1. Rethinking the Principal-Agent Theory of Judging
Jonathan R. Nash Professor of Law
Emory University
Rafael I. Pardo Robert T. Thompson Professor of Law

2. Models of Judicial Behavior
Attitudinal Model
most applicable to Supreme Court Justices
Limits to the applicability of the attitudinal model
strategic considerations
lower court judges
aspirations to an appointment to a higher court
monitoring by higher courts
legal constraints
Principal-Agent Hierarchical Models
higher courts review lower court decisions to constrain shirking
lower courts consider reversal a sufficient sanction to deter at least some shirking

3. Problems with Principal-Agent Judicial Hierarchical Models
Higher court “principals” generally do not select their lower court judge “agents”.
Reversal may not mean much to Article III judges who enjoy life tenure and guaranteed salary.

4. A Natural Experiment? The Federal Bankruptcy System
Bankruptcy courts are established as units of the district courts.
Bankruptcy court judges
Article I judges who serve for renewable 14-year terms
Appointed by the courts of appeals
Bankruptcy appellate panels (“BAPs”)
BAP judges selected by the circuit judicial council from the pool of existing bankruptcy judges
BAP judges continue to function as trial judges while serving on the BAP

5. Bankruptcy Appellate Structure for Core Proceedings

6. The Federal Bankruptcy Litigation System as the Basis for a Natural Experiment
Principals: Circuit court judges have incentives to appoint bankruptcy judges whose ideological preferences mirror their own (Pardo, 2008).
Actual agents: (1) bankruptcy court judges appointed by the court of appeals and (2) BAP judges selected by the circuit judicial council

7. Bankruptcy Court Judge
Institutional Constraints on the Voting Behavior of Bankruptcy Court Judges and BAP Judges
Voting Capacity
Institutional
Constraint
Bankruptcy Court Judge
BAP Judge
Likelihood of appeal to court of appeals
Relatively lower
Relatively higher
Proximity to court of appeals
Low
High
Panel effects
Extremely rare
Yes
Proximity to litigants

8. Hypotheses
Hypothesis 1: Judges will cast votes according to different ideological valence depending upon whether they are casting a vote as a bankruptcy court judge or as a BAP judge.
Hypothesis 2: The voting behavior of BAP judges will be more ideologically aligned with the ideological leaning of the circuit than will the voting behavior of bankruptcy court judges.

9. Research Design
Focus on votes cast in student-loan-discharge proceedings in consumer bankruptcy cases
nontechnical area of bankruptcy law with minimal role (if any) for specialized expertise
potential for ideological voting by circuit court judges in debt-dischargeability determinations (Nash & Pardo, 2012)
potential for ideological voting by bankruptcy judges in student-loan-discharge proceedings (Pardo & Lacey, 2005; Pardo & Lacey, 2009; Rachlinski, Guthrie & Wistrich, 2006)
Collect votes by circuit court judges in BAP circuits in student-loan-discharge proceedings
determine whether circuit court judges in BAP circuits vote ideologically in student-loan-discharge proceedings
Collect votes cast in student-loan-discharge proceedings during the same time period by bankruptcy judges serving as BAP judges and bankruptcy court judges
compare the ideological leanings of votes by bankruptcy court judges and BAP judges (i.e., the agents), and determine the extent to which the voting capacity of the judge predicts the ideological leaning of the vote
determine the extent to which the ideological leaning of the circuit predicts the ideological leanings of votes by bankruptcy court judges and BAP judges

10. Data Sets “Principal” Dataset “Agent” Dataset
published and unpublished appellate opinions ( ) by the 1st, 2nd, 6th, 8th, 9th, and 10th Circuits resolving appeals involving issues arising in student-loan-discharge proceedings
46 circuit court opinions and 137 judicial votes
“Agent” Dataset
published and unpublished appellate opinions ( ) issued by BAPs from the 1st, 2nd, 6th, 8th, 9th, and 10th Circuits resolving appeals involving issues arising in student-loan-discharge proceedings
56 BAP opinions and 168 judicial votes
published and unpublished trial opinions ( ) issued by bankruptcy court judges in student-loan-discharge proceedings provided that the judge have cast at least one vote as a BAP judge during the same time period in an appeal involving a student-loan-discharge proceeding
137 bankruptcy court opinions and 137 judicial votes

11. Variables of Interest: “Principal” Dataset
Dependent Variable
conservative vote by the circuit court judge
Independent Variable
judicial ideology (measured by Judicial Common Space (JCS) score)

12. Logistic Regression Model for Conservative Vote
Independent Variable
Odds Ratio
JCS Score
2.451* (1.040, 5.778) N
135
Adjusted Count R2
0.091
Note: *** p ≤ 0.001, ** p ≤ 0.01, * p ≤ Odds ratios presented with 95% confidence intervals in parentheses.

13. Probability of Conservative Vote by JCS Score

14. Variables of Interest: “Agent” Dataset
Dependent Variable
direction of vote by bankruptcy court judge or BAP judge
Independent Variables
voting capacity of the bankruptcy judge (i.e., as bankruptcy court judge or BAP judge)
ideological composition of the circuit

15. Direction of Vote by Voting Capacity
Liberal
Conservative
Total
Bankruptcy Court Judge
77 (45.83)
91 (54.17)
168
(100.00)
BAP Judge
70 (51.09)
67 (48.91)
137 (100.00)
147 (48.20)
158 (51.80)
305 (100.00)
Note: Row percentages are reported in parentheses. The p-value from a chi-square test with two degrees of freedom is

16. Logistic Regression Model for Conservative Vote
Independent Variable
Odds Ratio
Circuit Median JCS Score
1.120 (0.369, 3.393) N
268
Adjusted Count R2
0.000
Note: *** p ≤ 0.001, ** p ≤ 0.01, * p ≤ Odds ratios presented with 95% confidence intervals in parentheses.

17. Alternative Explanations?
Selection process for bankruptcy court judges tends to produce ideological homogenization
Insufficient sanctions available to circuit court judges
Circuit judicial council does not select BAP judges based primarily on ideological leanings