Under the Weather: Government Insurance and the Regulation of Climate Risks

Regulating weather risk is an increasingly urgent social issue. There is little doubt that the frequency and magnitude of weather-related disasters are rising over time. Although the precise combination of causes may be debated—emissions of greenhouse gases? natural climatic cycles? increased concentration of populations in coastal areas? —the trend is undisputed. As the magnitude and frequency of weather patterns seem to pose a risk higher than ever, a large and growing fraction of humanity’s physical assets is located in harm’s way. Thus, the combination of severe natural forces and increased human exposure pose one of the major public policy challenges … Read more

The Futility of Cost Benefit Analysis in Financial Disclosure Regulation

The following post comes to us from Omri Ben-Shahar, Professor at the University of Chicago Law School and Carl E. Schneider, Professor at the University of Michigan Law School.  It is based on their recent paper entitled “The Futility of Cost Benefit Analysis in Financial Disclosure Regulation” and is available here.  

A fascinating debate is emerging: should financial regulations be subject to Cost-Benefit Analysis (CBA) just as, say, environmental regulations are? In a recent article for the Journal of Legal Studies (here), we examined financial regulation’s crown jewel—mandated disclosure—and asked what would happen if CBA were applied … Read more