Here is Larry Ribstein commenting on Lucien Bebchuk’s recent WSJ op-ed criticizing the stimulus bill paycaps,
Harvard’s Lucian Bebchuk, perhaps the leading academic critic of executive pay, has found a regulation of executive pay he didn’t like – the stimulus bill. …
Academics often do not seem to understand when they propose regulatory fixes that they do not control the lawmaking process. I and many others have pointed out that whatever problems there are with executive pay are best fixed by the market than by turning regulators loose amid populist angst over high-paid executives. Professor Bebchuk, at least, is now learning about the dark side of regulating governance. I fear he may have his eyes opened further over the next few years.
Perhaps the financial crisis will create a substantial increase in demand for public choice economics, or at least force some of its key insights into the fore front of public debate.