An Economic Analysis of Property Rights in Information: Justifications and Problems of Exclusive Rights, Incentives to Generate Information, and the Alternative of a Government-Run Reward System

This article examines and questions the traditional justifications for intellectual property (I.P.) rights in America (focusing on copyright and patent law), and explores incentives necessary to induce the creation of these works of information. I conclude that changes are needed to I.P. law in order to best foster society\u27s dual goals of 1) promoting incentives to create I.P. works (such as currently patented drugs), while also 2) maximizing distribution of those products to all consumers who would stand to gain (and not merely those who can afford the monopoly price charged). Hence, I suggest the creation of a Government-Run Reward System to best serve both of society\u27s goals: incentives distribution. Under the reward system, innovators would be paid directly by the government for their intellectual property creations. In turn, their works would pass immediately into the public domain so that they are freely reproducible and distributable at their marginal cost of production (rather than the monopoly price which prevails under patent and copyright law today). In its ideal form, the reward system thereby allows for both socially optimal creation and distribution of intellectual property works, eliminating the deadweight social loss that plagues us today

Cash for Kidneys? Utilizing Incentives to End America\u27s Organ Shortage

This article addresses the growing organ shortage in America, analyzes current donation and procurement law, and explores both monetary and nonmonetary incentives aimed at eliminating the worsening crisis. Part I details the law governing human organ donation. Under both the Uniform Anatomical Gift Act (“UAGA”) and the National Organ Transplant Act (“NOTA”), no donor of a human organ may receive “valuable consideration” for providing it. Congress’ intention was simply that the organ recipient be given the “gift” of life—not one which she had to purchase on the market. In reality, the consequences of the Act bear little resemblance to its initial intent. Organ scarcity has been the unintended result, leading to a thriving global black market in human organ sales. Part II explores the traditional arguments that scholars and legislators have raised against legalizing the sale of human organs. Notions of morality, distributive justice, imperfect information, and negative externalities are routinely offered to justify the current law prohibiting sales. Part III explores some of the limitations of the above rationales, offering reasons why properly regulated organ sales may not be as far-fetched or offensive as some initially think. I will offer suggestions for responsible regulation of sales to guard against the abuses and exploitation rampant on the black market, and to ensure that a seller’s decision is truly voluntary, fully informed, competent, and enduring. Part IV proposes and analyzes incentive-based solutions to cure the organ crisis in America. Monetary incentives short of outright sale by living donors would go far towards boosting organ supply while reducing the concerns raised by open markets in organs. Some scholars have suggested “futures markets,” allowing individuals to receive remuneration today in exchange for agreeing to have their organs donated at death. A few states have considered tax deductions for donors, and some even offer nominal amounts of money to individuals who opt in to donation when renewing their driver’s licenses. By modifying and combining some of these ideas, I will propose ways that we could dramatically raise organ donor participation rates while staying within the confines of NOTA and UAGA

Vanishing Vaccinations: Why Are So Many Americans Opting Out of Vaccinating Their Children?

Vaccinations against life-threatening diseases are one of the greatest public health achievements in history. Literally millions of premature deaths have been prevented, and countless more children have been saved from disfiguring illness. While vaccinations carry unavoidable risks, the medical, social and economic benefits they confer have led all fifty states to enact compulsory childhood vaccination laws to stop the spread of preventable diseases. Today, however, vaccines are becoming a victim of their success-many individuals have never witnessed the debilitating diseases that vaccines protect against, allowing complacency toward immunization requirements to build. Antivaccination sentiment is growing fast in the United States, in large part due to the controversial and hotly disputed link between immunizations and autism. The internet worsens fears regarding vaccination safety, as at least a dozen websites publish alarming information about the risks of vaccines. Increasing numbers of parents are refusing immunizations for their children and seeking legally sanctioned exemptions instead, apparently fearing vaccines more than the underlying diseases that they protect against. A variety of factors are at play: religious and philosophical beliefs, freedom and individualism, misinformation about risk, and overperception of risk. State legislatures and health departments now face a difficult challenge: respecting individual rights and freedoms while also safeguarding the public welfare. Nearly all states allow vaccination exemptions for religious reasons and a growing number provide philosophical opt-outs as well. However, in all but a handful of jurisdictions, neither objection is seriously documented or verified. Often, the law requires a parent to do no more than simply check a box indicating she does not wish her child to receive immunizations. The problem is exacerbated by financial incentives schools have to encourage students to opt out of vaccinations. The rise in parents opting out has caused the AMA grave concern, with many experts decrying the rise of so-called exemptions of convenience. In some areas, nearly one out of five children have not received their recommended vaccines. The consequences are serious not only for those unprotected children, but for the rest of society as well. Herd immunity is threatened as more and more parents free ride off of the community\u27s dwindling immunity, and outbreaks of diseases thought to have been conquered have already occurred. Lawsuits against vaccine manufacturers threaten them with bankruptcy, costs are being externalized onto the healthcare and legal systems, and vulnerable populations are suffering harm or even death. In the interests of social welfare, state legislatures and health departments should consider methods to ensure that the exemption process is carefully tailored to prevent check-thebox opt-outs of convenience, while still allowing exemptions for those with earnest and informed convictions or medical reasons

Penalizing Punitive Damages: Why the Supreme Court Needs a Lesson in Law and Economics

The recent landmark Supreme Court decision addressing punitive damages in the infamous Exxon Valdez oil spill case has brought the issue of punitive awards back into the legal limelight. Modern Supreme Court jurisprudence, most notably BMW of North America, Inc. [517 U.S. 559 (1996)], State Farm [538 U.S. 408 (2003)], Philip Morris [549 U.S. 346 (2007)], and now Exxon Shipping Co. [128 S.Ct. 2605 (2008)] in 2008, has concluded that such judgments are justified to punish morally reprehensible behavior and to send a message to evildoers. The Court, however, has increasingly emphasized that the U.S. Constitution\u27s Due Process Clause presumptively limits punitive awards, drawing an arbitrary line in the sand of no more than ten times actual damages. This Article critically examines modern punitive damages jurisprudence using a law and economics lens. From that standpoint, there is no justifiable basis for tort law\u27s requirement of morally reprehensible or intentional conduct before punitive damages may be awarded. Indeed, punitives should be imposed—must for deterrence purposes—even in the absence of egregious behavior, when a defendant has escaped liability previously, either intentionally or serendipitously. In this manner, the punitive award makes up for the occasions in which the defendant avoided liability and failed to compensate victims for harm caused. On the other hand, sound economic analysis dictates that imposing enormous punitive damages simply because a tortfeasor\u27s behavior was morally offensive can inadvertently lead to overdeterrence, price inflation beyond optimum, quantity of goods purchased below optimum, and a significant reduction in overall social welfare. In sum, the Supreme Court must drastically revise its approach to punitive damages jurisprudence: such awards should not be arbitrarily based on a gut reaction to how reprehensibly we feel a defendant acted. Rather, punitive damages should be granted only where tortfeasors have the potential to escape liability for their actions, and they should be awarded in that case even if the defendant in no way meets the modern requirement of egregious behavior. Moreover, the Supreme Court\u27s arbitrary due process litmus test of ten times compensatory damages as a ceiling on punitive damages makes zero sense from an economic analysis point of view, and needs to be summarily abolished

Sports Medicine Conflicts: Team Physicians vs. Athlete-Patients

Team physicians for professional sports franchises face a conflict of interest created by the competing loyalties they owe to the team that employs them and to the athlete-patient they must treat. Marketing agreements under which physicians pay significant sums of money to be designated as the team\u27s official healthcare provider exacerbate this conflict. These marketing arrangements call into question the independent judgment of team physicians and cause players to question the quality of care they receive. This paper explores several solutions to the growing conflicts between athletes and team doctors with the goal of enhancing players\u27 trust in the medical care they receive. First, to remove the dual loyalty problem faced by team physicians, professional sports leagues or players\u27 unions should hire medical providers directly—as opposed to having individual teams employ and provide them. If this fundamental employment change proves impossible, physician groups should enter into explicit agreements with sports franchises that assert the groups\u27 independence, and professional sports leagues should mandate that physicians disclose all potential conflicts of interest to the players they treat. In addition, sports leagues could ban physicians from advertising their affiliation with teams to alleviate the problem of doctors engaging in bidding wars to service athletes at below-market rates in order to gain a PR edge on their competition. Finally, states might consider exceptions to the exclusive remedy provisions of workers\u27 compensation laws to ensure that professional athletes have legal recourse when they suffer the deleterious effects of these conflicts. This conflict of interest between team physicians and the athlete-patients they treat must be remedied by aggressively implementing policies and procedures that change the current relationship between healthcare providers, teams, and their players. Part I of this Paper examines the various duties that a team physician owes her athlete-patient. Part II details the nature of the relationship between teams, physicians, and players, and Part III explains how these relationships cause conflicts of interest to arise. Finally, Part IV outlines policy solutions that would remedy the diverging interests that team doctors face. Contributed to a symposium on Sports Medicine: Doping, Disability Health Quality

Vanishing Vaccinations: Why Are So Many Americans Opting Out of Vaccinating Their Children?

Part I of this Article details the historical development and medical achievements made possible by vaccines. From Edward Jenner to Jonas Salk to Albert Sabin, immense strides have been made in eradicating or substantially eliminating some of the worst diseases in human history. Smallpox, polio, measles, mumps, rubella, diphtheria, pertussis, tetanus, influenza, hepatitis A and B, and even the chicken pox are all now largely preventable. Literally hundreds of millions of deaths have been avoided and many more lives markedly improved, to say nothing of the financial ramifications for the American healthcare system. All fifty states have therefore enacted compulsory childhood vaccination laws to keep immunization rates high. The Supreme Court has reinforced the government\u27s police power to require vaccinations in the name of overall public safety, holding that important individual liberty rights (to opt out from vaccines) do not override other people\u27s rights (to communal health safety). Subsequent cases have confirmed that compulsory vaccination laws do not violate one\u27s constitutional right to Due Process or Equal Protection, or interfere with the practice of religion under the First Amendment. Part II analyzes the reasons for the growing anti-vaccination sentiment in America. Vaccines have become a victim of their tremendous success—as horrific diseases like smallpox and polio have all but disappeared in America, today\u27s generation no longer fears them as our grandparents did, allowing complacency towards immunization requirements to build. Vaccines do pose health risks—minor but some serious—that lead parents to have cause for concern. Immunization opponents also raise deeply held beliefs in individualism and freedom from government regulation and medical intervention as justifications for their decision to opt out. The internet fuels this opposition, with dozens of websites spreading information and sometimes misinformation about vaccine safety. Additionally, well-meaning parents may over-perceive the true risks that exist, influenced by widespread media coverage of the highly controversial link between vaccines and autism. All of these factors combine to spur lawsuits against vaccine manufacturers, producing upward pressure on prices and vaccine shortages as makers leave the market. Congress responded to some of these concerns in the mid-1980s with the National Childhood Vaccine Injury Act, which limited liability of producers and set compensation rates for Americans who are legitimately harmed by the inevitable side effects of vaccines. Still, no action has stemmed the tide of legally sanctioned exemptions to vaccination requirements, or the implications that a parent\u27s decision to opt out presents for her child. Part III details the repercussions of the rise in exemption rates. Herd immunity is threatened as more parents opt out of vaccinating under the rationale that if everyone else is protected, then so is my child—so why take even the minute risk of any vaccine side effect at all? Unfortunately, this triggers a classic collective action problem: increasing numbers of free-riders undermine society\u27s ability to achieve a critical mass of people who are vaccinated. The declining community immunity no longer protects members in the group who have not yet been immunized or whose immune systems are more vulnerable due to age or infirmity. Sadly, as exemptions proliferate, disease hot spots are cropping up across the United States where large pockets of children have not received many or any of their mandatory immunizations. The consequences are not merely academic—outbreaks of measles, whooping cough, mumps, rubella and diphtheria are reoccurring, costing hundreds of lives and hospitalizing thousands more. Negative externalities are imposed upon well-intending parents, as their young infants may be exposed to life-threatening illnesses before they even have the ability to complete the recommended childhood immunization schedule. Others, often in the elderly segment of the population or those afflicted with HIV or cancer, have weakened immune systems that leave them susceptible despite previous vaccinations. Finally, the rise in exemptions imposes substantial financial burdens on the healthcare system in dealing with the outbreaks that do occur. Part IV takes up the ultimate question of what the law can and should do about this public health issue. Legislators must not sit idly by if exemptions of convenience continue to increase—rather, the exemption process should be a thoughtful one, not a rubber stamp. The Supreme Court has long laid out the principle that government can regulate for the public safety, though those concerns must be balanced with individual freedom and rights. Given the harm that opting out imposes on innocent parties, the exemption process cannot be trivialized into checking a box. Schools should not be given financial incentives to encourage parents to opt out. Rather, careful deliberation must be given and exemptions awarded only where medically necessary or where parents can demonstrate their informed and sincerely held objections. This is a unique problem that the law can actually do something about in order to balance societal health with individual rights

Standards of Review in Law and Sports: How Instant Replay\u27s Asymmetric Burdens Subvert Accuracy and Justice

A fundamental tension exists in both law and sports: on one hand, adjudicators must “get the decision right” in order to provide fairness to the parties involved, but on the other, they must issue speedy and certain rulings to avoid delaying justice. The certainty principle dictates that courts follow stare decisis in the law even if they believe that an earlier decision was wrong. However, it is often the case that there is a need to reverse earlier decisions or the law itself in order to make the correct call on appeal. Both law and sports are constantly balancing the goals of accuracy, fairness, certainty, and speed by providing for different standards of proof for initial rulings versus appellate review, as well as different burdens in civil versus criminal cases. While asymmetrical burdens in law might be desirable (e.g., to protect the rights of the innocent or to reflect the fact that juries are in a better position to judge credibility than appellate judges), they do not carry the same intuitive appeal in sports. The commonly used indisputable evidence standard employed by professional sports leagues for reviewing and reversing referee decisions only leads to unnecessary inaccuracy and unfairness. It requires an enormously high threshold to be met before an official’s decision on the field can be corrected, whereas absolutely no evidence at all is required to allow that same call to stand. Sports would be well-served to borrow the lessons of law in order to further the fundamental goal of fairness without compromising certainty or speed, abandoning the asymmetrical indisputable proof burden in favor of a de novo standard of review