Scene from Yale University on Commencement Day in 2015 (f11photo/shutterstock.com).Competition Can Improve on Apparent Market Failure
The Larger Lessons of Increased Collaboration Among Law Professors
One of the most striking changes since I have been a law professor is the rise in the number of legal articles written jointly. This increase in collaboration is of more than academic interest because the reasons for it are leading to greater collaboration in other areas, too. The result will be greater prosperity and human flourishing.
First, joint authorship has grown with interdisciplinary scholarship. Increasingly, law is the subject of inquiry in other disciplines – economics, political science and psychology prominent among them. But those with expertise in these areas frequently lack institutional knowledge of and practical experience in law. They can strengthen their arguments by partnering with law professors more sophistication about these matters, who, in turn get the advantage of more disciplined frameworks of social science. We see the same phenomenon in public policy, where different kinds of knowledge are more regularly pooled, resulting in a fuller, less one-dimensional view of the world.
Second, many law professors also team up in their research, even if neither have interdisciplinary backgrounds. The modern legal academy is marked by increased competition for both students and faculty. Standards for productivity and quality have clearly risen even in my two decades in the businesses. One way of competing better is to combine forces.
For More Privatization and Less Unionization at the TSA
I travel a lot and one of most unpleasant problems I encounter is the TSA. The lines are frequently long and the employees on occasion discourteous. But the most annoying aspect is that I have very little confidence that its procedures are well designed to keep us safe or that its personnel even assiduously follow these procedures. Over the summer confirmation of my fears came in the form of Homeland Security’s revelation that in over ninety percent of the instances, a “red team” designed to test security got through with some sort of dangerous contraband. Such failures should force us to reconsider the structure of TSA.
What the agency most needs is more private competition. Currently few passengers go through private screening. If the agency put more private contracts out for bid, the government could incentivize better results. The contracts could include clauses that would reward companies for passing the tests that the government run screening has so miserably failed. More competition would also aid innovation and efficiency over time. A centralized bureaucracy is unlikely to come up on its own with the all best ideas. At first, the government could continue to centralize various aspects of security, like background checks of screeners. But even those could be outsourced as if contractors could show that they had better methods.
The government should also reconsider unionization of TSA screeners currently employed by the agency.
The Battle for Open Skies
An article in the New York Times this week described how domestic airlines are conspiring with their unions to weaken open skies agreements. These agreements permit American and foreign carriers access to one another’s markets on a reciprocal basis. They empower airlines to decide where and how often to fly internationally, based on market conditions, not national quotas or other irrelevant considerations. The result are good for airline passengers. Fares become lower, and more international flights go from more cities in the United States to more cities abroad.
The most troubling aspect of the article was that the Secretary of Commerce, Penny Pritzker, and the Secretary of Commerce, Anthony Foxx, were entertaining the American airlines’ and unions’ request for restrictions on the entry of new foreign airlines into the American market. Their complaint is that deep pocketed airlines from the Middle Eastern countries, like the United Arab Emirates, were engaging in “unfair” competition and thus their flight plans needed to be blocked.
These Secretaries should have directed the airlines and their unions to take their complaints to the Justice Department, because competition laws are the best way to assess whether the foreign airlines are acting anti-competitively.
