The John M. Olin Center

Courses

The following courses are specifically designed to teach economic analysis of law, economics, or empirical methods.

Analytical Methods for Lawyers (Fall) , Lecturer David Cope
Lawyers in almost every area of practice (litigation, corporate, government, public interest) deal routinely with problems that are usefully illuminated by basic business and economic concepts. This course is designed to teach the most important analytical methods to law students, in a manner that will be fully accessible to those with no prior quantitative training or background in the subjects covered. Using text, classroom activities, and written exercises, we will explore how these tools may be used to analyze concrete problems that arise in a wide range of legal practice settings. :
The course will consist of seven units: Decision Analysis/Games and Information, Contracting, Accounting, Finance, Microeconomics, Law and Economics, Statistics.

Business Strategy for Lawyers , Professor Kathryn Spier
This course presents the fundamentals of business strategy to a legal audience. The class sessions include both traditional lectures and business-school case discussions. The lecture topics and analytical frameworks are drawn from MBA curriculums at leading business schools. The cases are selected for both their business strategy content and their legal interest.

The main course material is divided into four parts. The first part presents the basic frameworks for the analysis of strategy. The topics include economic and game theoretic approaches to strategy, competitive advantage and industry analysis. The second part is concerned with organizational and contractual responses to agency problems. Topics include pay-for-performance, corporate control, and the design of partnerships and other business associations. The third part takes a broader view of business associations, considering the horizontal and vertical scope of the firm and the advantages of hybrid organizational forms such as franchising and joint ventures. The fourth part covers special topics in competitive strategy, including product differentiation, tacit collusion, facilitating practices, network externalities, market foreclosure, and innovation.

In addition, class sessions at the end of the semester will be devoted to student presentation and analysis of selected case studies. Working in small assigned groups, students will apply the frameworks learned in class to recent strategic and legal issues facing organizations and industries.

Economic Analysis of Law, Professor Steven Shavell
What effects does law have? Do people drive more cautiously, clear ice from sidewalks more diligently, and commit fewer crimes because of the threat of legal sanctions? Do corporations pollute less, market safer products, and obey contracts to avoid suit? And given the effects of legal rules, which are socially best? Such questions about the influence and desirability of laws have been investigated by legal scholars and economists in a new, rigorous, and systematic manner since the 1970s. Their approach, labeled "economic," is widely considered to be intellectually compelling and to have revolutionized thinking about the law. This course will provide an in-depth analysis and synthesis of the economic approach to the analysis of the major building blocks of our legal system -- property law, tort law, contract law, criminal law, and the legal process. The course will also address welfare economic versus moral conceptions of the social good. The course is aimed at a general audience of students. No economic background is needed to take it.

Contracts: Advanced (not offered 07-08) , Lecturer Joni Hersch

Corporate Governance in East Asia: Seminar, Professor Reinier H. Kraakman and Visiting Professor Hyun-Chul Lee
This seminar will explore the evolution of corporate governance in three principal Asian economies: Korea, Japan, and People's Republic of China. The seminar will open with a review of the general literature on comparative corporate governance, with particular attention to the convergence debate. After this introduction, we will consider our three principal Asian countries. For each, we will first address sources of corporate finance, patterns of equity ownership, and governance institutions. Next, we will examine the response of each country's corporate governance institutions to economic or political challenges. In the Korean case, we will focus on the national debate over the current state and future survival of the large conglomerates (chaebols) at the core of the economy, with an emphasis on the multiple challenges that confront these firms. In the Japanese case, we will focus on recent legal developments associated with the first indications of a hostile takeover market (e.g., the adaptation of its legal system to embrace the defensive tactics developed in the United States). In the Chinese case, we will examine the development of corporate governance institutions in the transition to a market economy. Finally, we will review the trajectory of corporate governance reform in each of these countries and explore how well the legal theories and institutions developed in the western countries have worked in the process. We expect each case study to provide a different perspective on the debate over convergence in corporate law and governance. Nevertheless, we hope that larger communalities will emerge from exploring the three cases together. The written assignments for this seminar will consist solely of discussion memoranda addressing the weekly readings. Seminar participants may write papers for additional credit in tandem with taking the seminar, but not as a substitute for weekly memos. An introductory course in U.S. corporate law or its foreign equivalent is a prerequisite for this seminar!

Corporate Governance: Current Topics & Theories, Professor Mark Roe
In this course we will consider current academic thinking about corporate governance and ownership. The course work will be divided among these topics: the theory of the firm, the role of institutional investors, the foundations for venture capital markets, the role of gatekeepers (and how they failed in Enron and other recent corporate scandals), explanations for the differences in corporate governance around the world, the policy bases for building capital markets in developing and transition nations, current thinking on jurisdictional competition in producing corporate law, and bases for and against shareholder primacy in the corporation. Prerequisite or co-requisite: Corporations or equivalent exposure to corporate law.

Corporate Governance: Reading Group , Professor Lucian Bebchuk
Students will read and discuss work about corporate governance policy and corporate governance reforms. As is the norm with reading groups, there will be no examination or paper, and the class will be graded pass/fail.

Innovative Contracting: Seminar , Professor George G. Triantis
This seminar explores the method and process of innovation in the structuring of transactions, and examines the factors that promote or impede such innovation. The discussion will focus on the tools and value of creative contracting: how lawyers interact with their clients (and their clients' other advisers) to produce novel contractual terms or structures; and the legal, economic and social forces that spur or impede innovation. Some of the class material consists of law-review and economics articles, but we will also look at case studies of transactional innovation in practice.

Law and Economics: Empirical Issues (not offered 07-08)

Seminar: Law and Economics, Professors Louis Kaplow and Steven Shavell
This seminar will provide students with an opportunity to discuss ongoing research in economic analysis of law. At most of the meetings invited speakers--some from the Law School--will present works in progress. Students are required to submit, before sessions, brief written comments on the papers to be presented.

Law & Finance, Professor Lucian A. Bebchuk
This course will consider a wide range of issues in law and finance and corporate governance. The issues to be considered include the allocation of power between managers and shareholders, corporate transactions (takeovers, freezeouts, and sales of control block), boards of directors, insider trading, executive pay, state competition in corporate law, corporate ownership structures, and shareholder activism. Some sessions will feature speakers, including both academics and prominent practioners, who will present their work and thinking about current issues and research in the area. Readings will be mainly from law review articles. Many of the readings will use economic reasoning, and familiarity with (or at least tolerance for) such reasoning will be helpful. The aim will be to give students a good sense of the issues that have been discussed in the literature and the ways in which the corporate law rules can be analyzed and criticized. The course will meet for twenty-two sessions during the semester. There will be no examination. Instead, students will be asked to submit, before sessions, a brief memo on the assigned readings; grades will be based on these memos (primarily) and on class discussion.

Law, Economics & Organizational Research: Seminar, Professors Lucian A. Bebchuk, Louis Kaplow, and Oliver Hart
This seminar will involve the presentation by speakers of papers in the fields of law and economics, law and finance, and contract theory. The two-credit seminar will meet for one and a half hours for two-thirds of the weeks in each of the two terms. Lunch will be served. A student may take the seminar for only one term, for one credit (2 credit fall/spring terms = LAW-96250A-1/FS, one credit fall term = Course LAW-96250A-1/F, or one credit spring term = Course LAW-96250A-1/S). The seminar is given jointly with the Economics Department, and should be taken only by students with substantial prior interest in or exposure to economic analysis. (If you have questions about this, please contact Professors Bebchuk or Kaplow.) Students may satisfy the course requirement either by submitting, before sessions, short written comments on the paper to be presented or by writing a short seminar paper on any approved topic. Oliver Hart is a Professor of Economics at the Economics Department.

Mergers, Acquisitions, and Split Ups, Professor Robert C. Clark and Chancellor Leo E. Strine, Jr.
This course, co-taught by a corporate law professor (who is also a director) and a member of the Delaware Court of Chancery, will focus on the state law affecting corporate mergers and acquisitions (including both third-party and going-private deals), and divestitures such as spin-offs and split-ups. It will also deal substantially with merger agreements, considered as contracts, and with the business aspects of breakup plans. The course will have a practical bent and will address the real-world problems faced by parties contemplating, attempting, or resisting acquisitions and divestitures, as well as the policy dilemmas faced by courts called upon to assess such transactions. To further this goal, several classes may involve the participation of leading practitioners. Please note that, while most classes will be held on Mondays and Tuesdays, some sessions of this course will be scheduled to occur on Wednesdays during the same course block (5 pm to 7 pm). Accordingly, students in the course should not plan on enrolling in any other course or seminar that is held at this time. Prerequisites: JD students should have already taken Corporations; LLM students should have had a comparable basic business organization course, or relevant background and experience, or should be contemporaneously taking the basic Corporations course; cross-listing Business School students (whom the co-teachers very much welcome) need not have taken Corporations; cross-listing students from other parts of Harvard should seek permission from Professor Clark.

Negotiation Advanced: Deal Set Up, Design, & Implimentation (not offered 08-09), Professor Guhan Subramanian
First, many of the class sessions will be structured around high profile recent or ongoing deals. Student teams will research and analyze these transactions in order to present their most important aspects and lessons to the class. For many of these presentations (as well as some more traditional case studies and exercises), the practicing lawyers, bankers, and/or business principals who participated in the transactions under discussion will attend class, listen to the team's assessment, provide their perspectives, and suggest broader negotiation insights.

Second, the class will be composed of an equal number of business and law school students, and will be jointly taught by faculty from the business and law schools. These differences in professional background, perspective, and experience should be highly complementary, mutually informative, and in line with the perspectives represented in most significant negotiations.

Topics developed throughout the course include how negotiators create and claim value through the setup, design, and tactical implementation of agreements. The first part provides advanced tools for identifying, setting up, and negotiating value-creating deals. This module will explore the inevitable tension between creating and claiming value; complexities that can arise through agency, asymmetric information, moral hazard, and adverse selection; structural, psychological, and interpersonal barriers that can hinder agreement; and the particular challenges inherent in the roles of advisors as negotiators. It will also identify the differences between deal-making and dispute resolution; single-issue and multiple-issue negotiations; and between two parties and multiple parties.

The second part of the course will apply these tools to a series of real-world deals. Some of these case studies will follow the usual HBS case study method; in other cases, as described above, student teams will examine and present the deal to the class and, often, to participants in the actual negotiation.

Positive Political Science and Public Law I,

Shareholder Activism, Professor Lucian Bebchuk and Ms. Beth Young
This course will focus on the practice and regulation of shareholder activism in US publicly-traded companies. After examination of the legal and economic impediments to shareholder involvement in corporate affairs, we will proceed to examine the ways in which some shareholders have sought to influence the governance of firms. Here we will review in detail the regulation and practice of shareholder proposals; we shall discuss both the requirements that stockholders must meet to place proposals on the corporate ballot -- and the main types of proposals that shareholders have been putting forward, including proposals concerning majority voting, executive compensation, poison pills, and corporate social responsibility. We shall also discuss other ways in which stockholders may seek to influence firm governance, including withhold campaigns and proxy contests, and the role of the Securities and Exchange Commission in regulating shareholder actions and communications. In addition, we shall examine the different types of players in the shareholder activism landscape, including money managers, hedge funds, union and public pension funds, block-holders, and shareholder advisors such as ISS.

Venture-Backed Start-Up Company: Seminar, Professor Allen Ferrell and Mr. Richard Forrest
This seminar will focus on legal issues relevant to the development of a venture-backed start-up company. The seminar will analyze key events in the life cycle of a company from initial formation through venture financing and potential public offering and highlight the different regulatory issues, control structures and incentive mechanisms that need to be addressed. The seminar will also provide an overview of the venture capital industry and consider how certain characteristics of a venture capital fund shape its approach to investing in a start-up company. The seminar will consider issues from both a theoretical and practical perspective and will include guest speakers ranging from venture capitalists, executives from venture-backed technology companies, academics and practitioners.