This book serves as a compact introduction to the economic analysis of law and organization. At the same time it covers a broad spectrum of issues. It is aimed at undergraduate economics students who are interested in law and organization, law students who want to know the economic basis for the law, and students in business and public policy schools who want to understand the economic approach to law and organization. The book covers such diverse topics as bankruptcy rules, corporate (...) law, sports rules, the organization of Congress, federalism, intellectual property, crime, accident law, and insurance. Unlike other texts on the economic analysis of law, this text is not organized by legal categories but by economic theory. The purpose of the book is to develop economic intuition and theory to a sufficient degree so that one can apply the ideas to a variety of areas in law and organization. (shrink)

While Bryan Caplan’s theory of rational irrationality is important and original, he does not actually demonstrate that the theory explains public opinion about economics. The theory holds that voters are aware of the insignificance of their votes, and therefore feel free to vote based on whatever beliefs they “prefer” to hold, regardless of whether or not these beliefs are true. Yet by voting, voters suggest that they do not, in fact, understand that the odds against their votes “counting” are astronomical. (...) And by failing to vote in greater numbers for minor‐party or write‐in candidates, they confirm that they think that their votes may be decisive, and must thus be confined to one of the two candidates who might win. It is therefore implausible to think that voters don’t care whether they are voting based on true beliefs. A better explanation for voter “errors” may be that voters are simply ignorant . Yet even this thesis may be too strong, because Caplan’s data do not show all that much disagreement between voters and economists. Nor is it clear that these disagreements concern economics rather than xenophobia and, possibly, other non‐economic attitudes on the part of the public. In that case, however, it would still be true that, as Caplan argues, public policy reflects the views of the people—however blinkered or distasteful those views may be. (shrink)