Volume 19, Issue 2

After studies of economics and business administration in Cologne my academic career as an economist started 1968 as a doctoral student and later as a post doc in the Institute of Development Research and Development Policy of the University of Bochum in Germany. The economic theories, with which I worked at the time had no relation to legal or social norms. This changed, after I became a professor of economics in the newly established second law department of the University of Hamburg. It was a model trial of a reformed legal education. My lawyer colleagues propagated a more policy oriented and teleological understanding of the law, legal scholarship, and teaching and demanded the integration of social sciences into the study of the law. I began studying and teaching the classical writings of the American law and economics pioneers and related them to German private law. Gradually I shifted the focus of my academic interest and publications from development studies to the economic study of civil law and became increasingly convinced that “law and economics” corrects a scientific fallacy, which emerged when the two disciplines fell apart. Later I joined -together with my lawyer colleague Claus Ott-the European master program in law and economics, established a doctoral program in law and economics and the Hamburg institute of law and economics. After the merger of the two competing law departments the united faculty took supportive and far reaching decisions to consolidate the institute and make it a center for the study of law and economics. The following pages show in more detail the factors and reasons, which made me a convinced supporter and scholar of the economic approach to law and of institutional economics.

This article supports the view that, while judges suppress dissent when dissenting is too costly, the cost of dissenting depends on the political dimension of the issue broached. It contends that judges who disagree may nevertheless try to safeguard integrity and legitimacy in political disputes by presenting a public impression of unity. We muster evidence from the United Kingdom, specifically, votes from the Judicial Committee of the Privy Council (JCPC) between 1998 and 2011. We demonstrate through statistical analysis that judges are likelier to suppress dissent in devolution cases, which are characterized to be more political in character, than in Commonwealth appeals, which are more mundane in nature. We find that, while consensus on domestic issues reflects the absence of disagreement across judicial ideologies, judges have stronger conflicting positions on issues concerning devolution, but tend to suppress their propensity to dissent. This finding confirms that the JCPC wants to appear cohesive to give an image of greater authority on decisions of predominantly political content.

Protecting street art faces significant hurdles. To overcome them, Salib, P.N. (2015. The law of Banksy: Who owns street art? The University of Chicago Law Review, pp. 2293–2328) proposes to unbundle the various rights that art ownership usually implies. Specifically, he proposes to treat the finder of a street art piece as a minority shareholder in this piece, granting him some percentage of its value. We provide an economic analysis of this proposal by refining a simple discovery process model involving street art finders and the owners of the premises where street art is found. We consider both the optimal number of researchers and the share of the street art value that should accrue to a finder. We also pay attention to the co-determination of the numbers of seekers and street artists. We find that a change in the share of the value of discovered street art has an ambiguous effect on the numbers of seekers and street artists. Moreover, relying on this share alone cannot guarantee that the equilibrium values of the numbers of seekers and street artists are equal to their socially optimal values.

Can stricter community supervision (i.e., parole and probation) requirements lead to an increase in recidivism? I investigate this question by constructing a law enforcement model in which individuals can incur costs to increase their degree of self-control. The analysis reveals that stricter community supervision can, in fact, increase recidivism if these investments lead to ego-depletion. This possibility therefore warrants empirical investigation, and policy makers ought to be mindful of it when determining the strictness of community supervision conditions.

We explain why competing firms form collective entities to buy patents from other entities, particularly from non-practicing entities (NPEs), and follow a catch and release patent strategy. We show why having competitors bid as a single unit is better than having competitors bid against each other. More important, we show that collusive bidding on patents held by NPEs, even when the patents are not essential for a standard (SEPs), may increase consumer surplus, particularly when technological innovation is drastic, and improve social welfare. This provides a theoretical foundation that explains why competition authorities often allow collusive bidding for patents and why courts employ the “rule of reason” to analyze agreements under competition law. We also show that a cartel of incumbents will always outbid a potential entrant, or a patent assertion entity, over a technology that can destroy the value of the incumbents’ existing assets.

The purpose of this study is to identify the principles of taxation of transnational corporations in the European Union (EU), as well as the effectiveness of legal norms in this area based on the analysis of Ukrainian and world studies. The leading approach to the study of this problem is the method of review and critical analysis of the scientific literature on the subject of the study, as well as methods of logical deduction, scientific abstractions and a systematic approach that allows a comprehensive examination of the differences in the taxation procedures of transnational corporations in the EU Member States. The study presents topical issues of tax harmonisation in the field of taxation of transnational corporations in the European Union. The paper notes that the priorities of the EU Member States are aimed to a greater extent at combating the erosion of the tax base and tax evasion by transnational corporations than at eliminating tax obstacles in the internal market.