Problem
1. Kidneys on Amazon? There are three conventional approaches to regulation: Command-and-control, Pigouvian, and property-rights based approach. There is also a fourth approach to "regulation" - the one that relies on norms and customs, and one I introduced in class based on Ellickson 1999. Describe the current method for allocating kidneys to those who need them. Acknowledge the illegal trade of kidneys in your discussion. Do a cost-benefit analysis of the four methods, explain how each would work, tabulate decision costs and error-costs and recommend the ‘best" approach to maximize social welfare. I have included two Wall Street journal readings on the topic of kidneys. Read: Winston 2006; also helpful: Dudley & Brito 2012. Ostrom 2000;
2. Quis custodiet Ipsos custodes? [Who watches the watchman?] Explain regulatory capture; draw from the assigned podcasts to illustrate. Why is this a problem? What are public goods? Explain why public goods will be underprovided? Why is oversight of government regulatory agencies considered a public good? Relatedly, if it is a public good to watch the watchers - how can we arrive at the optimal level of watching? Read: Winston 2006; also helpful: Dudley & Brito 2012; also Teles 2010.
3. When Excluding Makes Sense. It has been noted that a number of private marine fishery organizations historically implemented its own conservation minded catch limitations. But they ran into trouble under the antitrust laws. Explain the essence of antitrust; explain the essence of conservation regulation. Explain how antitrust conflicts with conservation. Read Adler 2004; Read Yandle 1998.
4. Ceasar's Wife. Are regulators immune from decision-making foibles? What are behavioral decision-making heuristics and biases? Define and discuss the relevance of what Slavisa Tasic calls "the illusion of regulatory competence" for regulatory decisionmaking. Read: Tasic 2013; Teles 2010.