New Economics Papers
on Law and Economics
Issue of 2010‒10‒30
four papers chosen by
Jeong-Joon Lee, Towson University

  1. Optimal Leniency Programs in Antitrust By Andrea Pinna
  2. Product Market Regulation: Extending the Analysis Beyond OECD Countries By Anita Wölfl; Isabelle Wanner; Oliver Röhn; Giuseppe Nicoletti
  3. Untouchability and Public Infrastructure. By Catherine Bros; Mathieu Couttenier
  4. Welfare Costs of Crime and Common Violence: A Critical Review By Rodrigo Reis Soares

  1. By: Andrea Pinna
    Abstract: This paper analyses the incentive structure underlying the adoption of leniency programs in antitrust enforcement. The enforcement of competition law is treated as the delegation of the economic activity from the government to private firms. The model contributes to the debate over desirability of granting leniency to more than one cartelists. For this purpose, I introduce a probability of conviction that depends on authority-specific characteristics. This results in the optimal number of leniencies being specific to national authorities and market structures. The model confirms a result widely acknowledged in the antitrust literature - a program that merely reduces sanctions to the first reporter is ineffective.
    Keywords: Antitrust; Leniency; Deterrence
    JEL: K21 L13 L14
    Date: 2010
  2. By: Anita Wölfl; Isabelle Wanner; Oliver Röhn; Giuseppe Nicoletti
    Abstract: In this paper the recently updated product market regulation (PMR) indicators are extended to a larger set of countries including several non-OECD members. It investigates regulatory patterns in this extended set of countries as compared to the OECD countries and analyses the link between regulation and growth. On average, regulation is more restrictive of competition in non-member countries than in the OECD area. However, there exists considerable heterogeneity within this country grouping as concerns the level of the regulatory stance and its composition as well as the potential past evolution of regulatory processes. Furthermore, growth regressions provide evidence that less restrictive product market regulation is conducive to growth. An improvement of ½ index points of barriers to entrepreneurship would translate into approximately a 0.4% higher average annual rate of GDP per capita growth. However, the results also suggest that for countries that are less advanced, the potential growth benefits of enhancing product market competition may be impaired by other structural weaknesses. In particular, some restrictions of foreign trade and investment might be beneficial for growth in early stages of development.<P>La réglementation des marchés de produits : étendre l'analyse au-delà des pays de l'OCDE<BR>Dans cet article, les indicateurs de réglementation des marchés de produits, qui ont été récemment mis à jour, sont étendus à de nombreux pays, dont plusieurs pays non-membres. Cet article examine la réglementation dans cet ensemble de pays et analyse le lien entre la réglementation et la croissance. En moyenne, la réglementation est plus restrictive pour la concurrence dans les pays non-membres vis-à-vis de la zone OCDE. Toutefois, il existe une hétérogénéité considérable au sein de ce groupe de pays en ce qui concerne le niveau de réglementation et sa composition ainsi que l'évolution potentielle des processus de réglementation dans le passé. En outre, des estimations économétriques mettent en évidence qu'une réduction des obstacles à la concurrence est favorable à la croissance. Une amélioration d'un ½ point des obstacles à l'entrepreneuriat se traduirait par un taux annuel moyen de croissance du PIB par habitant qui serait d'environ 0,4% plus élevé. Cependant, les résultats suggèrent également que pour les pays moins avancés dans leur développement économique, les avantages potentiels de croissance résultant d'un renforcement de la concurrence sur les marchés de produits peuvent être altérés par d'autres faiblesses structurelles. En particulier, certaines restrictions au commerce international et à l'investissement étranger pourraient être favorables pour la croissance dans les premiers stades de développement.
    Keywords: product market regulation, growth regressions, réglementation du marché des produits, estimations économétriques
    JEL: K20 L51 O11 O43
    Date: 2010–10–06
  3. By: Catherine Bros (Centre d'Economie de la Sorbonne et Centre de Sciences Humaines - Delhi); Mathieu Couttenier (Centre d'Economie de la Sorbonne)
    Abstract: Caste rules prohibit the sharing of water between castes as a contact made by an untouchable with water ritually taints the source. Despite untouchability practices being outlawed by the Constitution of India, they are still vigorous and violently enforced. This is what is investigated in this article. The aim is to evidence a relationship between the number of acts of violence against untouchables and the way water is distributed. Our results show that, the more individual the source, the less scope there is for potential ritual pollution and hence, the lower the number of violent acts against untouchables. This is the first analysis, to the best of our knowledge, that quantifies and evidences the enforcement of untouchability rules with regard to water distribution. This paper underlines that water improvement programs have the nice side effect of alleviating caste based violence on top of improving sanitation.
    Keywords: Castes, India, water distribution.
    JEL: K42 J15 H4
    Date: 2010–09
  4. By: Rodrigo Reis Soares (Department of Economics PUC-Rio)
    Abstract: This paper critically reviews a vast array of literature on the costs of crime and common violence. Using a simple economic model of crime as a theoretical benchmark, we conceptually discuss the estimates available and their potential use as inputs for public policy. We present current methodologies, explore their main results, discuss their limitations, and suggest directions for further research.
    Keywords: crime, violence, welfare, costs, contingent valuation, willingness to pay JEL codes: K42, O17, O57
    Date: 2010–10

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