Questions tagged [law]

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29
votes
10answers
15k views

A law against selling any house cheaper than it was bought for, what consequences would that have?

I'm looking for a more general and principled answer and use Scandinavia today only as a sketchy example of the kind of scenario I'm asking about. I live in Scandinavia where house prices has had an ...
24
votes
4answers
8k views

Why is bartering uncommon in modern countries?

Recently, I witnessed two acquaintances of mine engaging in bartering, where one traded his services for the services of the other. Both services had about the same value. By trading them directly, ...
5
votes
1answer
574 views

Example of Law of One Price holds but No Arbitrage Fails

I have been told that no arbitrage is a stronger assumption than than the law of one price. In particular, Law of One Price is equivalent to the existence of a stochastic discount factor, whereas no ...
5
votes
3answers
3k views

How are shell companies used for tax evasion?

The recent release of leaked documents on Mossack Fonseca has information on corporations and individuals using the firm's services for, among other things, tax evasion: The massive security breach ...
5
votes
1answer
360 views

Understanding at a quote about externalities in law and economics

that something is an externality is partly a statement about physical reality and partly a statement about the legal system. What does this mean? I assume the aspect of externality being a physical ...
5
votes
1answer
49 views

Trying to track down the earliest usage of rivalry, tangibility, excludability, and durability in economics

I'm interested in a history of these terms, and wondered if anyone knows where I might find such a thing. The first mention I can find for excludability is a 1957 law journal paper referring to a ...
5
votes
2answers
101 views

How would Greece “temporarily” leave the Eurozone?

Amongst the negotiations between Greece and the Eurozone leaders, there currently exists the possibility of Greece leaving the Eurozone for five years. Does this imply Greece would have to use a ...
5
votes
2answers
187 views

Why does every electronic transaction of USD legally take place on American territory?

In an article of a respected German newspaper (Die Zeit) I found the following statement (translation by me): 90 % of all foreign exchange trades are dealt in USD. Since every electronic ...
4
votes
1answer
116 views

In the case of externalities, does the initial allocation of rights affect the final outcome from the perspective of each party?

I think I understand the main implication of the Coase Theorem—that the outcome will be Pareto efficient regardless of the initial allocation of property rights, provided transaction costs are zero, ...
4
votes
1answer
47 views

2010 flash crash: cause and rationale for illegality

A British trader has been arrested on accusations of having triggered the 2010 "flash crash" that saw the Dow plummet by 600 points in 20 minutes. This is reported, for example, here (BBC), or here (...
4
votes
1answer
94 views

Argentine default: “Rights upon future offers”

Argentina defaulted on its sovereign debt in 2002. It has reached an agreement with most but not all of its creditors. Wikipedia has a pretty good summary. The agreements included a 70% hair cut but ...
3
votes
1answer
60 views

Gelman and Hill's Data on Effects of Child Support Enforcement

In Gelman and Hill's 2007 book, Data Analysis Using Regression and Multilevel/Hierarchical Models, chapter 11 begins the exploration of multilevel models. To do so, they introduce a data set that ...
3
votes
1answer
33 views

EU-Canada Comprehensive Economic and Trade Agreement?

Once applied, CETA will offer EU firms more and better business opportunities in Canada and support jobs in the EU, it will remove customs duties, end restrictions on access to public contracts, open-...
3
votes
0answers
23 views

What is a stockholder class action for?

Sometimes, when a public company allegedly does something wrong/illegal/etc, the investors of the company organise a class action suit against the company, such as the Commonwealth Bank of Australia (...
3
votes
0answers
19 views

Are some laws “Progressive” for businesses?

(United States Based) I'm not sure if this is the right exchange to ask this in. You know how there are progressive tax laws where lower income individuals are taxed a smaller percent of their income. ...
2
votes
4answers
483 views

What are taxes for since law forbids printing of money?

This question bothers me for a long time: why government keeps up with the taxes instead of with printing money? This would decrease its operating costs, simplify law and generally raise comfort of ...
2
votes
1answer
34 views

What is banking compliance

I'm not sure if I'm using the term correctly but there's something that's referred to as compliance in banking. Am I correct to understand that it's the process of obeying the laws and regulatory ...
1
vote
3answers
106 views

How bad is piracy hurting the entertainment industrie's economy? Are they going bankrupt or have a good outlook?

By entertainment I mean book publishing, music uploads like on iTunes or even movies whether DVD, Blue Ray, Netflix, Hulu whatever. So much is moving online, that's the future. Piracy cannot be ...
1
vote
1answer
75 views

Regulatory differences between stocks and bonds

If you buy stocks of a company you are buying a share in that business. If you buy bonds from the same company you are essentially loaning them money for future payment. I am guessing (correct me if ...
1
vote
0answers
31 views

In Korea, violations of foreign exchange controls were punished with the death penalty? [closed]

According to Chang Ha-Joon (2007), in (South) Korea, violation of foreign exchange controls could be punished with the death penalty. Is this true? What was/were the exact law(s)? Did anyone ...
1
vote
0answers
24 views

What would be the costs of declaring/legislating that Scottish banknotes be legal tender?

Bank of England: English banknotes aren’t legal tender in Scotland. Scottish notes aren’t legal tender in England or Scotland. Committee of Scottish Bankers: Scottish Bank notes are not Legal ...
1
vote
0answers
72 views

If the company were to buy back all their shares, does that mean the company would own itself? [closed]

If a publicly traded company buys back all it's shares from the public, majority holder and every last person that owns it's shares who would own the company? Obviously, it wouldn't be a normal ...
1
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0answers
30 views

Foreseeability vs negligence

Why is it the case that contractual liability is usually defined by basis of foreseeability rather than negligence (like in tort law)? I am looking a good explanation for this from economics. I ...
0
votes
1answer
122 views

Is the concept of limited liability in corporate law beneficial to economy

The concept of limited liability in corporate law is widespread all over the world. Limited liability means, that owners of a company can only loose their capital invested into the company - the ...
0
votes
1answer
65 views

How does the Contract Law definition of 'consumer surplus' relate to the Microeconomics definition?

O'Sullivan & Hilliard's The Law of Contract (2018 8 ed). 16.23 starts on p. 387, 16.35 on p. 391. Right: Pindyck, Rubinfeld. Microeconomics, Global Edition (2017 9 ed). p. 152. Richard and ...
0
votes
1answer
31 views

Why doesnt Law of Diminishing Marginal Utility not affect price effect?

Ok so in my textbook, it is given that the downward slope of the demand-price curve is justified by three factors: Law of Diminishing Marginal Utility Income Effect(Real income) Substitution effect ...
0
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1answer
69 views

What are the arguments for banning insider trading?

I can't see any economic argument for banning insider trading. In general, the point of allowing financial securities to be traded is to ensure that they are properly valued. "Insiders" seem better ...
0
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1answer
22 views

who is responsible as international court to solve economic conflicts between countries and is it obligatory? [closed]

you know turkey was one of the 7members of F-35 joint strike fighter program..its engine is being manufactured in turkey.turkish government made all legal obligations to program and paid 35 billion ...
0
votes
0answers
18 views

References on foreign ownership of domestic assets

In Piketty's Capital in the 21st Century, he occasionally analyzes the ownership of domestic assets by foreign countries. On p. 192, he writes: Japan and Germany have accumulated quite significant ...
0
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0answers
22 views

Advantages of compensating victims of medical injuries via tort liability

Does anyone know any advantages of compensating victims of medical injuries via tort liability? There are lots of disadvantages to that but it seems like there are no advantages. Most of the articles ...