American universities are increasingly proactive in dealing with conflict of interest problems of their faculty. Changing social norms, publicized scandals, and more have made both university administrators and faculty extra alert to the dangers of faculty infidelity to their roles as teachers and scholars. Personal interests — both financial and non-financial — appear increasingly to pressure faculty to behave inappropriately. Most faculty members resist those pressures. Yet, enough conduct that either is, or appears to be, improper has occurred to prompt (...) the adoption by universities of an ever-more complex regulatory regime. This regime no longer relies primarily upon threats of after-the-fact punishment for gross deviations from professorial norms. Instead, universities have also enacted a wide array of in-advance restrictions. These include required disclosures by faculty members of certain private interests, prohibitions of specific faculty behavior, and specified instances in which faculty members must temporarily withdraw from their professorial roles in light of their private interests. This article draws especially upon the author’s experience at the University of California to illustrate the new system of regulation. (shrink)

The overriding theme of the conference honoring Bob Cooter and his work is the question whether law and policy can change people’s preferences. The conventional “law and economics” answer is “no.” People have preferences that are fixed. What changes in law and policy do is to change how people behave by altering the costs and benefits people face in pursuit of their preferences. Put simply, the assumption of the “law and economics” model is that people respond to financial incentives by (...) changing how they act, not what they want. So, to take a simple example, imagine two people at the same starting point, both wanting to drive separately to visit a mutual friend. Their preference to get there promptly and safely is common to both of them, but how they act in pursuit of that goal may well differ. Moreover, government can alter how they drive to their friend’s by making changes such as putting in a freeway, or adding a new lane to the road, or installing lots of new traffic signals or stop signs along one route. The two people may have driven different routes previously, and they may alter their driving strategy in response to the policy changes government has adopted and may still decide that different routes are better for them. But they do not change their desire to see their friend in a prompt and safe manner. In this Article I offer a counterexample — an instance in which changes in law and policy can not only alter the behavior of some with fixed preferences, but also can impact the preferences of others. My example is about changes in society that can alter parenting style (of those parents with a fixed preference to have their children succeed) and can also change the underlying preferences that those children have as to how their lives should play out. (shrink)

The patient safety movement seeks to reduce the number of avoidable injuries and diseases that patients suffer while in hospital. Two regulatory strategies in support of that movement are explored here. “Required disclosure” would rely on market responses to an increase in publicly available information about hospital errors. “Performancebased regulation” would require hospitals to reduce their error rate or suffer substantial financial penalties. Both approaches are designed to give medical service providers incentives to promote safety without resorting to “command and (...) control” regulation under which government experts tell hospitals how to act. (shrink)