Final Exams (Suggested Templates)


Image result for confused tearing out my hair


In light of the recent election and the desire of professors to remain relevant, here are some suggested templates for use in drafting final exams within your department.


What does the high-end commercial construction business teach us about how to run the federal government so as to improve the American economy and the welfare of the American people?   (maximum word count: 28 words)


“Amateurs and Professionals”

The amateur/professional distinction is long-standing in western thought.  In light of the recent election, please explain which is which, how one can tell and whether it’s all going to be amateurism from here on out.    (Please note that use of definitions, stipulations, the ideal observer or the like will be penalized.)

Political Science

We do not have exam templates for you.  Please contact your department chair as soon as possible.   This major and the department have been discontinued.   Exams are canceled. Tenure relocation pursuant to Regent Rule 10-5-23 in Journalism or Theater Arts is advised where possible.  For further career advice, see  http://kremlinology–WTF happened?


We do not have exam templates for you.  Please contact your department chair as soon as possible.   This major and the department have now been merged into Theater Arts.

Theater Arts

We do not have exam templates for you.  Please contact your department chair as soon as possible.   This major and the department will continue, but all classes and workshops are canceled.   It’s all a four-year Twitter externship from here on out.  (Good luck with that).

Bonus Question

What do cultural conservatism, proto-fascism, crony capitalism, industrial policy, free-range ignorance and white supremacy have in common?  (maximum word count: 1 word).


For further context on the above templates, see generally The Knowledge Bubble by Schlag.  (Aw hell, see just about anything by Schlag.)


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This is Not a Law Review Article

By Pierre Schlag *

March 31, 2016

Keywords: law review article, absurd, cass sunstein

Abstract: This short piece [does not] describe the form, structure and vexations of the law review article qua scholarly artifact. It also [does not] contain Professor Max Stein’s latest thoughts as articulated in Schlag’s recently published novel, “American Absurd.”


This is not a law review article. In an earlier version, it was a law review article. Here specifically—in the last post. But now, it is no longer a law review article. It is not a law review article because a “processor” at SSRN determined that it was not “sufficiently scholarly.” Accordingly, it was not sent out to the e-journal editors, but merely posted on SSRN as a kind of stand-alone text.  And so it exists in a kind of cyber-version of what used to be called, “the limbo of the infants.”  Or to put it in a  more wizened idiom: “Forget it Jake—it’s not listed.”

In my youth (i.e. last year) I would have railed against the machinations of bureaucracy, the insidious enforcement of categorial matrices that screen out the deviant and the interesting (in my case, hopefully a combination of the two).

But now I am tired. I have dwelled too long in the leisures of laudanum to muster the energy for it. The most I can do, at this point, is take a quiet resigned pleasure that it has come down to this: My work has been rejected by a “processor.”

Actually, this quiet resignation thing is not entirely true. More accurately, it is false—in fact a concatenation of lies, a veritable feast of falsehood. In fact, the real truth of the matter is that I am nearly bursting with joy.

Think of it: My work has been screened out by an SSRN “processor”!   Now, I ask you:  What more fitting end can there possibly be for the moniker “pierre schlag,” than to be screened out—“approved” but “not distributed” (this is SSRN lingo)—by a “processor”? A processor no doubt following protocols—protocols that you and I both know must exist (and that we both recognize as necessary to an endeavor like SSRN).

Still, never in my wildest dreams had I anticipated that the end could come like this–Indeed, how could I possibly ever (ever) write anything again after this?  I mean, it doesn’t get–it couldn’t possibly get–any better than this. This is “Spam Jurisprudence” confirmed. “The Faculty Workshop” operationalized. “Dinner at Langdell’s” served.  I mean this is the sort of performative confirmation of all that stuff I’ve been saying for years about pre-figuration, screens, indicators, proxies, standardization, automaticity.   To me this is manna from heaven.

Now I must say that I do not actually know (I did not ask SSRN) why my article was deemed “insufficiently scholarly.” And it’s not as if the SSRN processor—Is this a person? A program? A hybrid? —could not have had reasons. It could have been the mock advertisement for fictional tenure services in the middle of the article. It could have been that I quoted a fictional academic character from my recently published novel “American Absurd” (now available on Amazon here).   Or maybe it’s the bizarre but tenacious either/or notion that if something is funny, it couldn’t possibly be serious. Or maybe–just maybe–the processor made a substantive determination that there wasn’t sufficient scholarly content.

That could well be. It is a very (very) short piece after all. And deep or sustained—it surely is not. So it’s arguable that it’s not sufficiently scholarly.  It is not a crazy idea by any means.

Still, think about the relevant baseline here.

O.K.   Moving on.

So this is where things stood a few days ago. And then I blew it. I totally (totally) tear-my-hair-out bite-my-fingers blew it. The chance of a lifetime and I—you will not frigging believe this—appealed to SSRN. Yes. I did. And the SSRN staff has been nothing but courteous, helpful, and professional.   And timely too.  The result—now you see where this is going—is that SSRN has agreed that “The Law Review Article” should after all go out of to the e-journal classifiers. The determination of the processor has been vacated.   Yep. And it is all my doing. I did this to myself. (If you need a visual, simply picture here the Chris Farley SNL skit where he is tearing his hair out and yelling, “So stupid. I’m so stupid.”)

Anyway,  as a result of all this, the determination of the processor has been vacated. So in all likelihood, there is no real future for “This is Not a Law Review Article,” In all likelihood, that is a version that I will never write. Or if it is to be written, it would have to be done very quickly—before the classifiers decide to distribute the earlier article. Even then, we know that there wouldn’t be a much of a future for the piece.

So it goes. I am reconciled. Anyone seen my boulder?

Update 4/3/2016  (The article is being distributed.  “This is not a Law Review Article” is being considered for limbo.)

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The Law Review Article

Just posted on ssrn and bepress:

The Law Review Article

By Pierre Schlag *

March 11, 2016


Keywords: law review article, absurd, cass sunstein,

Abstract: This very short piece describes the form, structure and vexations of the law review article qua scholarly artifact. It also contains Professor Max Stein’s latest (fictional) thoughts as articulated in Schlag’s recently published novel, “American Absurd.”


The most important thing at the beginning of a law review article is to excite the reader’s imagination, to evoke the hope that what comes next is truly gripping. A page-turner. Something totally out of the ordinary. Perhaps not even a law review article at all. Once this moment is reached,….

[For the rest see here on ssrn or bepress]


“American Absurd”

Available on Amazon March 15th:

Front Cover 3D Square Canvas Small[2].jpeg




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American Absurd

Square Ad[1] copy(Pre-order from Amazon)

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Dear Black People, Part Two

Nine African Americans—a beloved pastor, a track coach, and a grandmother among them—were murdered by a White racist who, in his own words, hoped to spark a civil war and get his country back. It is obvious that the killer/terrorist is a product of racist thinking, overt as well as of the dog whistle variety. He may also be deranged, psychopathic, and so on. But even if he is mentally infirm, his deficiency followed a well-worn path created by rational people who embrace the color line either because they benefit from it or are afraid to be without it. In addition to this layer of rational racists, there are strata of White people who do not think of themselves as racists, and who may even actively oppose racism, but whose lives and economic wellbeing are better off for being White and not Black, and therefore who also bear responsibility for the production of this White racist killer. Who are these White people? All of us.

And here is where I have to bring up Rachel Dolezal—not the actual person, whom I cannot possibly know, but Rachel Dolezal the symbol. What she symbolizes is the White person who opposes racial hierarchy and discrimination but who cannot tolerate the discomfort of being White. Being White is not everything that White people are. In my case, being White goes along with being female, Jewish, and, like all of us, many more particular and individual things. I am not just White.

But being White, and not Black or Brown or Native, includes benefitting from the privileges that accompany a socially constructed status that is at the top of the racial hierarchy. To pretend otherwise is to deny the very structures of racialized thought that anti-racist Whites purport to oppose. Being an anti-racist White person is therefore constantly uncomfortable and difficult. We have to face, on a regular basis, that we (not personally, but as beings situated in a structure of inequality based on race) are part of the problem. We can, through individual and allied efforts, strive constantly to undermine the structures that benefit us and harm others. And many White people do. But there come these moments, like now, when we must also stand apart and simply say we are sorry. We hate this, but we are not suffering the same way you are. Tomorrow, we will again channel our discomfort into trying, with all our might, to eradicate the conditions that make me White and you Black. And until then, we will cry next to you and for you, but not pretend that our experiences are yours; that your pain is ours.

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Dear Black People

Dear Black People,

I just wanted to write to say I am sorry about Michael Brown, Eric Garner, Tamir Rice, and the others too numerous too list.

About Brown, the process that resulted in a decision not to indict Darren Wilson was so unusual as to appear rigged. Prosecutors rarely cross-examine and express skepticism about their pro-indictment witnesses. They also typically do not launch a wide-ranging investigation into all the possible explanations for the alleged crime. Nor do they fail to instruct the grand jury about the charges they are seeking. For that matter, state prosecutors, including those in Missouri, can charge defendants without going through a grand jury at all. Even we white people, who fail to see so much of the bias that affects you, can see that this proceeding was, for lack of a more polite word, f*cked up. As the details seep about about the failure to indict Daniel Pantaleo, Eric Garner’s killer, the story appears to be similar. A grand jury, the saying goes, can indict a ham sandwich. But apparently a grand jury cannot indict a white police officer for killing an unarmed African American man.

And I am sorrier still for the conditions that surround the deaths of all these African American men. They include the high rate at which police kill young black men generally. They include the continuing inequality of income, wealth, employment, and education for black people. They include the government and private sector’s role in all of these phenomena: our history of redlining African American and integrated neighborhoods, our history of disinvesting in public institutions in ways that have discriminatory effects, our history of eliminating public sector jobs that benefit rising working and middle class African Americans, our history of disproportionate criminal prosecution and sentencing, and most of all, for the fact that none of this is only history. It is our present too.

I am sorry that much of this has gotten worse, not better, under the watch of our nation’s first African American president. Many of us, if I might speak across the racial divide for a moment, had great hope that President Obama would lead us all to a more honest understanding of race and its continuing role in subordinating millions of African Americans. But instead, his presidency seems to have brought out the worst in some of our fellow citizens. Their racism against him has made it harder to address the structural barriers to equality–inadequate health care, drastically unequal education, huge disparities in wealth, and so on–that compound racial discrimination. To be clear, I do not blame the President for the entrenchment of racial discrimination. Yet it is a grievous disappointment that his election did not signify the beginning of something better, something closer to the erasure of the color line. But it did not.

I am sorry that your sons and daughters are not safe, that they cannot goof off, go shopping, rent apartments, walk or drive in some neighborhoods, and myriad other everyday activities, without your worrying about them. Will they come home? Will they get arrested? Will they have that first moment of realizing they are different, that the world views them differently, that they are less free?

Finally, I am sorry to be writing to you as a group. I know you are not one big family, a monolith that experiences everything the same way. I do know that. But I also know that white people have not kicked their habit of racism, of not seeing what is inconvenient and unsettling to see. So, dear Black People, I have little to offer other than these words and the hope that some day, through conflict, struggle, the hard work of politics and the occasional soaring communion of high ideals, we may reach a day when we white people get it– when no one is disposable, when everyone matters, and everyone gets justice.

With respect and love, White Person

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Coase’s Conception of Production Factor Costs (and the Coasean Challenge)

Here I want to lay out Coase’s conception of production factor costs as articulated in The Problem of Social Cost.  Coase’s conception of production factor costs has very significant implications for what might be called the “Coasean Challenge”–a challenge which in my view has been all but ignored by Chicago Law and Economics.  We start with the Coasean Challenge and then show how Coase’s conception of production factor costs greatly amplifies the difficulties of that challenge.

The Coasean Challenge

In The Problem of Social Cost, Coase deals with the “harmful effects” that result from conflicting resource use (e.g. cattle ranching and farming).  In his article, Coase identified the then-dominant “Pigouvian” approach, as follows:   First, the harm from resource conflict is identified as an “externality” (Coase did not use the term for good reason) and second some sort of government regulation (a tax, a liability rule, etc.) is imposed.

Coase was highly critical of this approach.  He argued that harmful effects can be addressed in a number of ways–not simply, government regulation, but by the market or internally by the firm.  In The Problem of Social Cost, Coase deftly showed that at least sometimes, government regulation would be less desirable economically, then doing nothing and letting the market and the firms fashion their own arrangements.

It is clear both in terms of Coase’s general orientation and the tenor of The Problem of Social Cost that Coase was trying to correct what he perceived to be an overly enthusiastic endorsement of government regulation by economists. As he put it: “All solutions have costs and there is no reason to suppose that government regulation is called for simply because the problem is not well handled by the market or the firm.” (Coase pp. 18–19.)   Right.  But Coase was a scrupulous thinker and thus he recognized that, on some occasions, regulation might be preferable. In a passage which could not possibly be quoted enough (and probably ought to be committed to memory) Coase wrote:

There is no reason why, on occasion, such governmental administrative regulation should not lead to an improvement in economic efficiency. It is my belief that economists, and policy-makers generally, have tended to over-estimate the advantages which come from governmental regulation. But this belief, even if justified, does not do more than suggest that government regulation should be curtailed. It does not tell us where the boundary line should be drawn. This, it seems to me, has to come from a detailed investigation of the actual results of handling the problem in different ways.(Coase pp. 18-19 ).

This brings us within reach of the Coasean Challenge.   This challenge is simple enough to elaborate (somewhat harder to resolve).  For Coase, in any situation where there are conflicting resource use problems and thus attendant harmful effects, there are three major solutions available: the firm, the market, and government regulation.

Recall Coase’s rancher/cattle hypothetical. If the cattle are not restrained in some way, they will eat the farmers crop. This is what Coase calls a “harmful effect.”  What to do?  Answer–at  least according to Coase: There are  three systems of coordination available.  (Today we would list more, but never mind).  Here they are:

1.  The Firm: If somehow the rancher and farmers were subsumed in a single firm (merger, buyout, etc.) then the firm’s profit maximization incentive would push toward an efficient solution. If it was more remunerative to allow free-range for the cattle, the firm would do that. If instead, protecting the crops from the cattle were more attractive, the firm would build a fence and do that.   The upshot here is that one solution to a conflicting resource problem is to subsume the two conflicting activities within a single firm.

2. The Market: Another option (not unrelated to the first one) is to allow the market actors (ranchers and farmers) to strike a deal on the market. Coase’s notion of opportunity costs means that each actor has to consider the possible receipts not just from its own respective productive activities, but from each other. Hence, the farmer may increase receipts by curtailing farming in exchange for a payment from the rancher. Or vice versa. If transaction costs are too high, however, and they cannot afford to strike a deal, whatever the law establishes as the baseline or default legal regime (Rancher liability for harm to crops? No liability? Something else?) will remain the final one.

3. Government Regulation: Yet a third option is to use law or government regulation to address the harmful effects problem. The effort is to try to decide what would be the optimal arrangement and impose it through law–taxes, liability rules, mandatory rules, etc.

In the Coasean world, these are the basic options.  Coase at times writes as if these coordination systems were analytically distinct. But one should not make too much of this: His key point is that each has effects upon and is dependent upon the others.   And indeed, it is obvious at this late date that 1) each is always attended and affected by the others and 2) there are a rich panoply of options or mixes of these different coordination system. (Note in this respect that Sunstein’s and Thaler’s “nudges,” Ian Ayres “altering rules” and the ubiquitous sticky/non-sticky defaults are simply some of the currently more popular or at least most visible elaborations of this point.)

And now we can articulate Coase’s Challenge: How are we to choose among the three coordination systems?   Which ones should we tinker (or not tinker) with?    More specifically: Should we leave well enough alone (the do-nothing strategy) and let the market and/or the firms adjust? Should, we instead use the law to tinker with the market (perhaps enable a market to emerge)?   Should we tinker with the law so as to induce the firms to reorganize (i.e. consolidate ranching and farming activities)?  Should we decide that transaction costs are such that there is nothing to expected from changes in the markets or the firms and thus we should impose some tax, liability rule, new property definitions, etc.? Or should we decide to the contrary that even though we cannot expect the market or the firms to reorganize (no matter what we do with the law) we would be better off nonetheless doing nothing?

Coase was keen on making sure we understood this last point (this is the main lesson of his train sparks hypothetical), just because we have a harmful effect and neither the firm nor the market handle it well, this does not mean that we will necessarily be better off with government regulation.  It may be that in terms of economic performance, the best thing to do is to let the harmful effect occur.  This (perhaps surprisingly) brings us to the notion of “production factor cost.”

Coasean Production Factor Costs

In neoclassical economics, a production factor cost is basically the cost of an input in production—usually, conceived as land, capital, and labor. Sometimes economists suggest additional categories (e.g. technology, education, knowledge, entrepreneurship) and then a debate ensues (one I don’t wish to join) about whether these are in fact distinct production factor costs or whether they really are aspects of the original big three (land, capital, and labor). For our purposes, a production factor cost is the costs of inputs in a production enterprise.

Now, the interesting thing is that Coase offers a different take on production factor costs—different at least from most of his fellow economists at the time.  Specifically, Coase recognizes the role that law plays in deciding what is a production factor cost of what?  Economists, he argues, should think of production factor costs less as the costs of physical things and more in terms of legal entitlements.

Take the familiar example of a steel factory emitting smoke that damages nearby commercial activities (e.g. a laundromat). Coase’s point is that if the steel factory is prohibited from emitting smoke by regulation then smoke abatement (or cessation) becomes a production factor cost of producing steel. If by contrast, emitting smoke is allowed with no legal consequence, the smoke damage becomes a cost of any activity potentially damaged by such smoke. In other words, the law (the way it is structured and organized—liability, no liability, tax, regulation, etc.) effectively decides, in many cases what is a cost of what. Coase makes the point very clearly in the concluding sections of The Problem of Social Cost:

A final reason for the failure to develop a theory adequate to handle the problem of harmful effects stems from a faulty concept of a factor of production. This is usually thought of as a physical entity which the businessman acquires and uses (an acre of land, a ton of fertiliser) instead of as a right to perform certain (physical) actions (Coase pp. 43-44).

This moment is huge.   It is huge because it is an affirmation that law plays a crucial role in establishing production factor costs—the kind of costs (identity—e.g. cost of abatement, cost of relocation, cost of…) and their magnitude (dollar amount). Coase, a free market proponent (at least in inclination) is corroborating what many of us who grew up on the Robert Lee Hale–Duncan Kennedy axis of economics believed all along—namely, that law plays a crucial role in establishing the costs of goods (of all kinds).  Law (common law, constitutional law, etc.) is undeniably and intimately involved then in the disbursement of penalties and subsidies (deciding what is a cost of what?) to various activities.

I say penalties and subsidies in the sense that we are socializing the costs of private activities through law and we have no neutral baseline available to tell us across the multitude of existing and potential markets which markets and which activities we should subsidize or penalize how much when.

Now, if we can bring in the Coasean Challenge, as described above, the question arises: in cases of conflicting resource uses, what aspects of the coordination systems should we tinker with—let the firms and the market deal with it? Change the law in some way? Do nothing? Notice that this was a daunting question even before we started thinking about the Coasean conception production factor costs.  Now that we are confronted with Coase’s legalist conception of production factor costs, the challenge has become even more difficult. Why? Because it now looks like when we change the law (or keep it the same) we are unavoidably affecting the size and magnitude of the production factor costs of various private production activities. So how much should we subsidize or penalize them (size) and what costs should we, in fashioning our law, impose on them (magnitude)?   There is even the further question–fodder for a later post: what kind of cost is to be allocated to which coordination system: the firm, the market, the law?  But bracket that for now.

It is perhaps surprising, but Coase has effectively shown that law (common law, constitutional law, etc.) is in effect a socialization of costs.   Such socialization is unavoidable.  Even the most libertarian or laissez-faire regimes are involved in such socialization of costs.

The only question worth arguing after Coase then is how to talk about this socialization of costs.  For that purpose the broad-gauge and deeply cliched disputes about “big government” versus “the free market” or “individual freedom” versus “command and control ” (or even “nudge” versus “mandatory rules”)  are rather crude.    Rather we should face up to much more circumspect, interesting, and important questions on which we might actually make some headway (or at least carry out some useful experiments): which costs and whose costs do we want to socialize when for how long by what means?   This, of course, is an obviously political question (the distributive justice stakes are high)… but my point… is that it is also inexorably an economic question as well and that the failure to confront this question yields not only bad politics, but bad economics.   Coase Minus the Coase Theorem contains the full argument.

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