Thousands of long-term legal permanent residents are deported from the United States each year because they have been convicted of criminal offenses, many quite minor. These deportations occur without any of the constitutional safeguards that generally protect criminal defendants. Immigration authorities rely on cases asserting that such deportations are not punishment for the crime, but merely collateral consequences of the conviction. This article challenges that reasoning. It argues that its factual and doctrinal foundation has completely disintegrated over the last 20 years. Far-reaching changes in immigration law and enforcement have rendered deportation for aggravated felonies a "definite, immediate and largely automatic effect on the range of the defendant's punishment," that is, the direct consequence of a conviction. As such, the state should impose it only subject to the same constitutional protections that apply to criminal prosecutions. One key implication is that non-citizen criminal defendants should be fully and accurately advised of the immigration consequences of any plea agreement. Finally, this article argues that, while deportation has essentially become an additional criminal sanction for non-citizens, it is not a particularly effective or appropriate one. The article thus advocates a deep revision of immigration laws to restore deportation as a sanction imposed in the exercise of discretion on those whose criminal offenses outweigh their ties to the United States community and the hardship they and their community would suffer if they were deported.
{"title":"Fact or Fiction: The Legal Construction of Immigration Removal for Crimes","authors":"M. A. Sweeney","doi":"10.2139/ssrn.1361670","DOIUrl":"https://doi.org/10.2139/ssrn.1361670","url":null,"abstract":"Thousands of long-term legal permanent residents are deported from the United States each year because they have been convicted of criminal offenses, many quite minor. These deportations occur without any of the constitutional safeguards that generally protect criminal defendants. Immigration authorities rely on cases asserting that such deportations are not punishment for the crime, but merely collateral consequences of the conviction. This article challenges that reasoning. It argues that its factual and doctrinal foundation has completely disintegrated over the last 20 years. Far-reaching changes in immigration law and enforcement have rendered deportation for aggravated felonies a \"definite, immediate and largely automatic effect on the range of the defendant's punishment,\" that is, the direct consequence of a conviction. As such, the state should impose it only subject to the same constitutional protections that apply to criminal prosecutions. One key implication is that non-citizen criminal defendants should be fully and accurately advised of the immigration consequences of any plea agreement. Finally, this article argues that, while deportation has essentially become an additional criminal sanction for non-citizens, it is not a particularly effective or appropriate one. The article thus advocates a deep revision of immigration laws to restore deportation as a sanction imposed in the exercise of discretion on those whose criminal offenses outweigh their ties to the United States community and the hardship they and their community would suffer if they were deported.","PeriodicalId":46196,"journal":{"name":"Yale Journal on Regulation","volume":null,"pages":null},"PeriodicalIF":2.8,"publicationDate":"2010-05-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.2139/ssrn.1361670","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"68169706","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"社会学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Uncertainty as to tax results is an ever present obstacle to business transaction despite the extensive number of Code sections that exist. Private insurance companies have seen an opportunity to enter the market and provide a useful service which can reduce tax uncertainty obstruction to engaging in promising endeavors. Some insurance companies now provide an insurance product to protect the insured against adverse tax consequences from proposed transactions.Ironically, this new insurance product, labeled tax insurance, poses uncertain tax consequences itself. If the adverse tax consequences arise (that is, the taxpayer has additional tax liability) and the insurance company is contractually required to cover that liability, are the insurance proceeds that reimburse the insured for the additional tax liability included in the insured's gross income? If so, the insured might need to purchase additional coverage to pay for the tax incurred on receiving the proceeds.Commentators have concluded that the proceeds are taxable, and insurance companies also appear to adopt that view since tax insurance generally includes gross-up provisions to cover the tax that might be imposed on the disbursement of the proceeds. Contrary to that general opinion, this article argues that the tax insurance proceeds are not includable in the insured's gross income.The proceeds of general liability insurance have not been treated as taxable to the insured when paid to satisfy a liability of the insured. Some commentators have questioned whether there is a justification for that treatment under tax policy. As part of the reasoning that underlies the author's conclusion concerning tax insurance, the article examines that question and develops a novel approach that provides a tax policy justification for excluding those proceeds from the insured's income. The article concludes that the same justification also applies to exclude tax insurance proceeds from the insured's gross income.
{"title":"Hedging the IRS - A Policy Justification for Excluding Liability and Tax Insurance Proceeds","authors":"J. Kahn","doi":"10.2139/SSRN.1106343","DOIUrl":"https://doi.org/10.2139/SSRN.1106343","url":null,"abstract":"Uncertainty as to tax results is an ever present obstacle to business transaction despite the extensive number of Code sections that exist. Private insurance companies have seen an opportunity to enter the market and provide a useful service which can reduce tax uncertainty obstruction to engaging in promising endeavors. Some insurance companies now provide an insurance product to protect the insured against adverse tax consequences from proposed transactions.Ironically, this new insurance product, labeled tax insurance, poses uncertain tax consequences itself. If the adverse tax consequences arise (that is, the taxpayer has additional tax liability) and the insurance company is contractually required to cover that liability, are the insurance proceeds that reimburse the insured for the additional tax liability included in the insured's gross income? If so, the insured might need to purchase additional coverage to pay for the tax incurred on receiving the proceeds.Commentators have concluded that the proceeds are taxable, and insurance companies also appear to adopt that view since tax insurance generally includes gross-up provisions to cover the tax that might be imposed on the disbursement of the proceeds. Contrary to that general opinion, this article argues that the tax insurance proceeds are not includable in the insured's gross income.The proceeds of general liability insurance have not been treated as taxable to the insured when paid to satisfy a liability of the insured. Some commentators have questioned whether there is a justification for that treatment under tax policy. As part of the reasoning that underlies the author's conclusion concerning tax insurance, the article examines that question and develops a novel approach that provides a tax policy justification for excluding those proceeds from the insured's income. The article concludes that the same justification also applies to exclude tax insurance proceeds from the insured's gross income.","PeriodicalId":46196,"journal":{"name":"Yale Journal on Regulation","volume":null,"pages":null},"PeriodicalIF":2.8,"publicationDate":"2008-03-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"68140673","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"社会学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This Article considers the role of tax lawyers in the corporate tax shelter controversy. In the mid-1990s, a large market emerged in abusive tax shelters, which cost the treasury tens of billions of dollars in lost tax revenue a year. Although individual tax lawyers were deeply involved in abusive tax shelters, the organized tax bar supported law reforms intended to rein in the tax shelter market. The bar's initiatives included due diligence obligations for opinion letters issued in connection with tax shelters and other proposals intended to strengthen practice standards. The tax bar's positions in the tax shelter debate cannot be adequately explained by conventional accounts of the organized bar, which assume that bar groups act to further lawyers' or clients' economic interests or to improve the reputation of the bar. Nor, however, should the bar's positions be taken as pure expressions of public-mindedness. A more nuanced conception of professionalism is required to account for the bar's initiatives. This Article argues that the bar's positions reflect a specific professional ideology of tax practice in which tax lawyers, by virtue of their expertise, serve as gatekeepers for the tax system. While not conferring immediate economic benefits to tax lawyers, the bar's reforms further tax lawyers' long-term reputational and other interests, even as they serve to bind lawyers to higher practice standards and protect the integrity of the tax system.
{"title":"Sheltering Lawyers: The Organized Tax Bar and the Tax Shelter Industry","authors":"Tanina Rostain","doi":"10.2139/SSRN.696704","DOIUrl":"https://doi.org/10.2139/SSRN.696704","url":null,"abstract":"This Article considers the role of tax lawyers in the corporate tax shelter controversy. In the mid-1990s, a large market emerged in abusive tax shelters, which cost the treasury tens of billions of dollars in lost tax revenue a year. Although individual tax lawyers were deeply involved in abusive tax shelters, the organized tax bar supported law reforms intended to rein in the tax shelter market. The bar's initiatives included due diligence obligations for opinion letters issued in connection with tax shelters and other proposals intended to strengthen practice standards. The tax bar's positions in the tax shelter debate cannot be adequately explained by conventional accounts of the organized bar, which assume that bar groups act to further lawyers' or clients' economic interests or to improve the reputation of the bar. Nor, however, should the bar's positions be taken as pure expressions of public-mindedness. A more nuanced conception of professionalism is required to account for the bar's initiatives. This Article argues that the bar's positions reflect a specific professional ideology of tax practice in which tax lawyers, by virtue of their expertise, serve as gatekeepers for the tax system. While not conferring immediate economic benefits to tax lawyers, the bar's reforms further tax lawyers' long-term reputational and other interests, even as they serve to bind lawyers to higher practice standards and protect the integrity of the tax system.","PeriodicalId":46196,"journal":{"name":"Yale Journal on Regulation","volume":null,"pages":null},"PeriodicalIF":2.8,"publicationDate":"2005-04-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"67804517","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"社会学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
For many decades, scholars have puzzled over why the market for judicial clerks has been characterized by increasingly early bidding, with interviews and offers extended at progressively early points in a student's law school career. An important article published recently by Jolls, Avery, Judge Posner and Alvin Roth reported the results of a study the authors conducted of judges and clerks documenting the many ways in which the market operated inefficiently. In their view, the clerk market corresponds to other markets studied chiefly by Roth that show timing disturbances claimed to be market failures. The authors recommended adoption of a modified matching program, similar to the program that matches medical residents with hospitals. This paper reanalyzes the clerkship market and the other markets studied by Professor Roth from the standpoint of the costs and benefits of information acquisition. It shows that, far from market failure, the use of time as a currency in the market, represents the working out of market forces where other, more traditional terms of trade - in particular, price - are unavailable. The paper also shows that virtually all of the other markets studied by Roth that show timing peculiarities are characterized by restraints on the use of price to clear the market.
{"title":"Reexamining the Market for Judicial Clerks and Other Assortative Matching Markets","authors":"G. Priest","doi":"10.2139/SSRN.444220","DOIUrl":"https://doi.org/10.2139/SSRN.444220","url":null,"abstract":"For many decades, scholars have puzzled over why the market for judicial clerks has been characterized by increasingly early bidding, with interviews and offers extended at progressively early points in a student's law school career. An important article published recently by Jolls, Avery, Judge Posner and Alvin Roth reported the results of a study the authors conducted of judges and clerks documenting the many ways in which the market operated inefficiently. In their view, the clerk market corresponds to other markets studied chiefly by Roth that show timing disturbances claimed to be market failures. The authors recommended adoption of a modified matching program, similar to the program that matches medical residents with hospitals. This paper reanalyzes the clerkship market and the other markets studied by Professor Roth from the standpoint of the costs and benefits of information acquisition. It shows that, far from market failure, the use of time as a currency in the market, represents the working out of market forces where other, more traditional terms of trade - in particular, price - are unavailable. The paper also shows that virtually all of the other markets studied by Roth that show timing peculiarities are characterized by restraints on the use of price to clear the market.","PeriodicalId":46196,"journal":{"name":"Yale Journal on Regulation","volume":null,"pages":null},"PeriodicalIF":2.8,"publicationDate":"2003-09-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"68789466","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"社会学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Although competitive local exchange carriers (CLECs) collectively have gained considerable market share since the passage of the Telecommunications Act of 1996, many entrants into local telecommunications have stumbled or failed. Some argue that competitive local telephony will eventuate only if the incumbent local exchange carriers (ILECs) place their wholesale and retail operations in structurally separate subsidiaries. By mid-2001, several states began proceedings on mandatory structural separation, and influential members of Congress introduced legislation mandating structural separation. In this Article, we analyze, and reject as unpersuasive, the putative benefits of mandatory structural separation. Such regulatory intervention is unnecessary to prevent discrimination against unaffiliated retailers of telecommunications services. Nor would mandatory structural separation lower wholesale discounts or increase the CLECs' market share. Plausible hypotheses for the CLECs' problems do not require the assumption of anticompetitive behavior by the ILECs. Apart from producing no discernable benefits to consumers, mandatory structural separation would entail a substantial social cost in terms of forgone coordination of investment and production and forgone economies of scope. Moreover, mandatory structural separation would harm consumer welfare and reduce resources for investment by facilitating an anticompetitive strategy by the ILECs' largest rivals to raise the ILECs' costs of providing local telecommunications services. Policy makers should reject proposals for mandatory structural separation of the ILECs.
{"title":"Is Structural Separation of Incumbent Local Exchange Carriers Necessary for Competition","authors":"R. Crandall, J. Sidak","doi":"10.2139/SSRN.302846","DOIUrl":"https://doi.org/10.2139/SSRN.302846","url":null,"abstract":"Although competitive local exchange carriers (CLECs) collectively have gained considerable market share since the passage of the Telecommunications Act of 1996, many entrants into local telecommunications have stumbled or failed. Some argue that competitive local telephony will eventuate only if the incumbent local exchange carriers (ILECs) place their wholesale and retail operations in structurally separate subsidiaries. By mid-2001, several states began proceedings on mandatory structural separation, and influential members of Congress introduced legislation mandating structural separation. In this Article, we analyze, and reject as unpersuasive, the putative benefits of mandatory structural separation. Such regulatory intervention is unnecessary to prevent discrimination against unaffiliated retailers of telecommunications services. Nor would mandatory structural separation lower wholesale discounts or increase the CLECs' market share. Plausible hypotheses for the CLECs' problems do not require the assumption of anticompetitive behavior by the ILECs. Apart from producing no discernable benefits to consumers, mandatory structural separation would entail a substantial social cost in terms of forgone coordination of investment and production and forgone economies of scope. Moreover, mandatory structural separation would harm consumer welfare and reduce resources for investment by facilitating an anticompetitive strategy by the ILECs' largest rivals to raise the ILECs' costs of providing local telecommunications services. Policy makers should reject proposals for mandatory structural separation of the ILECs.","PeriodicalId":46196,"journal":{"name":"Yale Journal on Regulation","volume":null,"pages":null},"PeriodicalIF":2.8,"publicationDate":"2002-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"68492818","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"社会学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper was substantially revised in March 2003 to analyze WorldCom's fraud and bankruptcy and the FCC's February 20, 2003 decision its Triennial Review of mandatory unbundling. To date, policymakers and scholars have failed to recognize how those topics are interrelated. The United States has spent seven years trying to deregulate telecommunications. We are not in the transition any longer. It is time to take stock. In this essay, I address three topics. The first, addressed in Part I, is the administrative cost of deregulation, which has grown substantially under the Telecommunications Act of 1996.Part II addresses the consequences of the FCC's use of a competitor-welfare standard when formulating its policies for local competition, rather than a consumer-welfare standard. I evaluate the reported features of the FCC's decision in its Triennial Review. Press releases and statements concerning that decision suggest that the FCC may have finally embraced a consumer-welfare approach to mandatory unbundling at TELRIC prices. The haphazard administrative process surrounding the FCC's decision, however, increases the likelihood of reversal on appeal.Beginning in Part III, I address at greater length the WorldCom fraud and bankruptcy. I offer an early assessment of the harm to the telecommunications industry from WorldCom's fraud and bankruptcy. I explain how WorldCom's misconduct caused collateral damage to other telecommunications firms, government, workers, and the capital markets. WorldCom's false Internet traffic reports and accounting fraud encouraged overinvestment in long-distance capacity and Internet backbone capacity. Because Internet traffic data are proprietary and WorldCom dominated Internet backbone services, and because WorldCom was subject to regulatory oversight, it was reasonable for rival carriers to believe WorldCom's misrepresentation of Internet traffic growth. Event study analysis suggests that the harm to rival carriers and telecommunications equipment manufacturers from WorldCom's restatement of earnings was $7.8 billion. WorldCom's false or fraudulent statements also supplied state and federal governments with incorrect information essential to the formulation of telecommunication policy. State and federal governments, courts, and regulatory commissions would thus be justified in applying extreme skepticism to future representations made by WorldCom.Part IV explains how WorldCom's fraud and bankruptcy may have been intended to harm competition, and in the future may do so, by inducing exit (or forfeiture of market share) by the company's rivals. WorldCom repeatedly deceived investors, competitors, and regulators with false statements about its Internet traffic projections and financial performance. At a minimum, WorldCom's fraudulent or false statements may have raised rivals' costs by inducing inefficient investment in capacity or inefficient expenditures for customer acquisition and may have artificially reduced WorldCom
{"title":"The Failure of Good Intentions: The WorldCom Fraud and the Collapse of American Telecommunications After Deregulation","authors":"J., Gregory Sidakt","doi":"10.2139/SSRN.335180","DOIUrl":"https://doi.org/10.2139/SSRN.335180","url":null,"abstract":"This paper was substantially revised in March 2003 to analyze WorldCom's fraud and bankruptcy and the FCC's February 20, 2003 decision its Triennial Review of mandatory unbundling. To date, policymakers and scholars have failed to recognize how those topics are interrelated. The United States has spent seven years trying to deregulate telecommunications. We are not in the transition any longer. It is time to take stock. In this essay, I address three topics. The first, addressed in Part I, is the administrative cost of deregulation, which has grown substantially under the Telecommunications Act of 1996.Part II addresses the consequences of the FCC's use of a competitor-welfare standard when formulating its policies for local competition, rather than a consumer-welfare standard. I evaluate the reported features of the FCC's decision in its Triennial Review. Press releases and statements concerning that decision suggest that the FCC may have finally embraced a consumer-welfare approach to mandatory unbundling at TELRIC prices. The haphazard administrative process surrounding the FCC's decision, however, increases the likelihood of reversal on appeal.Beginning in Part III, I address at greater length the WorldCom fraud and bankruptcy. I offer an early assessment of the harm to the telecommunications industry from WorldCom's fraud and bankruptcy. I explain how WorldCom's misconduct caused collateral damage to other telecommunications firms, government, workers, and the capital markets. WorldCom's false Internet traffic reports and accounting fraud encouraged overinvestment in long-distance capacity and Internet backbone capacity. Because Internet traffic data are proprietary and WorldCom dominated Internet backbone services, and because WorldCom was subject to regulatory oversight, it was reasonable for rival carriers to believe WorldCom's misrepresentation of Internet traffic growth. Event study analysis suggests that the harm to rival carriers and telecommunications equipment manufacturers from WorldCom's restatement of earnings was $7.8 billion. WorldCom's false or fraudulent statements also supplied state and federal governments with incorrect information essential to the formulation of telecommunication policy. State and federal governments, courts, and regulatory commissions would thus be justified in applying extreme skepticism to future representations made by WorldCom.Part IV explains how WorldCom's fraud and bankruptcy may have been intended to harm competition, and in the future may do so, by inducing exit (or forfeiture of market share) by the company's rivals. WorldCom repeatedly deceived investors, competitors, and regulators with false statements about its Internet traffic projections and financial performance. At a minimum, WorldCom's fraudulent or false statements may have raised rivals' costs by inducing inefficient investment in capacity or inefficient expenditures for customer acquisition and may have artificially reduced WorldCom","PeriodicalId":46196,"journal":{"name":"Yale Journal on Regulation","volume":null,"pages":null},"PeriodicalIF":2.8,"publicationDate":"2002-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.2139/SSRN.335180","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"68587821","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"社会学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The competitive transformation of telecommunications and other network industries in the United States has caused governmental policy makers to be increasingly concerned with the fairness of the deregulatory process. This Essay offers a set of concrete guidelines that regulators of network industries should follow in removing regulatory controls: To achieve the productive and allocative benefits of competition and to ensure that the transition from regulation to competition is accomplished fairly, regulators should observe the principles of economic incentive, equal opportunity, and impartiality. Economic incentives allow incumbent firms to maintain their quality of service and innovation and investment, and allow them to recover stranded costs for past, present, and future regulatory obligations. Regulators can ensure equal opportunity by ensuring that regulation falls evenly on both competitive entrants and incumbents. Impartiality in increasing competition can be achieved by regulators refraining from market interventions that favor particular competitors. Only by treating incumbents and entrants symmetrically and resisting the temptation to manage competition will the regulators ensure that the deregulatory process in network industries will yield all of the benefits of market competition.
{"title":"Deregulation and Managed Competition in Network Industries","authors":"Gregory Sidakt, Daniel F. Spulber","doi":"10.2139/SSRN.289849","DOIUrl":"https://doi.org/10.2139/SSRN.289849","url":null,"abstract":"The competitive transformation of telecommunications and other network industries in the United States has caused governmental policy makers to be increasingly concerned with the fairness of the deregulatory process. This Essay offers a set of concrete guidelines that regulators of network industries should follow in removing regulatory controls: To achieve the productive and allocative benefits of competition and to ensure that the transition from regulation to competition is accomplished fairly, regulators should observe the principles of economic incentive, equal opportunity, and impartiality. Economic incentives allow incumbent firms to maintain their quality of service and innovation and investment, and allow them to recover stranded costs for past, present, and future regulatory obligations. Regulators can ensure equal opportunity by ensuring that regulation falls evenly on both competitive entrants and incumbents. Impartiality in increasing competition can be achieved by regulators refraining from market interventions that favor particular competitors. Only by treating incumbents and entrants symmetrically and resisting the temptation to manage competition will the regulators ensure that the deregulatory process in network industries will yield all of the benefits of market competition.","PeriodicalId":46196,"journal":{"name":"Yale Journal on Regulation","volume":null,"pages":null},"PeriodicalIF":2.8,"publicationDate":"2001-11-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.2139/SSRN.289849","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"68425006","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"社会学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Local telephone companies have long been regulated as natural monopolies. However, technological innovation and the prospect of falling regulatory barriers to entry now expose some portions of the local exchange to competition from cable television systems, wireless telephony, and rival wireline systems. Nevertheless, it is probable that certain parts of local telephony will remain naturally monopolistic. In these cases the local exchange carrier must be permitted to sell necessary inputs to its competitors in the market for final telecommunications products at a price that reflects all its costs, including opportunity costs. This essay explains in nontechnical terms the derivation and logic of the efficient component-pricing rule, or ECPR. The authors' analysis applies to any network industry. Thus, it is useful in antitrust analysis of essential facilities and in regulatory analysis of transportation, energy transmission, pipelines, and mail delivery.
{"title":"The Pricing of Inputs Sold to Competitors","authors":"W. Baumol, J. Sidak","doi":"10.2139/SSRN.289386","DOIUrl":"https://doi.org/10.2139/SSRN.289386","url":null,"abstract":"Local telephone companies have long been regulated as natural monopolies. However, technological innovation and the prospect of falling regulatory barriers to entry now expose some portions of the local exchange to competition from cable television systems, wireless telephony, and rival wireline systems. Nevertheless, it is probable that certain parts of local telephony will remain naturally monopolistic. In these cases the local exchange carrier must be permitted to sell necessary inputs to its competitors in the market for final telecommunications products at a price that reflects all its costs, including opportunity costs. This essay explains in nontechnical terms the derivation and logic of the efficient component-pricing rule, or ECPR. The authors' analysis applies to any network industry. Thus, it is useful in antitrust analysis of essential facilities and in regulatory analysis of transportation, energy transmission, pipelines, and mail delivery.","PeriodicalId":46196,"journal":{"name":"Yale Journal on Regulation","volume":null,"pages":null},"PeriodicalIF":2.8,"publicationDate":"2001-11-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"68423698","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"社会学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Mail delivery is one of the few economic activities that has avoided the wave of deregulation and privatization that has swept network industries over the last few decades. This Article examines several questions regarding the business activities of Canada Post Corporation in a competitive environment. What should be the appropriate mandate of Canada Post? If Canada Post is a natural monopoly, what form of regulation best serves Canadian consumers? If Canada Post's delivery of letter mail is not a natural monopoly, what basis exists for retaining Canada Post's current statutory monopoly? What potential exists for Canada Post to abuse its statutory monopoly-and other statutory privileges and immunities-to compete unfairly against efficient private suppliers of postal services? Part I of this Article outlines the regulatory and institutional setting in which Canada Post operates, including the nature and extent of Canada Post's legal monopoly. Part II demonstrates why technological justifications for the postal monopoly are no longer valid. Part III establishes that public provisions of the full range of postal services is no longer needed. Part IV explains how postal pricing and regulation can cause competitive problems for private firms because of incorrect measurement and misallocation of attributable costs and because of the potential to misuse Ramsey pricing principles. Part V presents four options that are available to the Canadian Parliament for addressing the problem of protecting efficient competition from the postal monopoly.
{"title":"Monopoly and the Mandate of Canada Post","authors":"J. Sidak, Daniel F. Spulber","doi":"10.2139/SSRN.289390","DOIUrl":"https://doi.org/10.2139/SSRN.289390","url":null,"abstract":"Mail delivery is one of the few economic activities that has avoided the wave of deregulation and privatization that has swept network industries over the last few decades. This Article examines several questions regarding the business activities of Canada Post Corporation in a competitive environment. What should be the appropriate mandate of Canada Post? If Canada Post is a natural monopoly, what form of regulation best serves Canadian consumers? If Canada Post's delivery of letter mail is not a natural monopoly, what basis exists for retaining Canada Post's current statutory monopoly? What potential exists for Canada Post to abuse its statutory monopoly-and other statutory privileges and immunities-to compete unfairly against efficient private suppliers of postal services? Part I of this Article outlines the regulatory and institutional setting in which Canada Post operates, including the nature and extent of Canada Post's legal monopoly. Part II demonstrates why technological justifications for the postal monopoly are no longer valid. Part III establishes that public provisions of the full range of postal services is no longer needed. Part IV explains how postal pricing and regulation can cause competitive problems for private firms because of incorrect measurement and misallocation of attributable costs and because of the potential to misuse Ramsey pricing principles. Part V presents four options that are available to the Canadian Parliament for addressing the problem of protecting efficient competition from the postal monopoly.","PeriodicalId":46196,"journal":{"name":"Yale Journal on Regulation","volume":null,"pages":null},"PeriodicalIF":2.8,"publicationDate":"2001-11-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.2139/SSRN.289390","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"68423823","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"社会学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
What is the proper legal standard for product integration involving software? Because software is subject to low marginal costs, network effects, and rapid technological innovation, the Supreme Court's existing antitrust rules on tying arrangements, which evolved from industries not possessing such characteristics, are inappropriate. In this Article, I ask why firms integrate software products. Next, I review the Supreme Court's tying decisions in Jefferson Parish and Eastman Kodak. I propose an approach to judging the lawfulness of product integration in technologically dynamic markets that supplements the Supreme Court's current standard with four additional steps in cases of tying of computer software. Thereafter, I examine the D.C. Circuit's approach to software integration, which arose from that court's 1998 interpretation, in Microsoft II, of an antitrust consent decree between the U.S. Department of Justice and Microsoft Corporation. I argue that the D.C. Circuit's rule has general applicability and should be recognized as the appropriate standard for software integration under antitrust law. I show how my approach imparts greater clarity to the D.C. Circuit's rule. I examine the competing product integration rule proposed in 2000 by Professor Lawrence Lessig as amicus curiae in the government's subsequent antitrust case against Microsoft, concerning the integration of Internet Explorer and Windows 98. My approach enables Professor Lessig's analysis to be reconciled with the D.C. Circuit's rule, but Professor Lessig's rule, on its own, would contain serious shortcomings. Thereafter, I evaluate Judge Thomas Penfield Jackson's April 2000 findings of law on the integration of Internet Explorer and Windows 98. I conclude that Judge Jackson's approach, in contrast to the D.C. Circuit's rule as refined by my approach, would harm consumers in the technologically dynamic market for computer software.
{"title":"An Antitrust Rule for Software Integration","authors":"J. Sidak","doi":"10.2139/SSRN.268508","DOIUrl":"https://doi.org/10.2139/SSRN.268508","url":null,"abstract":"What is the proper legal standard for product integration involving software? Because software is subject to low marginal costs, network effects, and rapid technological innovation, the Supreme Court's existing antitrust rules on tying arrangements, which evolved from industries not possessing such characteristics, are inappropriate. In this Article, I ask why firms integrate software products. Next, I review the Supreme Court's tying decisions in Jefferson Parish and Eastman Kodak. I propose an approach to judging the lawfulness of product integration in technologically dynamic markets that supplements the Supreme Court's current standard with four additional steps in cases of tying of computer software. Thereafter, I examine the D.C. Circuit's approach to software integration, which arose from that court's 1998 interpretation, in Microsoft II, of an antitrust consent decree between the U.S. Department of Justice and Microsoft Corporation. I argue that the D.C. Circuit's rule has general applicability and should be recognized as the appropriate standard for software integration under antitrust law. I show how my approach imparts greater clarity to the D.C. Circuit's rule. I examine the competing product integration rule proposed in 2000 by Professor Lawrence Lessig as amicus curiae in the government's subsequent antitrust case against Microsoft, concerning the integration of Internet Explorer and Windows 98. My approach enables Professor Lessig's analysis to be reconciled with the D.C. Circuit's rule, but Professor Lessig's rule, on its own, would contain serious shortcomings. Thereafter, I evaluate Judge Thomas Penfield Jackson's April 2000 findings of law on the integration of Internet Explorer and Windows 98. I conclude that Judge Jackson's approach, in contrast to the D.C. Circuit's rule as refined by my approach, would harm consumers in the technologically dynamic market for computer software.","PeriodicalId":46196,"journal":{"name":"Yale Journal on Regulation","volume":null,"pages":null},"PeriodicalIF":2.8,"publicationDate":"2001-04-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"68254702","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"社会学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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