I. What is rent seeking? Why does it lead to inefficient outcomes? Briefly explain the relevance of rent seeking to inefficiencies associated with two of the following:
A. Burglary
B. Monopoly
C. Speculation
D. Efficient punishment
[These are not based on material in the book, but may be of interest to those who have read it]
II. Briefly explain the differences between the adversarial system for trying cases used in the U.S. and the inquisitorial system used in much of Europe. Give at least one advantage of each system.
IV. Suppose we changed our legal rules so that the losing party in a civil suit was required to pay the legal expenses of the winning party. What would the consequences be?
V. Suppose we changed our legal rules so that, when a criminal defendant was acquitted, the state was required to reimburse him for the costs of his defense--lawyer fees, time in prison, etc. What would the consequences be?
VI. B. Suppose that, from 1900 to 1950, the rules determing when someone injured by a defective product can collect damages remain the same. From 1950 to 1960, legal doctrine changes, leading more and more courts to a position much more favorable to plaintiffs in such cases. A plaintiff who, in 1950, would have only a fifty percent chance of winning his case, would have a ninety percent chance of winning the same case in 1960. After 1960 legal doctrine stops changing. Describe what you would expect to happen to the fraction of cases won by plaintiffs over the period 1940 to 1970, and why.
VII. One of my students comes to me with a convincing reason why he cannot take the exam on the scheduled day. I agree to let him take the same exam on a different day. I am worried that if he takes the exam early, he might tell other students what is on it, and if he takes it late, one of them might tell him.
Assuming that the students are motivated only by rational self-interest, which is more likely to happen? When should I schedule his exam?