Seminar and Workshop on Advanced Issues in Law and Policy of the European Union, nafta and the wto

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Article 171 [original]. If the Court of Justice finds that a Member State has failed to fulfil an obligation under this Treaty, the State shall be required to take the necessary measures to comply with the judgment of the Court of Justice.

Article 171 [as amended in 1992]. 1. If the Court of Justice finds that a Member State has failed to fulfil an obligation under this Treaty, the State shall be required to take the necessary measures to comply with the judgment of the Court of Justice.

2. If the Commission considers that the Member State concerned has not taken such measures it shall, after giving that State the opportunity to submit its observations, issue a reasoned opinion specifying the points on which the Member State concerned has not complied with the judgment of the Court of Justice.

If the Member State concerned fails to take the necessary measures to comply with the Court's judgment within the time‑limit laid down by the Commission, the latter may bring the case before the Court of Justice. In so doing it shall specify the amount of the lump sum or penalty payment to be paid by the Member State concerned which it considers appropriate in the circumstances.

If the Court of Justice finds that the Member State concerned has not complied with its judgment it may impose a lump sum or penalty payment on it.

This procedure shall be without prejudice to Article 170.

*LL.M., Harvard Law School; Associate, Sullivan & Cromwell, Paris.

*** The author wishes to thank Professors Joseph H.H. Weiler and Josephine Shaw for their encouragement and comments; the participants in the seminar, "WTO, NAFTA and EU: Advanced Issues in Law and Policy", at Harvard Law School (Spring 1998) for helpful discussion; and Heidi Libesman for her support and for comments on an earlier draft. The support of the Social Sciences and Humanities Research Council of Canada is gratefully acknowledged.

*Case C-6/90, Francovich v. Italy, [1991] I E.C.R. 5357, [1993] 2 C.M.L.R. 66.

1C. Harlow, "Francovich and the Problem of the Disobedient State," 2 E.L.J. 199 at p. 199 (1996). A bibliography of articles on Francovich is included in Appendix A.

2J. Steiner, , “From Direct Effects to Francovich: Shifting Means of Enforcement of Community Law,” 18 E.L.Rev. 3, at p. 6 (1993). See, along the same lines, D. Curtin, “Directives: The Effectiveness of Judicial Protection of Individual Rights,” 27 C.M.L.Rev. 709, at pp. 709-11.

3European Community Treaty, European Coal and Steel Community Treaty, Euratom Treaty. Hereinafter, "Treaty" refers to the European Community Treaty.

1 Once the Amsterdam Treaty enters into force, these will be Articles 226-228 of the consolidated EC Treaty.

2Case 39/72, Commission v. Italy, [1973] E.C.R. 101, [1973] C.M.L.R. 439, at par. 11.

3 Article 288 of the consolidated version of the EC Treaty, after the entry into force of the Amsterdam Treaty.

4Cases 106-120/87, Asteris v. Greece, [1988] E.C.R. 5515, at p. 5539, par. 18.

5In a 1972 case, the Court of Justice was invited to adopt the French doctrine of égalité devant les charges publiques, a principle of no-fault liability which I discuss in Part II. The Court disposed of the case on other grounds, and, as a result, did not consider whether to adopt the doctrine. See Cases 9, 11/71, Compagnie d’Approvisionnement v. Commission, [1972] E.C.R. 391. As Schwarze observes, the Court has probably not yet spoken its last word on the issue: Schwarze, European Administrative Law, at p. 533.

6Cases 83, etc./76, Bayerische HNL et al. v. Council and Commission, [1978] E.C.R. 1209, at p. 1224. See also Case 5/71, Zuckerfabrik Schöppenstedt v. Council, [1971] E.C.R. 975. See generally Schwarze, at pp. 524-30.

7J. Shaw, Law of the European Union, 2nd ed. (MacMillan, 1993), at p. 357.

8Bayerische HNL, supra.

9See C. Lewis, Remedies and the Enforcement of European Community Law (London: Sweet & Maxwell, 1996) at p. 265, and the cases cited therein.

10Bayerische HNL, supra, at p. 1224, par. 5 and 6.

11Lewis suggests another explanation, namely the Court’s pragmatic concern for the financial consequences of incurring liability to large number of claimants. See p. 266-67.

12Case 6/60, Humblet, Rec., Vol. VI, p. 1125.

13Paragraphs 33 and 36.

14Par. 40.

15Par. 45.

16Par. 43.

17Case 45/76, Comet BV v. Produktschap voor Siergeswassen, [1976] E.C.R. 2043; Case 33/76, Rewe-Zentralfinanz eG and Rewe-Zentral AG v. Landwirtschaftskammer fur das Saarland, [1976] E.C.R. 1898. See generally R. Kovar, “Voies de droit ouvertes aux individus devant les instances nationales en cas de violation es normes et décisions du droit communautaire,” in Les Recours des individus devant les instances nationales en cas de violation du droit européen (Colloquium, 24 and 24 April 1975) at pp. 248-51; Lewis, at pp. 55-56.

18Joined cases C-46 and 48/93, Brasserie du Pêcheur v. Germany and R. v. Secretary of State for Transport, ex. p. Factortame, [1996] E.C.R. I-4845.

19Case C-213/89, [1990] E.C.R. I-2433

20Case C-221/89, [1991] E.C.R. I-3905

21Brasserie du Pêcheur, at par. 34.

22Ibid., at par. 67.

23Ibid., at par. 79.

24 Despite its desire for uniformity of remedies, the Court has not overruled the principle of national procedural autonomy, and, in cases since Brasserie du Pêcheur, it has reiterated the principle. See, for example, Case 66/95, Sutton v. Secretary of State for Social Security, [1997] E.C.R. I-2163, in which the Court indicated that the heads and quantum of damages were a matter for national law, subject only to the general principles that Community law causes of action must not be treated less favourably than those under domestic law, and that national rules must not make it impossible or excessively difficult to obtain redress. See also Case C-127/95, Norbrook Laboratories v. M.A.F.F., [1998] E.C.R. I-1531, at par. 111.

25Ibid., at par. 55-57.


27See, for example, Joined Cases C-178, 179 and 188-90/94, Dillenkofer et al., [1996] E.C.R. I-4845, at par. 29: “... failure to take any measure to transpose a directive in order to achieve the result it prescribes within the period laid down for that purpose constitutes per se a serious breach of Community law...”; Case C-319/96, Brinkmann Tabakfabriken v. Skatteministeriet, [1998] 3 C.M.L.R. 673.

28See Case C-140/97, Rechberger et al. v. Austria, decision of June 15, 1999, at par. 50-51.

29Case C-302/97, Konle v. Austria, decision of June 1, 1999, at par. 62. The Member State’s responsibility would be discharged by providing in national law for damages to be obtained from the sub-unit.

1See the opinion of Advocate General Tesauro in Brasserie du Pêcheur. Van Gerven also adopts a tort law approach in "The ECJ Case-Law as a Means of Unification of Private Law" in A. Hartkamp et al., Towards a European Civil Code, 2d ed. (The Hague: Kluwer, 1998), at pp. 96-97.

2See Harlow, at p. 206, and the opinion of Advocate General Tesauro in Brasserie du Pêcheur. Craig discusses the characterization of Member State liability in English law, comparing it to an action for breach of statutory duty, a common law administrative tort: see "The Domestic Liability of Public Authorities in Damages: Lessons from the European Community?" in J. Beatson and T. Tridimas, eds., New Directions in European Public Law (Oxford, Hart: 1998), at pp. 81-82.

3See Harlow, at p. 207.

4Par. 37.

5Par. 40.

6Breaches not causing harm to individuals may give rise to enforcement action at the behest of the Commission or a Member State under Articles 169 and 170.

7Brasserie du Pêcheur, supra, at par. 34.

8 Konle, loc. cit.

9See, for example, Case C-261/95, Palmisani v. INPS, [1997] E.C.R. I-4025, in which the Court poses (but does not answer) the question whether public authorities can be sued under general Italian tort law.

10See, for example, Harlow, supra, at p. 206, and the opinion of Advocate General Tesauro in Brasserie du Pêcheur.

11See Schockweiler et al., “Le régime de la responsabilité extracontractuelle du fait d’actes juridiques dans la Communauté européenne” [1990] R.T.D.E. 27; and P. Moor and J.-M. Woehrling, "Le contrôle juridictionnel de l'administration", in G. Brabant et al., eds., Le contrôle de l'administration en Europe de l'est et de l'ouest (Paris: CNRS, 1985), at p. 82.

12C.E. Ass. 14 janv. 1938, Société Anonyme des Produits Laitiers «La Fleurette», Rec. 25; C.E. Sect. 22 nov. 1957, Compagnie de navigation Fraissinet, Rec. 635.

13See Long, Weil et al., Les grands arrêts de la jurisprudence administrative, at p. 310 (1993).

14See N. Green and A. Barav, “Damages in the National Courts for Breach of Community Law”, [1986] Y.E.L. 55, at p. 55. See also Kovar, at p. 273.

15Case 26/62, Van Gend en Loos v. Nederlandse Administratie der Belastingen, [1963] E.C.R. 1, at par. 12.

16 See I. Brownlie, Principles of Public International Law, 4th ed. (Oxford: Clarendon Press, 1990), ch. 20, esp. pp. 449-50; International Law Commission, Draft Articles on State Responsibility, July 12, 1996, ch. II. In the context of the European Convention on Human Rights, see Lingens v. Austria, Ser. A, No. 103, 8 E.H.R.R. 407 (1986), at par. 46: "[The Court] does not have to specify which national authority is responsible for any breach of the Convention: the sole issue is the State's international responsibility."

17Brasserie du Pêcheur, supra, at par. 34.

18 See K. Zemanek, "Responsibility of States: General Principles", in Max-Planck Institute for Comparative Public Law and International Law, R. Berhardt, dir., Encyclopedia of Public International Law, vol. 10 (North Holland, 1987), at p. 368.

19Decision of 12 March 1987, Juristenzeitung 1987, p. 1024.

20Laubadère, Traité de droit administratif, vol. 1 (1994), at p. 904-908; Kovar, at p. 273; Morange, L’irresponsabilité de l’État législateur, D. 1962, chron. p. 163.

21In France, the Conseil Constitutionnel may pronounce on the validity of legislation only before it has been promulgated and, even then, private individuals have no standing to bring challenges: see Constitution of the Fifth Republic, art. 61.

22Schockweiler, at p. 47.

23Guimond v. Quebec (Attorney General), [1996] 3 S.C.R. 347, at par. 15-19. The equivocation comes from the Court’s statement, at par. 19, that “it cannot be said that damages can never be obtained following a declaration of constitutional invalidity.”

24For example, 42 U.S.C. §1983 makes state and local officials liable for constitutional violations in some circumstances, while the liability of federal officials is based on the Due Process Clause of the Fifth Amendment: Bivens v. Six Unknown Named Agents of the Federal Bureau of Narcotics, 403 U.S. 388 (1971).

25Under the Federal Tort Claims Act, until 1974, the United States was vicariously liable only for the negligent acts of its agents. In 1974, the FTCA was amended to waive immunity for intentional torts. However, the United States remains immune from liability for unconstitutional legislative or judicial acts. See P.H. Schuck, Suing Government: Citizen Remedies for Official Wrongs (New Haven, YUP 1983); R.A. Cass, “Damage Suits Against Public Officers,” 129 U. Pa. L. Rev. 1110 (1981); M. Olson, “Official Liability and Its Less Legalistic Alternatives,” 42 L. and Contemp. Prob. 67 (1978); J.L. Mashaw, “Civil Liability of Government Officers: Property Rights and Official Accountability,” 42 L. and Contemp. Prob. 8 (1978); R. Epstein, “Private-Law Models for Official Immunity,” 42 L. and Contemp. Prob. 53 (1978); Norton v. United States, 581 F.2d 390 (4th Cir. 1978).

26Jaundoo v. A.G. Guyana, [1971] A.C. 972 (P.C.).

27Maharaj v. A.G. for Trinidad and Tobago (No. 2), [1978] 2 All E.R. 670.

28Ibid., at p. 679, per Lord Diplock.

29Lingens, supra.

30Article 34 of the Convention, as amended by Protocol No. 11 (ETS No. 155) of May 11, 1994.

31Article 41.

32A list of books and articles on constitutional torts appears in Appendix A.

1See R. Posner, Economic Analysis of Law, at p. 14-15 (5th ed., 1998).

2M.J. Trebilcock, "Economic Analysis of Law," Canadian Perspectives on Legal Theory, R.F. Devlin, ed., at p. 103 (1991). See also Posner, Economic Analysis of Law, at p. 25.

3R. Coase, "The Problem of Social Cost," 3 J. L. and Econ. 1 (1960); G. Calabresi and D. Melamed, "Property Rules, Liability Rules and Inalienability: One View of the Cathedral," 85 Harv. L.Rev. 1089 (1972).

4See, e.g., G.S. Becker, The Economic Approach to Human Behavior (Chicago: U. Chi. P., 1978); “An Economic Analysis of Marital Instability,” 85 J. Pol. Econ. 1141 (1977); “Crime and Punishment: An Economic Approach,” 76 J. Pol. Econ. 169 (1968); Posner, op. cit..

5See R. Posner, Economic Analysis of Law, at p. 18 (5th ed., 1998); D. Baird, “The Future of Law and Economics: Looking Forward,” 64 U. Chi. L. Rev. 1129, at pp. 1131-32 (1997).

6This approach was taken, for example, in a number of American constitutional cases: a famous and now discredited example is Korematsu v. U.S., 323 U.S. 214 (1944) (internment of persons of Japanese ancestry during World War II). A more recent example is the Progressive case (injunction against publication of instructions for building a hydrogen bomb). Another well-known example is U.S. v. The Progressive, Inc., 467 F.Supp. 990 (W.D. Wisc., 1979), recons. den., 486 F.Supp. 5 (W.D. Wisc., 1979), app. dism., 610 F.Supp. 819 (7th Cir., 1979). Here, a federal district court granted an injunction against the publication of instructions for building a hydrogen bomb, saying that while a prior restraint on publication represented a “drastic and substantial” infringement of the freedom of speech, “[a] mistake in ruling against the United States could pave the way for thermonuclear annihilation for us all. In that event, our right to life is extinguished and the right to publish becomes moot” (p. 996).

7Several authors have noticed the need for an antecedent theory of rights in a framework of social welfare maximization. See, e.g., C.G. Veljanovski, “Wealth Maximization, Law and Ethics — On the Limits of Economic Efficiency,” 1 Int. Rev. L. and Econ. 5, at p. 20 (1981); W.J. Samuels, “Book Review — Maximization of Wealth as Justice: An Essay on Posnerian Law and Economics as Policy Analysis,” 9 Tex. L. Rev., at p. 155 (1981); N. Mercuro and T.P. Ryan, Law, Economics and Public Policy (Greenwich, Conn.: JAI, 1984), at p. 132. Even Posner seems now to agree that social welfare maximization rests on tacit assumptions about the relative value of various components of social welfare: see R. Posner, Overcoming Law (Cambridge: Harvard U.P., 1995).

8See Posner, Economic Analysis of Law, at p. 30.

9U.S. v. Carroll Towing Co., 159 F.2d 169, at p. 173 (2d Cir. 1947).

10It can be demonstrated that, as a first approximation, strict liability and negligence lead to the same conduct on the part of potential injurers. This is because, in determining what measurers to take to avoid incurring liability in a regime of strict liability, a potential injurer will compare the costs of avoiding the harm with the likelihood that she will in fact cause harm and have to pay damages. This calculus is identical to Learned Hand’s negligence formula and, as a result, we would expect potential injurers to act in the same way regardless of whether negligence or strict liability is the rule. See R. Posner, Tort Law: Cases and Economic Analysis, at p. 4 (1982).

11By “socially detrimental,” I mean conduct which produces a negative net social benefit. Conversely, “socially beneficial” refers to conduct which produces a positive net social benefit.

12That is, if they exceed the net private benefit from the activity.

13Again, if their cost exceeds the net private benefit from the activity.

14Few legal economists seem to acknowledge this difficulty with the externalities theory of tort law. Some authors have made a similar argument against the personal liability of government officials, but the problem arises with equal force in the general law of torts. In the context of bureaucratic liability, see J.L. Mashaw, “Civil Liability of Government Officers: Property Rights and Official Accountability,” 42 L. and Contemp. Prob. 8, at pp. 26-27 (1978); R. Posner, “Excessive Sanctions for Governmental Misconduct in Criminal Cases,” 57 Wash. L.Rev. 635, at p. 640 (1982); D. Cohen, “Regulating Regulators: The Legal Environment of the State,” 40 U. Toronto. L.J. 213, at p. 225 (1990).

15Cohen, at p. 646.


0See A. Chayes, “The Role of the Judge in Public Law Adjudication,” 89 Harv. L. Rev. 1281 (1976).

0But see A. Stone, The Birth of Judicial Politics in France (Princeton: Princeton U.P., 1992).

0Oxford: Clarendon Press, 1987.

0See pp. 182-196.

0Page 193.

0United States v. Carolene Products (1938), 304 U.S. 144, at fn. 4.

0Posner, “Excessive Sanctions,” supra.

0 In their classic work, The Modern Corporation and Private Property, at p. 124 (1932), A. Berle and G. Means argue that corporate managers are effectively unconstrained because shareholders have insufficient incentive and opportunity to monitor them. See, for an explanation of the same phenomenon in relation to government, Cohen, supra, at pp. 252ff.

0Harlow, at p 209.

0Cases C-297 and 268/91, Keck and Mithouard, [1995] 1 C.M.L.R. 101.

0E.J. Weinrib, “Causation and Wrongdoing,” 63 Chi.-Kent L. Rev. 407, at p. 409 (1987).

0Aristotle, Nicomachean Ethics, Book V., ch. IV, R.W. Browne trans. 1914. See also Weinrib, “Causation,” supra, at p. 449; E.J. Weinrib, The Idea of Private Law (Cambridge: Harvard U.P., 1995), at pp. 56ff. On the distinction between distributive and corrective justice, see also J.L. Coleman, Risks and Wrongs (Cambridge, U.K.: Cambridge U.P., 1992), at pp. 304-305.

0Aristotle, ch. IV.

0Weinrib, “Causation,” at p. 449, citing I. Kant, The Metaphysical Elements of Justice (J. Ladd trans. 1975), at p. 34. See also Weinrib, Private Law, at pp. 81-82.

0Weinrib, “Causation.” See also Coleman, supra, at p. 324.

0Aristotle, chap. IV.

0M. Deguergue, Jurisprudence et doctrine dans l’élaboration du droit de la responsabilité administrative (Paris: LGDJ, 1994), at p. 72.

0Précis de droit administratif, 9e éd., 1919, p. 521.

0L. Duguit, L’État, le droit objectif et la loi positive, 1901, p. 5.

0See J.J. Jeffries, Jr., “Compensation for Constitutional Torts: Reflections on the Significance of Fault,” 88 Mich. L. Rev. 82; S. Nahmod, “Constitutional Damages and Corrective Justice: A Different View,” 76 Va. L. Rev. 997 (1990); R.H. Fallon, Jr., and D.J. Meltzer, “New Law, Non-Retroactivity and Constitutional Remedies,” 104 Harv. L. Rev. 1731, at p. 1793 (1991); K. Cooper-Stephenson, Charter Damages Claims (Toronto: Carswell, 1990), at p. 58.

0Jeffries, at pp. 94-96, footnotes omitted.

0Nahmod, supra, at p. 1011.

0Nahmod, supra, at p. 1009.

0Prosser, “Palsgraf Revisited”, 52 Mich. L. Rev. 1, at pp. 15, 17.

0See Coleman, supra, at p. 312.

0This phenomenon was first named by G. Harden in “The Tragedy of the Commons,” 162 Science 1243 (1968), who observed that shared pastures tended to be overgrazed. The theory developed to explain this phenomenon also explains more generally why, in the absence of regulation, rational, self-interested individual behavior with respect to common resources leads to their overuse and depletion.

0Another commonly invoked example is the public good problem. In the absence of coercive governmental action, such as the raising of taxes, certain socially beneficial goods would be underproduced because it is not feasible to exclude “free riders”, that is, to limit the enjoyment of the goods to the people who pay for them. Thus, although everyone benefits from the existence of traffic lights, a rational, self-interested person would decline to contribute to a fund for their installation, because, once they have been installed, she benefits fully from them regardless of whether or not she contributed. See J. Rawls, A Theory of Justice (Cambridge: Harvard U.P., 1971), at pp. 267-68; Coleman, supra, at p. 312.

0J. Chevallier, L’État de droit (Montchrestien, E.J.A. 1992), at p. 59-60.

0Duguit, loc. cit.

0I do not deny that there may be reasons unrelated to corrective justice for granting immunity to such an official.

0Case 1155/73, Saachi, [1974] E.C.R. 409. Article 90(2), however, creates an exception for undertakings entrusted with the operation of services of general economic interest or having the character of a revenue-producing monopoly, where the antitrust rules would obstruct the performance of the tasks assigned to them. See J. Maitland-Walker, Competition Laws of Europe (London: Butterworths, 1995), at p. 4.

0See, e.g., Posner, Economic Analysis of Law, supra, at p. 30; Weinrib, Private Law, supra, at pp. 56ff; Coleman, supra, at pp. 304-305.

0A theory of distributive justice is at the base of Rawls’ “second principle”, namely that “[s]ocial and economic inequalities are to be arranged so that they are both (a) to the greatest benefit of the least advantaged, consistent with the just savings principle, and (b) attached to offices and positions open to all under conditions of fair equality of opportunity.” See Rawls, supra, at p. 302.

0Coleman, supra, at p. 304.

0Jeffries, supra, at p. 91.

0Van Gend, at par. 12.

0Case 179/84, Bozzetti,[1985] ECR 2301, [1986] 2 CMLR 246, par. 17.

0Francovich, par. 31.

0Par. 32-34, emphasis added

0J.H.H. Weiler, “The Jurisprudence of Human Rights in the European Union: Integration and Disintegration, Values and Processes,” Harvard Jean Monnet Working Paper 2/96.

0Some authors interpret the Treaty in a way that demonstrates a hostility to regulation reminiscent of the U.S. Supreme Court's Lochner era, essentially erecting non-interference with the market as an inherent constraint on government. See, for example, the comments of A. Mattera, who deplores “[c]e phénomène inquiétant et grandissant de l’intervention des États dans la vie économique de leur pays par des mesures touchant aux domaines les plus disparates...” in “Libre circulation des marchandises et articles 30 à 36 du Traité C.E.E.,” [1976] R.M.C. 500, at pp. 518-19. However, the integrationist objectives of the Treaty do not require such an interpretation.

0Case C-145/88, Torfaen v. B&Q, [1989] E.C.R. 3851.

0Case 41/74, Van Duyn v. Home Office, [1974] E.C.R. 1337.

0Case C-13/93, P v. S. and Cornwall City Council, [1996] I.R.L.R. 347.

0Case C-159/90, Society for the Protection of Unborn Children v. Grogan, [1991] E.C.R. I-4685. Here, an Irish injunction against distribution of pamphlets advertising U.K. abortion clinics was upheld because the distributor of the pamphlets was acting gratuitously; in the absence of an economic link between the pamphleteer and the clinics, enjoining the pamphlets was not a restriction on the “free movement of services.”

0J. Lambert, Les origines du contrôle judiciaire de constitutionnalité des lois fédérales aux États-Unis (1933). It was Lambert who coined the expression, “gouvernement des juges,” in describing U.S. constitutional review.

0Internationale Handelsgesellschaft, [1974] 2 C.M.L.R. 549. The case was overruled in 1986, in part, and a more recent statement of the German Court’s position can be found in its 1993 decision on Maastricht. See also N. Reich, “Europe à la carte: Some Remarks on Recent Conflicts Between European and German Constitutional Law Provoked by the Banana Litigation.”

0Case 4/73, Nold, Kohlen and Baustoffgroßhandlung v. Commission, [1974] E.C.R. 491.

0Case 5/88, Wachauf v. Germany, [1989] E.C.R. 2609.

0E.g., the national measure violates the Art. 30 prohibition on measures having an effect equivalent to quantitative restrictions on imports, but the Member State seeks to justify it on grounds of public policy under Art. 36. See Case C-260/89, Elliniki Radiophonia Tileorasi v. Dimotiki Etairia Pliroforissis (ERT), [1991] E.C.R. I-2925.

0For example, it did not adopt Advocate General Jacobs’ opinion in Konstantinidis: “[A] Community national who goes to another Member State as a worker or self-employed person ... is entitled to assume that ... he will be treated in accordance with a common code of fundamental values. ... In other words, he is entitled to say, “civis europeus sum,” and to invoke that status in order to oppose any violation of his fundamental rights.” See See Darcy S. Bhinder, “The European Court of Justice and the Protection of Fundamental Rights in the European Community” Harvard Jean Monnet Working Paper 1995.

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