Precedent and Discretion

Informative Precedent and Intrajudicial Communication

We develop an informational model of judicial decision-making in which deference to precedent is useful to policy-oriented appellate judges because it improves the accuracy with which they can communicate legal rules to trial judges. Our simple model yields new implications and hypotheses regarding conditions under which judges will maintain or break with precedent, the constraining effect that...

Unit precedent

Precedent in the Making

Accounting Discretion

This study investigates the factors affecting acquirers’ allocation of purchase price between goodwill and identifiable intangible assets with finite lives. SFAS 142 replaces goodwill amortization with periodic impairment tests that are based on fair value estimates, while most identifiable intangible assets are still amortized over finite useful lives. As a result of the differential accountin...

Discretion, Rules, and Volatility

E conomic models with multiple equilib-ria, such as Diamond and Dybvig (1983), have become increasingly useful in analyzing volatility in financial markets and in business cycles. In many of these models, indeterminacy is a result of incomplete financial markets or technological nonconvexities. Here we identify economic policy discretion to be another distinct cause of indeterminate equilibrium...