The Agreement of Subsides and Countervailing Measures (SCM Agreement) is considered on of the major areas for which the WTO system achieves significant improvement from the GATT system. During the Uruguay Round negotiation, the GATT contracting parties agreed on, inter alia, the new concept of non-actionable subsidy that would be mostly exempted from the rigorous disciplines of the SCM Agreement. This exemption was, however, due to expire after a period of five years, unless the Committee on Subsidies and Countervailing Measures (SCM Committee) determines to extend the application of non-actionable subsidies. The SCM Committee subsequently prepared elaborated procedural rules for notification under Article 8.3 and arbitration under Article 8.5. The SCM Committee could not agree on whether to extend the application of non-actionable subsidy within the time limit of Article 31 and finally, as of January 1, 2000, declared the termination thereof. If we reflect the WTO system through the famous traffic light analogy for subsidy disciplines, the current situation of subsidy traffics looks quite messy. All green lights for subsidy roads were taken off from the traffic signals, leaving only red and yellow lights. Most of subsidy traffics are either jammed at read lights or risking their lives to venture passing at yellow lights. This systemic fracture for subsidy disciplines has caused considerable uncertainty not only to WTO Members' government sectors but also to private business community when they cannot assure the legitimacy of the governmental policies under which they are sometimes vastly affected until the trade or economic effects of the policies are assessed only based on other Members' circumstances. Therefore, it is imminent to construct a new non-actionable subsidy mechanism under which WTO Members should feel safe and stable.
The law school rankings published by US News and World Report have changed and continue to change the law school world, affecting both the demand and supply sides of legal education. Are the rankings valid? Are they changing schools for the better? The US News rankings mislead both applicants and law schools. As measures of educational quality, the US News rankings are seriously flawed. They overweight criteria that matter little, such as bar pass rate. They exclude criteria that matter greatly, such as job satisfaction. At least two of the seemingly valid criteria incorporated into the US News rankings are illusory; the reputation surveys done by US News do not tap into independent professional opinion but instead measure opinions that are echos of US News and, thus, add little reliability to the results that would be reached on other criteria. A more serious problem is the effect of US News rankings on the operation of law schools and students who desire admission. The rankings have created incentives for students who want to be lawyers to go to schools that have grade inflation and take easy courses at those schools. The US News rankings have created incentives for schools to teach to the bar exam, spend money on glossy publications, raise tuition, increase the number of transfer students, and admit students according to their bubble ability (their aptitude for taking multiple-choice standardized exams) rather than their prospects for contributing to the learning environment at the law school or their prospects for becoming effective and responsible lawyers.
This paper examines the use of metaphoric representations of vampires in judicial writing. Although relatively unexplored in the literature of vampire studies, in both of these cases vampire imagery reflects the cultural milieu of the author and acts as a barometer to popular attitudes.
In 2004 the country witnessed the first presidential election since the passage of the Bipartisan Campaign Reform Act of 2002 (BCRA). A major purpose of BCRA was to end two of the worst abuses of the federal campaign finance law-sham issue ads and soft money raised by political party committees. The BCRA amendments, like existing federal campaign finance law, were designed first and foremost to prevent corruption or the appearance of corruption resulting from large contributors' requesting favors from or gaining influence with the public officials whose campaigns their contributions benefited, regardless of whether the contributor or the lawmaker initiated the mutually beneficial process. As many foresaw at the time of BCRA's passage, individuals and groups with considerable assets would seek and probably find new campaign finance vehicles for achieving most of the benefits of the system prior to BCRA. Nonetheless, the swiftness with which 527 groups have threatened to replace political parties as the soft-money middlemen in federal campaigns surprised and angered many - from members of Congress to ordinary citizens. Since the 2004 election saw one of the most polarized campaigns on record and since 527 groups, both Democratic and Republican, were especially active in funding attack ads and other highly visible forms of campaign activity, they emerged as the arch villains of the process. Bills have been introduced in Congress to compel almost all 527 groups engaged in federal campaigns to register as political committees subject to federal campaign finance law (FECA). In addition, lawsuits have been filed to force the Federal Election Commission (FEC) to impose sanctions on 527 groups that failed to register as political committees in the last election. Lawsuits were also filed challenging some of the FEC's regulations on the grounds that they emasculated the provisions of BCRA, thereby contributing to the failure of reform efforts the agency is charge with implementing. As a result, some of the regulations were invalidated, some rewritten, and some are being appealed. In short, campaign finance reform is still in flux. The purpose of this Article is to analyze the legal issues that must be resolved before the validity of efforts to rein in 527 groups can be established. Most of these issues are constitutional because, by its nature, campaign finance regulation intrudes upon political speech, part of the core of First Amendment speech entitled to the most vigorous protection by the courts. My contribution to an area of the law where so many others have preceded me is to integrate the constitutional election law analysis with a technical analysis of what 527 groups really are and how they actually operate under the Internal Revenue Code. I also develop a new paradigm for understanding the conceptual foundations of specific constitutional doctrines that can and, in my view, do reveal a relatively coherent election law jurisprudence across the Supreme Court's campaign finance decisions, even taking into account the recent decision in McConnell v. FEC, which most commentators agree broke new ground. I divide the constitutional issues at stake into different categories and conclude that in some areas the precedents are difficult to square with the 527 reform proposals, whereas in other areas mainstream Court precedents tend to support the validity of the reform proposals. In conclusion, I raise some policy questions that, if faced squarely, should give lawmakers pause before painting all 527 organizations with the same legislative brush.
Talbot Page, Louis G. Putterman, Matthias M. Cinyabuguma
The fact that many people take it upon themselves to impose costly punishment on free riders helps to explain why collective action sometimes succeeds despite the prediction of received theory. But while individually imposed sanctions lead to higher contributions in public goods experiments, there is usually little or no net efficiency gain from them, because punishment is costly and at times misdirected. We document the frequency and probable causes of punishment of high contributors in several recent studies, and we report a new experiment which shows that introducing higher-order punishment opportunities offer a partial solution to the problem, but also reveal the deep-seatedness of retaliatory tendencies.
Modern Finance has dominated the area of financial economics for at least four decades. Based on a set of strong but highly unrealistic assumptions its advocates have produced a range of very influential theories and models. Nonetheless, in the last two decades a new academic school of thought has emerged that refutes the key assumption of a homo economicus; an assumption that represents the cornerstone for the development of the theory of efficient markets. The first empirical evidence against efficient markets in the mid-eighties signalled the beginning of a fierce debate between these two schools of thought. This paper gives an overview of the key arguments of these two distinctive academic doctrines.
Sudarno Sumarto, Asep Suryahadi, Alexander R. Arifianto
This study is the first attempt to systematically examine the impact of bad governance practices in Indonesia on poverty reduction. Indonesia is a country that has endured bad governance for a long period, but has also sustained significant poverty reduction. Prior to the onset of the economic crisis in mid 1997, the problem of bad governance in Indonesia was apparent but mostly ignored because it was compensated for by high economic growth. The advent of the economic crisis, however, has highlighted the seriousness of the problem. This study focuses on the impact of bad governance on the poor, the people who are most vulnerable to the impact of bad governance. By assembling scattered anecdotal evidence on how past and current practices of bad governance in Indonesia have hurt the poor, this study shows that the adverse impact of bad governance on the poor is real, systematically affects many people, and undermines the efforts to reduce poverty in the country. More systematic evidence on how bad governance affects poverty reduction indicates that regions that practice better governance indeed experience faster poverty reduction and vice versa.
We study decentralized trade processes in general exchange economies and house allocation problems with and without money. Such processes are subject to persistent random shocks stemming from agents' maximization of random utility. By imposing structure on the utility noise term - logit distribution - one is able to calculate exactly the stationary distribution of the perturbed Markov process for any level of noise. We show that the stationary distribution places the largest probability on the maximizer of several social welfare functions in different variants of the model.
From Introductory Paragraph: When one thinks of international organizations whose administrative processes legal scholars should understand, the European Union and the World Trade Organization come to mind without a moment's hesitation. A bit later, perhaps, one might also come up with the Montreal Protocol secretariat, Codex Alimentarius, or the International Organization for Standardization. It will probably take a good while before the Organization for Economic Cooperation and Development (OECD) comes to mind. In some respects this is hardly surprising, for the OECD is neither a well-known nor well-studied international organization (and is certainly not known as a lawmaking institution). Located in Paris and best known for its research reports, the OECD has a "secret life" that goes well beyond that of policy analysis. Indeed, a number of its activities influence domestic agency action far more than is generally realized.
In an influential article, Ian Ayres and Robert Gertner introduced the concept of the "penalty default rule," a rule that fills a gap in an incomplete contract with a term that would not be chosen by a majority of parties similarly situated to the parties to the contract in question. Ayres and Gertner argued that such a rule might be efficient in a model in which contracting parties have asymmetric information. However, Ayres and Gertner did not provide any persuasive examples of penalty default rules; their best example is the Hadley rule, but this rule is probably not a penalty default rule. It turns out that there are no plausible examples of penalty default rules that solve the information asymmetry problem identified by Ayres and Gertner. The penalty default rule is a theoretical curiosity that has no existence in contract doctrine.
Contract-drafting courses are gaining in popularity in law school, and they are a pleasure to teach. In July 2005, Northwestern School of Law provided the location and on-site assistance in hosting the first national conference, in recent times, on the topic of Teaching Contract Drafting. Approximately 100 participants attended, indicating the need and growing enthusiasm for guidance on how to develop and teach contract-drafting courses. At the conference, presenters addressed teaching contract drafting to both first-year students and upper-level students. Law schools may offer an upper-level course as a stand-alone, such as the one I have been teaching, in which the students (and the professor) are not linked to a particular doctrinal basis. Alternatively, upper-level professors may focus their contract-drafting course around a specific topic, such as intellectual property, or have their students research actual corporations. The number of credits the course is worth affects classroom instruction; the more time in the classroom, the more in-class drafting and negotiations can occur. This article provides suggestions regarding selecting books, structuring the course, incorporating negotiations, offering learning-styles assessments, and grading assignments. It also offers a comparison to first-year legal writing courses. A contract-drafting course can foster students' self-confidence and enthusiasm for learning, as well as provide them with the necessary tools for practice.
We offer the first direct evidence of an implicit contract in a goods market. The evidence we offer comes from the market for Coca-Cola. We demonstrate that the Coca-Cola Company left a substantial amount of written evidence of its implicit contract with its consumers—a very explicit form of an implicit contract. The contract represented the promise of a five cent (nominal) price and adherence to the “Secret Formula”. In general, the implicit nature of such contracts makes observation difficult. To overcome this difficulty, we adopt a narrative approach. Based on the analysis of a large number of historical documents obtained from the Coca-Cola Archives and other sources, we offer evidence of the Coca-Cola Company both acknowledging and acting on this implicit contract. We also make another unique contribution by exploring quality as a margin of adjustment available to Coca-Cola. The implicit contract included a promise not only of a constant nominal price but also a constant quality (i.e., 6.5 oz. of the Secret Formula). During a period of over 70 years, we find evidence of only a single case of true quality change. By studying the margin of adjustment the Coca-Cola Company chose in response to changes in market conditions, we demonstrate that the perceived costs of breaking the implicit contract were large. We argue that one piece of direct evidence on the magnitude of these costs is the aftermath “New Coke’s” introduction in 1985.
Corrective-justice theorists have enjoyed a certain amount of success explaining tort law. Some of these theorists have begun to apply corrective-justice theory to the law of contract, but they have not yet explained how corrective justice, which normally argues that private law is concerned with the correction of wrongdoing done to victims by injurers, can explain a body of law like contract that seems indifferent to wrongdoing. In this paper, I argue that this void is a problem for corrective-justice theories of contract, since although contract compensates for breach it does not do so as a way of responding to breach as a form of moral wrongdoing. Corrective justice can still explain contract law, however, because there is a way of understanding corrective justice as the view that private law compensates for losses that are wrongful even though they may or may not be the result of wrongdoing. Moreover, I argue that by understanding corrective justice in this way we achieve a general theory of contract that is more acceptable from the point of view of political liberalism than the current non-corrective accounts of contract.
This essay examines the origins and early construction of the contract clause of the Constitution. It points out that the contract clause must be understood in the context of the troubled economic circumstances of post-Revolutionary America. The clause, which was little debated at the Philadelphia convention, can be traced to language in the Northwest Ordinance of 1787. This paper focuses on the contested issue of whether the framers intended the clause to cover only contracts between private parties or to extend to public contracts between states and individuals. As asserted by the Progressive historians, it has long been the dominant position among scholars that Chief Justice John Marshall expanded the meaning of the contract clause when he ruled that the provision governed private contracts. This paper disputes that conventional wisdom and argues that the clause could fairly be construed to safeguard both public and private contracts from state abridgement. It gives attention to discussion at the state ratifying conventions as well as to the views of prominent members of the constitutional convention. The paper also considers pre-Marshall court cases that examined the meaning of the contract clause and the famous 1796 opinion letter by Alexander Hamilton. Although recognizing that it is difficult to establish a collective state of mind concerning the scope of the ban against contractual impairments, the paper concludes that there was ample support for the views later endorsed by the Marshall Court concerning the reach of this provision.
When would parties to a contract want performance to be specifically required, and when would they prefer payment of money damages to be the remedy for breach? This fundamental question is studied here, and an answer is provided that is based on a simple distinction between contracts to produce goods and contracts to convey property. Setting aside qualifications, the conclusion for breach of contracts to produce goods is that parties would tend to prefer the remedy of damages, essentially because of the problems that would be created under specific performance if production costs were high. In contrast, parties would often favor the remedy of specific performance for breach of contracts to convey property, in part because there can be no problems with production cost when property already exists. The conclusions reached shed light on the choices made between damages and specific performance under Anglo-American and under civil law systems, and they also suggest the desirability of certain changes in our legal doctrine.
Consider a contract over trade in continuous time between two players, according to which one player makes a payment to the other in exchange for an exogenous service. At each point in time, either player may unilaterally require an adjustment to the contract payment, involving adjustment costs for both players. Players' payoffs from trade under the contract, as well as from trade under an adjusted contract, are exogenous and stochastic. We consider players' choice of whether and when to adjust the contract payment. It is argued that the optimal strategy for each player is to adjust the contract whenever the contract payment relative to the outcome of an adjustment passes a certain threshold, depending among other things on the adjustment costs. There is strategic substitutability in the choice of thresholds, so that if one player becomes more aggressive by choosing a threshold closer to unity, the other player becomes more passive. If players may invest in order to reduce the adjustment costs, there will be over-investment compared to the welfare-maximizing levels.
The application of the doctrine of piercing the corporate veil to contract disputes has been attacked as undesirable. This article shows that applying piercing to contracts is desirable. Contract-centered veil-piercing functions akin to a penalty-default clause that encourages the efficient production of information, avoids wasteful precaution, and promotes the use of the corporate form for entrepreneurship.
This paper considers the concept of the "author" and its role in defining the nature of a text in light of Michel Foucault's essay "What is an Author?" Taking up his suggestion that the fictional, constructed author of literature functions to limit the possibilities of meaning of a text, the paper explores how it might apply to the genre of contracts. While Foucault explicitly identifies contracts as authorless texts, this paper aims to identify other generic manifestations of the "author function" that attempt to stabilize meaning in contracts' written forms. Specifically, this paper examines prevalent boilerplate provisions and conventions of drafting and construction that have emerged in written contracts in the absence of an author. In doing so, the paper considers the relationship between the agreement and the written contract in contract law and interpretation, with an eye to the importance of delimiting the meaning of language in the law, and in the texts of contracts, in particular, as ostensible manifestations of consensus. By examining the contemporary form of the written contract in terms of boilerplate and other drafting conventions that often inscribe fictions of stability or limitation of meaning into the contractual text, the paper seeks to further an understanding of the written contract as a genre in which the author function or an analogous limiting principle manifests itself without reference to the individual. Such an analysis seeks to shed light not only on the nature and function of the written contract but on the nature of the discourse of the law more generally and the ways in which it defines itself in contrast to that of literature.
The financing management of the enterprise group is the core of the enterprise management,and the mode of the financing management of the enterprise group in China can be divided into centralized and decentralized modes.This article primarily analyzes the choices and implementation of the modes of the financing management for modern enterprise group in China so that the enterprises could maximize their profits and operate in a good circumstance.
Capital adequacy regulations specify a minimum capital-to-assets ratio for banks in the economy. The effects of these regulations on the level of economic activity have not been thoroughly studied by the banking regulation literature. Specifically, the fact that as proposed by the Basle Accords, a constant ratio tying bank lending to bank equity may reinforce macroeconomic fluctuations has been looked at by only a few existing theoretical papers. This paper proposes a stochastic dynamic general equilibrium model to study the interactions between the banking sector and the aggregate level of economic activity. Banks behavior is fully micro-founded. Banks financing decisions (equity versus deposits) are constrained not only by the regulation but also by a financial imperfection arising from the fact that during bad times banks find it difficult to recapitalize by raising equity. Thus, higher borrower bankruptcy rates during recessions imply that banks have to cut new loans until the ratio is restored to the required level. Since production firms can only imperfectly substitute bank lending with other forms of financing, a negative macroeconomic shock affects production and investment both directly and indirectly through the bank loan supply. This banking regulation and the financial imperfection imply two different constraints to the banks problem that bind only occasionally in the stochastic steady state. This prevents the use of standard linearization techniques to solve the model numerically. Alternatively, using some discretization of the state space methods such as Value Function Iteration is difficult because the model cannot be written in terms of a central planner problem. Following Fackler (2003) I solve the decentralized general equilibrium problem by using a very general Function Approximation technique that nests the Parameterized Expectation Approach as a particular case. The method allows to approximate numerically either the policy functions or the expectation functions. It is also flexible as regards the choice of approximating functions, including Chebyshev polynomials and piecewise polynomial splines. The technique relies on the Collocation Method to solve for the polynomial coefficients in combination with either generic root-finding algorithms or a fixed-point iteration scheme. Numerical results suggest that banks try to anticipate aggregate shocks by accumulating a buffer of capital over the regulatory minimum. Nevertheless, a series of bad shocks may be strong enough to eventually undermine these "reserves" and to make banks cut back on lending. This suggests the existence of a financial accelerator, since the supply of loans shrinks together with the demand during recessions. This mechanism has interesting policy implications and provides grounds for a procyclical value of the required capital-to-assets ratio
Subliminal channel is proposed by Simmons, he showed a method that a message authentication without secrecy channel transferring secret message. Subsequently, subliminal channel is implemented in ElGamal, DSA which based on the difficulty of discrete logarithms. Zero-knowledge proof is an important tool in cryptology, a digital signature scheme based on zero-knowledge proof or “cut and chose” is regarded as resist subliminal channel. The possibility of constructing subliminal channel in these digital signature scheme is analyzed, the security and application of subliminal channel is discussed also.
In terms of educational administration system,Britain is a decentralized country. The central authority and local governments have formed a partner relationship through long years' development. They both shoulder educational finance responsibility but with different emphasis. Besides,during a long process of development,traditions of civilian-run schools,autonomy of universities and double-system in higher education have been formed in education of Britain.
Ces trente dernières années, le fédéralisme fiscal s'est imposé comme une priorité dans le calendrier des réformes institutionnelles de nombreux pays. L'idée que le fédéralisme fiscal soit un mécanisme porteur d'efficacité - bien que controversée tant sur le plan théorique qu'empirique - en a grandement influencé la diffusion. L'examen de l'économie des réformes fédérales se fonde sur trois questions : comment attribuer d'une façon optimale les pouvoirs publics aux divers niveaux de gouvernement ? Comment les forces de la concurrence et de la coordination interviennent-elles dans les relations intergouvernementales ? Comment les comportements des entreprises et des ménages limitent-elles les politiques économiques décentralisées ? Les dynamiques économiques, institutionnelles et politiques semblent déterminer les objectifs et la structure optimale du fédéralisme fiscal. Toutefois ce rôle crucial a été négligé dans la théorie traditionnelle du fédéralisme fiscal. Les théories économiques de l'information et la politique économique ont fortement contribué à l'amélioration de la compréhension de ces processus. A partir de ces développements de la recherche, notre travail met en lumière les enjeux du design optimal du fédéralisme fiscal. Tout d'abord, l'argument économique considérant le fédéralisme fiscal comme un mécanisme porteur d'efficacité dépend strictement de l'hypothèse de constitution incomplète : l'information incomplète joue un rôle important par rapport à cet argument à condition qu'elle soit considérée dans un contexte de constitution incomplète. Ensuite, la dynamique de la décentralisation des pouvoirs (c.-à-d. e pluribus unum -dans le cas de fédérations et confédérations consolidées dans le temps- ou e pluribus unum -dans un contexte de dévolution des pouvoirs) modèle la distribution de l'information et, à son tour, la structure optimale des relations intergouvernementales. Enfin, les caractéristiques économiques des fonctions et des services publics décentralisés (par ex. la substituabilité entre services publics et privés) influencent la structure optimale des programmes publics gérés par les gouvernements locaux aussi bien que leur capacité de les financer.