New Economics Papers
on Law and Economics
Issue of 2011‒04‒09
five papers chosen by
Jeong-Joon Lee, Towson University

  1. Alternative indices of political freedoms, property rights, and political instability for Zambia By J.W. Fedderke; I. Lourenco; F. Gwenhamo
  2. Youth Unemployment and Crime: New Lessons Exploring Longitudinal Register Data By Grönqvist, Hans
  3. The Effect of the Election of Prosecutors on Criminal Trials By Siddhartha Bandyopadhyay; Bryan C McCannon
  4. Turning 18: What a Difference Application of Adult Criminal Law Makes By Entorf, Horst
  5. Law and Growth Economics: A Framework for Research By Cooter, Robert D.; Edlin, Aaron

  1. By: J.W. Fedderke; I. Lourenco; F. Gwenhamo
    Abstract: This paper presents new institutional measures for Zambia. Coverage is of political rights and freedoms, of property rights, and of political instability. The sample period is from 1947 to 2007. Comparison of the indices with directly comparable Zimbabwean and Malawian series, shows strong sources of divergence in institutional conditions. The paper also considers interaction amongst the institutional measures, and between the institutional measures and measures of economic development. We find that there is an association among the institutional variables, with the various rights dimensions moving together, and being negatively associated with political instability. The evidence further suggests that the institutional measures are associated benevolently with economic development. In this sense the indicators of the present paper therefore conform to the precepts of the new institutional economics
    Keywords: Institutions, Political freedom, Property rights, Political Instability and Zambia
    JEL: K00 N4 O1
    Date: 2011
  2. By: Grönqvist, Hans (Swedish Institute for Social Research, Stockholm University)
    Abstract: This paper investigates the link between youth unemployment and crime using a unique combination of labor market and conviction data spanning the entire Swedish working-age population over an extended period. The empirical analysis reveals large and statistically significant effects of unemployment on several types of crime. The magnitude of the effect is similar across different subgroups of the population. In contrast to most previous studies, the results suggest that joblessness explain a meaningful portion of why male youths are overrepresented among criminal offenders. I discuss reasons for the discrepancy in the results and show that that the use of aggregated measures of labor market opportunities in past studies is likely to capture offsetting general equilibrium effects. Contrary to predictions by economic theory the effect of unemployment on crime is not mediated by income. Instead, an analysis of crimes committed during weekdays versus weekends provides suggestive evidence that unemployment increases the time that individuals have to engage in crime.
    Keywords: Unemployment; Delinquency; Age-crime profile
    JEL: J62 K42
    Date: 2011–03–30
  3. By: Siddhartha Bandyopadhyay; Bryan C McCannon
    Abstract: We examine if elections of public prosecutors (as is common in the U.S.) influence the way they handle cases. In particular, does it affect which cases are taken to trial? A theoretical model is constructed where voters use outcomes of the criminal justice system as a signal of prosecutor's quality. This leads to a distortion of the mix of cases they take to trial. Our results imply that when re-election pressures are high (i) prosecutors take too many cases to trial. This increases the number of convictions from trial and reduces the amount of plea bargaining so that (ii) the proportion of convictions stemming from trial increases. Consequently, (iii) the average sanction obtained in both jury trials and plea bargains decreases. A detailed dataset from North Carolina is used to identify empirical evidence of such distortions. Our empirical findsings verify that elections do affect the decision of which cases to take to trial and confirms our predictions.
    Keywords: elections, prosectutor, trials
    JEL: K41 D82
    Date: 2011–03
  4. By: Entorf, Horst
    Abstract: This paper contributes to the literature on specific deterrence by addressing the issue of selecting adolescents into adult and juvenile law systems. In Germany, different from the U.S. and most other countries, turning a critical cutoff age does not cause a sharp discontinuity from juvenile to adult penal law, but rather implies a shift to a discretionary system of both adult and juvenile law, dependent on the courts’ impression of moral and mental personal development of the adolescent at the time of the act. The German legal system draws the line of adulthood at some fuzzy age interval between 18 and 21, which is well above the thresholds prevailing in the U.S. (16 to 18 years, state specific) and other countries such that the German evidence entails some external evidence to the previous literature mostly relying on U.S. data. Based on a unique inmate survey and two-equation models controlling for selectivity problems, results show that application of adult criminal law instead of juvenile penal law decreases expected recidivism of adolescents.
    Keywords: Specific deterrence; selectivity; inmate survey
    JEL: C35 K42 K14
    Date: 2011–03
  5. By: Cooter, Robert D.; Edlin, Aaron
    Abstract: Many law and economics models concern static efficiency and redistribution. The standard analysis of dynamic industries requires lawmakers to balance faster innovation against lower consumer prices. Sustained growth dominates these effects, so law and growth economics should focus on maximizing it. Law can increase the growth rate by making innovation more profitable. We distinguish innovation into phases -- discovering ideas, developing them with capital and labor, and marketing innovations. Strengthening intellectual property law and weakening antitrust law increases the costs of developing ideas, and also increases the revenues from marketing innovations. To maximize the profitability of innovation, law should balance these two effects. We use these ideas to develop a framework for law and growth economics.
    Keywords: Law
    Date: 2011–01–13

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