ESF:MPE_LAEC Law and Economics - Course Information

MPE_LAEC Law and Economics

Extent and Intensity

1/1. 4 credit(s). Type of Completion: zk (examination).

Teacher(s)

Ing. Josef Montag, Ph.D. (lecturer)
doc. Ing. Štěpán Mikula, Ph.D. (assistant)

Guaranteed by

Ing. Michal Kvasnička, Ph.D.
Department of Economics – Faculty of Economics and Administration
Contact Person: Lydie Pravdová
Supplier department: Department of Economics – Faculty of Economics and Administration

Timetable

Tue 15:30–17:00 S313

Prerequisites (in Czech)

Working knowledge of intermediate-level microeconomics (i.e. Microeconomics 2; MPE_AMI2 or MPE_MIE2) and related technical tools (constrained optimisation)  level is assumed. No prior training in law is required; relevant legal concepts will be introduced and discussed in class or covered in reading material. Some acquaintance with econometrics may be helpful, but is not essential. Wherever necessary, micro tools may be re-introduced so that no-one is left behind.

Course Enrolment Limitations

The course is offered to students of any study field.

Course objectives (in Czech)

Law and economics is---from the economist’s point of view---microeconomics applied to legal phenomena, i.e. it analyzes incentives and behaviour under alternative rules. This is a narrow definition but captures a lot of the essence of what the field is about. Put more broadly, it is a study of rules and institutions from the efficiency and social welfare point of view. It seems that law and economics is a dominating theory of law, at least in the US. There is also a vibrant community in Europe with main centers being Hamburg, Rotterdam, and Bologna.
The course will cover basic concepts and models of economic analysis of law with main focus on four core areas: property, tort, contract, and crime. Apart from textbook material, we will discuss some seminal papers and some more recent (preferably empirical) ones.
Students will obtain a general overview of the field of law and economics. They will learn basic concepts and theories, read seminal papers, learn about influential authors, as well as receive a sample of more recent research papers in the field. Most importantly, students should be able to apply those concepts to real problems and use them in analyzing rules and cases.

Syllabus (in Czech)

• 1. Economics and law -- the relationship (1 week)
• 2. Accidents (2 weeks)
• 3. Property (2 weeks)
• 4. Contract (2 weeks)
• 5. Theory of the firm and corporate governance (2 weeks)
• 6. Crime and punishment (2 weeks)
• 7. Legal process or behavioral law and economics (1 week)
• 8. Students’ cases presentation and discussion (1 week)

Literature

• MONTAG, J. A Radical Change in Traffic Law: Effects on Road Safety in the Czech Republic. CERGE-EI Working Paper Series. 2013, No 484. info
• COOTER, R.B. and T. ULEN. Law and Economics. 6th ed. Boston: Pearson, 2013. ISBN 0-13-254065-7. info
• MONTAG, Josef and Tomáš SOBEK. Should Paris Hilton Receive a Lighter Prison Sentence Because She’s Rich. 2013. info
• ELINDER, Mikael and Erixson OSCAR. Gender, Social Norms, and Survival in Maritime Disasters. In Proceedings of the National Academy of Sciences. 2012. info
• POSNER, Richard A. Economic analysis of law. 8th ed. Austin: Wolters Kluwer, 2011, xxiii, 100. ISBN 9780735594425. info
• FEHR, E and S GACHTER. Cooperation and punishment in public goods experiments. AMERICAN ECONOMIC REVIEW. NASHVILLE: AMER ECONOMIC ASSOC, 2000, vol. 90, No 4, p. 980-994. ISSN 0002-8282. Available from: https://dx.doi.org/10.1257/aer.90.4.980. info
• JOLLS, C, C R SUNSTEIN and Rudolf DREITHALER. Behavioral Approach to Law and Economics. Stanford Law Review. 1998, p. 1471–1550. info
• KAHAN, D M. What Do Alternative Sanctions Mean? The University of Chicago Law Review. 1996, p. 591-653. info
• SCHWARTZ, Gary T. Reality in the Economic Analysis of Tort Law: Does Tort Law Really Deter. UCLA Law Review. 1994, vol. 42, No 377. info
• AYRES, I and R GERTNER. Filling gaps in incomplete contracts: An economic theory of default rules. The Yale Law Journal. 1989, vol. 99, No 1, p. 87-130. info
• TSEBELIS, G. The Abuse of Probability in Political Analysis: The Robinson Crusoe Fallacy. American political science review. Washington, D.C.: American political science association, 1989, vol. 83, p. 77-91. ISSN 0003-0554. info
• EASTERBROOK, F H and D R FISCHEL. Limited Liability and the Corporation. University of Chicago Law Review. 1985, vol. 52, No 89. info
• FAMA, E F and M C JENSEN. Separation of Ownership and Control. Journal of Law & Economics. 1983, vol. 26, No 301. info
• SHAVELL, Steven. Strict Liability Versus Negligence. Journal of Legal Studies. 1980, vol. 9, p. 1–25. info
• JENSEN, M C and W H MECKLING. Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure. Journal of Financial Economics. 1976, vol. 3, p. 305–360. info
• CHEUNG, S. The Fable of the Bees: An Economic Investigation. Journal of Law & Economics. 1973, vol. 16, No 11. info
• BROWN, J P. Toward an economic theory of liability. Journal of Legal Studies. 1973, vol. 2, No 2, p. 323-349. info
• ALCHIAN, Armen A and Harold DEMSETZ. Production, information costs, and economic organization. The American Economic Review. American Economic Association, 1972, vol. 62, No 5, p. 777-795. ISSN 0002-8282. info
• CALABRESI, G and A D MELAMED. Property Rules, Liability Rules, and Inalienability: One View of the Cathedral. Harvard Law Review. 1971, vol. 85, p. 1089–1128. info
• BECKER, Gary S. Crime and punishment: An economic approach. Journal of Political Economy. 1968, vol. 76, No 2, p. 169-217. info
• DEMSETZ, H. Toward a Theory of Property Rights. AMERICAN ECONOMIC REVIEW. NASHVILLE: AMER ECONOMIC ASSOC, 1967, vol. 57, p. 347–359. ISSN 0002-8282. info
• COASE, R.H. The Problem of Social Cost. The Journal of Law and Economics. 1960, vol. 3, p. 1–44. info
• COASE, R.H. The Federal Communications Commission. Journal of Law and Economics. 1959, vol. 2, p. 1–40. info
• COASE, R.H. The Federal Communications Commission. Journal of Law and Economics. 1959, vol. 2, p. 1–40. info
• COASE, R.H. The Nature of the Firm. Economica. Blackwell Publishing, 1937, vol. 4, p. 386–405. ISSN 1018-0451. info
• COASE, R.H. The Nature of the Firm. Economica. Blackwell Publishing, 1937, vol. 4, p. 386–405. ISSN 1018-0451. info

Teaching methods (in Czech)

a. Classes: Concepts and basic theory will be introduced in lectures and we will then look at more specific topics during seminars. Active participation in lectures as well as seminars is encouraged.

b. Readings: Lectures and seminars complement assigned literature and not vice versa. That is, reading material beyond what was explicitly covered in class may be assigned. For seminars, knowledge of lectured material and assigned reading will be assumed. The textbook is Cooter and Ulen (2013, henceforth CU). Older editions can be used. If necessary, relevant sections will be distributed. Other readings are available on the Internet or via library databases (e.g. JSTOR), else they will be distributed.

c. Problem sets: There will be 3 take-home problem sets. Working in groups is encouraged, but everyone turns in his/her own solution. We will then work out solutions in class.

d. Court case analysis: We will create groups of about 5 students. The task will be to find an interesting court case and analyze it as economists. This will require some background research of the relevant literature. The group should produce a short paper containing summary of the case and the analysis. This paper will be read by another group, which should provide you with feedback. We will then discuss your case in class.

Assessment methods (in Czech)

Final open-book written exam. The class participation, homework solution and court case analysis will be taken into account. Final grade will be given based on student’s relative ranking in class.

Language of instruction

English

Further Comments

Study Materials
The course is taught annually.

Information about innovation of course.

This course has been innovated under the project "Inovace studia ekonomických disciplín v souladu s požadavky znalostní ekonomiky (CZ.1.07/2.2.00/28.0227)" which is cofinanced by the European Social Fond and the national budget of the Czech Republic.

• Enrolment Statistics (Autumn 2013, recent)
  
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