New Economics Papers
on Law and Economics
Issue of 2009‒03‒22
five papers chosen by
Jeong-Joon Lee, Towson University

  1. Deterrence and Incapacitation: Towards a Unified Theory of Criminal Punishment By Thomas J. Miceli
  2. Patent Scope and Technology Choice By Färnstrand Damsgaard, Erika
  3. The laws, regulations, guidelines, and industry practices that protect consumers who use gift cards By Philip Keitel
  4. Another Look at the Deterrent Effect of Death Penalty By Choe, Jongmook
  5. Generating Evidence to Guide Merger Enforcement By Orley C. Ashenfelter; Daniel Hosken; Matthew Weinberg

  1. By: Thomas J. Miceli (University of Connecticut)
    Abstract: Economic models of crime have focused primarily on the goal of deterrence; the goal of incapacitation has received much less attention. This paper adapts the standard deterrence model to incorporate incapacitation. When prison only is used, incapacitation can result in a longer or a shorter optimal prison term compared to the deterrence-only model. It is longer if there is underdeterrence, and shorter if there is overdeterrence. In contrast, when a fine is available and it is not constrained by the offender's wealth, the optimal prison term is zero. Since the fine achieves first-best deterrence, only efficient crimes are committed and hence, there is no gain from incapacitation.
    Keywords: Career criminals, deterrence, incapacitation, law enforcement
    JEL: K14 K42
    Date: 2009–03
  2. By: Färnstrand Damsgaard, Erika (Research Institute of Industrial Economics (IFN))
    Abstract: This paper analyzes the effect of an increase in patent scope on R&D and innovation. It presents a model where patent scope affects an entrant firm's technology choice and thereby creates a trade-off between R&D investments and wasteful duplication of R&D. The model predicts that an increase in patent scope can increase the probability of innovation if the incumbent’s profit increase from innovation is large and the patented technology has a small advantage over the alternative technology. However, when the model is extended to Stackelberg competition or licensing, the benefit of a broad patent scope to a large extent disappears.
    Keywords: Innovation; Patents; Patent policy; Licensing
    JEL: K20 L51
    Date: 2009–03–03
  3. By: Philip Keitel
    Abstract: This paper discusses consumer protections available to gift-card users. Specifically, it examines the ways in which value loaded at the time of purchase is protected for future card use or returned to consumers when the card is not used or has expired. The consumer protection information included in this paper is derived from a number of sources, including several types of state statutes, Federal Trade Commission decisions, financial industry regulatory agency guidelines, and previous interviews with payments industry experts regarding practices concerning network-branded gift cards. This paper expands research begun by the Payment Cards Center in 2004 into prepaid cards generally and the protections available to consumers who use gift cards specifically.
    Keywords: Payment systems
    Date: 2008
  4. By: Choe, Jongmook
    Abstract: There is a question whether the execution rate is appropriate to examine the deterrent effect of death penalty. Instead of using execution rate, this paper uses dummy variables to categorize states into different groups and to compare the group mean homicide rates. With U.S. state-level panel data for the period 1995 - 2006, this paper fails to find a significant homicide-reducing effect of death penalty.
    Keywords: Death Penalty; Execution; Homicide; Deterrence; Dummy Variable
    JEL: K14 K41
    Date: 2009–03–01
  5. By: Orley C. Ashenfelter; Daniel Hosken; Matthew Weinberg
    Abstract: The challenge of effective merger enforcement is tremendous. U.S. antitrust agencies must, by statute, quickly forecast the competitive effects of mergers that occur in virtually every sector of the economy to determine if mergers can proceed. Surprisingly, given the complexity of the regulators task, there is remarkably little empirical evidence on the effects of mergers to guide regulators. This paper describes the necessity of retrospective analysis of past mergers in building an empirical basis for antitrust enforcement, and provides guidance on the key measurement issues researchers confront in estimating the price effects of mergers. We also describe how evidence from merger retrospectives can be used to evaluate the economic models used to predict the competitive effects of mergers.
    JEL: K21 L1 L4
    Date: 2009–03

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