Talking law and economics at ETH Zurich

For a long time, scholars have been classifying most legal systems around the world as falling within one of two inherently different categories: common or civil law systems. While the former (common law), rooted in England and practiced also in the US, involves precedent or deference to previously published judicial opinion; the latter (civil law), practiced in continental Europe and elsewhere in the world, does not – or so many still think. In this episode of the CLE vlog series, Prof. Holger Spamann (Harvard Law School) examines the myths and the reality of common and civil law with Alessandro Tacconelli (ETH Zurich). After a brief explanation of the alleged differences between the two systems and the history of such distinction, Prof. Spamann explains the findings of some of his work on the topic. In his paper ‘Judges in the Lab,' he and his co-authors recruited 299 real judges from seven major jurisdictions to judge an international criminal appeals case and to determine the appropriate prison sentence, to show that: (i) document use and written reasons did not differ between common and civil law judges, and (ii) ‘precedent effect' was barely detectable. Similarly, in his paper ‘The Reasons Highest Courts Give,' Prof. Spamann and co-authors quantitatively analysed 80 representative opinions of English and German apex courts in the late 19th century and early 21st century, to find that, even in 1880s, opinions of English and German courts differed in degree rather than kind and that, by the 2000s, the Germans cited precedent as frequently as the English. Paper References: Judges in the Lab: No Precedent Effects, No Common/Civil Law Differences Holger Spamann, Lars Klöhn, Christophe Jamin, Vikramaditya Khanna, John Zhuang Liu, Pavan Mamidi, Alexander Morell, Ivan Reidel Journal of Legal Analysis, Volume 13, Issue 1, 2021, Pages 110–126 https://doi.org/10.1093/jla/laaa008 The Reasons Highest Courts Give: England vs. Germany, 1880-1889 vs. 2007-2016 Jasper Kunstreich, Markus Lieberknecht, Heinrich Nemeczek, Holger Spamann, Stefan Vogenauer Working Paper Audio Credits for Trailer: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

For years, academic experts have championed the widespread adoption of the “Fama-French” factors in legal settings. Factor models are commonly used to perform valuations, performance evaluation and event studies across a wide variety of contexts, many of which rely on data provided by Professor Kenneth French. Yet these data are beset by a problem that the experts themselves did not understand: Widespread retroactive changes which can materially affect a broad range of estimates. In this episode of the CLE vlog & podcast series, Prof. Adriana Robertson (University of Chicago) discusses the background and findings of the study "Noisy Factors in Law" with Alessandro Tacconnelli (ETH Zurich). In their study, she and her co-authors Mikhail Simutin and Pat Akey (both University of Toronto) show how these retroactive changes, heretofore overlooked by experts, can have enormous impacts in precisely the settings in which experts have pressed for their use. They provide examples of valuations, performance analysis, and event studies in which the retroactive changes have a large—and even dispositive—effect on an expert's conclusions. Their analysis demonstrates how even the most well accepted expert approaches can be fraught with hidden peril. Paper References: Adriana Robertson - University of Chicago Mikhail Simutin - University of Toronto Pat Akey - University of Toronto Noisy Factors in Law (Please contact the authors for the latest version) Audio Credits for Trailer: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

Disinformation is proliferating on the internet, and platforms are responding by attaching warnings to content. There is little evidence, however, that these warnings help users identify or avoid disinformation. In this episode of the Center for Law & Economics' vlog & podcast series, Prof. Jonathan Mayer (Princeton) discusses the study "Adapting Security Warnings to Counter Online Disinformation" with Amit Zac (ETH Zurich). In their work, Jonathan Mayer (Princeton) and his co-authors Ben Kaiser, Jerry Wei, Eli Lucherini, Kevin Lee (Princeton), and J. Nathan Matias (Cornell University) adapt methods and results from the information security warning literature in order to design and evaluate effective disinformation warnings. They show a path forward for designing effective warnings, and contribute repeatable methods for evaluating behavioral effects. They also surface a possible dilemma: disinformation warnings might be able to inform users and guide behavior, but the behavioral effects might result from user experience friction, not informed decision making. In this podcast with Amit Zac (ETH Zurich), Jonathan Mayer provides insights into the background of the study and its results. Paper References: Ben Kaiser, Jerry Wei, Eli Lucherini, and Kevin Lee - Princeton University J. Nathan Matias - Cornell University Jonathan Mayer - Princeton University Adapting Security Warnings to Counter Online Disinformation Usenix Security (2021) https://www.usenix.org/conference/usenixsecurity21/presentation/kaiser Audio Credits for Trailer: AllttA by AllttA https://www.youtube.com/watch?v=ZawLOcbQZ2w&t=0s

In this episode of the CLE's vlog & podcast series, Prof. Henry E. Smith (Harvard) discusses his essays "Putting the Equity Back into Intellectual Property Remedies" and "Equity as Meta-Law" with Christophe Gösken (ETH Zurich). In his articles, Henry Smith argues that equity and related parts of the law solve complex and uncertain problems — including interdependent behavior and misuses of legal rules by opportunists — and do so in a characteristic fashion: as meta-law. These problems are rife in intellectual property settings. An attention to meta-law can focus on potential two-sided opportunism in scenarios of possible injunctions, and a more traditional equitable framework can help frame when presumptions for injunctions are appropriate and when they should be overcome. As a result, equity as meta-law could avoid flattening the law of intellectual property remedies. Paper References: Henry E. Smith - Harvard University Putting the Equity Back into Intellectual Property Remedies Notre Dame Law Review, 96(4), 1603–1622 (2021) https://scholarship.law.nd.edu/ndlr/vol96/iss4/12 Henry E. Smith - Harvard University Equity as Meta-Law The Yale Law Journal, 130(5), 1050–1287 (2021) https://www.yalelawjournal.org/article/equity-as-meta-law Audio Credits for Trailer: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of the CLE's vlog series, Luca Baltensperger (ETH Zurich) discusses the study "Environmental Preferences and Technological Choices: Is Market Competition Clean or Dirty?" with Prof. Ralf Martin (Imperial College London). In their study, Ralf Martin and his co-authors Prof. Philippe Aghion (College de France), Prof. Roland Bénabou (Princeton), and Prof. Alexandra Roulet (INSEAD) investigate the joint effect of consumers' environmental concerns and product-market competition on firms' decisions whether to innovate “clean” or “dirty”. They develop a step-by-step innovation model to capture the basic intuition that socially responsible consumers induce firms to escape competition by pursuing greener innovations. To test and quantify the theory, the authors bring together patent data from the automobile industry, survey data on environmental values, and competition measures. Results suggest that the combination of historically realistic increases in prosocial attitudes and product market competition can have the same effect on green innovation as major increase in fuel prices. Paper References: Philippe Aghion - College de France Roland Bénabou - Princeton University Ralf Martin - Imperial College London Alexandra Roulet - INSEAD Environmental Preferences and Technological Choices: Is Market Competition Clean or Dirty? https://www.nber.org/papers/w26921 Audio Credits for Trailer: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of the CLE's vlog & podcast series, Prof. Stefan Bechtold (ETH Zurich) talks to Prof. Saul Levmore (Chicago) about "SPACs, PIPEs, and Common Investors", a recent study by Levmore and Prof. Frank Fagan (South Texas). Special Purpose Acquisition Companies, or SPACs, have come to play a large role in bringing together small and large investors in the acquisition and expansion of private companies. A pessimistic version of this relatively recent alternative to conventional initial public offerings (IPOs), and other methods of investing in companies ready to expand, is that clever sharks take advantage of overly optimistic and ill-informed small investors. In their study "SPACs, PIPEs, and Common Investors", Levmore and Fagan offer a very different view. They show that common investors need someone to locate good investment opportunities, and then they often benefit if another well-informed party can credibly vouch for the entity that claims to have found a good target. Fagan's and Levmore's article also suggests the development of other means of vouching for parties that claim to have found worthy targets for investment. Paper References: Frank Fagan - South Texas College of Law Houston Saul Levmore - University of Chicago SPACs, PIPEs, and Common Investors University of Chicago Coase-Sandor Institute for Law & Economics Research Paper 954 https://ssrn.com/abstract=4036767 Audio Credits for Trailer: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

When machine-learning algorithms are deployed in high-stakes decisions, we want to ensure that it leads to fair and equitable outcomes. However, many machine predictions are deployed to assist in decisions where a human decision-maker retains the ultimate decision authority. In this episode of the CLE's podcast series, Prof. Talia Gillis (Columbia) and Prof. Alexander Stremitzer (ETH Zurich) discuss Gillis' study "On the Fairness of Machine-​Assisted Human Decisions" - joint with Bryce McLaughlin (Stanford) and Jann Spiess (Stanford) - on how properties of machine predictions affect the resulting human decisions. In their study, Gillis, McLaughlin and Spiess show in a formal model that the inclusion of a biased human decision-maker can revert common relationships between the structure of the algorithm and the qualities of resulting decisions. Specifically, they document that excluding information about protected groups from the prediction may fail to reduce disparities. Their results demonstrate more broadly that any study of critical properties of complex decision systems, such as the fairness of machine-assisted human decisions, should go beyond focusing on the underlying algorithmic predictions in isolation. Paper References: Talia Gillis - Columbia University Bryce McLaughlin - Stanford University Jann Spiess - Stanford University On the Fairness of Machine-Assisted Human Decisions https://arxiv.org/abs/2110.15310 Audio Credits for Trailer: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

Behavioral economics — arising from the insight that people make recognizable, systematic mistakes — has revolutionized policymaking. For example, in governments around the world, including the US, teams of experts have recently arisen to harness these insights, promising to do things like increase retirement savings. But there is a problem: Economic experts do not look or think like the rest of the population. They are deeply unrepresentative demographically and have quite different policy views. In this episode of the CLE's vlog & podcast series, Prof. Alexander Stremitzer (ETH Zurich) talks to Prof. Daniel Markovits (Yale) about a new approach to behavioral economics called "democratic law and economics", a concept developed by Markovits and Prof. Zachary D. Liscow (Yale). Rather than dictating what the right policy or action is, they suggest that behavioral economists instead inform representative samples of ordinary people about the evidence and let them decide for themselves. Those decisions, rather than experts' opinions alone, should then inform policymakers. Paper References: Zachary D. Liscow - Yale Law School Daniel Markovits - Yale Law School Democratizing Behavioral Economics https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4012996 Audio Credits for Trailer: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this podcast of the CLE's vlog & podcast series, Prof. John J. Donohue discusses the study "Right-to-Carry Laws and Violent Crime: A Comprehensive Assessment Using Panel Data and a State-Level Synthetic Control Analysis" with Prof. Alexander Stremitzer (ETH Zurich). In their study, John J. Donohue (Stanford), Abhay Aneja (Berkeley) and Kyle D. Weber (Columbia) use indepth state panel data and new statistical techniques to estimate the impact on violent crime when states adopt right-to-carry (RTC) concealed handgun laws. They find that RTC laws increase overall violent crime and that RTC laws are associated with 13–15 percent higher aggregate violent crime rates 10 years after adoption. Using a consensus estimate of the elasticity of crime with respect to incarceration of 0.15, the average RTC state would need to roughly double its prison population to offset the increase in violent crime caused by RTC adoption. Paper References: John J. Donohue - Stanford Law School Abhay Aneja - Berkeley Law Kyle D. Weber - Columbia University Right-to-Carry Laws and Violent Crime: A Comprehensive Assessment Using Panel Data and a State-Level Synthetic Control Analysis Journal of Empirical Legal Studies, Vol. 16(2), p. 198-247 (2019) https://onlinelibrary.wiley.com/doi/full/10.1111/jels.12219 Audio Credits for Trailer: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of the CLE's vlog & podcast series, Prof. Sarath Sanga (Northwestern) talks with Prof. Alexander Stremitzer (ETH Zurich) about his paper "The Origins of the Market for Corporate Law", a study of the market for corporate charters and the emergence of Delaware as the leader of this market. In his paper, Prof. Sanga assembles new data on 19th and 20th-century corporations to evaluate two widely-held beliefs: (1) the U.S. Supreme Court is responsible for enabling a national market for corporate charters in the 19th century and (2) Delaware became the leader in this market only because New Jersey (the initial leader) repealed its extremely liberal corporate laws in 1913. In the discussion with Prof. Stremitzer he explains why he argues against both claims. Paper Reference: Sarath Sanga – Northwestern University, Pritzker School of Law The Origins of the Market for Corporate Law https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3503628 Audio Credits for Trailer: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of the vlog & podcast series of ETH's Center for Law & Economics, Professor Erina Ytsma from Carnegie Mellon discusses her study “Effort and Selection Effects of Performance Pay in Knowledge Creation” with Dr. Amit Zac (Postdoc at ETH Zurich). It is well-documented that performance pay has positive effort and selection effects in routine tasks, while its effect in knowledge creation is much less understood. In her study, Ytsma analyses the effects of explicit and implicit career concerns incentives common in knowledge work in a multi-tasking model, and estimates the causal effort and selection effects of performance incentives in knowledge creation, using the introduction of performance pay in German academia as a natural experiment. Paper Reference: Erina Ytsma – Carnegie Mellon University, Tepper School of Business Effort and Selection Effects of Performance Pay in Knowledge Creation https://gitlab.com/eytsma/research_papers/raw/master/Effort+Selection_Effects-KnowledgeCreation_ErinaYtsma_latest.pdf Audio Credits for Trailer: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this vlog, Prof. Laura Pedraza-Fariña (Northwestern) discusses her paper "A Network Theory of Patentability" with PhD student Margaritha Windisch (ETH Zurich). Patent law is built upon a fundamental premise: only significant inventions receive patent protection while minor improvements remain in the public domain. Despite its importance, the doctrine that performs this gate keeping role — non-obviousness — has long remained indeterminate and vague. In their article, Laura Pedraza-Fariña and her co-author Prof. Ryan Whalen (University of Hongkong) draw on network theory, a novel approach answering the questions what non-obvious inventions are and how to determine non-obviousness in specific cases. Paper References: Laura Pedraza-Fariña - Northwestern Pritzker School of Law Ryan Whalen - University of Hong Kong, Faculty of Law A Network Theory of Patentability University of Chicago Law Review, Volume 87, No. 1, (2020) https://lawreview.uchicago.edu/publication/network-theory-patentability Audio Credits: Trailer music: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of the vlog and podcast series of ETH's Center for Law & Economics, Professor Alessandro Acquisti (Carnegie Mellon) and Dr. Naman Goel (ETH Zurich) discuss Prof. Acquisti's study "Secrets and Likes: The Drive for Privacy and the Difficulty of Achieving it in the Digital Age". Paper References Alessandro Acquisti - Carnegie Mellon University Laura Brandimarte - University of Arizona George Loewenstein - Carnegie Mellon University Secrets and Likes: The Drive for Privacy and the Difficulty of Achieving it in the Digital Age https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3688497 Audio Credits Trailer music: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of ETH's Center for Law & Economics vlog and podcast series, Professor Melissa Wasserman (University of Texas) talks to Gabriel Gertsch (ETH Zurich) about her study "A Prescription for Rising Drug Prices: Patent Office Reform". Paper References: Michael Frakes - Duke University Melissa Wasserman - University of Texas "A Prescription for Rising Drug Prices: Patent Office Reform" https://www.law.umich.edu/centersandprograms/lawandeconomics/workshops/Documents/Paper10.Wasserman.Rising%20Drug%20Prices%20Reform%20(2).pdf Audio Credits: Trailer music: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of ETH's Center for Law & Economics vlog and podcast series, Professor Stefan Bechtold (ETH Zurich) talks with Professor Luis Aguiar (UZH) about his recent assessment of Spotify's market power by measuring the impact of its promotion decisions via platform-operated playlists. Paper References Luis Aguiar - University of Zurich Joel Waldfogel - University of Minnesota and NBER Platforms, Power, and Promotion: Evidence from Spotify Playlists http://www.luis-aguiar.com/research Audio Credits Trailer music: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of ETH's Center for Law & Economics vlog and podcast series, Professor Stefan Bechtold (ETH Zurich) talks with Professor Tobias Salz (MIT) about his recent study on the effects of the EU’s General Data Protection Regulation (GDPR), using a novel dataset from an online travel intermediary. Paper References Guy Aridor - Columbia Yeon-Koo Che - Columbia Tobias Salz - MIT The Effect of Privacy Regulation on the Data Industry: Empirical Evidence from GDPR https://www.ftc.gov/system/files/documents/public_events/1548288/privacycon-2020-guy_aridor.pdf Audio Credits Trailer music: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of ETH's Center for Law & Economics vlog and podcast series, Professors Christian Peukert (HEC Lausanne) and Stefan Bechtold (ETH Zurich) discuss how privacy law interacts with competition and trade policy in the context of the European General Data Protection Regulation (GDPR). Paper References Christian Peukert - University of Lausanne (HEC) Stefan Bechtold - ETH Zurich Michail Batikas - ESC Rennes School of Business Tobias Kretschmer - Ludwig Maximilian University of Munich European Privacy Law & Global Markets for Data https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3560392 Audio Credits Trailer music: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of ETH's Center for Law & Economics Vlog/Podcast Series, Daniela Sele talks to Professor Saul Levmore from the University of Chicago Law School about his paper "Competing Algorithms for Law: Sentencing, Admissions, and Employment". Paper Reference Saul Levmore - University of Chicago Law School Frank Fagan - EDHEC Business Competing Algorithms for Law: Sentencing, Admissions, and Employment https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3668616 Audio Credits Trailer music: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of the Center for Law & Economics @ ETH Zurich, we are exploring what being innovative in the 21st Century means with Prof. Benjamin Jones from Northwestern Kellogg School of Management. Paper References: Age and Great Invention: https://www.kellogg.northwestern.edu/faculty/jones-ben/htm/AgeAndGreatInvention.pdf Decoding team and individual impact in science and invention: https://www.pnas.org/content/pnas/116/28/13885.full.pdf Audio Credits: Trailer music: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of the Center for Law & Economics @ ETH Zurich, Daniela Sele is discussing copyright and creative incentives with Prof. Christopher Sprigman from NYU School of Law. Paper References: Copyright and Creative Incentives: What We Know (and Don't) https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3095740 Audio Credits: Trailer music: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of the Center for Law & Economics @ ETH Zurich, Erasmus Elsner and Prof. Adam Badawi is taking a deep dive into the paper "Contractual Complexity in Debt Agreements: The Case of EBITDA" with Professor Adam Badawi from the Berkeley Law. Paper References: Contractual Complexity in Debt Agreements: The Case of EBITDA, joint work with Elisabeth de Fontenay https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3455497 Audio Credits: Trailer music: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w

In this episode of the Center for Law & Economics @ ETH Zurich, Christian Peukert is exploring " 3D Challenges: Ensuring Competition and Innovation in 3D Printing" with Professor Michal Gal from Haifa University.

In this episode of the Center for Law & Economics @ ETH Zurich, Gabriel Gertsch is exploring the book chapter " Intellectual Property and the Promotion of Happiness" with Professor Christopher Buccafusco from Cardozo School of Law

In this episode of the Center for Law & Economics @ETH Zurich, Erasmus Elsner is exploring biometric privacy with Prof. Matthew Kugler from Northwestern University Pritzker School of Law. Paper References: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3289850 Audio Credits: Trailer music: AllttA by AllttA https://youtu.be/ZawLOcbQZ2w