prior probability

We’re taking a couple weeks off for spring break (March 12-26), but in the meantime, we want to share the following idea with our loyal and patient readers. Our friend and colleague Tyler Cowen (via Marginal Revolution) gave us the following idea:

Imagine giving all lawyers and law professors an essay exam. Determine their area of legal expertise, give them a blue book, and then ask them to write out by hand a ten-page essay max on one of the most basic questions in their field, such as: “What remedy should courts give for breach of contract?” Or “How should courts measure tort damages?”

They can use some empirical data or refer to some cases or statutes, but mostly they should write out the best answers they can.

Then grade the blue books.

At which law schools would the law professors do the best? In which fields would the lawyers do the best, recognizing that some face more difficult problems than do others? In which countries?

How much should the legal academy or the legal profession be focused on being able to write good answers to such questions?

Our friend and colleague Dale Whittaker was appointed president of the University of Central Florida (UCF) on March 9. We wish Dr Whittaker the best; we will miss our outgoing president, the legendary John Hitt.

Via Cliff Pickover: “If we are all ten different people depending on lighting, what are the implications for eyewitness testimonies in a court of law? http://bit.ly/1L1GY3k “

The great medieval scholar Thomas Aquinas, father of modern natural law theory, died on this day in 1274.

Via Pinterest

Russell Hardin (1999, pp. 88-89) gives three reasons why a constitution is NOT like a contract. First, according to Hardin, a constitution is designed to create a government for a large group of people; a contract, by contrast, is designed to solve a prisoner’s dilemma between two parties. Second, a constitution does not require an explicit agreement among the people to be effective once it is adopted, while an essential element of contracts is mutual agreement between the parties to the contract. Third and last, constitutions are self-enforcing; contracts are enforced by courts. Alas, Hardin is wrong. Let’s examine each one of these arguments in reverse order:

* Constitutions are self-enforcing; contracts are enforced by external sanctions (the courts). What does it mean to say that constitutions are “self-enforcing”? The U.S. Constitution, for example, allocates to the political branches the power to enforce various provisions of the constitution, or as Hamilton wrote in The Federalist, the Congress has the power of the purse, while the President has power of the sword. Frankly, whether these enforcement powers are internal or external is just a play on words. In addition, many contracts are just as self-enforcing as constitutions are, especially long-term agreements or so-called “relational contracts” in which the parties care about their reputations and have more to lose by breaking their promises than keeping them.

* Constitutions don’t require explicit agreement; contracts do. At first glance, there is something to this argument. After all, “mutual agreement” is one of the essential elements of contract formation, yet none of us were around when the U.S. Constitution was drafted and ratified in the late 1780s. Nevertheless, consider the “battle of the forms” in business-to-business commercial transactions or Internet-era contracts such as “Shrink Wrap Agreements” and “Terms of Use” for most Apps. Commercial transactions and Internet contracts are generally enforceable, thus showing that consent is not really required to enforce a contract!

* Constitutions are designed for large groups of people; contracts are designed to solve a prisoner’s dilemma between two parties. No, this claim is not right, for both contracts and constitutions are designed to solve prisoner’s dilemmas. In the case of a constitution, the prisoner’s dilemma involves a larger group of people, to be sure, but the underlying strategic problem in creating a government (via a constitution) is whether to cooperate (obey the laws of the new government) or defect (every man or clan for himself). In a previous paper (Guerra-Pujol, 2008), for example, we used the “stag hunt” model to describe the strategic nature of the process of constitutional ratification. Without getting into all the technical details (this is a blog post, after all), a stag hunt is a special kind of group prisoner’s dilemma (see image below): without a constitution, it is in most factions’ individual interest to defect and go it alone; with a constitution, it is in most factions’ interest to play by the rules (or game the rules) and cooperate.

Is our disagreement with Hardin just another trivial academic squabble? I, for one, actually agree with Hardin’s larger point about the strategic nature of constitutions. My main point here is that commercial transactions and most contracts also share many of the same strategic elements that constitutions do. But again, why does any of this matter? If constitutions are often like contracts (or vice versa, if contracts are often like constitutions), this observation should inform the role of the courts in enforcing these two types of agreements. In a word, judges should be humble …

Image credit: tutor2u

Welcome to our eclectic scholarly jungle! Our Spring Break is still a week away, but here is what we’ve been reading or rereading or will start reading over our break:

1. Unwritten Rules, an essay by Stephen Sniderman.
2. Fides et Ratio (pictured below), Pope John Paul II’s encyclical on the relation between faith and reason.
3. The Art of Game Design, a comprehensive, interdisciplinary guidebook for game designers written by Jesse Schell.
4. Ten Great Ideas about Chance (pictured below), a history of the main breakthroughs in probability theory written by Brian Skyrms and Persi Diaconis.
5. Chapters 3 and 4 of Russell Hardin’s book Liberalism, Constitutionalism, and Democracy. (Chapter 3 is titled Contract or Coordination?; Chapter 4 is Agreement or Acquiescence?)
6. Chapters 1, 3, 5, and 10 of Playing to Learn with Reacting to the Past, a collection of essays about role play games in education (edited by C. Edward Watson and Thomas Chase Hagood).
7. Framing Contract Law, an interdisciplinary treatise by Columbia University law and economics professor Victor Goldberg. (My friend, colleague, and fellow contract law scholar Dan O’Gorman and I will be meeting on weekends to discuss the main ideas of this book.)