Noncommutative Dynamics of Random Operators

We continue our program of unifying general relativity and quantum mechanics in terms of a noncommutative algebra ${\cal A}$ on a transformation groupoid $\Gamma = E \times G$ where $E$ is the total space of a principal fibre bundle over spacetime, and $G$ a suitable group acting on $\Gamma$. We show that every $a \in {\cal A}$ defines a random operator, and we study the dynamics of such operators. In the noncommutative regime, there is no usual time but, on the strength of the Tomita-Takesaki theorem, there exists a one-parameter group of automorphisms of the algebra ${\cal A}$ which can be used to define a state dependent dynamics; i.e., the pair $({\cal A}, \phi)$, where $\phi$ is a state on ${\cal A}$, is a ``dynamic object''. Only if certain additional conditions are satisfied, the Connes-Nikodym-Radon theorem can be applied and the dependence on $\phi$ disappears. In these cases, the usual unitary quantum mechanical evolution is recovered. We also notice that the same pair $({\cal A}, \phi)$ defines the so-called free probability calculus, as developed by Voiculescu and others, with the state $\phi$ playing the role of the noncommutative probability measure. This shows that in the noncommutative regime dynamics and probability are unified. This also explains probabilistic properties of the usual quantum mechanics.Comment: 13 pages, LaTe

Lessons from Fiascos in Russian Corporate Governance

"Bad corporate governance" is often invoked to explain poor enterprise performance, but the catch phrase is never precisely defined - neither its consequences for the real economy, nor its causes in particular countries has been adequately explained. This paper uses Russian enterprise examples to address these open questions in corporate governance theory. We define corporate governance by looking to the economic functions of the firm rather than to any particular set of national corporate laws. Firms exhibit good corporate governance when their managers maximize residuals and, in the case of investor-owned firms, make pro rata distributions to shareholders. First, using this definition, we develop a typology that shows the channels through which bad corporate governance can inflict damage on the real economy. The topology helps identify vulnerabilities to corporate governance problems that may appear in any country and it suggests a new way to tailor policy responses. Second, we explain the causes of poor corporate performance in Russia by looking to the particular conditions prevailing at privatization - untenable initial firm boundaries and insider allocation of firm shares - and the bargaining dynamics that followed. The focus on initial conditions helps expand a comparative corporate governance literature built on United States, Western European, and Japanese models. Lessons from Russian fiascos counsel caution as to "stakeholder" proposals - including labor or local communities in formal corporate governance - and generate testable hypotheses regarding potential losses from the multiple large block share ownerships typical of many U.S. firms, especially close corporations.

Gridlock Economy: How Too Much Ownership Wrecks Markets, Stops Innovation, and Costs Lives (Introduction)

Twenty-five new runways would eliminate most air travel delays in America; fifty patent owners are blocking a major drug company from creating a cancer cure; 90 percent of our broadcast spectrum sits idle while American cell phone service suffers. These problems have solutions that can jump-start innovation and help save our troubled economy. So, what\u27s holding us back

The UNE Anticommons: Why the 1996 Telecom Reforms Blocked Innovation and Investment

The United States is losing its competitive edge in telecommunications partly because of FCC mistakes in fragmenting property rights in, and in the regulatory oversight of local telephone facilities and services. As with post-socialist transition, reformers created a tragedy of the anticommons in which too many owners and regulators each can block the others\u27 investments and all players forego innovation. By forcing existing companies to unbundle network elements (UNEs) and sell them too cheaply, the FCC has created an industry where the players cannibalize the legacy network, divert resources to regulatory arbitrage, and have little incentive for bold new investments

Chernobyl Fallout: Recent IAEA Conventions Expand Transboundary Nuclear Pollution Law

After releasing a radioactive cloud over Europe, the April 1986 nuclear power plant accident at Chernobyl in the USSR sparked a chain-reaction of diplomatic negotiation that culminated in two recent International Atomic Energy Agency (IAEA) conventions on nuclear accidents. The Convention on Early Notification of a Nuclear Accident (Convention on Early Notification) and the Convention on Assistance in the Case of a Nuclear Accident or Radiological Emergency (Convention on Assistance) were both opened for signature on September 26, 1986 at the end of a three-day IAEA special session on the lessons of the Soviet nuclear plant disaster. In the months following adoption, sixty IAEA member-states signed the Convention on Early Notification and fifty-nine members signed the Convention on Assistance. These conventions structure international expectations for quick response to the transnational effects of nuclear accidents. In doing so, the conventions aim to reduce the confusion immediately following such accidents by: (1) allowing more rational and effective crisis management responsive to accident-specific information; and (2) coordinating specialized national and international assistance capabilities. Although only committing signatory countries to do what most would consider obvious and natural, the conventions nevertheless expand international legal responsibility for the extraterritorial consequences of nuclear pollution

Common Interest Developments at the Crossroads of Legal Theory

What makes common interest developments (CIDs) interesting for legal theory? In my view, CIDs should provoke our interest because they operate at the intersection of two axes of contemporary legal scholarship. The first axis concerns rights allocation, what I have called the spectrum from commons to anticommons property. The second axis concerns governance institutions, which can occupy the space between private and public. These two dimensions define the theoretical field within which we create new forms of group property, and through which we solve emerging collective action dilemmas. CIDs are located at this crossroads, delicately poised between extremes on both the rights allocation and the decision-making axes. A word on collective action dilemmas (CADs). They have become the legal scholar\u27s full-employment program. With so few analytic arrows in our legal theory quiver, simple metaphors must do a lot of work. Both axes that I discuss in this essay could be understood as versions of CADs. The danger here is that the CAD perspective can easily expand to the point that it loses its bite: how do incentives shape community, when does law tame competition, and why do individuals ever cooperate? Looking at CIDs helps to bring the focus from these imponderable questions to more narrow and useful questions about creating well-functioning group property forms. We continue to be shocked to find cooperation in a CID world. Within CIDs, what explains virtuous cycles of cooperation and ameliorates vicious cycles of defection

Critical Approaches to Property Institutions

Private property is a rather elusive concept. Any kid knows what it means for something to be mine or yours, but grownup legal theorists get flustered when they try to pin down the term. Typically they, actually we, turn to a familiar analytic toolkit: including, for example, Blackstone\u27s image of private property as sole and despotic dominion ; Hardin\u27s metaphor of the tragedy of the commons ; and, more generally, the division of ownership into a trilogy of private, commons, and state forms. While each analytic tool has a distinguished pedigree and certain present usefulness, each also imposes a cost because it renders invisible many new forms of property. This essay suggests that legal scholarship, particularly its law and- economics branch, relies on an outdated and overly simplistic image of private property, an understanding that acknowledges just one of the many faces of private property. I will focus here on three faces – first, the possibility of creating a new ideal type of property; second, synthesizing existing ideal types; and third, redefining our core types – that may render private property a more tractable term, one better designed to identify and support innovation at the frontiers of social relations

The Cutting Edge of Poster Law

Students place tens of thousands of posters around law schools each year – in staircases, on walls, and on bulletin boards. Rarely, however, do formal disputes about postering arise. Students know how far to go – and go no farther despite numerous avenues for postering deviance: blizzarding, megasigns, commercial or scurrilous signs. What is the history of poster law? What are its norms and rules, privileges and procedures? Is poster law effident? Is it just

Empty Moscow Stores: A Cautionary Tale for Property Innovators

Under socialism, governments stifled markets and often left store shelves bare. One promise of transition was that new entrepreneurs would acquire the stores, create businesses, and fill the shelves. 2 However, after several years of reform, storefronts often remained empty, while flimsy metal kiosks, stocked full of goods, mushroomed on Moscow streets (Rapaczynski 1996). Why did new merchants not come in from the cold? This chapter argues that even if the initial endowment of property rights were clearly defined, corruption held in check, and the rule of law respected (e.g., Gray, Hanson, and Heller 1992; Frydman and Rapaczynski 1994; Shleifer 1994), storefronts would remain empty because of the way governments are creating property rights. Transition regimes have often failed to transfer to individuals a coherent bundle of rights that represents full ownership of storefronts or other scarce resources. Instead, those regimes have ratified the expectations of powerful socialist-era stakeholders by making them rights-holders in the new economy. Fragmented rights were made alienable in the hope that new owners would trade them to more productive users. In a typical Moscow storefront, one owner may hold the right to sell, another to receive sale revenue, and still others to lease, receive lease revenue, occupy, and determine use. No one can set up shop without collecting consent from the other owners