Quantitative Model for Measuring Line-Drawing Inequity
The law draws lines. It draws lines between manslaughter and murder, negligence and gross negligence, speeding and driving legally, and capital gains and ordinary income. Those lines invariably cause undesirable results. In particular, lines in the law cause inequity because they impose different treatment on similarly-situated persons. Despite line-drawing’s inequity, analysts generally shun inequity and embrace the quantitative comforts of inefficiency analysis. This Article introduces a quantitative model for measuring inequity, so the preference for quantitative measures no longer justifies the disdain for inequity analysis. Instead, democratic and philosophical ideals should make now-quantifiable inequity analyses the analytical tool of choice.The quantitative model introduces a robust method for measuring line-drawing inequity. The quantitative information it provides illustrates that the location of a line affects the amount of inequity line-drawing causes. The model provides an opportunity to test and rethink the relationship between equity and efficiency. It demonstrates that the governed may reduce line-drawing inequity by altering their behavior to avoid negative line-drawing effects. The model also provides quantitative evidence that the perceived tension between equity and efficiency analyses is misinformed. In fact, the model shows that efficiency and equity may correlate in the line-drawing context. Finally, the Article illustrates that the criteria used to draw a line may result in the inappropriate orientation of the line. The Article concludes that excessive inequity may signal a need to change the orientation of a line or otherwise alter the law to reduce line-drawing inequity.
Residual-Risk Model for Classifying Business Arrangements
Tax law classifies business arrangements as one of three general structures: (1) disregarded arrangements, (2) tax partnerships, or (3) tax corporations. Since the enactment of the income tax in 1913, tax law has struggled unsuccessfully to develop an ideal model for classifying business arrangements. The current model’s sole virtue is its simplicity, derived from formalistic, elective attributes. Its greatest shortcoming may be that it disregards the reasons parties form business arrangements and the reasons they use economic items to reduce rent-seeking behavior and agency costs. That disregard often allows business participants to choose their tax classification and minimize their taxes, which erodes the tax base and shifts tax burdens to others but does not alter the parties’ economic relationships. This Article rejects the current model and presents a classification model based on the economic theory of the firm. Economic theory aids classification in three respects. First, it helps explain why parties form business arrangements. Second, it views business arrangements as nexuses of contracts composed of various parties. This view helps identify the economic aspects of business arrangements and the economic rights of business participants, irrespective of legal form. Third, economic theory demonstrates that residual risk (the right to the residual assets of a business) measures the economic interests parties have in business arrangements. In particular, residual risk helps distinguish between arrangements that can trace income from its source to the owner of the source, or from allocations to the beneficiaries of those allocations, and those that cannot. That knowledge clarifies the appropriate tax regime for all arrangements and leads to the residual-risk model for classifying business arrangements.
An analysis of patients discharged from a hospital‐based glaucoma case‐finding clinic over a 3‐year period
Purpose:  To analyse the false positive referrals by community optometrists to a glaucoma case‐finding clinic over a 3‐year period.