The Politics of the Brady Report: A Comment

Abstract

I'd like to thank Jon Macey and the Cornell Law School and Law Review for organizing an interesting conference. I will keep my comment brief for two reasons: it's late in the day and I do not have many points of deep disagreement with David Haddock's paper. Let me say at the outset that I agree with Dave's fundamental point-that the Brady Report on the October 1987 market crash is best understood as a political document, rather than as a policy prescription grounded in positive economic research. I also found the Report quite disappointing, because the Report's explicit objective is not to understand the economic reasons for the crash but to study "market mechanisms," to locate a cause for the rapid rate of the market decline, and correspondingly propose improvements to those mechanisms.