Section numbers correspond to the Research Program Report 2005-2007

The Institute also continues its tradition of investigating applied topics concerning collective goods. This research is complementary to the more fundamental research summarized in Sections C.I and C.II: On the one hand, the principles that emerge from the more fundamental research provide guidance for the analysis of applied issues; this guidance is needed to avoid the danger of provincialism in studying special applications. On the other hand, the applied issues themselves serve as a proving ground for abstract ideas, also as a source of new ideas. The latter is particularly likely when different applications turn out to involve common themes.

As applied topics we have chosen:

• The organization and regulation of network industries, and
• Financial stability and the regulation of financial markets and financial institutions.

Our choice of these topics was to some extent motivated by considerations of comparative advantage, based on past research expertise, as well as the scope for interdisciplinary research by jurists and economists. Apart from making progress on these topics in their own right, we are also keen to explore the parallels and links between them.

Our choice of these topics is not meant to be exclusionary. Indeed, in some of the work on which we report under the heading of network industries, we have crossed boundaries and studied questions that properly “belong” to other topics, in particular, competition law and policy and the law and economics of innovations and intellectual property rights. Because we do not see ourselves in a position to have full-fledged research programs on these topics, we report on this work under the heading of network industries where our interest came from. However, in the future, we may want to branch out into these directions.

More generally, if a person has promising ideas about another topic concerning collective goods and we are convinced of this person and these ideas, we will not look the other way merely because this is not one of the applied topics in our list. The fruitfulness of research ideas and synergies with the rest of the institute seem more important to us than a literal interpretation of topic specifications.