Before Dr. Rausser accepted two successive political appointments in Washington, DC, in the mid-1980s, members of the legal community became aware of Professor Rausser’s academic publications and sought out his services as a testifying expert in a number of complex business litigations. After 1988, once he had left his posts in the federal government and returned to California, Dr. Rausser drew on his legal, business, and government experience in offering his consulting services to clients through a succession of highly successful companies.
Co-Founder of LECG (the Law and Economics Consulting Group)
Along with three colleagues who were also UC Berkeley faculty members, Dr. Rausser Co-Founded the Law and Economics Consulting Group (LECG) in 1988. LECG offered counsel on such matters as the competitive effects of mergers and acquisitions, calculations of damages, measurement of market share and market concentration, liability analysis in securities fraud cases, and the impact of increased regulation. In eight short years, LECG grew from two to more than 600 employees and opened offices across the United States, Canada, Europe, Asia, Australia, and New Zealand. The company’s clients included governmental entities as well as some of the nation’s leading business and law firms. Dr. Rausser became one of LECG’s top testifying experts, helping the firm’s revenues grow by more than 30 percent per year between 1991 and 1997. In late 1997, LECG went public with a $60 million initial public offering on the New York Stock Exchange. San Francisco Chronicle, October 30, 1997. After Dr. Rausser had served on the board of directors of the public company for one year, LECG merged with another company to form Navigant Consulting (NYSE: NCI). Concerned about the governance structure at Navigant, Dr. Rausser left that company.
Senior Consultant at Charles River Associates
In 2000, Dr. Rausser signed an exclusive agreement with Charles River Associates International (NYSE: CRAI). Like LECG, CRA is a public company that provides expert advice on technical issues to law firms and businesses involved in litigation and regulatory proceedings. Dr. Rausser remained at CRA for five years and became one of the largest “rainmakers” at the firm. During his tenure with CRA, the market value of the company’s shares on the stock exchange increased 400 percent.
Charles River Associates Securities and Exchange Commission Form 10-K, December 2000.
Charles River Associates: New Frameworks for Economic Damage Measurement
Senior Economic Consultant at OnPoint Analytics
In 2005, Dr. Rausser left CRA to become Chairman of the Board and Senior Economic Consultant at OnPoint Analytics, a litigation and business consulting company he founded in Emeryville, California. As one of OnPoint Analytics’ highly regarded experts,
Dr. Rausser continues to provide statistical, economic, and financial analysis for a broad range of clients.
Recent Publications in Law and Economics
Monopsony and Predatory Bidding in the Lumber Industry: The Weyerhaeuser Cases (2007) with John Foote.
In The Antitrust Revolution, edited by L. White and J. L. Kwoka (6th ed.). New York: Oxford University Press (2013)
While most economists would agree that predatory bidding and predatory pricing are similar, not everyone agrees that the issues are either identical or sufficiently similar to warrant the application of the same legal standard. This paper describes Weyerhaeuser’s place in the US hardwood lumber market and the specific claims of predatory bidding that it faced in a 2007 case before the U.S. Supreme Court (Weyerhaeuser Company v. Ross-Simmons Hardwood Lumber Company, Inc., 549 U.S. 312). We place these claims in the context of the economic literature on predatory conduct and evaluate the economic and statistical analysis presented by each side in the dispute. We advance a lens on predatory buying that is an alternative to the typical partial-equilibrium test of Areeda and Turner (1975), which involves a predation period followed by recoupment. In our view, this test fails to recognize related markets (especially substitutability and/or complementarity of both inputs and outputs). In contrast, our general-equilibrium approach is more consistent with the market and institutional structure of the lumber industry. Accordingly, we maintain that a general-equilibrium lens is needed in order to investigate the potential impact of related markets. Finally, we present the basic elements of such an analysis.
General Equilibrium in Vertical Market Structures: Overselling vs. Overbuying with Richard E. Just
Research in Law and Economics 23 149–81 (2007)
This paper investigates a theoretical formulation of predatory selling and/or bidding motivated by a U. S. Supreme Court ruling relating to the forest, timber, and lumber industry. The paper goes to the heart of the controversy that exists within the economic literature regarding predatory pricing and strategic theory. Courts continue to accept the non-strategic Areeda and Turner formulation, while some of the leading game theorists (e.g., Bolton and Riordan) have argued that predatory conduct is inherently strategic and thus begs for a game-theoretic analysis. Drs. Rausser and Just show that a third lens, that of general-equilibrium analysis, can be used to assess the market-structure conditions that are conducive to predatory conduct.