Scott’s Reviews > The Failure of Judges and the Rise of Regulators > Status Update

[A]ppellate judges sometimes “simplify” the facts to elucidate a legal principle. A very clean example of this is Cardozo’s extreme mischaracterization of facts in MacPherson v. Buick (Henderson 2003), but Cardozo also appears to have altered the facts at least marginally in Palsgraf as well (Posner 1990).

Viewed from the perspective of standard economics, [quantity regulations] appear inferior to Pigouvian taxes, for example. Yet, as Glaeser and I (2001) argue, from the perspective of efficient enforcement these rules make perfect sense precisely because the government can co-opt the private sector to facilitate enforcement.

Workplace safety is especially informative because the traditional transaction-cost objection to the Coase Theorem, namely that contracting is impractical because many parties are involved (as with pollution), does not apply.

The public interest theory of regulation ... has been used to justify much of the growth of public ownership and regulation over the twentieth century (Allais 1947; Meade 1948; Lewis 1949).