New Economics Papers
on Law and Economics
Issue of 2009‒11‒14
four papers chosen by
Jeong-Joon Lee, Towson University

  1. Review Essay: How Rational is International Law? By Niels Petersen
  2. Economic incongruities in the European patent system By Malwina Mejer; Bruno van Pottelsberghe de la Potterie
  3. Trade protection and tax evasion: evidence from Kenya, Mauritius and Nigeria By Antoine BOUET; Devesh ROY
  4. Testing Enforcement Strategies in the Field: Legal Threat, Moral Appeal and Social Information By Gerlinde Fellner; Rupert Sausgruber; Christian Traxler

  1. By: Niels Petersen (Max Planck Institute for Research on Collective Goods, Bonn)
    Abstract: Economic approaches are becoming increasingly prominent in international law. A few years ago, Jack Goldsmith and Eric Posner caused a great stir with their account of The Limits of International Law, in which they argued that international law did not have any effect on state conduct. This contribution reviews two recent books analyzing the effectiveness of international law from an economic perspective. Both authors, Andrew Guzman and Joel Trachtman, take a much more differentiated approach than did Goldsmith and Posner, thus making analytical methods of economics more acceptable for mainstream international law scholarship. Still, this contribution argues that we should be cautious to perceive the economic perspective as a holistic explanation of “how international law works”. Economic models are, for methodological reasons, based on certain assumptions. The analytical tools are thus only capable to answer a certain range of questions so that they have to be complemented by other theoretical approaches. Therefore, we have to be very cautious with policy recommendations that are based on a purely economical perspective.
    Date: 2009–06
  2. By: Malwina Mejer (Université Libre de Bruxelles); Bruno van Pottelsberghe de la Potterie (Université Libre de Bruxelles)
    Abstract: This article argues that the consequences of the ‘fragmentation’ of the European patent system are more dramatic than the mere prohibitive costs of maintaining a patent in force in many jurisdictions. The prevalence of national jurisdictions, which are highly heterogeneous in their costs and practices, over the validity and enforcement of European patents induces both a high level of uncertainty and an intense managerial complexity which undoubtedly reduces both the effectiveness and the attractiveness of the European patent system in its mission to stimulate innovation.
    Keywords: European patent system, litigation process, enforcement, uncertainty
    JEL: K41 P14 O34
    Date: 2009
  3. By: Antoine BOUET; Devesh ROY
    Abstract: Trade protection and tax evasion: evidence from Kenya, Mauritius and Nigeria
    Date: 2009–06
  4. By: Gerlinde Fellner; Rupert Sausgruber; Christian Traxler
    Abstract: We run a large-scale natural field experiment to evaluate alternative strategies to en- force compliance with the law. The experiment varies the text of mailings sent to potential evaders of TV license fees. We find a strong alert effect of mailings, leading to a substantial increase in compliance. Among different mailing conditions a legal threat that stresses a high detection risk has a significant and highly robust deterrent effect. Neither appealing to morals nor imparting information about others' behavior enhances compliance. However, the information condition has a positive effect in municipalities where evasion is believed to be common. Overall, the economic model of crime performs remarkably well in explaining our data.
    Keywords: Field experiments, law enforcement, compliance, deterrence
    JEL: K42 C93
    Date: 2009–10

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