The Faculty Lounge

Paying Kidney Donors, Football Players, And Boxers: Informed Consent And It’s Limits

In prior posts, I introduced the question, If We Allow Football Players and Boxers to Be Paid for Entertaining the Public, Why Don't We Allow Kidney Donors to Be Paid for Saving Lives?, and argued that the ban against paying kidney donors cannot rest on the basis of medical risk when we pay professional athletes to incur far greater risks. Today, I will talk about the consent process and the extent to which we might expect the system to protect participants – whether organ donors or professional athletes – from making bad choices against their own interests in exchange for the lure of money.

We believe that if NOTA were amended to allow payments to donors, potential kidney donors could be protected against being unduly tempted through the existing structure of screening, counseling, and delay, perhaps with some additional protections to prevent hasty decisions. On the other hand, it is not clear that NFL recruits have such protections in place.

Whether and when sane, sober, well-informed, adults should be banned by government authority from choosing to engage in an activity that risks their own life and limb is an ancient point of contention. There are a variety of hazardous activities that are permitted with no legal bar to receiving compensation. Included on this list are such occupations as logging, roofing, commercial fishing, and military service. Also included are violent sports such as football, boxing, and mixed martial arts (MMA). These examples illustrate a broad endorsement of the principle that consenting adults should be allowed to exchange (in a probabilistic sense) their physical health and safety for financial compensation, even in some instances where the ultimate product is simply providing a public entertainment.

One potentially distinguishing feature of kidney donation is that the harm is not the result of an accident, but rather of the deliberate action (of the surgeon and medical team). But this is also the case with fighting sports and with egg donors, who are compensated.

It is helpful to deconstruct the decision to donate a kidney under both the current regime (no compensation) and a hypothetical regime (in which the donor would be financially compensated). A well-developed organ procurement process in the American system seeks to ensure that potential donors are fully capable of making a good decision. Potential kidney donors are not only provided with full information, but also screened for mental and physical disability. While there is the possibility of “mistakes” (a decision to donate against the true best interests of the individual) under both a compensated and uncompensated system, the screening, consent process, and delays should minimize the chance for the kind of errors that behavioral economics has demonstrated are common. There is nothing intrinsically irrational about a willingness to assume medical risk in exchange for a substantial amount of money. But the quality of the choice may be influenced by a variety of factors, and we recommend some “nudges” designed to overcome the most common causes of faulty decision-making under such circumstances.

The same concerns that apply to the quality of kidney donor decisions also apply, and more obviously, to the decision to sign a contract to play in the NFL. Yet the consent and screening process in professional sports is not as developed as in kidney donation. Players are provided with little information about the risks, and indeed, the longer-term risks (including the risk of CTE in middle age) have not been well quantified, but appear to be far higher than for kidney donation. The payoff in both financial terms and status is also very high, and in part conveyed immediately. Any counseling or screening that might occur is up to the player to pursue.

In short, to the extent that the ban on compensated kidney donation is grounded in a concern that the lure of money may cause donors to disregard the risks of the procedure and subsequent long-term effects, that concern applies with even more force to participation in violent sport.

This, of course, is just a taste of our analysis and evidence, so read the full paper for more.

Prior related posts:

If You Oppose Paying Kidney Donors, You Should Oppose Paying Football Players And Boxers Too

Paying Kidney Donors, Football Players, And Boxers: Medical Risks

Related articles

Paying Kidney Donors, Football Players, And Boxers: Medical Risks

Paying Kidney Donors, Football Players, And Boxers: Medical Risks

Yesterday, in If You Oppose Paying Kidney Donors, You Should Oppose Paying Football Players And Boxers Too, I introduced a new paper, written by Phil Cook and me, arguing that the case for paying kidney donors is much stronger than the case for paying participants in football, boxing, and other violent sports, and promising to follow up with subsequent posts outlining our arguments and evidence. 

Today, I’ll discuss the central argument in our paper: the medical risks to a professional career in football, boxing, and other violent sports are much greater both in the near and long term than the risks of donating a kidney. Injuries in such sports are common, and retired players are very often disabled by the long-term effects of these injuries as well the cumulative effect of thousands of blows to the body.

One challenge in making a meaningful comparison between the risks entailed in kidney donation and the risks entailed in participation in contact sports is that the latter may stretch out for many years and involve not one choice (donate or not) but rather a series of choices regarding participation. While it is difficult to quantify these effects in a way that provides a natural comparison with kidney donation, we provide some statistics that suggest that, for example, a man who signs a contract to play in the NFL for a year is consenting to be exposed to far greater medical risks than someone who volunteers to donate a kidney.

We focus our analysis on football, because the epidemiology of injury and disability is better developed than for fighting sports. It is worth noting, however, that there has always been concern about the risk posed by fighting sports, and that concern has accelerated in recent years, due to a better understanding of the long-term effects of head trauma. As a result of these risks, medical associations around the world, including the American Medical Association and various state medical associations, have called for limitations or bans on boxing and MMA.

As to kidney donation, we analyze both the post-operative risk from surgery and the post-recovery chance of death or disability resulting from loss of function of the remaining kidney. Both risks – while greater than zero -- are quite low, both in an absolute sense and in comparison to the typical risks of participation in violent sport. For example, post-operative complications (most of them minor, such as bleeding or wound infection) are present in 7.3% of cases, and donors face a higher cumulative incidence of end stage renal disease than nondonors – 0.31% versus 0.04%. While that risk is thus significantly elevated for donors, it remains very low in an absolute sense, representing an increased chance of about 1 in 400.

With respect to football, we discuss injury rates at the youth, high school, collegiate, and professional level. While that data is far too extensive to fully discuss here, I’ll provide a few highlights:

• In 2016, the 2,274 active players in the NFL experienced 2066 injuries during the preseason and regular season, 244 of which were concussions. That’s .073 concussions per player-season – about equal to the rate of surgical complications (most commonly, minor complications, such as bleeding or wound infection) in kidney donation.
• Official injury reports and survey information suggest that for a substantial majority of former players, injuries ended their career or contributed to the decision to end their career. Nine of 10 former players have nagging aches and pains from football when they wake up, and for most the pain lasts all day. For those age 30-49, the ability to work is impaired by injury.
• A recent postmortem study of a sample of donated brains of former NFL players found that 110 of 111 indicated either mild or (more commonly) severe CTE.

This last point requires some explanation, because the findings do not imply that 99% of former NFL players will have CTE. The brains in the study were voluntarily submitted for examination by family members who were often motivated by a desire to know the cause of their loved ones dementia or other neurological problems. But the 111 brains do represent 8.5% of the 1300 former NFL players who died during the period that these brains were donated. That places something of a logical lower bound on the prevalence of CTE. Presumably the true prevalence is much higher than 8.5%.

While it is not possible to do a precise “apples to apples” comparison of the medical risks associated with kidney donation` and the risks associated with a professional football career, it seems clear that the acute risk of injury and of long-term disability are far higher for the football player. As discussed above, most NFL veterans live out their lives following retirement with serious physical and mental disabilities. The vast majority of kidney donors lead entirely normal lives following recovery from the initial operation.

In other words, the ban against paying kidney donors cannot rest on the basis of medical risk when we pay professional athletes to incur far greater risks. This is just a short preview of the evidence on medical risk, so read the whole paper, If We Allow Football Players and Boxers to Be Paid for Entertaining the Public, Why Don't We Allow Kidney Donors to Be Paid for Saving Lives?

Prior related posts:

If You Oppose Paying Kidney Donors, You Should Oppose Paying Football Players And Boxers Too

If You Oppose Paying Kidney Donors, You Should Oppose Paying Football Players And Boxers Too

Having concluded that simply advocating for compensated kidney donation was not sufficiently controversial, Phil Cook and I are now turning our sights on professional sports – specifically, professional football and boxing. In a piece just posted to SSRN, we contrast the compensation ban on organ donation with the legal treatment of football, boxing, and other violent sports in which both acute and chronic injuries to participants are common. While there is some debate about how best to regulate these sports in order to reduce the risks, there appears to be no serious debate about whether participants should be paid. Indeed, for the best adult football players, college scholarships and perhaps a professional contract worth multiple millions are possible.

Phil and I will likely spend part of the winter break as television viewers contributing to the NFL teams’ collective $56 billion valuation. But our position on paying kidney donors saves us from hypocrisy. If, however, you are one of the many, many people who believe it is unethical to compensate kidney donors, then you should be out protesting the NFL. And don’t even think about watching the latest boxing or MMA matches.

Over the next couple of posts, I’ll outline the gist of our argument and evidence. We focus on the core argument for a ban on compensation for kidney donation, namely the paternalistic concern that even well-informed adults will sometimes be enticed by a financial reward to donate a kidney when in fact that is not in their “true” self-interest. In this view, the allure of money, especially for those who are in debt and struggling to make ends meet, will overcome good sense, leading to “exploitation” and even “coercion” to which people with less income and education are particularly vulnerable. But the same concerns apply with still greater force to participation in violent sports. Whatever one concludes about the ethics of regulating risky choices, and the problematic aspects of choices involving money and risk, the current circumstance – ban compensation for kidney donors, permit compensation for participation in violent sports – appears difficult to defend.

Over the next few days, I’ll touch on these key points: the medical risk to participants, the consent process, social justice concerns, and social welfare considerations. The medical risks to a professional career in football, boxing, and other violent sports are much greater both in the near and long term than the risks of donating a kidney. On the other hand, the consent and screening process in professional sports is not as developed as in kidney donation. The social justice concerns stem from the fact that most players are black and some come from impoverished backgrounds. Finally, the net social benefit from compensating kidney donors – namely, saving thousands of lives each year and reducing the suffering of 100,000 more receiving dialysis – far exceeds the net social benefit of entertaining the public through professional sports.

Download the piece here. And check back in over the next few days for subsequent posts.

Does Contract Law Need Morality? The Slave, The Digital Pedophile, and The Indebted Gambler

Wenhao Liu and I have just posted to SSRN a draft of our paper discussing Nate Oman’s book, The Dignity of Commerce.  For those of you who have not yet read the Dignity of Commerce, I highly recommend it. I adopted it for my Advanced Contracts seminar last year and have done the same for this year. The book might also be a useful addition to a first-year contracts course, depending on your coverage, but it definitely works well for me in the more advanced setting.

In brief, The Dignity of Commerce sets out an ambitious market theory of contract, which Nate argues is a superior normative foundation for contract law than either the moralist or economic justifications that currently dominate contract theory. One of the book’s most important contributions is its emphasis on the positive role played by markets and thus, by extension, of contracts. In an era rife with warnings about the market’s dangers to society, Nate’s cogent reminder of the market’s benefits is both refreshing and welcome. I was particularly drawn to the discussion of the market’s (and, therefore, contract’s) often forgotten role in organizing productive social interactions. These social benefits, Nate argues, are so important that it is these benefits—rather than a commitment to markets in and of themselves—that justify the use of state resources to support markets, and thus contracts.

Nate’s theory is also descriptively appealing: by recognizing that conceptions of morality and blameworthiness impact contract law, The Dignity of Commerce surely provides a descriptively more realistic account of contract law than theories that contend that contract law is explained solely by economic considerations or solely by moral ones. We find Nate’s market theory of contract less successful as a normative or prescriptive theory, however. To our mind, Nate makes moral judgments about the validity of certain markets (and, therefore, certain contracts) without providing a theoretical framework to replace either the moralist or economic theories he rejects. As a result, we don’t think the market theory can provide meaningful guidance to courts, policymakers, or scholars confronted with the more difficult questions facing contract law.

We illustrate all of these points using the examples of forced slavery, “The Digital Pedophile,” “The Indebted Gambler,” and taboo (or pernicious) markets, such as commercial surrogacy and sex work. And, hey, what could be more fun than that?!

So, all in all, The Dignity of Commerce is definitely a worthwhile read and can easily be incorporated into contract law courses and seminars, especially if you try to spend some time asking students to think about the normative foundations of contract law and how courts should resolve some of the thornier questions that emerge.

And, of course, you should make sure to read our critique of the book, as well!

Policy Shock Has Arrived!

And you can get it at a discount. 

My new book, Policy Shock: Recalibrating Risk and Regulation After Oil Spills, Nuclear Accidents, and Financial Crises  (Cambridge University Press, November 2017) is finally here. It is edited by Duke University Rethinking Regulation program members Edward Balleisen, Professor of History and Duke's Vice Provost for Interdisciplinary Studies; Lori Bennear, the Juli Plant Grainger Associate Professor of Energy Economics and Policy at the Nicholas School of the Environment; Kimberly Krawiec, the Kathrine Robinson Everett Professor of Law (AKA me!); and Jonathan Wiener, the William R. & Thomas L. Perkins Professor of Law, Professor of Environmental Policy, and Professor of Public Policy. 

The book looks at responses to events over the last century in the U.S., Europe, and Japan, and assesses how they affected laws, regulations, and institutions. (A special discount of 30% off the list price is available from Cambridge University Press until June 1, 2018, by entering the code:  Policy17.)

I’ve included screen shots of the Table of Contents below. As you can see, some great authors are included here, representing contributions from law, economics, history, political science, psychology, engineering, and more.

I’ve also uploaded a pdf of the Introduction.  Download 9781107140219_excerpt-2

You can also read this Q&A with my colleague and co-author, Jonathan Wiener, discussing the book.

Law & Markets Volume Is Out!

I’ve posted a few times about the Duke Project on Law and Markets (see here, here, and here), which was led last year by Joseph Blocher and me. Like the Custom and Law Project that preceded it, this Project culminated in an edited volume, published this time by Law & Contemporary Problems.  

Those wanting a more detailed description of the Project and papers in the volume can read the Foreword, but here’s a taste:

We started the Law and Markets Project at Duke Law School in the summer of 2015 in an effort to better understand the relationship between the legal system on the one hand and markets on the other. That relationship is central to understanding the nature and practical impact of legal rules, the degree to which those rules are shaped by economic forces, and the ways in which law and markets should or can operate independently. Further, it inevitably raises foundational and difficult questions. What are (or should be) the limits of markets? When, and through what mechanisms, should the law restrict the free exchange of goods and services? To what extent, and how, should the legal system address market driven inequalities in income, wealth, or access to goods and services like health care and education?

By addressing these questions, we hoped to generate interesting conversations that would deepen people’s understandings of their own and each other’s work and set the stage for collaboration going forward. We chose to focus our efforts on the Duke community, so as to help build those conversations and relationships. Given our colleagues’ broad and deep substantive and methodological expertise, this hardly felt like a limitation.

* * *

We held a symposium in early May 2016, the proceedings of which are collected in this issue. Duke faculty authored or co-authored all of the pieces, and the breadth of the topics demonstrates some of the many facets of the relationship between law and markets—from the sale (and tax treatment of) body parts to moral economies in the early Chinese land market; from the supply and demand of anticorruption enforcement to evaluating financial regulation; from markets and the environment to markets for sovereignty itself.

The volume table of contents are below, and the papers can all be downloaded here. The photos throughout this post are highlights from the Project’s workshop and reading groups, which are described in prior posts: here, here, and here.

I’ll be back in due course with more to say about my contribution to the volume, coauthored with Wenhao Liu (Stanford University, Department of Management Science & Engineering; Strategic Decisions Group International) and Marc Melcher (Stanford University, Department of Surgery): Contract Development in a Matching Market: The Case of Kidney Exchange.

 

Some signs of world end are more palatable than others . . .

 

More signs the world is ending: a sociologist and a lawyer (@KimKrawiec) appear in the May American Economic Review. https://t.co/xp0scIV1kO pic.twitter.com/WphDtEUfnT

— Kieran Healy (@kjhealy) February 3, 2017

Understanding Moral Repugnance in Markets at AEA 2017!

For those who decided to freeze themselves in Chicago over the next few days rather than attend the much more pleasant AALS venue, make sure to check out this session tomorrow morning: Understanding Moral Repugnance in Markets.  It features some great speakers (and there's me!) and discussants. 

I've copied the program below (which may or may not work, given the idiosyncrasies of typepad) but you can follow the link to the program, with papers and abstracts, here.  

 

Understanding Moral Repugnance in Markets

Paper Session

Friday, Jan. 6, 2017 8:00 AM – 10:00 AM

 

Hyatt Regency Chicago, Grand Ballroom CD North

Hosted By: AMERICAN ECONOMIC ASSOCIATION

• Chair: Kimberly Krawiec, Duke University

 

The impact of pathogen-disgust sensitivity on vaccine and GM food risk perceptions: Some evidence for skepticism

Dan Kahan

Yale University

• View Abstract
• Download Preview (PDF, 393.53 KB)

Repugnance and Transactions in the Body

Kieran Healy

Duke University

 

Kimberly Krawiec

Duke University

• View Abstract
• Download Preview (PDF, 131.59 KB)

The Ethics of Incentivizing the Uninformed. A Vignette Study

Sandro Ambuehl

Stanford University

• View Abstract
• Download Preview (PDF, 193.27 KB)

Sacred versus Pseudo-Sacred Values

Philip E. Tetlock

University of Pennsylvania

• View Abstract
• Download Preview (PDF, 205.61 KB)
• Download PowerPoint (PPT, 493.50 KB)

Discussant(s)

Brigitte Madrian

Harvard University

 

Luigi Zingales

University of Chicago

 

Deirdre McCloskey

University of Illinois-Chicago

 

Muriel Niederle

Stanford University

JEL Classifications

• D4 - Market Structure, Pricing, and Design

Law Schools Ranked By Job Placement Rates

Updated as noted below

The ABA has provided a ton of data on law school job placement and I've tried to summarize it here - comparing the placement rate ranking with the U.S. News ranking,  and providing actual placement numbers.  The numbers set out here represent the percentage of graduates in the class of 2015 who found full-time long term positions (JD required or where a JD was an advantage) within nine months after graduation.  This is the number many ranking organizations use, though I recognize that there are other  ways to slice the data.  As I note below, I have excluded law school funded positions.

This ranking uses the freshest data currently available and - compared to what you can find for pretty much any other discipline outside of law - a pretty damn good data set.    We only wish business schools and other similar programs would give this sort of guidance to applicants.

I think a big takeaway is that the US News ranking doesn't actually predict how well graduates of a given school will do on the job market.  One conclusion from this data is that any school recruiting solid students (as opposed to students who probably don't belong in law school)  can deliver those students good job outcomes if it trains them well and provides good support from bar prep through career planning.  (It helps to be in a region with jobs or a region that is not a net importer of law grads.)

It's also worth pointing out that this chart suffers from an infirmity it shares with US News: it tends to over-state the gaps between law schools.  Another way to read this chart is to think in clumps - schools in the +/- 85% placement range; those in the +/- 75% placement range; etc.  But I do think there may be real differences between schools with 80% rates and those with 65% rates.

This ranking doesn't get at salaries - though, having looked at the data, I have a strong sense that there are really only about 15 schools where more than 33% of the graduating class scores a large firm job.   US News is actually pretty good at this element of ranking: if you want a big firm job, the US News top 15-20 is a reasonably good guide.  But US News ceases to be very predictive of large firm placement after that point.   This list also has anomalies: Yale is #20, but that probably has more to do with the choices that students made rather than the options they encountered.  And Georgetown?  My theory is that their career strategies office is good for students seeking big firms, but has work to do with the other 63% of the class.

The schools with the biggest gaps between this ranking and US News?  Figure that out for yourself - there are some whoppers!

Update:  I've decided that it would be more accurate and useful to round placement results to the nearest whole number and describe virtual ties as ties.  As I discuss above, my goal is to provide information without overstating gaps between schools.  Schools that are tied are listed in order of their precise rank.  With this change, Yale is now #18.  In this analysis, I excluded law school funded positions - consistent with US News - in large part because it is impossible to determine how many of these graduates would have been able to secure long-term full-time employment in the absence of law school assistance.   

Update 2: A kind reader has alerted me to at least one error - the numbers provided to the ABA by South Texas on their form are inconsistent with the numbers set out in the ABA spread sheet.  I am not going to change anything yet, but I hope that over the next day or two, I can identify any other conflicts between the forms and the spreadsheet.  If there is an error or two, I can fix that easily.  If problems are more pervasive, I'll pull and rework it entirely.  For now, please note that based on the employment form submitted to the ABA, South Texas seems to have a 62% placement rate, rather than a 54% rate,  which puts it at 152 rather than 172.

Update 3, Nov. 30, 12:30 pm: I have adjusted the chart to reflect what I expect are accurate numbers.  As I discuss in this post, there are discrepancies between data reported by the ABA in individual school summaries and in the overall compilation spread sheet.  This list reflects the numbers reported by schools in their individual school summaries.  These changes shifted the rankings a bit.  I have inserted asterisks after schools whose ranking changed after switching to the data provided on the individual school summary.  In a later post, I will detail the changes.   I believe the numbers are now as accurate as I can make them.  

So without further ado: 

New Book Announcement: Lifetime Disadvantage, Discrimination and the Gendered Workforce

Cambridge University Press has published a new book by Susan Bisom-Rapp (Thomas Jefferson) and Malcolm Sargeant (Middlesex University, UK): Lifetime Disadvantage, Discrimination and the Gendered Workforce.  Here is the publisher's description:

Lifetime Disadvantage, Discrimination and the Gendered Workforce fills a gap in the literature on discrimination and disadvantage suffered by women at work by focusing on the inadequacies of the current law and the need for a new holistic approach. Each stage of the working life cycle for women is examined with a critical consideration of how the law attempts to address the problems that inhibit women's labour force participation. By using their model of lifetime disadvantage, the authors show how the law adopts an incremental and disjointed approach to resolving the challenges, and argue that a more holistic orientation towards eliminating women's discrimination and disadvantage is required before true gender equality can be achieved. Using the concept of resilience from vulnerability theory, the authors advocate a reconfigured workplace that acknowledges yet transcends gender.

Thomas Jefferson has a nice press release here.

Duke Law Students Featured in Bloomberg View

A paper by a group of Duke law school students recently posted to SSRN is featured by Matt Levine in BloombergView today.  Says Levine:

Meanwhile in less-sovereign debt, the other day I mentioned that some law students may have found a solution to Puerto Rico's debt problems. Here it is; it relies on provisions in the Puerto Rico Civil Code to force creditors to come to the table, negotiate in good faith, and obtain equal benefits for all creditors. It's sort of an effort to construct a bankruptcy regime out of some vague equitable statements in existing law. I like it! Elsewhere here is a report on the "Origins of the Puerto Rico Fiscal Crisis."

I do not know whether to be jealous or proud . . . okay, decision made: Im proud!

Congratulations to Duke Law students Ryan Alexander Berger, Felix Aden, and Sigurdur K. Tryggvason!

Download their paper here.

The Moral Limits Of Free Markets In Boulder

On Monday, I’ll be at CU Boulder’s Center For Western Civilization, Thought, & Policy, along with Jason Brennan (Associate Professor of Strategy, Economics, Ethics & Public Policy, Georgetown University) and Margaret Jane Radin (Michigan Law, Toronto Law) to discuss and debate the moral limits of free markets.

The event is free and open to the public, and I’ve copied the event information below. Although I’ll be back after the event with updates on the substance, I expect that Jason will take the position, consistent with his book, Markets Without Limits, that “if you may do it for free, you may do it for money.” I imagine that Peggy, consistent with her book, Contested Commodities, will argue that there should be some limits on markets, when necessary to protect nonmarket ideals important to personhood.

I plan to leave the normative debate to those two and take a more descriptive approach: regardless of whether or not market transactions actually degrade relationships and values, most people continue to believe that they do, at least in certain contexts. As a result, market advocates need to account for, and even accommodate, those concerns if the market is to exist at all.

As I explain in a piece I just posted to SSRN:

Students of markets from all disciplines are increasingly turning their attention to the cultural and psychological factors that affect market structure. In traditionally taboo markets, of which reproduction surely is one, those factors include cultural understandings of the moral limits of markets and our collective level of comfort with fully commodifying and subjecting traditionally sacred items and activities to the marketplace.

While it is easy to dismiss these cultural understandings as romantic, silly, or delusional, this severely underestimates their importance, not just to society, but to the market itself. By reframing traditionally unacceptable behavior as a more palatable and familiar transaction, society is able to accept a market that is otherwise socially problematic or even repulsive. Market architects ignore these cultural understandings--and, in particular, societal conceptions of the ethical limits of markets--at their peril. In a world unwilling to embrace the sale of female reproductive capacity for merely a price, the "priceless gift" of egg donation allows a market to flourish that otherwise might stagnate under the weight of social disapproval.

________________________________________________________________________________________________

The Moral Limits of Free Markets (4/4/16)

The "Western Civ Dialogue" series presents:

The Moral Limits of Free Markets

Monday, April 4, 2016

4 p.m. to 5:30 p.m.

British and Irish Studies Room

Norlin Library – 5th Floor

University of Colorado Boulder

Free and open to the public.

If you may do it for free, may you do it for cash? For instance, may you buy and sell votes? How about buying and selling kidneys? Or buying and selling children? What should be off-limits to the market economy? Or do genuinely free markets permit everything? Scholars representing a wide range of views discuss the issues.

Featuring:

- Jason Brennan, Associate Professor of Strategy, Economics, Ethics & Public Policy, Georgetown University

- Margaret Jane Radin, Professor of Law, Emerita, University of Michigan Law School & Distinguished Research Scholar, University of Toronto Faculty of Law

- Kimberly Krawiec, Professor of Law, Duke University Law School

Sponsored by the:

Center for Western Civilization, Thought and Policy (CWCTP)

http://www.colorado.edu/cwctp/

Co-sponsored by the:

Center for Values and Social Policy

http://www.colorado.edu/philosophy/center/

Who Gets What And Why? Photos And Video

Our communications folk were out in full force for Al Roth’s lecture on Wednesday and have already posted some nice photos from the event and uploaded a video of the lecture to YouTube. I’ve included a few below.

 

 

Our Day Of Market Design

As I mentioned in my last post, 2012 Nobel Prize winner Al Roth visited Duke Law School this week as a guest of the Law & Markets project. We basically worked Al to death while he was here – he gave three talks in a single day: a casual morning discussion over coffee with my Taboo Trades students and select faculty; a lunchtime public lecture about his book, Who Get’s What And Why: The New Economics of Matchmaking and Market Design; and an afternoon faculty workshop on Global Kidney Exchange (sometimes called Reverse Transplant Tourism). And that’s not counting the breakfasts, lunch, and dinner he had with faculty who wanted to hear even more about market design. I was exhausted from just watching him in action.

Those who know Al won’t be surprised by that, I suspect. As I’ve discussed before in prior posts (here and here), Al is deservedly well-known for his generosity in sharing his time and expertise with students, colleagues, and even know-nothings like me.

Whether by design or happy accident (I’m not sure which, though he is a market designer, hmm . . . ) there was little overlap in the content of the three talks, though each one built on the other and someone who attended all three (as many of us did) could gain new insight into market design at each stage. The morning session focused primarily on labor markets, especially the judicial clerkship market and market for summer associates and how that compared to the market for new medical residents. As Al discusses in the book, the market for judicial clerks, unlike the market for medical residents, is one in which attempts to prevent market unraveling have been largely unsuccessful. We talked a bit about why that might be and it was interesting to have that discussion among someone who has studied that market (Al), current market participants (the students), prior participants (law professors) and those who have negotiated some of the earlier (failed) agreements – law school administrators.

The lunch talk focused on the concept of market design more generally, but with an emphasis on school choice, kidney exchange, and high frequency trading as examples. The afternoon session was devoted to Al’s current work on repugnant transactions and Global Kidney Exchange, an issue we have both worked on with Mike Rees.

It was a really special day all around, but I was especially happy to get a chance to share Al in person with my Taboo Trades students. They have already spent more time thinking about repugnant transactions than most people ever will, and it was great for them to have a chance to meet “The Pied Piper of Repugnance,” as I referred to Al some years ago, in person. We memorialized his visit with us in the photo above.

Prior posts about Al Roth:

Tomorrow Is Al Roth Day!

Congratulations to Al Roth!

Al Roth: The Pied Piper of Repugnance?

Al Roth, Market Designer, in August Forbes

Scalping The Dalai Lama

Prior posts about Global Kidney Exchange/Reverse Transplant Tourism: collected here

Prior posts about the Taboo Trades seminar: collected here

 

Tomorrow Is Al Roth Day!

I blogged recently about our Law & Markets program (and earlier here) and tomorrow is one of the highlights of the year – 2012 Nobel Prize winner Al Roth is visiting Duke Law as a guest of the Law & Markets project and will deliver a public lecture about his work and his new book, Who Get’s What And Why: The New Economics of Matchmaking and Market Design. He’ll also give a faculty workshop on global kidney exchange. If you’re in the triangle area, stop by for one or both events (see the attached flyers for details).

You can read more about Roth’s work here:

What Al Roth Did To Win The Nobel Prize In Economics

And here: http://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/2012/roth-facts.html

I’ll be back later with a full report.

 

Lola Wage-and-Hour Document Review Case Settles; Vexing Questions About What Constitutes “The Practice of Law” Persist

Lola v. Skadden Arps has settled (reports here and here).  Lola is a wage-and-hour case with wide implications for the legal profession.  To recap (see my previous post on the Second Circuit’s recent decision here), David Lola, a lawyer licensed to practice in California, took a job as a document reviewer for Skadden Arps in a large MDL venued in a federal court in Ohio.  He was placed in that position with Skadden by a staffing agency, Tower Legal Staffing.  (Tower Legal provides attorneys and paralegals to law firms on a contract basis, and thus remained Lola’s direct employer during his period of service to Skadden.)  Lola spent 14 months reviewing documents in North Carolina for the case; his Complaint alleged he typically worked 45-55 hours per week.  He was paid $25 per hour, without overtime.

After the engagement ended, Lola sued Skadden and Tower Legal in a Fair Labor Standards Act “collective action,” which is the FLSA’s statutory version of a class action (see 29 U.S.C. § 216(b)).  Lola claimed that he and all those similarly situated were entitled to time-and-a-half for work in excess of 40 hours per week. 

The FLSA exempts from overtime requirements any “employee employed in a bona fide professional capacity,” including “any employee who is the holder of a valid license . . . permitting the practice of law . . . and is actually engaged in the practice thereof . . . .”  29 C.F.R. § 541.304.  Skadden and Tower Legal argued that Lola’s document review responsibilities constituted “the practice of law” within the meaning of the FLSA and supporting regulations, and he therefore was exempt from overtime pay. 

Lola admitted that he was licensed to practice (the fact that it was in a jurisdiction with no connection to any aspect of his work doesn’t matter under the FLSA), so the wage-and-hour question boiled down to whether or not he was “actually engaged” in the “practice of law.”  Lola alleged that his responsibilities as a document reviewer were completely mechanical and devoid of judgment—that he was given a list of key words and names and told to “code” documents in a specified way if those words or names appeared in the document.  Period.  On a motion to dismiss (where these allegations had to be taken as true), the District Court found that these activities constituted “the practice of law.”  The Second Circuit reversed, finding that work that ministerial and rudimentary did not comprise the practice of law, though more typical document review work requiring “a modicum of judgment” likely would.  (As related in my earlier post, most document review jobs do involve some degree of judgment in determining documents’ responsiveness to a request or potentially privileged status, judgments that a fair reading of the appellate opinion suggests would qualify as “the practice of law” under the standard the decision articulates.  The Second Circuit agreed with the District Court that the FLSA borrows the law of the state governing the services at issue to determine whether they qualify as “the practice of law,” which in this case was North Carolina, though North Carolina’s definition is typical in most respects.)  The case was remanded to determine whether Lola’s job required him to be the automaton he alleged.

I'll address the settlement and what it does and doesn't tell us about the future after the jump.

Weidemaier: Dear NY Times: Thank You For Letting Me Sue Only 500 Miles From My Home

Over at Credit Slips, Mark Weidemaier has a nice post on the NY Times recent series on arbitration.  From the text:

The attention on arbitration also seems a bit disproportionate, given the nearly-infinite ways that businesses use contracts to extract hidden value from employees and customers: incomprehensible warranty disclaimers, clauses limiting liability for damages, clauses requiring claimants to bring claims in remote and therefore expensive places, etc. Even if competition results in somewhat lower prices, that's cold comfort for those on whom the costs fall most heavily. For all its high-mindedness, the NY Times is no different. Have a legal claim arising out of Times digital products? The Times graciously lets you file a lawsuit, but you'll have to go to New York to do it, wherever you happen to live.* 

I assume the NYT timed the series roughly to coincide with the Consumer Financial Protection Bureau's anticipated decision to regulate the use of arbitration clauses in consumer financial contracts. One likely regulation would ban the use of class action waivers. For better or worse, private individual and class action lawsuits have come to occupy a significant place in the U.S. regulatory system. Yet the Supreme Court has gradually interpreted the Federal Arbitration Act to let businesses decide whether they want to participate in this system; many have opted out. This is an extraordinarily consequential development, and political actors should assume responsibility for deciding whether to embrace or reject it. So whatever the CFPB ultimately does, the decision will be noteworthy, and welcome, as one of the too-rare moments when politically-accountable actors finally take responsibility for deciding the limits of arbitration.  

Read the whole thing here. 

New Book by Andre Smith--Tax Law and Racial and Economic Justice: Black Tax

Andre L. Smith (Widener) has just published a new book, Tax Law and Racial and Economic Justice: Black Tax.  Here is the publisher's description:

No study of Black people in America can be complete without considering how openly discriminatory tax laws helped establish a racial caste system in the United States, how they were designed to exclude blacks from lucrative markets and the voting franchise, and how tax laws extracted and redistributed vast sums of black wealth. Not only was slavery nearly a 100% tax on black labor, so too was Jim Crow apartheid and tax laws specified the peculiar institution as “negro slavery.” The first instances of affirmative action in the United States were tax laws designed to attract white men to the South. The nineteenth-century Federal Tariff indirectly redistributed perhaps a majority of the profits from slavery from the South to the North and is the principle reason the Confederate states seceded. The only constitutional amendment obtained by the Civil Rights Movement is the Twenty-Sixth Amendment abolishing poll taxes in federal elections. Blending traditional legal theory, neoclassical economics, and a pan-African view of history, these six interrelated essays on race and taxes demonstrate that, even in today’s supposedly post-racial society, there is no area of human activity where racial dynamics are absent.

Professor Smith's book is an important contribution.

Read more about the book here.

The Internship As Professional Training And Barrier to Entry

Al Roth has an interesting post about law internships in Israel (and about professional licensing – particularly lawyer licensing – more generally), based on a recent Ynet story.  Apparently Israel has extended the mandatory internship period from one year to two.

Says Roth:

Internships and pre-licensing employment under other names serves multiple purposes. One purpose is to train future professionals. Another might be to limit entry into a profession. Both things seem to be at issue with law internships in Israel.

According to Ynet:

While senior lawyers welcome new regulations announced by Justice Minister Shaked, law students complain internship is akin to 'modern slavery.'

Justice Minister Ayelet Shaked elaborated in remarks at the annual conference of the Israel Bar Association:

"I decided to extend the length of the required internship period to two years believing that law students will be much better qualified and prepared to take their bar exam, and will have to show a great deal of dedication in order to become lawyers," Shaked said.

"This will lead to a decline in the number of lawyers, and an increase in their professional expertise," she concluded.

Although the move was praised by senior lawyers, law students had a different take. Said Or Gavish, who is about to start his law studies at Tel Aviv University: 

The internship period is difficult and tiring, and according to what I have heard, you become a type of 'modern slave,' while doing secretarial work for a meager salary," he added. "It’s a cheap and efficient labor force, because without the firm's approval you can't become a lawyer."

The Law School Industry - Institutional Considerations for Military Veterans

From movies to policy debates, veterans are a perennial image in the American psyche. At the law school, the most notable presence of the military are recruiting officers (e.g., JAG), and to a lesser extent, student organizations (e.g., student veterans organizations, military justice societies) and the occasional veteran clinic. There is, however, no comprehensive in-depth study of how law schools accommodate veterans or how various institutional platforms operate (in the next few months, I will post an excel-based study mapping all these initiatives at law schools with some brief comments). While researching this topic and speaking with student veteran groups, military personnel and therapists, certain themes have emerged that might provide law school administrations with some guide for developing 'best practices' towards students serving or having served in the military. 

The core challenge seems to be that there tends to be a lack of awareness by law school admission offices about the psychological and social challenges that veterans face, in civilian life or at school in particular. Below is a brief list of some common blind spots and potential reforms.