| In this dissertation, I explore three questions in law and economics.; First, I discuss the contracting out of government services. The privatization literature depicts contracting out as a tradeoff between excessive private cost saving and inadequate public quality improvement. I show that monitoring can improve the private sector but not necessarily the public sector.{09}Monitors are capturable, which may decrease social welfare. Welfare losses from capture may be greater for public provision: monitors of public providers may be more capturable because monitors often indirectly benefit from public provision. A purchaser-provider split and a monitor-provider split may be prudent on efficiency grounds.; Next, I investigate the effect on wages of the expansion of products liability. The expansion of products liability has two effects: a "labor supply-side effect," where workers accept a lower wage for increased tort insurance for on-the-job injuries, and a "labor demand-side effect," by which the value of workers' marginal product decreases as the cost of the product they produce comes to include tort costs.{09}Comparative negligence decreases wages by about 4%, two-fifths of which is a supply-side effect. Strict liability for manufacturing defects slightly increases wages; four-fifths of this is supply-side. The expansion of the tort system affects not only wages but also employment.; Finally, I propose a solution to a longstanding puzzle of economic history. In medieval Europe, tenant farming became more common relative to direct management, while in thirteenth-century England, this trend briefly reversed. Also, sharecropping was common on the Continent and between English peasants, but rare in England between tenants and lords. I model contract choice as a tradeoff between incentives for high effort and risk-bearing. Sharecropping is ruled out between English tenants and lords because of pleading requirements for the writ of debt in royal courts. Leasing increases as outside options for peasants improve, small landowners are more likely to manage their land directly, and large landowners are more likely to lease small estates than large ones. With insecure property rights, improved freehold protection increases direct management and improved leasehold protection increases leasing. The trends in contract form match the timing of legal changes. |
