The University of Chicago Law School Faculty Blog

Ambiguity in Legal Interpretation: Opening remarks

When confronted with a dispute about a statute, people will have policy preferences about how the case should come out.  They also will have opinions about what the statute means just as a matter of English and whether it’s ambiguous.  The questions that interest me and my co-authors (Ward Farnsworth and Dustin Guzior) involve the relationships between those issues.  Do policy preferences affect peoples’ judgments about what a statute means and how clear it is?  If so, is there any way to reduce that influence?

We examined these issues by surveying over 1,000 law students at various schools.  We showed them statutes and facts that the statutes might apply to; the problems were based on real Supreme Court cases.  We asked our respondents what outcome they preferred as a matter of policy preference.  Then we asked them to say whether they thought the statute was ambiguous, or what reading of the statute’s text they thought was best. 

The first result is that peoples’ judgments about ambiguity and meaning are closely entwined with their policy preferences.  People with strong preferences about how a case should come out tend to find that the statute at issue is unambiguous, and that it means what they want it to mean.  This is true even when we instruct them to put the statute’s text aside when stating their preferences, and to put their preferences aside when stating their views about the text.  They generally can’t do it.

But something interesting happens when we change the questions.  Instead of asking our respondents whether they thought the statute was ambiguous, sometimes we asked them whether they thought ordinary readers would likely agree about the statute’s meaning.  Or instead of asking them what they thought the statute meant as a matter of ordinary English, we asked them what they thought ordinary readers would think it meant.  The answers were then remarkably different.  They weren’t biased.  When saying what ordinary readers would think, the respondents, as a group, were able to give answers that were independent of their preferences about how the case should come out.

Here’s an example.  In Chapman v. United States, a statute applied a harsh sentence to anyone who distributed more than one gram of a "mixture or substance containing a detectable amount” of LSD.  The question was whether, in sentencing the defendant, the court should weigh the blotter paper onto which his LSD had been sprayed, or just the LSD itself.  We asked our respondents whether the statute was ambiguous, but we put the question to them in different ways.  The results are shown in this graph:

 


The vertical axis measures judgments about ambiguity.  The horizontal axis measures policy preferences.  The green and orange lines show the results when we ask people whether they think the statute is “ambiguous” or whether multiple readings of it are “plausible”.  The black line shows the results when we ask whether ordinary readers would likely agree about the statute’s meaning.  Notice that the black line does not vary with policy preferences nearly as much as the other lines do.
 
Here is another example.  In Smith v. United States, the defendant was arrested after trying to trade his machine gun for a bag of cocaine.  A statute imposed a long sentence on anyone who “uses” a firearm in relation to a drug trafficking crime.  The question was whether the defendant “used” the gun by trying to trade it.  We asked our respondents what they thought the statute meant.  But again we put the question in different ways.  The results have not yet been published, but they are illustrated here:




Subjects who wanted the government to win were much more likely than others to say that the government’s reading of the text was best as a matter of ordinary meaning.  They also were likely to say that the government’s position was most consistent with the intent of the statute’s drafters.  But when they are asked what ordinary readers would think the statute means, the result is the nearly flat line:  their preferences and their judgments become two different things.

These findings raise many interesting questions.  Why do these questions produce such different answers, and with such different relationships to policy preferences?  What, if anything, might they suggest about how a judge or lawyer should think about a statute’s meaning?  Of course we can’t generalize too aggressively from student survey takers to lawyers and judges who have more experience, more time to think, and more resources to bring to bear on their interpretive problems.  But the basic cognitive issue we find here may well extend to those other populations.  Everyone knows that some judges tend to read criminal statutes in the government’s favor more often than others do; yet the judges speak and often claim to feel as though they are just arguing about law.  These studies suggest how it is that this happens.  But of course it would be better to survey practicing lawyers and judges (it’s just harder to get access to those populations). 

And the surveys have other limitations, and produce other findings, and raise other questions.  But I can get to that later, since this post is long enough.  Let me invite initial thoughts, questions, suggestions, criticisms, etc., from our other participants.

Ambiguity in Legal Interpretation: A Debate

Here at Chicago, we love nothing more than a good debate, and this extends to the Faculty Blog as well. Next week we'll be featuring a conversation about Professor of Law and Aaron Director Research Scholar Anup Malani's paper "Ambiguity about Ambiguity: An Empirical Inquiry into Legal Interpretation." Along with Prof. Malani, the debate will feature Professor Einer Elhauge (Harvard), Professor William Eskridge (Yale), Chicago's own Judge Richard Posner, and Judge Stephen Williams (D.C. Circuit).

The abstract of Anup's paper is below, and you can download the complete paper here. Tune in Monday for what is sure to be a fascinating debate.

Most scholarship on statutory interpretation discusses what courts should do with ambiguous statutes. This paper investigates the crucial and analytically prior question of what ambiguity in law is. Does a claim that a text is ambiguous mean the reader is uncertain about its meaning? Or is it a claim that readers, as a group, would disagree about what the text means (however certain each of them may be individually)? This distinction is of considerable theoretical interest. It also turns out to be highly consequential as a practical matter.

To demonstrate, we developed a survey instrument for exploring determinations of ambiguity and administered it to nearly 1,000 law students. We find that different ways of asking whether a statute is ambiguous produce very different answers. Simply asking respondents whether a statute is “ambiguous” as applied to a set of facts produces answers that are strongly biased by the policy preferences of those giving the answers. But asking respondents whether they would expect others to agree about the meaning of the statute does not produce answers biased in this way. This discrepancy leads to important questions about which of those two ways of thinking about ambiguity is more legally relevant. It also has potential implications for how cases are decided and for how law is taught.

Update: Prof. Malani's co-author on the paper, Ward Farnsworth of Boston University, and Judge Frank Easterbrook will also be joining the debate.

Student Blogger - Winter WIP: Malani Asks if We Can Select Beliefs Without Evidence

Most (not all) models of human preferences are rather agnostic about the process by which we form beliefs about the world. And on the occasion that scholars do think about the subject, they general posit that people change their beliefs based on the acquirement of new information.

But this can't be right -- or at least, not always. First, people have to at some point form a set of priors, which necessarily occurs mostly devoid of factually inquiry. Second, people do seem to form beliefs about certain subjects that are not typically amenable to factual support (such as a belief in God). Third, people often seem to resist updating prior beliefs even in the face of contradictory data, indicating that belief construction can be affected by considerations other than hard data. There are situations where there might be utility considerations in "selecting" between different beliefs -- for example, someone who suffers from anxiety might prefer to believe that good things will happen in the future, because they experience a utility loss from worrying about future losses. Eliminating this loss might outweigh any utility gains from forming a more accurate belief structure about the future.

In this week's WIP, Professor Anup Malani presented the findings of an experiment designed to test the possibility of forming beliefs without evidence. The trick was to use the placebo effect, which fundamentally is the statistically measurable boost one gets from taking an action that one believes will improve performance, divorced from any "objective" reasons that performance should actually be enhanced. The (rather ingenuous) model of the study, in a simplified form, is as follows:

Student Blogger - Ambiguity about Ambiguity

Professor Anup Malani on how we know when we don't know

What are judges supposed to do when statutes are ambiguous? This question is the source of endless quantities of legal scholarship and is at the core of public debates over the proper role of judges. While the is obviously important, it is hard to see how anything really new could be said. Asking this question - how to deal with ambiguity - presupposes another, however: that ambiguity exists in the first place. How do we - or any given decisionmaker - know when a text is ambiguous? Relatively little academic work has been done on this question, which would seem to be at least as important.

Chicago's Anup Malani, along with co-authors Ward Farnsworth and Dustin Guzior (both at Boston University) attempts to fill this gap with his paper Ambiguity about Ambiguity: An Empirical Inquiry into Legal Interpretation, which was presented at this week's Works in Progress (WiP) talk at the law school. The paper is based on an empirical study of nearly 1,000 law students.

"Corporate Philanthropy and the Market for Altruism"

Todd Henderson and Anup Malani recently posted their paper "Corporate Philanthropy and the Market for Altruism" to SSRN. The abstract is below, and the paper can be downloaded here. You can also listen to Prof. Malani's discuss corporate philanthropy at a CBI earlier this year.

The existing literature on corporate philanthropy asks why corporations engage in philanthropy. But corporations are not alone in doing good works. Non-profit charities and the government also lend a hand. Together the three sectors compete in a larger market for good deeds where individuals seek to satisfy their desire to help others.

The existing literature on public goods ignores the role for-profit firms play in this market, which we call the market for altruism. Once the demand and supply for altruism is understood, asking why firms are philanthropic becomes about as meaningful as asking why Ford produces the Explorer or Apple produces the iPod Nano. Instead the question becomes how is this market different from other markets, and when are for-profit corporations best suited to supplying it. The market for altruism is special because one of the competitors - the government - also regulates competition in the remainder of the market. After analyzing the market for altruism, and explaining the comparative advantages of corporations, this paper highlights one area - tax policy - in which the government discriminates among competitors. We argue that this discrimination is not justified and propose a number of tax reforms to level the playing field and improve the efficiency of the market for altruism.

 

Anup Malani Podcast: "Understanding Corporate Philanthropy"

Last week, Anup Malani gave a Chicago's Best Ideas talk entitled "Understanding Corporate Philanthropy." Since we're feeling philanthropical ourselves, we're making a recording of the talk available here.

Here is the blurb for the talk:

Much of current scholarship views corporate philanthropy managerial waste or profiteering. In this talk, Professor Malani argues that both views are correct, and incomplete. Corporate philanthropy is the corporation’s entry into the market for private financing of public goods, also called the production of “warm glow.” This market was previously dominated by non-profit charities and the government. The feature that distinguishes corporate production of warm glow from other goods is that the corporation’s shareholders and workers are also its consumers. (Would you rather own or work for Google or Altria?) The key choices for the consumers of warm glow are whether to purchase from corporations or their competitors, and whether to do this via ownership, employment or product purchase. The talk will discuss the competitive advantage of corporations over charities and the government, and the importance of tax law in determining how consumers purchase warm glow from corporations.

Malani CBI: Valuing Laws as Local Amenities

On Wednesday, April 25, 2007, Professor Anup Malani delievered a Chicago's Best Ideas talk on "Valuing Laws as Local Amenities." Professor Malani thinks we go wrong in trying to determine the value of a law only by its direct effects - he argues that by looking at the effect that any given law has on wages and property values, we can determine the relative value of all laws. This allows us to treat laws just like any other community amenities, such as the fixing of potholes or the building of a swimming pool. Listen to the talk here, and read the full blurb after the jump.

Coase Lecture: Culling Chickens

The annual Ronald H. Coase Lecture in Law and Economics is geared towards our first year law students. This year's lecture, on January 23, 2007, was delivered by Professor Anup Malani and titled "Culling Chickens." Professor Malani spoke about prevention of the spread of avian flu in chickens, particularly, although not exclusively, in third world countries. Much of the discussion centered around the economic principles that go into determining the appropriate rate to pay for potentially-diseased chickens in order to ensure that farmers will indeed turn them over for slaughter.  A lively Q&A followed, and you can listen to the whole thing here.

Housing, Wages, and Malani

Anup Malani’s latest paper argues that perhaps the best way to evaluate a law is to look at how the law affects housing prices and local wages. The intuition is that a good law will make the relevant community more attractive, which in turn will cause housing prices to rise and wages to fall. That is, a good law will increase the number of people who want to live in a given community, and that will drive housing prices up and push local wages down.

Malani recently asked for examples of legal rules for which this story sounds plausible, in essence looking for things that might influence a person when they choose where to live. When debating whether to live in Hyde Park or Highland Park, Anup asks, is it plausible to think that people inquire about local land use regulation, criminal enforcement, and the like? With respect to schools the answer is surely yes; but Anup wants to know if the same dynamic applies on the state level to tort law or on the local level to criminal enforcement or parking issues.

Two reactions.

Valuing Laws as Local Amenities

I recently started a paper which argues that the value of a law should be judged by the extent to which it raises housing prices and lowers wages.   This may seem an odd way to assess the welfare effect of a law.  After all, higher housing prices and lower wages are thought to be bad outcomes, not good ones.  But the proper way to understand these changes is as signals of positive outcomes, not positive outcomes themselves.  They indicate that something good has happened in the community.  Housing prices go up because more people want to live there.  Wages go down because more people want to work there.  Phrased more formally, higher housing prices and lower wages are how markets ration an attractive local amenity.  Indeed, the increase in housing prices combined with the reduction in wages provides a measure how much people are willing to give up to enjoy the amenity.  Conventional economic thinking recognizes this when it comes to estimating the social value of a new park or a better school.  The same logic, I argue, applies when the amenity is anything from a better tort system to smarter rules regarding capital punishment.