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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. 9781107140219_excerpt-2

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

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The Moral Limits Of Free Markets In Boulder 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.


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)


Co-sponsored by the:

Center for Values and Social Policy

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Kweku Adoboli’s Future Career In Music Promotion?

I mentioned earlier Kweku Adoboli’s recent podcast interview with Lindsay Fortado of the FT, and listening to it has convinced me that, though his career as a trader may be over, perhaps he has a future in music promotion.

Let me explain.

Adoboli is the UBS rogue trader who was brought up on criminal charges in the UK stemming from unauthorized trading that first came to light in September 2011. He served about four years in prison and was recently released.

Adoboli was a trader on UBS’s four person ETF desk.  According to Adoboli, he began off-books trading in 2008 using an account nicknamed “umbrella,” which he used as a slush fund to hide profits until he needed them to cover a loss on some later, rainier, day.  As I’ve discussed, such smoothing of profits and losses is a common element in other recent rogue trading cases, including Jerome Kerviel at Société Générale.

As I said at the time:

The umbrella account is the one element of the case that has finally convinced me of the possibility of an Adoboli made-for-television movie (note to networks: I’m willing to consult on the cheap in exchange for hobnobbing with movie stars . . . or just for free lodging).  I think that we’re due for another rogue trading movie.  Though Nick Leeson got a real (not TV) movie out of his ordeal — starring Ewan McGregor, no less — it was a real dud, which hasn’t prevented me from showing it in class about a dozen times.

The umbrella account turned out to be an important element of Adoboli’s defense.  Adoboli’s lawyer, Charles Sherrard argued that all three ETF desk traders, including Adoboli’s supervisor, John Hughes, knew about the umbrella account.  Sherrard introduced numerous email and chat communications referencing Adoboli’s “umbrella,” “Rhianna,” and “ella ella,” in an attempt to establish that Adoboli, far from being a rogue agent, was part of a collaborative scheme in which other bank employees (again, including his direct supervisor) acquiesced.

Fortado asks Adoboli about the account in the podcast (“you had an internal fund that you created for the ETF desk, called the ‘umbrella’ or ‘Rihanna’ which was discussed at trial”) and Adoboli repeats his position that others (“many others”) at UBS knew about the trading scheme and either approved, directly participated, or turned a blind eye to it, because it was profitable.

Adoboli is the only rogue trader that ever gave me an excuse to show part of a Rihanna video at an international conference.

And now, he’s provided another music recommendation. At the end of the podcast, Fortado tells Adoboli that she knows he loves music and asks whether there is a song that is indicative of the way that he felt during the ordeal. His new theme song? Caught in the Hustle, by Immortal Technique:

So if I should ever fall and get caught in a hustle
Let them know that I died while I fought in a struggle
From the hoodrats to the rich kids lost in a bubble
Spray painting on the streets and at the subway tunnels
Write it down and remember that we never gave in
The mind of a child is where the revolution begins
So if the solution has never been to look in yourself
How is it that you expect to find it anywhere else

Well, there’s that then.

I have some thoughts on the interview itself, which I’ll try to return with, schedule permitting.

Related posts:

Kweku Adoboli Speaks!
Ella . . . Ella
AMV Seminario De Control Interno Y Compliance: Bogotá, Colombia
Kweku Adoboli Trial Began Today
The Rogue Trading KISS
When $61bn Seemed Like Real Money
Denial: It Ain’t Just A River In Egypt
It’s The Stupid Culture
It’s The Culture, Stupid
Kerviel’s Fake Trades: Genius Or Copy Cat?
Kerviel’s Fake Trades: The Anatomy of A Cover-Up
On Warning Signs II: Follow The Money
On Warning Signs: You Can’t Get There From Here
Rogues Versus Scapegoats
Kerviel Trial Opens to Fanfare
Société Générale: Back In The Saddle Again
Jérôme Kerviel to Société Générale: Stand By Your Man

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If You Want A Market, Have A Market . . . Otherwise

Eggs Donors Cartoon 2By now most readers will have seen the article in Friday’s New York Times discussing Kamakahi v. ASRM, the egg donor price fixing litigation that I’ve blogged about numerous times here. (See links below). I’ll be back later with more to say about the article, but for now wanted to highlight the following quote from Debora Spar, the president of Barnard College and the author of The Baby Business, an excellent book on the assisted reproduction industry. Says Spar:

Our whole system makes no sense . . .We cap the price because of the yuck factor of commodifying human eggs, when we should either say, ‘Egg-selling is bad and we forbid it,’ as some countries do, or ‘Egg-selling is O.K., and the horse is out of the barn, but we’re going to regulate the market for safety.’

I couldn’t agree more and make a similar point in a recent piece in the Journal of Applied Philosophy (the published piece is gated, but you can access an earlier draft here):

ASRM and SART also defend the compensation guidelines on the grounds that they prevent the undue influence and exploitation of egg donors. . . .

It is worth noting at the outset that many countries ban payments to egg donors entirely, due precisely to concerns such as these. Regardless of one’s views on the ultimate wisdom of such bans, they do possess a certain logic — if the lure of payment will cause women to donate who otherwise would not, then one possible solution is to ban payments. An attempt to address inducement concerns through price caps, however, is an entirely different matter.

Happy reading!

Related posts: 

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“Feeble Even By Normal Litigation Standards”

It seems that Ashby Jones opened the floodgates with his recent Wall Street Journal article on Kamakahi v. ASRM, the antitrust suit challenging the ethical guidelines on egg donor compensation promulgated by the American Society For Reproductive Medicine as an illegal price fixing agreement in violation of the Sherman Act. Since that article appeared, other news sources have picked up on the suit.

At Slate, for example, Eric Posner argues that the plaintiffs are not donors, but sellers, and deserve a fair price for their services. Says Posner: “Price-fixers always offer an excuse for their behavior, but these arguments [raised by the defense] are feeble even by normal litigation standards.”

And yesterday, the Legal Broadcast Network ran a video on the case, in which I argue that, were it not for the unusual nature of the product/service at issue, there would be little question that the pricing guidelines were an illegal, per se violation of the Sherman Act. The print version is here, but you can watch the video below.

Related posts:


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