Countries pursuing economic development confront a fundamental obstacle. Reforms that increase the size of the overall pie are blocked by powerful interests that are threatened by the growth-inducing changes. This problem is conspicuous in efforts to create effective capital markets to support economic development. Controlling owners and managers of established firms successfully oppose corporate governance reforms that would improve investor protection and promote capital market growth. [...]

Chapter 11 bars bankrupt debtors from immediately repaying their creditors, so that the bankrupt firm can reorganize without creditors’ cash demands shredding the bankrupt’s business. [...]

Throughout the last century, land use regulation evolved into a system in which local governments would examine significant land use projects on an individualized basis and then impose conditions tailored to mitigate the adverse effects of those projects. Informal negotiations between local governments and developers often preceded approval of the projects. However, formal contracts were avoided, largely because of constitutional concerns about “contracting away” the police power. [...]

Unmarried lovers who conceive are strangers in the eyes of the law. If the woman terminates the pregnancy, the man owes her nothing. If she takes the pregnancy to term, the man’s obligation to support her is limited. The law reflects this lovers-as-strangers presumption by making a man’s obligation towards a woman with whom he conceives derivative of his paternity-related obligations; his duty is towards his child, not towards the woman in her own right. [...]