schanzenbach and Robert H. Sitkoff, Reconciling Fiduciary Duty and Social Conscience: The Law and Economics of ESG Investing by a Trustee, 72 Stanford Law Review 381 (2020), available at https://ssrn-com.ezp-prod1.hul.harvard.edu/abstract=3244665.

Although there has been a proliferation of research and policy work into how nudges shape people's behaviour, most studies stop far short of consumer welfare analysis. In the current work, we critically reflect on recent efforts to provide insights into the consumer welfare impact of nudges using willingness to pay and subjective well-being reports and explore an unobtrusive approach that can speak to the immediate emotional impacts of a nudge: automatic facial expression coding. In an exploratory lab study, we use facial expression coding to assess the short-run emotional impact of being presented with calorie information about a popcorn snack in the context of a stylised ‘Cinema experience’. The results of the study indicate that calorie information has heterogeneous impacts on people's likelihood of choosing the snack and on the emotions they experience during the moment of choice which varies based on their level of health-consciousness. The information does not, however, affect the emotions people go on to experience while viewing movie clips, suggesting that the emotional effects of the information are short-lived. We conclude by emphasising the potential of automatic facial expression coding to provide new insights into the immediate emotional impacts of nudges and calling for further research into this promising technique.

I begin by defining democracy and antidemocracy. I then describe the farmworkers’ difficulty in cultivating democracy, the antidemocratic potential of Cedar Point, and the longstanding sources of antidemocracy that protect the Supreme Court’s discretion. I then draw a lesson from the farmworkers’ story for how this antidemocracy can be overcome. In short, for democracy to exist anywhere, it must exist everywhere: in our workplaces, our communities, our courts, and our constitutions.

Returning to the rule of law and fortifying democracy in the U.S. will best be accomplished by reemphasizing the country’s own democratic and egalitarian values, and by vindicating truthfulness after four years of Trumpian fraud.

A review of Justice On the Brink: The Death of Ruth Bader Ginsburg, the Rise of Amy Coney Barrett, and Twelve Months That Transformed the Supreme Court by Linda Greenhouse

Nudges are tools to achieve behavioural change. To evaluate nudges, it is essential to consider not only their overall welfare effects but also their distributional effects. Some nudges will not help, and might hurt, identifiable groups. More targeted, personalized nudging may be needed to maximize social welfare and promote distributive justice.

One of the leading casebooks in the field, The Law of Debtors and Creditors features 39 problem sets with realistic questions a lawyer considers in managing a bankruptcy case. It also challenges the students with the major policy and theoretical questions in the field. The text features a functional organization as a bankruptcy case would unfold. The focus is on teaching through the realistic problems, complete with ethical difficulties embedded into the fact patterns. The presentation is lively and colloquial. Explanatory text throughout makes bankruptcy law accessible to students and easier to teach. Because it divides the subject between consumer and business bankruptcy, professors can select the depth of coverage for each subject in designing a two-, three-, or four-credit class. The authors—Senator Elizabeth Warren, Congresswoman Katie Porter, and Professors Pottow (Michigan) and Westbrook (Texas)—are among the most prominent in the field. Uniquely comprehensive Teacher’s Manual—chock full of material on how to design class around the problem sets, citations to new cases and literature, and suggestions for steering class discussion.

Behind Henry Ford’s business decisions that led to the widely taught, famous-in-law-school Dodge v. Ford shareholder primacy decision were three industrial organization structures that put Ford in a difficult business position. First, Ford Motor had a highly profitable monopoly and needed much cash for the just-begun construction of the River Rouge factory, which was said to be the world’s largest when completed. Second, to stymie union organizers and to motivate his new assembly-line workers, Henry Ford raised worker pay greatly; Ford could not maintain his monopoly without sufficient worker buy-in. And, third, if Ford explicitly justified his acts as in pursuit of the monopoly profit in the litigation, the Ford brand would have been damaged with both his workforce and the car buyers. The transactions underlying Dodge v. Ford and resulting in the court order that a very large dividend be paid should be reconceptualized as Ford Motor Company and its auto workers splitting the “monopoly rectangle” that Ford Motor’s assembly line produced, with Ford’s business requiring tremendous cash expenditures to keep and expand that monopoly. Hence, a common interpretation of the litigation setting—that Ford let slip his charitable purpose when he could have won with a business judgment defense—should be reconsidered. Ford had a true business purpose to cutting back the dividend—spending on labor and a vertically integrated factory to solidify his monopoly and splitting the monopoly profit with labor—but he would have jeopardized the strategy’s effectiveness by boldly articulating it.The existing main interpretations of the corporate law decision and its realpolitik remain relevant—such as Ford seeking to squeeze out the Dodge brothers by cutting the Ford dividend to deny the Dodge brothers cash for their own car company. But those interpretations must take a back seat, as none fully encompasses the industrial setting—of monopoly, incipient union organizing, and a restless workforce. Without accounting for Ford Motor’s monopoly, the River Rouge construction, and the related labor tensions, we cannot fully understand the Dodge v. Ford controversy. Stakeholder pressure can more readily succeed in a firm having significant economic rents, a setting that seems common today and was true for Ford Motor Company in the 1910s.

This article analyzes concerns about market power and inequality in a model with multiple sectors, heterogeneous abilities, endogenous labor supply, and nonlinear income taxation. Proportional markups with no profit dissipation have no effect on the economy, and a policy that reduces a nonproportional markup raises (lowers) welfare when it is higher (lower) than a weighted average of other markups. With proportional (partial or full) profit dissipation, proportional markups are equivalent to a downward shift of the distribution of abilities, and the optimal policy rule with nonproportional markups maximizes consumer plus producer surplus despite concerns for distribution and labor supply distortion.

This case study puts students in the role of a private equity firm considering the acquisition of a portfolio firm, and later selling that same firm. Along the way, the case study introduces private equity and valuation techniques, which students need to apply in working through the case.

It is time to rethink the evidence so often submitted and relied upon in asylum claims, to return to a core principle of refugee law – the need to afford a

This Teaching Note provides guidance to instructors for the case study Project Merchandise: An Introduction to Private Equity. The case study, Project Merchandise: An Introduction to Private Equity, puts students in the role of a private equity firm considering the acquisition of a portfolio company, and later selling that same company. Along the way, the case study introduces private equity and valuation techniques, which students will need to apply in working through the case.

Organizations are riddled with cooperation problems, that is, instances in which workers need to voluntarily exert effort to achieve efficient collective outcomes. To sustain high levels of cooperation, the experimental literature demonstrates the centrality of reciprocal preferences but has also overlooked some of its negative consequences. In this paper, we ran lab-in-the-field experiments in the context of open-source software development teams to provide the first field evidence that highly reciprocating groups are not necessarily more successful in practice. Instead, the relationship between high reciprocity and performance can be more accurately described as U-shaped. Highly reciprocal teams are generally more likely to fail and only outperform other teams conditional on survival. We use the dynamic structure of our data on field contributions to demonstrate the underlying theoretical mechanism. Reciprocal preferences work as a catalyst at the team level: they reinforce the cooperative equilibrium in good times but also make it harder to recover from a negative signal (the project dies). Our results call into question the idea that strong reciprocity can shield organizations from cooperation breakdowns. Instead, cooperation needs to be dynamically managed through relational contracts.

Cultivation theory assumes that frequent exposure to certain media can lead people to perceive the real world through the lens of their preferred media. This led to the research question of whether fans of science fiction who are accustomed to seeing problem solving based on science and technology are prone to accept science- and technology-based interventions to curb the spread of the COVID-19 pandemic. An exploratory survey and a preregistered experiment (N = 1,983) found that participants who liked science fiction were more likely to trust science and to accept protective measures against COVID-19. This effect was especially visible for a Corona mobile-phone app but also extended to other behaviors. The effect was stronger for those whose genre preference was activated just before the behavioral intentions were assessed. Harnessing these preferences could improve health communication and may be useful in solving health crises, such as pandemics or the climate crisis.

Late twentieth-century tort theory was dominated by scholars who regarded tort law as primarily a means employed by government to deter anti-social conduct. On this model, tort plaintiffs are cast as private attorneys general whose lawsuits promote safety. Tort theorists today better appreciate that this approach obscures crucial respects in which tort law is private law–law that empowers persons who have been wronged to redress the wrongs done to them. But in practice there is a continued failure to perceive the ways in which the deterrence model has shaped and distorted views of tort law, as evidenced by the terms on which both the ‘right’ and the ‘left’ critique modern mass tort litigation. More troublingly, the problem extends beyond the field of torts. Indeed, we contend that the lawyerly loss of feel for distinctions between public law and private law explains the inability of the United States Supreme Court Justices, in Whole Woman’s Health v. Jackson, to capture why S.B. 8–Texas’s radical anti-abortion statute–really is a private attorney general statute and why, as such, it should be subject to preenforcement constitutional review.

On January 3, 2019, U.S. District Judge Theodore D. Chuang of the U.S. District Court of the District of Maryland took a crucial first step in redressing one of the worst human subjects research ethics violations in U.S. history.

Telehealth has the potential to address health disparities, but not without deliberate choices about how to implement it. To support vulnerable patients, health policy leaders must pursue creative solutions such as public-private partnerships, broadband infrastructure, and value-based payment. Without these initiatives or others like them, health disparities are likely to persist despite telehealth’s tantalizing potential.

In law, the process of analogical reasoning appears to work in five simple steps. (1) Some fact pattern A—the “source” case—has certain characteristics; call them x, y, and z. (2) Fact pattern B—the “target” case—has characteristics x, y, and q, or characteristics x, y, z, and q. (3) A is treated a certain way in law. (4) Some principle or rule, announced, created, or discovered in the process of thinking through A, B, and their interrelations, explains why A is treated the way that it is. (5) Because of what it shares in common with A, B should be treated the same way. It is covered by the same principle. It should be clear that the crucial step, and the most difficult, is (4). Often analogical reasoning works through the use of incompletely theorized agreements, making (4) tractable. Some of the disputes about analogical reasoning reflect contests between Burkean and Benthamite conceptions of law.

SB 8 not only stripped Texan women of their rights under Roe v Wade, it made a mockery of the US constitution and the supremacy of the federal courts.

In philosophy, economics, and law, the idea of voluntary agreements plays a central role. It orients contractarian approaches to political legitimacy. It also helps support the claim that outsiders, and especially the state, should not interfere with private contracts. But contractarianism in political philosophy stands (or falls) on altogether different grounds from enthusiasm for contractual ordering in economics and law. When participants in voluntary agreements lack information or suffer from behavioral biases (including adaptive preferences), there is reason to help them, potentially through mandates and bans. In philosophy, the idea of contractarianism can help lead to instructive thought experiments about what justice requires, as with John Rawls’ use of the veil of ignorance and the original position; it should not be taken as a basis for theories of legitimacy that rest on actual agreements among actual groups, in which some people have more information and power than others, and in which malice and self-interest may lead to distortions.