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on Law and Economics |
| By: | Anand Swamy (Williams College) |
| Abstract: | The East India Company’s conquest of various territories in India typically brought one issue to the forefront right away: How would land taxes, the principal source of governmental revenue, be collected? But taxation was not a thing unto itself; it was inextricably linked with “ownership” and indeed with the entire structure of land rights. For this reason, among others, the Company also created/adapted legal systems that would adjudicate the disputes that, inevitably, followed in the wake of its land-rights interventions. The legal and land tenure arrangements chosen also affected credit markets: to the extent land ownership is secure and transferable, land can be used as collateral, or seized in lieu of repayment of debts or other contractual obligations. Land, law, and credit in colonial India generated a huge (and ongoing) discussion: debates preceding policy choices; later commentary within the colonial administration; “nationalist” criticisms from the late 19th century onwards; and current research linking present-day economic outcomes to colonial era choices. In this paper we provide an overview of this literature, focusing on the period 1765-1900. In the interest of brevity and coherence we focus two regions, Bengal, which was first conquered (1757-64), and the Bombay Deccan, which was annexed in 1818, though we make references to other regions as well. |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:wil:wilcde:2011-03&r=law |
| By: | Entorf, Horst (Goethe University Frankfurt) |
| Abstract: | This paper tests predictions of a structural, augmented supply-of-offenders model regarding the relative effects of police, public prosecution and courts, respectively, on crime. Using detailed data on the different stages of the criminal prosecution process in Germany, empirical evidence suggests that public prosecutors and their influence on the probability of conviction play a major role in explaining the variation of crime rates, while the impact of the severity of punishment is small and insignificant. |
| Keywords: | public prosecutors, certainty of punishment, general deterrence, informal punishment, panel data |
| JEL: | K14 K41 C23 |
| Date: | 2011–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5670&r=law |
| By: | Claudio Detotto; Edoardo Otranto |
| Abstract: | In the last decades, the interest in the relationship between crime and business cy- cle has widely increased. It is a diffused opinion that a causal relationship goes from economic variables to criminal activities, but this causal effect is observed only for some typology of crimes, such as property crimes. In this work we examine the pos- sibility of the existence of some common factors (interpreted as cyclical components) driving the dynamics of Gross Domestic Product and a large set of criminal types by using the nonparametric version of the dynamic factor model. A first aim of this exercise is to detect some comovements between the business cycle and the cyclical component of some typologies of crime, which could evidence some relationships between these variables; a second purpose is to select which crime types are related to the business cycle and if they are leading, coincident or lagging. Italy is the case study for the time span 1991 - 1 - 2004 - 12; the crime typologies are constituted by the 22 official categories classified by the Italian National Statistical Institute. The study finds that most of the crime types show a counter-cyclical behavior with respect to the overall economic performance, and only a few of them have an evident relation- ship with the business cycle. Furthermore, some crime offenses, such as bankruptcy, embezzlement and fraudulent insolvency, seem to anticipate the business cycle, in line with recent global events. |
| Keywords: | business cycle; crime; common factors; dynamic factor models |
| JEL: | E32 C3 K0 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:cns:cnscwp:201107&r=law |
| By: | Mathiesen, Lars (Dept. of Economics, Norwegian School of Economics and Business Administration); Nilsen, Øivind Anti (Dept. of Economics, Norwegian School of Economics and Business Administration); Sørgard, Lars (Dept. of Economics, Norwegian School of Economics and Business Administration) |
| Abstract: | A common approach to merger simulations used in antitrust cases is to calibrate demand from market shares and a few additional parameters. When the products involved in the merger case are differentiated along several dimensions, the resulting diversion ratios may be very different from those based upon market shares. This again may affect the predicted post-merger price effects. This article shows how merger simulation can be improved by using observed diversion ratios. To illustrate the effects of this approach we use diversion ratios from a local grocery market in Norway. In this case diversions from the acquired to the acquiring stores were considerably smaller than suggested by market shares, and the predicted average price increase from the acquisition was 40 % lower using this model rather than a model based upon market shares. This analysis also suggests that even a subset of observed diversion ratios may significantly change the prediction from a merger simulation based upon market shares. |
| Keywords: | Merger simulation; diversion ratio; asymmetric differentiation; merger policy. |
| JEL: | K21 L11 L41 |
| Date: | 2010–09–30 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhheco:2010_027&r=law |
| By: | Jürgen-Peter Kretschmer (University of Marburg) |
| Abstract: | In competition law, the problem of the optimal design of institutional and procedural rules concerns assessment processes of the pro- and anticompetitiveness of business behaviors. This is well recognized in the discussion about the relative merits of different assessment principles such as the rule of reason and per se rules. Supported by modern industrial organization research, which applies a more differentiated analysis to the welfare effects of different business behaviors, a full-scale case-by-case assessment seems to be the prevailing idea. Even though the discussion mainly focuses on extreme solutions, different theoretical approaches do exist, which provide important determinants and allow for a sound analysis of appropriate legal directives and investigation procedures from a ‘Law and Economics’ perspective. Integrating and examining them in light of various constellations results in differentiated solutions of optimally structured assessment processes. |
| Keywords: | Law Enforcement, Competition Law, Competition Policy, Antitrust Law, Antitrust Policy, Decision-Making |
| JEL: | K21 K40 L40 L49 D81 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:mar:magkse:201114&r=law |
| By: | Ozbugday, F.C. (Tilburg University, Center for Economic Research) |
| Abstract: | The present study examines the impact of several industry characteristics on the propensity to collude using a dataset on the existence of collusion across Dutch industries during the late 1990s and early 2000s. The results of the Probit model with sample selection indicate that our sample of Dutch concerted practices is non-random in the sense that it only consists of anti-competitive agreements that were subject of an antitrust immunity behavior. Our bivariate probit model with sample selection indicates that concerted practices are less likely to be seen in service industries relative to manufacturing industries. The results also show that it is more likely that firms engaged in concerted practices in unconcentrated industries. Furthermore, we could not find a non-linear relationship between concentration and the presence of collusion. There is also strong evidence from all the regressions that concerted practices are less likely in industries where entry is more possible. Interestingly, our estimation results indicate that there is a positive correlation between cartel prevalence and import penetration, which implies that import competition did not discipline firm behavior and foreign importers joined the cartel paradise in the Netherlands. As to the role of measures of asymmetry on concerted practice prevalence, the association between patenting activity and propensity to engage in collusion is ambiguous in the current setting, while advertising intensity, as the second measure of asymmetry, is associated with increased likelihood of collusion. Contrary to the previous empirical findings, market growth has been found to have a negative effect on the probability of a concerted practice in an industry. Furthermore, our proposition that growing demand might attract new entrants, which, in turn, hampers collusion, has been falsified in the current context. |
| Keywords: | Cartels;Competition law;Overt collusion;Probit model with sample selection;the Netherlands. |
| JEL: | K21 L41 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:2011037&r=law |
| By: | Gérard Mondello (University of Nice Sophia Antipolis, CREDECO, GREDEG, UMR 6727, CNRS) |
| Abstract: | This paper addresses the conditions for setting up strict civil liability schemes. For that it compares the social efficiency of two main civil liability regimes usually enforced to protect the environment: the strict liability regime and the “capped strict liability scheme”. First, it shows that the regulator faces an effective dilemma when he has to enforce one of these schemes. This because the social cost of a severe harm (and the associated optimum care effort) is determined independently of any liability regime. This independency has economic consequences. First, victims and polluters pit one against another about the liability regime that the government should enforce. Hence, financially constrained polluters prefer the ceiling of responsibilities while victims wish to extend the amount of redress under a “standard” strict liability. Economic criteria for enforcing a regime rather than another one are lacking. Second, the paper shows that implementing civil strict liability rules may be done by setting up care standards as for instance in the nuclear or the maritime sectors and demanding to the injurers to comply with them. We show that this goal can be achieved by resorting to some friendly monitoring corresponding to frequent random controls with low fines rather than few controls that should involve heavy fines. |
| Keywords: | Environment, Strict Liability, Ex-Ante Regulation, Ex-Post Liability, Judgment-Proof, Environment Law, CERCLA, Environmental Liability |
| JEL: | K0 K32 Q01 Q58 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2011.21&r=law |
| By: | Steven D. Levitt; Thomas J. Miles |
| Abstract: | In determining the legality of online poker – a multibillion dollar industry – courts have relied heavily on the issue of whether or not poker is a game of skill. Using newly available data, we analyze that question by examining the performance in the 2010 World Series of Poker of a group of poker players identified as being highly skilled prior to the start of the events. Those players identified a priori as being highly skilled achieved an average return on investment of over 30 percent, compared to a -15 percent for all other players. This large gap in returns is strong evidence in support of the idea that poker is a game of skill. |
| JEL: | K23 K42 |
| Date: | 2011–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17023&r=law |