The Economics of Limited Liability: An Empirical Study of New York Law Firms

Since the rapid rise in organizational forms for business associations, academics and practitioners have sought to explain the choice of form rationale. Each form contains its own set of default rules that inevitably get factored into this decision, including the extent to which each individual firm owner will be held personally liable for the collective debts and obligations of the firm. The significance of the differences in these default rules continues to be debated. Many commentators have advanced theories, most notably those based on unlimited liability, profit-sharing, and illiquidity, asserting that the partnership form provides efficiency benefits that outweigh any costs. In this article, the authors test these theories empirically by examining the choice of organizational form by New York law firms. Although the evidence indicates a strong shift from the general partnership form to the limited liability partnership form, a significant number of New York law firms remain general partnerships. The authors conclude that the prevailing theories based on unlimited liability, profit-sharing, and illiquidity are insufficient and posit that, in contrast to the beliefs of many commentators, the choice of form decision is quite complex. It depends on a variety of factors, including the behavior of other similarly situated firms that the decision makers consider competitors for prestige and clients. Nonetheless, it is apparent that unlimited liability is generally considered burdensome, and it is the authors’ prediction that, at some point in time, nearly all the firms in their sample will choose to file as limited liability partnerships. The general partnership form, with its unlimited liability, will operate only as a penalty default that punishes parties who fail to sufficiently define their organization, forcing firm members to reveal relevant information to courts and interested third parties

What Drives Job Search? Evidence from Google Search Data

The large-scale unemployment caused by the Great Recession has necessitated unprecedented increases in the duration of unemployment insurance (UI). While it is clear that the weekly payments are beneficial to recipients, workers receiving benefits have less incentive to engage in job search and accept job offers. We construct a job search activity index based on Google data which provides the first high-frequency, state-specific measure of job search activity. We demonstrate the validity of our measure by benchmarking it against the American Time Use Survey and the comScore Web-User Panel, and also by showing that it varies with hypothesized drivers of search activity. We test for search activity responses to policy shifts and changes in the distribution of unemployment benefit duration. We find that search activity is greater when a claimant's UI benefits near exhaustion. Furthermore, search activity responses to the passage of bills that increase unemployment benefits duration are negative but short-lived in most specifications. Using daily data, we estimate that an increase by 1% of the population of unemployed receiving additional benefits results in a decrease in aggregate search activity of 1.7% lasting only one week.Job Search, Unemployment, Unemployent Insurance, Moral Hazard, Internet Search

A fault injection experiment using the AIRLAB Diagnostic Emulation Facility

The preparation for, conduct of, and results of a simulation based fault injection experiment conducted using the AIRLAB Diagnostic Emulation facilities is described. An objective of this experiment was to determine the effectiveness of the diagnostic self-test sequences used to uncover latent faults in a logic network providing the key fault tolerance features for a flight control computer. Another objective was to develop methods, tools, and techniques for conducting the experiment. More than 1600 faults were injected into a logic gate level model of the Data Communicator/Interstage (C/I). For each fault injected, diagnostic self-test sequences consisting of over 300 test vectors were supplied to the C/I model as inputs. For each test vector within a test sequence, the outputs from the C/I model were compared to the outputs of a fault free C/I. If the outputs differed, the fault was considered detectable for the given test vector. These results were then analyzed to determine the effectiveness of some test sequences. The results established coverage of selt-test diagnostics, identified areas in the C/I logic where the tests did not locate faults, and suggest fault latency reduction opportunities

‘Hidden habitus’: a qualitative study of socio-ecological influences on drinking practices and social identity in mid-adolescence

This study explored mid-adolescents’ views and experiences of socio-ecological influences on their drinking practices in order to help inform the development of interventions to reduce alcohol-related risk. We conducted 31 in-depth interviews with young people aged 13–17 in North East England. Verbatim interview transcripts and field notes were coded systematically and analysed thematically, following the principles of constant comparison. We adopted Bourdieu’s idea of social game-playing and elements of his conceptual toolkit (particularly habitus, capital and field) during analysis. Analysis yielded three intersecting themes: (1) ‘drinking etiquette’: conveying taste and disgust; (2) ‘playing the drinking game’: demonstrating cultural competency; (3) ‘hidden habitus’—the role of alcohol marketing. Our work demonstrates that there is a nexus of influential factors which come together to help shape and reinforce mid-adolescents’ behaviour, norms and values in relation to alcohol consumption. Drinking practices are not just formed by friendships and family traditions, these are also subject to wider cultural shaping including by the alcohol industry which can encourage brand identification, and gear specific products to add ‘distinction’. However young people are not inactive players and they use aspects of capital and social games to help cement their identity and present themselves in particular ways which in turn are influenced by age, gender and social status. Guided by promising work in the tobacco field, interventions which focus on critical awareness of the framing of alcohol products by key stakeholders, such as policymakers, commercial industry and public health professionals, and by wider society may facilitate behaviour change among young people

A Coasian Approach to Efficient Water Allocation of a Transboundary River

The United States and Mexico recently resolved a decade-old water dispute that required Mexico to repay the accumulated water debt within one year. A Coasian analysis estimates the social welfare gains attainable to each country under an alternative debt repayment scheme that allows repayment over a longer time horizon and in a combination of dollars and water, instead of solely in water. Assuming average water supply conditions, under the agreed 1-year repayment contract, U.S. compensation value is 534% greater and Mexico’s compensation cost is 60% less relative to when compensation is paid exclusively in water.coase, water allocation, water compensation, water markets, Agribusiness, Consumer/Household Economics, Environmental Economics and Policy, Q1, Q2,

Intellectual Property Disclosure as 'Threat'

This paper models the disclosure of knowledge via licensing to outsiders or fringe firms as a threat, useful in ensuring firms keep their commitments. We show that firms holding intellectual property are better able to enforce agreements than firms that don't. In markets requiring innovation to make a product, IP disclosure presents a more powerful threat than entry by the punishing firm alone. Occasionally, a punishing firm won't be able to translate its intellectual property into a full-blown product, making it impossible for it to enter the cheating firm's market and punish. Even if it can't make a product itself, the punishing firm can always credibly threaten to license the intellectual property it has on hand to someone else. With this intellectual property as a springboard, chances are at least one fringe firm will be able to do the translation, make the product and enter the cheating firm's market. In short, the potential for licensing increases the likelihood of punishment for uncooperative behavior.In the model, firms contract explicitly to ex-change knowledge and tacitly to coordinate the introduction of innovations to the marketplace. We find conditions under which firms can self-enforce both agreements. The enforcement conditions are weaker when (1) firms possess knowledge and (2) knowledge is easily transferable to other firms. The disclosure threat has implications for antitrust law generally, which are considered.

The Warrior in Contemporary American Society

The purpose of this thesis was to define and analyze the purpose of the warrior caste in contemporary American society. This was accomplished by first defining the castes of men that are present in today’s culture including the warrior, fighters, conflict averse and the supporters. Once the castes were defined the paper then analyzes the warrior in the context of history as well as how the warrior fits with technology in the age of high tech weapons and long range killing. Next the paper analyzes the genetics of the warrior through a biological viewpoint using research done with the MAOA gene to measure aggression. Lastly this paper looks at the place of the warrior in contemporary American culture, making the point that the warrior needs to be recognized as an important caste to society even today