nep-law New Economics Papers
on Law and Economics
Issue of 2014‒12‒29
eleven papers chosen by
Eve-Angeline Lambert, Université de Lorraine

  1. Optimal Leniency Programs when Firms Have Cumulative and Asymmetric Evidence By Blatter, Marc; Emons, Winand; Sticher, Silvio
  2. Registries By Benito Arruñada
  3. Individual Perceptions of Local Crime Risk By Salm, Martin; Vollaard, Ben
  4. Global trajectories, dynamics, and tendencies of business software piracy: benchmarking IPRs harmonization By Simplice Anutechia Asongu; Antonio Andrés
  5. Individual perceptions of local crime risk By Salm, M.; Vollaard, B.A.
  6. Do Judges React to the Probability of Appellate Review? Empirical Evidence from Trial Court Procedures By Berlemann, Michael; Christmann, Robin
  7. Building Legal Aid Services from the Ground Up : Learning from Pilot Initiatives in Jordan By Paul Scott Prettitore
  8. A Theory of Compliance with Minimum Wage Law By Simplice Anutechia Asongu; Mohamed Jellal
  9. The Distribution of Individual Conformity under Social Pressure across Societies By Michaeli, Moti; Spiro, Daniel
  10. A Theory of Buyer Fragmentation: Divide-and-Conquer Intensifies Competition By Jeon, Doh-Shin; Menicucci, Domenico
  11. PROTECTION OF COMPETITION POLICY IN SERBIA By Milan Petković, Svetislav Stanković

  1. By: Blatter, Marc; Emons, Winand; Sticher, Silvio
    Abstract: An antitrust authority deters collusion using fines and a leniency program. Unlike in most of the earlier literature, our firms have imperfect cumulative evidence of the collusion. That is, cartel conviction is not automatic if one firm reports: reporting makes conviction only more likely, the more so, the more firms report. Furthermore, the evidence is distributed asymmetrically among firms. Asymmetry of the evidence can increase the cost of deterrence if the high-evidence firm chooses to remain silent. Minimum-evidence standards may counteract this effect. Under a marker system only one firm reports; this may increase the cost of deterrence.
    Keywords: antitrust; cartels; deterrence; evidence; leniency
    JEL: D43 K21 K42 L40
    Date: 2014–08
  2. By: Benito Arruñada
    Abstract: Governments and international development agencies often fail in their efforts to build and reform property and company registries. They implement misguided policies rooted in a poor understanding of the role that registries play in the modern economy. This work aims to remedy this situation by first presenting a theory of registries as market-enabling institutions which, by making private contracts verifiable by judges, enable truly impersonal (i.e., assetbased, in rem) trade without endangering property enforcement. The theory is then applied to discuss and guide major policy decisions that reformers face in the areas of land titling and business formalization, emphasizing the principle of registry independence, identifying courts as the key users of registries, clarifying the main choices of titling and formalization projects, and pointing out the presence of diseconomies of scope between contractual and administrative registries.
    Keywords: property rights, land policy, land titling, registries, transaction costs, foreclosure crisis, business formalization, impersonal exchange.
    JEL: D23 K11 K12 L85 G38 H41 O17 P48
    Date: 2014–08
  3. By: Salm, Martin (Tilburg University); Vollaard, Ben (Tilburg University)
    Abstract: We provide evidence that perceptions of crime risk are severely biased for many years after a move to a new neighborhood. Based on four successive waves of a large crime survey, matched with administrative records on household relocations, we find that the longer an individual lives in a neighborhood, the higher their perception of the crime rate in the neighborhood. This finding holds irrespective of whether the move is from a relatively low-crime to a relatively high-crime area or vice versa. We find that avoidance behavior adjusts in line with the observed changes in beliefs.
    Keywords: heuristic, victimization, crime
    JEL: D81 K42 K14
    Date: 2014–11
  4. By: Simplice Anutechia Asongu (Association of African Young Economists); Antonio Andrés (Universidad Camilo Jose CelaFacultad)
    Abstract: In this paper, we examine global trajectories, dynamics, and tendencies of software piracy to ease the benchmarking of current efforts towards harmonizing the standards and enforcements of Intellectual Property Rights (henceforth IPRs) protection worldwide. Our empirical exercise is based on 15 different panel regressions, which together consists of 99 countries. The richness of the dataset allows us to disaggregate countries into fundamental characteristics of business software piracy based on income-levels (high-income, lower-middle-income, upper-middle-income and low-income), legal-origins (English common-law, French civil-law, German civil-law and, Scandinavian civil-law) and, regional proximity (South Asia, Europe & Central Asia, East Asia & the Pacific, Middle East & North Africa, Latin America & the Caribbean and, Sub-Saharan Africa). Our main finding suggest that, a genuine timeframe for standardizing IPRs laws in the fight against software piracy is most feasible within a horizon of 4.3 to 10.4 years. In other words, full (100%) convergence within the specified timeframe will mean the enforcements of IPRs regimes without distinction of nationality or locality within identified fundamental characteristics of software piracy. The absence of convergence (in absolute and conditional terms) for the World panel indicates that, blanket policies may not be effective unless they are contingent on the prevailing trajectories, dynamics and tendencies of software piracy. Policy implications and caveats are also discussed.
    Keywords: Piracy, Business Software, Software piracy, Intellectual Property Rights, Panel data, Convergence
    JEL: F42 K42 O34 O38 O57
    Date: 2014–10
  5. By: Salm, M. (Tilburg University, TILEC); Vollaard, B.A. (Tilburg University, TILEC)
    Abstract: We provide evidence that perceptions of crime risk are severely biased for many years after a move to a new neighborhood. Based on four successive waves of a large crime survey, matched with administrative records on household relocations, we find that the longer an individual lives in a neighborhood, the higher their perception of the crime rate in the neighborhood. This finding holds irrespective of whether the move is from a relatively low-crime to a relatively high-crime area or vice versa. We find that avoidance behavior adjusts in line with the observed changes in beliefs.
    Keywords: heuristic; Victimization; crime
    JEL: D81 K42
    Date: 2014
  6. By: Berlemann, Michael (Helmut Schmidt University, Hamburg); Christmann, Robin (Helmut Schmidt University, Hamburg)
    Abstract: The appellate review system is intended to serve as an efficient remedy for imperfect judicial decision making. However, it can fulfill this task only when appeals are filed solely due to bad verdicts and are ex-ante unpredictable based on factors that are exogenous to the judge. Using data from case records of a German trial court, we show that the probability of appeal can be predicted based on easily observable exogenous factors. Controlling for the complexity of a legal case, we find that judges also tend to increase their effort when the ex-ante probability of appeal is high. Thus, our empirical evidence indicates an inefficiency in the appellate review system.
    Keywords: litigation; judicial behaviour; appellate review; civil procedure
    JEL: D82 K10 K41
    Date: 2014–12–15
  7. By: Paul Scott Prettitore
    Keywords: Legal Institutions of the Market Economy Law and Development - Legal Products Gender - Gender and Law Corruption and Anticorruption Law Public Sector Corruption and Anticorruption Measures Public Sector Development
    Date: 2014–01
  8. By: Simplice Anutechia Asongu (Association of African Young Economists); Mohamed Jellal (Al Makrîzi Institut d'Economie)
    Abstract: Purpose – In this paper, we introduce firm heterogeneity in the context of a model of non-compliance with minimum wage legislation. Design/methodology/approach – Theoretical modeling under government compliance policy and wages & employment under non compliance. Findings – The introduction of heterogeneity in the ease with which firms can be monitored for non compliance allows us to show that non-compliance will persist in sectors which are relatively difficult to monitor, despite the government implementing non stochastic monitoring. Moreover, we show that the incentive not to comply is an increasing function of the level of the minimum wage and increasing function of the gap between the minimum wage and the competitive wage rate. Originality/value – We have shown why non compliance persists in certain sectors of activity despite frequent inspection by government agencies.
    Keywords: Minimum wage legislation, informal sector in LDCs
    JEL: H26 O17
    Date: 2014–09
  9. By: Michaeli, Moti (Department of Economics and The Center for the Study); Spiro, Daniel (Dept. of Economics, University of Oslo)
    Abstract: This paper studies the aggregate distribution of declared opinions and behavior when heterogeneous individuals make the trade-off between being true to their private opinions and conforming to an endogenous social norm. The model sheds light on how various punishment regimes induce conformity or law obedience, and by whom, and on phenomena such as societal polarization, unimodal concentration and alienation. In orthodox societies, individuals will tend to either fully conform or totally ignore the social norm, while individuals in liberal societies will tend to compromise between these two extremes. Furthermore, the degree of orthodoxy determines whether those who fairly agree with the norm or those who strongly disapprove it will conform. Likewise, the degree of liberalism determines which individuals will compromise the most. In addition, orthodox societies may adapt norms that are skewed with respect to the private opinions in society, while liberal societies will not do so.
    Keywords: Social pressure; Conformity; Liberal; Orthodox; Compliance
    JEL: D01 D30 D70 K42 Z10 Z12 Z13
    Date: 2013–12–30
  10. By: Jeon, Doh-Shin; Menicucci, Domenico
    Abstract: It is well-known from Innes and Sexton (1993, 1994) that divide-and-conquer contracts allow an incumbent facing a potential entrant to extract more surplus from buyers and hence buyers suffer from the strategy. In this paper, we show that when sellers compete by offering personalized non-linear tariffs, divide-and-conquer strategies intensify competition among sellers in the presence of indirect contracting externalities. Therefore, buyers prefer remaining fragmented to forming a buyer group. When buyer group formation is decided before the entry of an entrant, our result implies that buyers may deliberately induce a socially suboptimal entry by remaining fragmented in order to benefit from more intense competition upon the entry.
    Keywords: Divde-and-Conquer, Buyer Group, Indirect Contracting External- ities, Common Agency, Competition in Non-linear Tari¤s, Multimarket Contact.
    JEL: D4 K21 L41 L82
    Date: 2014–11–26
  11. By: Milan Petković, Svetislav Stanković (Visoka škola strukovnih studija za kriminalistiku i bezbednost, Nis)
    Abstract: Free trade and protection of competition on the market do little to benefit a large number of people a monopolized market provides a great benefit a few individuals. Without competition there is no free market. While in terms of general social interest competition is usually a desirable phenomenon in the market, from the point of view of the individual undertaking it is undesirable evil, because it forces them to work harder, and at the same time it reduces the profit.
    Keywords: Competition law, anti-trust policy, The Competition Commission
    JEL: E60 M21 O25
    Date: 2014–04

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