The Evolution of Sherman Act Jurisdiction: A Roadmap for Competitive Federalism

Recent Supreme Court decisions confirm for the first time in over six decades that federal regulatory authority under the Commerce Clause truly is limited. These decisions coincide with an increasing appreciation among scholars and jurists for the concept of competitive federalism. This paper derives the implications of competitive federalism for the evolution of federal jurisdiction over trade restraints under the Sherman Antitrust Act (1890). It provides a clear and substantively reasoned jurisdictional test based on the analysis of geographic market power familiar to antitrust scholars, practitioners, and regulators in evaluating horizontal mergers. To be subject to federal antitrust jurisdiction under this test, Sherman Act defendants must control a sufficiently large share of the geographic antitrust market that their trade restraint could plausibly affect prices “in more states than one.” This test resolves a number of troubling inconsistencies in the case law on federal antitrust jurisdiction and provides a useful roadmap for how the Court can constructively realign its approach to general Commerce Clause jurisdiction. As the Court’s economic understanding of the market failure underlying a regulatory statute advances, general Commerce Clause jurisdiction should evolve to require a closer substantive nexus between the market failure and the effect on interstate commerce necessary to justify federal jurisdiction This approach will allow the Court to iterate toward an appropriate and workable balance of dual sovereignty that takes seriously the concept of competitive federalism without requiring a dramatic departure from existing constitutional precedent

A Transaction Cost Assessment of SEC Regulation Best Interest

The U.S. Securities and Exchange Commission (“SEC”) is required to provide an economic analysis of proposed regulations and to show they plausibly meet a cost-benefit test. It recently proposed Regulation Best Interest (RBI) to replace the longstanding suitability rule for securities brokers when providing their retail clients with incidental investment advice. Despite a dearth of empirical support, the proposing release concludes that a best interest standard would better mitigate the conflicts of interest brokers face between providing their clients with impartial advice and inflating their own compensation. The empirical vacuum is a result of the SEC’s failure to ask the right economic questions, which Nobel laureate Ronald Coase raised over half a century ago: why does the rule of liability matter? What transaction costs prevent parties–who in this setting negotiate face-to-face–from correcting any market failure through private ordering? This essay provides a transaction cost assessment of RBI and concludes that a far more thorough economic analysis is necessary to justify imposing a best interest standard on retail brokers

Does Soft Dollar Brokerage Benefit Portfolio Investors: Agency Problem or Solution?

With soft dollar brokerage, institutional portfolio managers pay brokers “premium” commission rates in exchange for rebates they use to buy third-party research. One hypothesis views this practice as a reflection of the agency problem in delegated portfolio management; another views it as a contractual solution to the agency problem that aligns the incentives of investors, managers, and brokers where direct monitoring mechanisms are inadequate. Using a database of institutional money managers, we find that premium commission payments are positively related to risk-adjusted performance, suggesting that soft dollar brokerage is a solution to agency problems. Moreover, premium commissions are positively related to management fees, suggesting that labor market competition does not punish managers for using soft dollars

A Culturally Correct Proposal to Privatize the British Columbia Salmon Fishery

Canada now faces two looming policy crises that have come to a head in British Columbia. The first is long-term depletion of the Pacific salmon fishery by mobile commercial ocean fishermen racing to intercept salmon under the rule of capture. The second results from Canadian Supreme Court case law recognizing and affirming “the existing aboriginal and treaty rights of the aboriginal peoples of Canada” under Section 35(1) of the Constitution Act, 1982. This essay shows that the economics of property rights provides a joint solution to these crises that would promote the Canadian commonwealth by way of a privatization auction while respecting the tribes’ distinctive aboriginal culture

NAFLD exacerbates the effect of dietary sugar on liver fat and development of an atherogenic lipoprotein phenotype

This is the author accepted manuscript. It is currently under an indefinite embargo pending publication by Springer.${\bf Aims/hypothesis:}$ We aimed to test the hypothesis that the effects of dietary sugar on lipoprotein metabolism are influenced by non-alcoholic fatty liver disease (NAFLD). ${\bf Methods:}$ The effect of two 12 week, iso-energetic diets, high and low in non-milk extrinsic sugars (26% and 6% total energy), matched for macronutrient content, was examined in a randomised, cross-over study in men with NAFLD (n=11) and controls (n= 14). Lipoprotein kinetics and the sources of fatty acids for triacylglycerol (TAG) production were measured using stable isotope tracers. ${\bf Results:}$ Liver fat was higher after the high versus low-sugar diet in both groups (p<0.02), but men with NAFLD showed a relatively greater response than controls (p<0.05). After the high versus low-sugar diet, VLDL1-TAG production rate was higher in the controls (p <0.002) due to a greater contribution from splanchnic fatty acids (p<0.02) and de novo lipogenesis (p <0.002), whereas in NAFLD, VLDL2-TAG production rate was higher (p <0.05), due to a greater contribution from splanchnic fatty acids (p<0.02). There was no difference in the contribution of systemic NEFA to VLDL1 and VLDL2-TAG production rate between diets in either group. Intermediate density lipoprotein (IDL), LDL2 and LDL3-apolipoprotein B production rates and post-heparin hepatic lipase activity were all higher (p<0.05) on the high-sugar diet in NAFLD. ${\bf Conclusions:}$ A high sugar intake promoted a greater accumulation of liver fat in NAFLD than controls and increased VLDL-TAG production in both groups, due mainly to an increased contribution of fatty acids from splanchnic sources, which includes hepatic TAG storage pools. These effects may drive the formation of atherogenic lipoproteins.The work was supported by a UK government grant from the Biological Biotechnology Scientific Research Council (Grant no. BB/G009899/1); University of Surrey PhD scholarship for AM; Medical Research Council (body composition measurements) and infrastructure support from the National Institute of Health Research at the Cambridge Biomedical Research Centre

Meta-analysis of genome-wide association studies from the CHARGE consortium identifies common variants associated with carotid intima media thickness and plaque

Carotid intima media thickness (cIMT) and plaque determined by ultrasonography are established measures of subclinical atherosclerosis that each predicts future cardiovascular disease events. We conducted a meta-analysis of genome-wide association data in 31,211 participants of European ancestry from nine large studies in the setting of the Cohorts for Heart and Aging Research in Genomic Epidemiology (CHARGE) Consortium. We then sought additional evidence to support our findings among 11,273 individuals using data from seven additional studies. In the combined meta-analysis, we identified three genomic regions associated with common carotid intima media thickness and two different regions associated with the presence of carotid plaque (P < 5 × 10 -8). The associated SNPs mapped in or near genes related to cellular signaling, lipid metabolism and blood pressure homeostasis, and two of the regions were associated with coronary artery disease (P < 0.006) in the Coronary Artery Disease Genome-Wide Replication and Meta-Analysis (CARDIoGRAM) consortium. Our findings may provide new insight into pathways leading to subclinical atherosclerosis and subsequent cardiovascular events

Networks of corporate power revisited

This paper examines developments through the quarter century since the publication of Stokman, Ziegler and Scott's (1985) iconic ten-nation study of the structure of interlocking directorships. The surprising decline of research in the area following the publication of Networks of Corporate Power is in part testimony to the rigour of the comparative methods used, raising the standard of evidence required for subsequent director interlock studies. But it also reflected a critical weakness in director interlock research to that point, the limited ability to answer what Mark Mizruchi has called the “So what?” question. While replicated studies found clear structures in director interlocks, varying from country to country, and there was some speculative fit with the distinctive political economies of these countries, there was little evidence of any effect of these structures on firm performance or activity. The more recent resurgence in director interlock research is in some ways rooted in a second generation of the original drivers; the ready availability of now large masses of data on firm governance and firm level performance and further advances in social network analytical techniques. Where Stokman and his colleagues manually compiled lists of directors scoured from company reports, these data are now routinely collected and compiled in accessible databases by government agencies and business information services in many countries. And there has been a gradual accumulation of advances in addressing the “so what” question

Networks of corporate power revisited

This paper examines developments through the quarter century since the publication of Stokman, Ziegler and Scott's (1985) iconic ten-nation study of the structure of interlocking directorships. The surprising decline of research in the area following the publication of Networks of Corporate Power is in part testimony to the rigour of the comparative methods used, raising the standard of evidence required for subsequent director interlock studies. But it also reflected a critical weakness in director interlock research to that point, the limited ability to answer what Mark Mizruchi has called the “So what?” question. While replicated studies found clear structures in director interlocks, varying from country to country, and there was some speculative fit with the distinctive political economies of these countries, there was little evidence of any effect of these structures on firm performance or activity. The more recent resurgence in director interlock research is in some ways rooted in a second generation of the original drivers; the ready availability of now large masses of data on firm governance and firm level performance and further advances in social network analytical techniques. Where Stokman and his colleagues manually compiled lists of directors scoured from company reports, these data are now routinely collected and compiled in accessible databases by government agencies and business information services in many countries. And there has been a gradual accumulation of advances in addressing the “so what” question