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on Law and Economics |
| By: | Frank Maier-Rigaud (IESEG School of Management (LEM-CNRS)) |
| Abstract: | This paper critically reviews the European Commission’s proposed Directive on future rules concerning actions for damages for competition law infringements under national law. It is argued that the proposal underestimates the importance of loss of profits induced by increased prices and does little in ensuring that such effects will receive an equal treatment to price effects in damage claims. The paper suggests that the importance of such effects could have been emphasized by introducing a rebuttable presumption on lucrum cessans based on pass-on considerations – paralleling the presumption on overcharge. Furthermore, the decision to leave questions of causality to national tort laws is criticized as a harmonized regulation of claims based on the merits of the evidence presented would have been a superior tool, in line with a more economic approach and better suited for achieving the goal of compensation for any victim due to its intrinsic flexibility. Finally the notion that legally relevant damages only accrue within a vertical value chain is challenged. |
| Keywords: | quantification of damages, pass-on, passing-on defence, overcharge, unjust enrichment, private enforcement, lucrum cessans, quantity effect, damnum emergens, price effect, burden of proof, standard of proof, tort law, compensation, presumption |
| JEL: | K21 K40 L40 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:ies:wpaper:e201316&r=law |
| By: | Lindhe, Tobias (Uppsala center for fiscal studies); Södersten, Jan (Department of Economics) |
| Abstract: | This paper examines how the distortions caused by dividend taxation depend on whether or not shareholders can recover their original equity injections without being subject to the dividend tax. We point out the alternative assumptions in the literature on this, and we compare two different tax regimes, one where it is impossible for the firm to pay cash to its shareholders that is not taxed as dividends, the other where the shareholders are allowed a tax-free return of the original capital contributed through new issues. Our analysis shows that the regimes imply a substantial difference to our perceptions of the distortive effects of dividend taxation. |
| Keywords: | dividend taxation; share repurchases; equity trap; cost of capital; nucleus theory; growth path |
| JEL: | H24 H25 H32 |
| Date: | 2013–09–04 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uunewp:2013_016&r=law |
| By: | Roman Inderst (Johann Wolfgang Goethe-Universität, Frankfurt/Main); Frank Maier-Rigaud (IESEG School of Management (LEM-CNRS)) |
| Abstract: | We analyse the key determinants of umbrella effects, which arise when the price increase or quantity reduction of a cartel diverts demand to substitute products. Umbrella effects arise irrespective of whether non cartelists act as price takers (“competitive fringe”) or respond strategically to the increased demand. Sizable umbrella effects can also arise when non-cartelists are outside the relevant market (in the sense of a SSNIP test), provided that the cartel’s price increase is substantial. Further, a shift of demand to non-cartelists, triggering a price increase, can be induced also when their purchasers themselves benefit from higher demand as rivals purchase from the cartel and pass-on the respective price increase. To identify the actual damage it is thus key to take into account the overall adjustments among cartel members and outsiders as well as their respective, potentially competing purchasers. We also discuss how future analysis of the endogenous formation of cartels with partial market coverage should inform theories of the determinants of umbrella effects. |
| Keywords: | umbrella effect, partial cartel, pass-on, cartel effect, quantification of damages, merger effects, private enforcement, standing, market definition, cellophane fallacy, antitrust |
| JEL: | K21 L13 L41 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:ies:wpaper:e201317&r=law |
| By: | Randall Q. Akee (UCLA, Luskin School of Public Affairs); Timothy J. Halliday (UHERO, University of Hawaii at Manoa); Sally Kwak (U.S. Congress, Joint Committee on Taxation) |
| Abstract: | Due to the large social costs of juvenile crime, policymakers have long been concerned about its causes. In the 2009-10 school year, the State of Hawaii responded to fiscal strains by furloughing all school teachers employed by the Department of Education and canceling class for seventeen instructional days. We examine the effects of this unusually short school year to draw conclusions about the relationship between time in school and juvenile arrests on Oahu. We calculate marginal effects from a negative binomial model and find that time off from school is associated with significantly fewer juvenile assault and drug-related arrests, although there are no changes in other types of crimes, such as burglaries. During the shortened school year, we calculate that there were twenty fewer assault arrests and fourteen fewer drug-related arrests of juveniles on Oahu. The declines in arrests for assaults were the most pronounced in poorer regions of the island whereas the declines in drug-related arrests were higher in relatively more prosperous regions. |
| Keywords: | Education, Crime, Inequality |
| JEL: | J08 I24 |
| Date: | 2013–08 |
| URL: | http://d.repec.org/n?u=RePEc:hae:wpaper:2013-7r1&r=law |