Economics
College of Humanities and Social Sciences

Legal Investment Under Uncertainty: A Study of Rules Versus Standards

Timothy Reichert

Enterprise Hall, 318
April 20, 2004, 08:00 PM to 07:00 PM

Abstract:

The question of rules versus standards is one that is properly examined using the tools of dynamic programming. This is because the choice between rules and standards as alternative legal regimes has long run implications, and choices made under either regime have an effect on individuals' choice sets in future periods. However, despite the topic's importance, it has not been examined using dynamic programming as an analytical framework. This dissertation applies dynamic programming to the topic, and develops a number of insights and implications that have not previously been understood. These insights are then applied to areas of the law where the rules-standards tradeoff is an important one.

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