Key Research Areas
Since its inception in 2012, the Notre Dame Research Program on Law and Market Behavior has critically examined and researched law and market behavior in three main areas: Behavioral Regulation; Competition, Innovation, and Intellectual Property; and Corporate Governance.
In order to support research and discussion of these vital disciplinary areas, LAMB has hosted and sponsored numerous conferences, workshops, panel discussions, and book roundtables, bringing together hundreds of scholars, policy makers, and industry and legal professionals from around the world to discuss a full range of issues and perspectives. These events are held at Notre Dame Law School, at Notre Dame’s Global Gateways, and other prominent locations across the globe.
In addition, the Program is committed to highlighting the high quality empirical research on timely and important topics that advance the understanding of law and market behavior as well as provide implications for future policy and practice decisions.
By promoting its mission of influencing the way students, scholars, and policy makers think about the legal and policy issues at the intersection of law and market behavior, LAMB has become a dynamic leader in the United States and around the globe in this important area.
LAMB examines the implications of key findings from behavioral economics and psychology for the analysis, regulation, and reform of legal institutions.
Key Research: Understanding Behavioral Antitrust by Avishalom Tor
Behavioral antitrust – the application to antitrust analysis of empirical evidence of robust behavioral deviations from strict rationality – is increasingly popular and hotly debated by legal scholars and the enforcement agencies alike. This research by Dr. Avishalom Tor shows, however, that both proponents and opponents of behavioral antitrust frequently and fundamentally misconstrue its methodology, treating concrete empirical phenomena as if they were broad hypothetical assumptions. Because of this fundamental methodological error, scholars often make three classes of mistakes in behavioral antitrust analyses: First, they fail to appreciate the variability and heterogeneity of behavioral phenomena; second, they disregard the concrete ways in which markets, firms, and other institutions both facilitate and inhibit rational behavior by antitrust actors; and, third, they erroneously equate all deviations from standard rationality with harm to competition. After establishing the central role of rationality assumptions in present-day antitrust and reviewing illustrative behavioral analyses across the field – from horizontal and vertical restraints, through monopolization, to merger enforcement practices – his research examines the three classes of mistakes, their manifestation, and their consequences in antitrust scholarship. It concludes by offering two sets of essential lessons that the behavioral approach already can offer to make antitrust law and policy more realistic and effective in protecting competition: One concerning the value of case-specific evidence in antitrust adjudication and enforcement, the other showing how antitrust law can and should account for systematic and predictable boundedly rational behavior that is neither constant nor uniform.
Competition, Innovation, and Intellectual Property
Key Research: Do Patent Challenges Increase Competition? by Stephen Yelderman
For nearly a hundred years, the Supreme Court has claimed that litigation of patent cases provides a unique public benefit, because it has the potential to free the public from the burdens of a patent monopoly. Relying on this theory (and to nearly universal acclaim from legal scholars), the Court has overturned long-standing common-law doctrines, declined to enforce otherwise-valid contracts, and subjected patent settlements to scrutiny under the antitrust laws.
This research by Stephen Yelderman scrutinizes the claim that patent challenges lead inevitably to increased competition. It identifies a number of conditions that must hold for a patent challenge to provide this particular benefit, and evaluates the reasonableness of assuming that the procompetitive benefits of patent challenges are generally available. As it turns out, there are a number of ways these conditions can and regularly do fail, causing the potential benefits for competition to be smaller than previously thought or, in some cases, completely unavailable.
LAMB explores the system of practices and processes by which companies operate and are controlled and how shareholders, management, customers, suppliers, government, and the community interact together.
Key Research: The Shareholder Value of Empowered Boards by Martijn Cremers and Simon Sepe
This research presents new empirical evidence on staggered boards that suggests shareholders can benefit from staggered boards, and that there is no evidence that staggered boards are detrimental to shareholder interests. The authors show that staggered boards are associated with a statistically and economically significant increase in firm value by employing a unique and comprehensive dataset covering thirty-four years of board staggering and de-staggering decisions—from 1978 to 2011. Their research shows that staggered boards are associated with a statistically and economically significant increase in firm value. In light of these novel empirical results, they then show theoretically that a corporate model with staggered boards emerges as a rational institutional response to market imperfections that are more complex and more significant than shareholder advocates have realized. Boards that retain their historical authority—empowered boards—benefit, rather than hurt, shareholders. The research concludes with a normative proposal to revitalize the authority of U.S. boards.