Smart Contracts in Insurance: A Law and Futurology Perspective

Smart contracts are innovative contracts that differ from traditional ones in that they are self-executing, as they entail the possibility of representing contract terms in programming code that gets automatically executed on a blockchain or other distributed ledgers. Following the latest developments in blockchain technology, smart contracts have been the focus of growing attention and are currently among the major innovations that are taking place in financial services. This paper investigates the scope for their application in insurance both in the near and longer term, exploring the legal challenges that they pose. The analysis shows that in the near term smart contracts will be mainly exploited to automate underwriting, claims handling and payouts. It considers how the automation of these processes will operate at law and emphasises the impact that smart contracts can have especially on the reduction of transaction costs and on the very essence of the insurance contract—the insurer's promise to pay. Building on current technological developments, the paper then turns to role that smart contracts can play in insurance in the longer term, advancing the prospect of the automation of the entire insurance contract. In particular, it argues that the interaction between smart contracts and artificial intelligence and machine learning can challenge traditional frameworks of thought such as incomplete contracting and, in the farther-distant future, will culminate in contracts that will both self-interpret and self-enforce their terms—what can be called the true smart contracts. The analysis identifies and addresses the main legal issues that can arise in this context, exploring how to strike a balance between the goal of fostering innovation and the need to ensure policyholder and investor protection

An evolutionary approach to international political economy: the case of corporate tax avoidance

Corporate tax avoidance is both widespread and diverse in its practical mechanics. The scope of the phenomenon often leads economists to conclude that in the jungle of economic competition, tax planning (or optimisation) is among the necessary tools to ensure the survival of the fittest. This theory is increasingly associated with a Darwinian theory of economic evolution. In this paper, I develop a contrasting framework of the evolutionary political economy of corporate tax avoidance. Analysing core concepts of Old Institutionalist Economics (OIE), I examine the core drivers of corporate tax avoidance in a globalised system of states. The major contrast, I find, is between that of the corporate and legal personality and the institutional environment in which it operates. Historically, each corporate entity has been considered a separate legal person, yet a series of ‘mutations’ of incorporations laws created a widening gap between theory and reality, and these, in turn, give rise to tax arbitrage. Narrowing this gap, however, impinges on another venerable historical institution, the institution of sovereignty and sovereign inequality

Justice and Corporate Governance: New Insights from Rawlsian Social Contract and Sen’s Capabilities Approach

By considering what we identify as a problem inherent in the ‘nature of the firm’—the risk of abuse of authority—we propound the conception of a social contract theory of the firm which is truly Rawlsian in its inspiration. Hence, we link the social contract theory of the firm (justice at firm’s level) with the general theory of justice (justice at society’s level). Through this path, we enter the debate about whether firms can be part of Rawlsian theory of justice showing that corporate governance principles enter the “basic structure.” Finally, we concur with Sen’s aim to broaden the realm of social justice beyond what he calls the ‘transcendental institutional perfectionism’ of Rawls’ theory. We maintain the contractarian approach to justice but introduce Sen’s capability concept as an element of the constitutional and post-constitutional contract model of institutions with special reference to corporate governance. Accordingly, rights over primary goods and capabilities are (constitutionally) granted by the basic institutions of society, but many capabilities have to be turned into the functionings of many stakeholders through the operation of firms understood as post-constitutional institutional domains. The constitutional contract on the distribution of primary goods and capabilities should then shape the principles of corporate governance so that at post-constitutional level anyone may achieve her/his functionings in the corporate domain by exercising such capabilities. In the absence of such a condition, post-constitutional contracts would distort the process that descends from constitutional rights and capabilities toward social outcomes

Venture capital-backed firms, unavoidable value-destroying trade sales, and fair value protections

This paper investigates the implications of the fair value protections contemplated by the standard corporate contract (i.e., the standard contract form for which corporate law provides) for the entrepreneur–venture capitalist relationship, focusing, in particular, on unavoidable value-destroying trade sales. First, it demonstrates that the typical entrepreneur–venture capitalist contract does institutionalize the venture capitalist’s liquidity needs, allowing, under some circumstances, for counterintuitive instances of contractually-compliant value destruction. Unavoidable value-destroying trade sales are the most tangible example. Next, it argues that fair value protections can prevent the entrepreneur and venture capitalist from allocating the value that these transactions generate as they would want. Then, it shows that the reality of venture capital-backed firms calls for a process of adaptation of the standard corporate contract that has one major step in the deactivation or re-shaping of fair value protections. Finally, it argues that a standard corporate contract aiming to promote social welfare through venture capital should feature flexible fair value protections.info:eu-repo/semantics/publishedVersio

Teoría de agencia: una revisión del origen biológico del delito

Este trabajo aborda la causa del conflicto entre principal y agente, buscando respuestas en las disciplinas de la biología, particularmente en las ciencias de la antropología criminal. Se ha realizado un ensamble entre los hallazgos de la teoría de agencia y la teoría de los delitos de cuello blanco, reinterpretando las actuaciones del agente desde su configuración entre instinto, herencia y personalidad. Los resultados en las ciencias biológicas podrían aportar nuevas interpretaciones y explicaciones en las ciencias de la administración, avanzando hacia mejores conceptualizaciones del conflicto, mediante teorías con mayor contenido empírico. En general, pese al conflicto permanente entre las partes, su dinámica potencia los resultados perseguidos por el principal