Research

Recent Publications

Challenges for Comparative Fact-Finding, International Journal of Evidence & Proof ().
Abstract

A paradigm shift is underway in scholarship on legal fact-finding. Recent work points clearly and consistently in the direction that persuasion is the product of purely comparative assessments of factual propositions. This paper comments on the philosophical roots of this shift to a comparative paradigm. It also highlights two serious challenges for the comparative approach: (1) articulation of a coherent test of the beyond-a-reasonable-doubt standard, and (2) definition of what it means for a fact-finder to weigh an unspecific or disjunctive factual claim.

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Powers, But How Much Power? Game Theory and the Nondelegation Principle, 104 Virginia Law Review ().
Abstract

Of all constitutional puzzles, the nondelegation principle is one of the most perplexing. How can a constitutional limitation on Congress's ability to delegate legislative power be reconciled with the huge body of regulatory law that now governs so much of society? Why has the Court remained faithful to its intelligible principle test, validating expansive delegations of lawmaking authority, despite decades of biting criticism from so many camps? This article suggests that answers to these questions may be hidden in a surprisingly underexplored aspect of the principle. While many papers have considered the constitutional implications of what it means for Congress to delegate "legislative" power, few have pushed hard on the second part of the concept: what it means for an agency to have legislative "power."

Using game theory concepts to give meaning to the exercise of legislative "power" by an agency, this paper argues that nondelegation analysis is actually more complicated than it appears. As a point of basic construction, a delegation only conveys legislative power if it (1) delegates lawmaking authority that is sufficiently "legislative" in nature, and (2) gives an agency sufficient "power" over the exercise of that authority. But, again using game theory, this paper shows that an agency's power to legislate is less certain than it first appears, making satisfaction of this second element a fact question in every case.

This more complicated understanding of the nondelegation principle offers three contributions of practical significance. First, it reconciles faithful adherence to existing theories of nondelegation with the possibility of expansive delegations of lawmaking authority. Second, it suggests a sliding-scale interpretation of the Court's intelligible-principle test that helps explain how nondelegation caselaw may actually respect the objectives of existing theories of nondelegation. Third, it identifies novel factors that should (and perhaps already do) influence judicial analysis of nondelegation challenges.

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A Likelihood Story: The Theory of Legal Fact-Finding, 90 University of Colorado Law Review ().
Abstract

Are racial stereotypes a proper basis for legal fact-finding? What about gender stereotypes, sincerely believed by the fact-finder, and informed by the fact-finder’s life experience? What about population averages: if people of a certain gender, education level, and past criminal history exhibit a statistically greater incidence of violent behavior than the population overall, is this evidence that a given person within this class did act violently on a particular occasion?

The intuitive answer is that none of these feel like proper bases on which fact-finders should be deciding cases. But why not? Nothing in traditional probability or belief-based theories of fact-finding justifies excluding any of these inferences. Maybe intuition goes astray here. Or maybe something about the traditional theory of fact-finding is wrong. Arguing the latter, this article proposes a new theory of fact-finding. In contrast to historic probability and belief-based theories of fact-finding, this paper suggests that idealized fact-finding is an application of likelihood reasoning—the statistical analog of the ancient legal concept of the “weight of evidence,” and the formal analog of modern descriptions of legal fact-finding as a process of comparing the relative plausibility of competing factual stories on the observed evidence.

This likelihood theory of fact-finding marks a fundamental change in the understanding of legal fact-finding, and from this come a number of advancements. The likelihood theory of fact-finding simplifies the concept of fact-finding, describing every burden of persuasion as an application of the exact same reasoning principle. It harmonizes recent scholarship on fact-finding, showing how empirical work on the cognitive processes of fact-finders can be formalized into an intuitive and coherent theory of the ideal fact-finding process. It explains evidentiary mores, justifying hostility to naked statistical evidence, for example. And it affords new insights into the effects of subjective beliefs on fact-finding, clarifying and offering the first steps toward a solution to the problem of fact-finder bias.

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Experimental Economics and the Law, (with C. Holt), in 1 Oxford Handbook of Law and Economics 78 (Francesco Parisi ed., Oxford University Press ).
Abstract
This chapter surveys the past and future role of experimental economics in legal research and practice. Following a brief explanation of the theory and methodology of experimental economics, the chapter discusses topics in each of three broad application areas: (1) the use of experiments for studying legal institutions such as settlement bargaining and adjudicative functions, (2) the use of experiments to explore legal doctrines, and (3) the use of experiments in litigation and trial strategy. The general theme of this material is a broad and versatile relationship between law and experimental economics.
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Published Version
Why Wait to Settle? An Experimental Test of the Asymmetric Information Hypothesis, 59 Journal of Law & Economics 497 ().
Abstract
The U.S. legal system encourages civil litigants to quickly settle their disputes, yet lengthy and expensive delays often precede private settlements. The causes of these delays are uncertain. This paper describes an economic experiment designed to test one popular hypothesis: that asymmetric information might be a contributing cause of observed settlement delays. Experimental results provide strong evidence that asymmetric information can delay settlements, increasing average time-to-settlement by as much as 90% in some treatments. This causal relationship is robustly observed across different bargaining environments. On the other hand, results do not obviously confirm all aspects of the game-theoretic explanation for this relationship. And they suggest that asymmetric information may be only one of several contributing causes of settlement delay.
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Published Version
SSRN Entry
Attachments
Online Appendix: Video Replays of Settlement Bargaining
What Structural Presumption? Reuniting Evidence and Economics on the Role of Market Concentration in Horizontal Merger Analysis, 42 Journal of Corporation Law 403 ().
Abstract
The “structural presumption” is a proposition in antitrust law standing for the typical illegality of mergers that would combine rival firms with large shares of the same market. Courts and commentators are rarely precise in their use of the word “presumption,” and there is foundational confusion about what kind of presumption this proposition actually entails. It could either be a substantive factual inference based on economic theory, or a procedural device for artificially shifting the burden of production at trial. This paper argues that the substantive inference interpretation is the better reading of caselaw and the sounder application of the laws of antitrust and evidence. By instead interpreting the structural presumption as a formal rebuttable presumption, modern merger analysis needlessly complicates the use of market concentration evidence, and may be systematically undervaluing the probative weight of this evidence. At least in this context, a formal presumption likely confers less evidentiary weight than a simple substantive inference.
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Alternative Published Version
SSRN Entry
Attachments
Presentation (February, 2015)
Probative Inference from Phenomenal Coincidence: Demystifying the Doctrine of Chances, 14 Law, Probability & Risk 27 ().
Abstract
The doctrine of chances remains a divisive rule in the law of evidence. Proponents of the doctrine argue that evidence of multiple unlikely events of a similar nature supports an objective, statistical inference of lack of accident or random chance on a particular occasion. Opponents argue that admissibility is improper because the underlying inference ultimately requires a forbidden form of character or propensity reasoning. Using formal probability modeling and simple numerical examples, this article shows that neither side is correct. Contrary to the claims of its proponents, the doctrine of chances provides no novel or independent theory of relevance. But contrary to the claims of its opponents, the doctrine of chances does not require character or propensity reasoning. An intuitive way to understand these properties is to interpret the doctrine-of-chances inference as a weak form of any inference that could be permissibly drawn if extrinsic events were simply bad acts for which culpability or intent were certain.
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2013 ALEA Presentation
Empowering Market Regulation of Agricultural Animal Welfare through Product Labeling, 19 Animal Law Review 391 ().
Abstract
In many western countries, rising public concern for the welfare of agricultural animals is reflected in the adoption of direct regulatory standards. The United States has taken a different path, preferring a "market regulation" approach whereby consumers express their preference for agricultural animal welfare through their consumption habits, incentivizing desired welfare practices with dollar bills and obviating the need for direct government regulation. There is, however, little evidence that consumers in the United States actually demand heightened animal welfare practices at market. This article explores the failure of market regulation and the welfare preference paradox posed by consumers who express a strong preference for improved animal welfare in theory, but who do not actually demand heightened animal welfare in practice. I argue that the failure of market regulation is due to the inability of current voluntary and nonstandard animal welfare labeling practices to clearly and credibly disclose to consumers the actual treatment of agricultural animals. As a corollary, effective market regulation of agricultural animal welfare could be empowered simply by improving animal welfare labeling practices.
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Alternative Published Version
Q & A for 2012 Bob Barker Prize in Animal Law
Water Externalities: Tragedy of the Common Canal (with C. Holt, C. Johnson, and C. Mallow), 78 Southern Economic Journal 1142 ().
Abstract
Laboratory experiments are used to investigate alternative solutions to the allocation problem of a common-pool resource with unidirectional flow. The focus is on the comparative economic efficiency of nonbinding communications, bilateral “Coasian” bargaining, allocation by auction, and allocation by exogenous usage fee. All solutions improve allocative efficiency, but communication and bilateral bargaining are not generally as effective as market allocations. An exogenously imposed optimal fee results in the greatest allocative efficiency, closely followed by an auction allocation that determines the usage fee endogenously.
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Published Version
An Experimental Study of Settlement Delay in Pretrial Bargaining with Asymmetric Information Dissertation: University of Virginia (advisors C. Holt and J. Pepper), UMI Pub. No. 3501713 ().
Abstract

In the United States legal system, tort disputes often exhibit protracted delay between injury and settlement. That is, parties to a dispute tend to agree on settlement conditions only after engaging in lengthy legal sparring and negotiation. Resources committed to settlement negotiation are large and economically inefficient. Even small reductions in average settlement delay stand to affect large reductions in socially inefficient spending.

This research contributes to the understanding of settlement delay by carefully exploring one popularly advanced hypothesis for the phenomenon: the idea that asymmetric information over the value of a potential trial verdict might help to drive persistent settlement delay. A large-scale laboratory experiment is conducted with payment-incentivized undergraduate and law school subjects. The experiment closely implements a popular model of settlement delay in which litigants attempt to negotiate settlement under asymmetric information about the value of a potential trial verdict. The experiment is designed to address two broad research questions: (i) can asymmetric information over a potential trial verdict plausibly contribute to the protracted settlement delay observed in the field, and (ii) can specific policies be identified which might mitigate the settlement delay associated with asymmetric information?

In response to the first broad research question, experimental results strongly confirm the plausibility of asymmetric information contributing to settlement delay. Starting from a baseline of symmetric information, settlement delay in the laboratory is increased by as much as 95% when subjects are exposed to a controlled information asymmetry over the value of the potential trial verdict. This observation is found strongly robust to perturbations in the underlying bargaining environment.

In response to the second broad research question, experimental results do not strongly confirm the capacity of reasonable policy changes to affect large reductions in settlement delay. Collected data fail to indicate that any explored reform policy obviously reduces average settlement delay, though estimators are sufficiently imprecise that substantial effects on average delay cannot be ruled out. Settlement delay in the laboratory is responsive to changes in bargaining costs, but does not obviously respond to changes in the distribution of damages available at trial.

Online Appendix
Settlement Bargaining Replays
Attachments
2011 Discussion-Group Presentation
Measurement Error in Criminal Justice Data (with J. Pepper and C. Petrie), in Handbook of Quantitative Criminology 353 (A. Piquero and D. Weisburd eds., Springer ).
Abstract
While accurate data are critical in understanding crime and assessing criminal justice policy, data on crime and illicit activities are invariably measured with error. In this chapter, we illustrate and evaluate several examples of measurement error in criminal justice data. Errors are evidently pervasive, systematic, frequently related to behaviors and policies of interest, and unlikely to conform to convenient textbook assumptions. Using both convolution and mixing models of the measurement error generating process, we demonstrate the effects of data error on identification and statistical inference. Even small amounts of data error can have considerable consequences. Throughout this chapter, we emphasize the value of auxiliary data and reasonable assumptions in achieving informative inferences, but caution against reliance on strong and untenable assumptions about the error generating process.
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Published Version

Select Working Papers

The Logic of Market Definition (with D. Glasner)
Abstract
Despite the voluminous commentary that the topic has attracted in recent years, much confusion still surrounds the proper definition of antitrust markets. This paper seeks to clarify market definition, partly by explaining what should not factor into the exercise. Specifically, we identify and describe three common errors in how courts and advocates approach market definition. The first error is what we call the natural market fallacy: the mistake of treating market boundaries as preexisting features of competition, rather than the purely conceptual abstractions of a particular analytical process. The second is the independent market fallacy: the failure to recognize that antitrust markets must always be defined to reflect a theory of harm, and do not exist independent of a theory of harm. The third is the single market fallacy: the tendency of courts and advocates to seek some single, best relevant market, when in reality there will typically be many relevant markets, all of which could be appropriately drawn to aid in competitive effects analysis. In the process of dispelling these common fallacies, this paper offers a clarifying framework for understanding the fundamental logic of market definition.
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The Practice of Legal Bargaining: Economic Theory
Abstract
Economic models of bargaining processes are used as a framework for studying some of the details and complexities inherent in legal bargaining. The presentation begins with a review of the abstract concept of bargaining and the importance of bargaining in both legal theory and practice. Simple examples then track two basic models of bargaining through a wide range of economic research, combining non-technical presentations of simple axiomatic and structural theories of bargaining, empirical data on bargaining behavior, and approachable overviews of behavioral and focal-point theories of bargaining. By way of conclusion, brief commentary is provided on the application the economic approach to bargaining to the practice of settlement negotiation and the contract theory of unequal bargaining power.
Attachments
2012 Discussion-Group Presentation