Empirical Legal Studies


Measuring the Chilling Effect

Brandice Canes-Wrone, Michael C. Dorf

Supreme Court doctrine grants special protection against laws that “chill” protected speech, most prominently via the overbreadth doctrine. The overbreadth doctrine permits persons whose own speech is unprotected to challenge laws that infringe the protected speech of third parties. The Court has not generally applied overbreadth and the other speech-protective doctrines to other constitutional rights even though other rights could also be subject to a chilling effect. The case law simply assumes that the chilling effect only acts on the exercise of speech, and that this justifies treating speech differently from other rights.

We tested these assumptions with respect to abortion rights. By comparing abortion rates with state laws over a two-decade-plus period, we found a statistically significant correlation between laws forbidding late-term abortions and the reduction of not only late-term but also “near-late-term” abortions, i.e., abortions in the roughly one month before the period in which abortions are forbidden. That effect persists even after controlling for potentially confounding variables, such as the number of abortion providers and pro-life public opinion. Moreover, the effect is not limited to the year of enactment or associated with failed policy initiatives, suggesting that the impact is due to the law itself rather than associated publicity. These findings are consistent with, and strongly suggestive of, a chilling effect on abortion providers and/or women seeking abortions. This result undermines the implicit assumption that the chilling effect is unique to laws regulating speech and vindicates the general proposition that laws can chill the exercise of constitutional rights beyond their literal coverage.

Rhetoric and Reality

Rebecca L. Brown, Andrew D. Martin

Testing the Harm of Campaign Spending

In its landmark campaign finance decision Citizens United v. FEC, the Supreme Court found that favoritism or influence over elected officials gained by wealthy campaign contributors does not—in the absence of outright corruption—give rise to the sort of constitutional harm that would justify restrictions on campaign spending. The Court was also insistent that any perceptions of ingratiation would not undermine the electorate’s faith in democracy. This paper challenges the doc- trinal and empirical underpinnings of those assertions. We argue that a loss of faith by the electorate implicates a central constitutional value and is a sufficiently compelling interest to justify campaign finance regulation. We also demonstrate empirically that the Court should not have been so confident that the elecorate’s faith in democracy is unaffected either by the appearance of influence or access due to campaign spending or by independent expenditures.

Testing Shaw v. Reno: Do Majority-Minority Districts Cause Expressive Harms?

Stephen Ansolabehere, Nathaniel Persily

The Supreme Court’s decision in Shaw v. Reno established an “analytically distinct” constitutional claim of racial gerrymandering for majority-minority districts drawn predominantly on the basis of race. The case was and continues to be controversial, because the precise nature of the injury caused by such districts has been a persistent source of debate. Shaw districts did not minimize a group’s representation, but rather they communicated an “expressive harm” due to signals they sent to the electorate and representatives that the jurisdiction relied too much on race in the construction of a district. Such districts, the Court argued, communicated racial stereotypes that individuals belonging to the same racial group were politically interchangeable, despite their many social and economic differences. This paper tests the “Shaw hypothesis” with recent survey data. We find no patterns in racial attitudes based on the shape and racial composition of a congressional district. We do, however, find substantial and expected gaps among racial groups concerning attitudes toward the practice of majority-minority districting, Section 5 of the Voting Rights Act, and job approval of the respondent’s representative.

Set in Stone? Change and Innovation in Consumer Standard-Form Contracts

Florencia Marotta-Wurgler, Robert Taylor

Standard-form contracting is the engine of the mass-market economy, yet we know little about what drives it and what factors are associated with its evolution. Understanding change and innovation of the substance, length, and complexity of fine print in the consumer context can help regulators identify sources of potential intervention as well as help them evaluate the effectiveness of mandatory disclosure regimes, which are commonly used as consumer protection tools. This Article studies the rate, direction, and determinants of change in consumer standard-form contracting. We examine what changed between 2003 and 2010 in the terms of 264 mass-market consumer software license agreements. Thirty-nine percent of contracts materially changed at least one term, and some changed as many as fourteen terms. The average contract became more pro-seller as well as several hundred words longer. The increase in length is not due to the use of simpler language. Contract readability has been constant: The average contract is as readable as an article in a scientific journal. The variance of contract length has grown, as has the variance in overall pro-seller bias, resulting in reduced contract standardization over time. Firms that were younger, larger, or growing, as well as firms with inhouse counsel, were more likely to change existing terms and to introduce new terms to take advantage of technological and market developments. Contracts appear to respond to litigation outcomes: Terms that were increasingly enforced by courts were more frequently used in contracts, and vice-versa. The results indicate that software license agreements are relatively dynamic and shaped by multiple factors over time. We discuss potential consumer protection implications as a result of the increased length and complexity of contracts over time.

Market Conditions and Contract Design: Variations in Debt Contracting

Albert Choi, George Triantis

Scholars have catalogued rigidities in contract design. Some have observed that boilerplate provisions are remarkably resistant to change, even in the face of shocks such as adverse judicial interpretations. Empirical studies of debt contracts and collateral, in contrast, suggest that covenant and collateral terms are customized to the characteristics of the borrower and evolve in response to changes in market conditions, such as expansion and contraction in credit supply. Building on the adverse selection and moral hazard theories of covenants and collateral, we demonstrate that an expansion (contraction) of credit will lead not only to a decrease (increase) in the interest rate but also a reduction (expansion) of covenants and collateral through lessening (worsening) adverse selection and moral hazard problems. We conclude with some empirical implications of this analysis.

The Dynamics of Contract Evolution

Stephen J. Choi, Mitu Gulati, Eric A. Posner

Contract scholarship has given little attention to the production process for contracts. The usual assumption is that the parties will construct the contract ex nihilo, choosing all the terms so that they will maximize the surplus from the contract. In fact, parties draft most contracts by slightly modifying the terms of contracts that they have used in the past, or that other parties have used in related transactions. A small literature on boilerplate recognizes this phenomenon, but little empirical work examines the process. This Article provides an empirical analysis by drawing on a dataset of sovereign bonds. We show that exogenous factors are key determinants in the evolution of these contracts. We find an evolutionary pattern that roughly separates into three stages: stage one when a particular standard form dominates in the absence of external shocks; stage two when there are external shocks and marginal players experimenting with deviations from the standard form; and stage three when a new standard emerges. We find that more marginal law firms are likely to be leaders in innovation at early stages of the innovation cycle but that dominant law firms are leaders at later stages.