nep-law New Economics Papers
on Law and Economics
Issue of 2015‒02‒28
thirteen papers chosen by
Eve-Angeline Lambert, Université de Lorraine

  1. Systemacity Of Law: A Phantasm? By Mikhail Antonov
  2. Compliance – some thoughts about reaching the next level By Baxter, Thomas C.
  3. There Will Be Blood: Crime Rates in Shale-Rich US Counties By Alexander James ; Brock Smith
  4. Non-Scalability Of The Concept Of Law. A Reply To Thomas Schultz By Sergey V. Tretyakov
  5. The Reanimation Of Piracy: Challenges Of Adapting International Law Norms Into Russia’s Legal System By Anton A. Varfolomeev
  6. The Effect of Particularism on Corruption: Theory and Empirical Evidence By Valentina Rotondi ; Luca Stanca
  7. The adjustment of Moldova's competition law to European Union competition law By Bologan, Dumitriţa
  8. Overcriminalization: administrative regulation, prosecutorial discretion, and the rule of law By Ronald A. Cass
  9. Patent Litigation Insurance By Anne Duchêne
  10. Drug Decriminalization and the Price of Illicit Drugs By Félix, Sónia ; Portugal, Pedro
  11. Cannabis Decriminalization and the Age of Onset of Cannabis Use By Cervený, J. ; van Ours, J.C. ; Chomynova, Pavla ; Mravcik, Viktor
  12. Innovation and the Experience with Agricultural Patents Since 1990: Food for Thought By Douglas C. Lippoldt
  13. The Cost of Binge Drinking By Francesconi, Marco ; James, Jonathan

  1. By: Mikhail Antonov (National Research University Higher School of Economics )
    Abstract: The subject-matter of this article is the “systemacity of law” concept and its methodological feedback. Continuing a series of articles on this subject, the author focuses on the internal rationality of claims about systemic character of law. This rationality is embedded in the legal thinking of Modernity and reveals itself in the belief in rational nature of law. According to this style of legal thinking, such internal rationality impedes law from being chaotically or randomly organised and structured. Therefore, law shall have a reasonably organized structure, even if in reality it does not have such a structure. In this way, the belief in an internal rationality of law transforms itself into the requirement for the rational organization of law. These two elements—belief in an internal rationality and the requirement of rational organization of law—are the pillars of the dogmatic conception of law which was established in Begriffsjurisprudenz of the 19th century and which still holds sway over contemporary continental legal thinking.
    Keywords: normative systems, legal system, positivity of law, unity of law, identity of legal system, phantasm, coherence
    Date: 2015
  2. By: Baxter, Thomas C. (Federal Reserve Bank of New York )
    Abstract: Remarks at the Fordham Journal of Corporate Counsel & Financial Law Symposium, Fordham Law School, New York City.
    Keywords: compliance officer; ethics; Program Effectiveness Index (PEI); culture; values; rules; regulation; law; chief ethics and compliance officer (CECO); legal risk; de-risking; repeatable processes; boards of directors
    JEL: G18 G28 G38 K20
    Date: 2015–02–09
  3. By: Alexander James ; Brock Smith
    Abstract: Over the past decade, the production of shale oil and gas significantly increased in the United States.  This paper uniquely examines how this energy boom has affected regional crime rates throughout the United States.  There is evidence that, as a result of the ongoing shale-energy boom, shale-rich counties experienced faster growth in rates of both property and violent crimes including rape, assault, murder, robbery, burglary, larceny and grand-theft auto.  These results are particularly robust for rates of assault, and less so for other types of crimes.  Policy makers should anticipate these effects and invest in public infrastructure accordingly.
    Keywords: Natural Resources, Hydraulic Fracturing, Crime, Resource Curse
    Date: 2014–07–05
  4. By: Sergey V. Tretyakov (National Research University Higher School of Economics )
    Abstract: The thesis of non-scalability of the concept of law put forward by Professor Thomas Schultz is under the scrutiny in the paper. The major weakness of the thesis rests in the fact that the emergence of transnational normative regimes question the old paradigm of the concept of law. The deterritorialization of the legal mode of domination blocks the possibility to fix the (indisputable) necessary and sufficient conditions constituting the concept of law which is the prerequisite for the justification of the non-scalability thesis. The author thinks that we need the other sort of methodology to describe the problem
    Keywords: non-scalability of law, threshold, internal morality of law, deterritorialization, concept and conception, necessary and sufficient conditions
    JEL: K10
    Date: 2015
  5. By: Anton A. Varfolomeev (National Research University Higher School of Economics )
    Abstract: This study focuses on the dissonance between the definition of piracy in Russia’s Criminal Code (disposition of Article 227) and piracy as defined by international law (Article 101 of the UN Convention on the Law of the Sea, 1982). This can create obstacles in the appropriate qualification of piracy acts and lead to a certain discord between the two (national and international) law systems. At least four areas of possible disagreements were identified: contradictions over a place to commit an act of piracy; over the object of crime; a purpose, and over a crime’s objective aspect. The paper also investigates the potential competitions between jurisdictions, including situations in Russia’s exclusive economic zone and on board a vessel registered at a Russian port.
    Keywords: piracy, criminal prosecution, universal jurisdiction, collision of jurisdiction, Russia.
    JEL: K33
    Date: 2014
  6. By: Valentina Rotondi ; Luca Stanca
    Abstract: This paper investigates the role played by the cultural norms of particularism and universalism for collusive bribery. In our theoretical framework, the act of proposing or demanding a bribe violates a commonly held social norm, thus producing a psychological cost. By lowering this psychological cost, particularism increases the probability of offering or asking for a bribe. We test the predictions of the model by using individual-level data for 25 countries from the European Social Survey. Consistent with the theory, particularism is found to have a positive causal effect on the probability of offering a bribe, but no effect on the probability to be asked for a bribe. Overall, our findings indicate that policies aimed at favoring universalism may provide an effective tool in the fight against corruption.
    Keywords: Corruption, Bribe, Particularism, Universalism.
    JEL: D73 O17 C71 K42 Z13
    Date: 2015–02
  7. By: Bologan, Dumitriţa
    Abstract: This paper explores the historical background of the political and economic relations between the Republic of Moldova and the European Union, presenting an overview of relevant documents such as the Partnership and Cooperation Agreement and the Association Agreement. Special emphasis is put on the development of competition law in Moldova as one of the main instruments for ensuring the function of a market economy. In this context, the paper also addresses the process of adjustment of Moldova's relevant legislation to the European Union competition law, describing the range of legal instruments and institutions involved in this process and the monitoring thereof by the European Union.
    Keywords: European integration,Partnership and cooperation agreement,Association agreement,European competition law,Moldavian competition law,Adjustment of competition rules,Neighbor policy
    Date: 2015
  8. By: Ronald A. Cass
    Date: 2015–02
  9. By: Anne Duchêne
    Abstract: Empirical studies have found that high litigation costs often discourage small firms from investing in R&D, as they fear their patent will be infringed and they will not be able to afford litigation. As a solution, firms have been encouraged to purchase insurance policies which, by covering legal costs in the event of a trial, serve as a commitment to litigate so that settlement terms are more favorable to the insured, and potential infringement is less likely to occur. However, very few firms are purchasing insurance and the market remains poorly developed throughout the world. I show that firms might be discouraged from buying insurance because of information asymmetries, not only with insurance companies but also with their competitors. I study the situation of a patent holder, who perfectly knows the validity and enforceability (“strength”) of her patent, that has been infringed by a competitor with less information on the patent. The patent holder can purchase insurance to have a credible threat to litigate and increase the infringer’s settlement offer. But the decision to buy an insurance conveys information about the patent strength to the infringer. As a result the patent holder may prefer not to be insured rather than transmitting this information. This signaling effect can yield different equilibriums, in particular a pooling equilibrium “no insurance” where no patent holder purchases an insurance. I study if this situation might be improved by imposing a mandatory insurance or by giving the insurer a share of litigation proceeds.
    Keywords: litigation, settlement, patent litigation, insurance.
    JEL: D82 K41 G22 O34
    Date: 2015–02–10
  10. By: Félix, Sónia (Universidade Nova de Lisboa ); Portugal, Pedro (Banco de Portugal )
    Abstract: This study is an empirical assessment of the impact of the drug decriminalization policy followed by Portugal in July, 2001. We investigate especially the impact of the policy change on the price of illicit drugs. The analysis is performed using a difference-in-differences approach and a comprehensive set of countries as control group. We also investigate the application of Synthetic Control Method in order to construct a synthetic control unit from a convex combination of other countries. The results suggest that the prices of opiates and cocaine in the post-treatment period did not decrease in the sequence of the policy change. This result contrasts with the argument that softer drug law enforcement necessarily leads to lower prices and, consequently, to higher drug usage rates and dependence.
    Keywords: illicit drugs, drug decriminalization policy, drug prices, treatment effects
    JEL: C21 D04
    Date: 2015–02
  11. By: Cervený, J. (Tilburg University, Center For Economic Research ); van Ours, J.C. (Tilburg University, Center For Economic Research ); Chomynova, Pavla ; Mravcik, Viktor
    Abstract: This paper examines the effect of a change in drugs policy on the age of onset of<br/>cannabis use. We use 2012 survey data from the Czech Republic where in 2010 a<br/>law was introduced decriminalizing personal possession of small quantities of several illicit drugs, including cannabis. We estimate the effect of the policy change using a mixed proportional hazards framework that models the starting rate of cannabis use, i.e. the transition to first cannabis use. We find that the decriminalization of cannabis did not affect the age of onset of cannabis use.
    Keywords: Cannabis,; decriminalization; age of onset
    JEL: I18 C41
    Date: 2015
  12. By: Douglas C. Lippoldt
    Abstract: This report considers developments in agricultural patents since 1990 and their economic implications. It first provides an overview of the international framework for intellectual property protection and of the general trends in the stringency of protection in OECD countries. It then presents developments in the number of patents originating from OECD and other countries that are granted in Europe and the United States, for all fields and for agriculture and food technologies. These illustrate the leading role played by OECD countries in the provision of successful applications, although non-OECD countries increased their share of the total between 1990 and 2010. Finally, econometric analysis is used to assess the relationships between patenting and selected indicators of innovation and economic performance. The results points to favourable economic developments associated with the patent reforms in the recent decades.
    Keywords: intellectual property rights, patents, performance, intellectual property protection, innovation, agriculture
    JEL: O34 Q16 Q17
    Date: 2015–02–23
  13. By: Francesconi, Marco (University of Essex ); James, Jonathan (University of Bath )
    Abstract: We estimate the effect of binge drinking on accident and emergency attendances, road accidents, arrests, and the number of police officers on duty using a variety of unique data from Britain and a two-sample minimum distance estimation procedure. Our estimates, which reveal sizeable effects of bingeing on all outcomes, are then used to monetize the short-term externalities of binge drinking. We find that these externalities are on average £4.9 billion per year ($7 billion), about £80 for each man, woman, and child living in the UK. The price that internalizes this externality is equivalent to an additional 9p per alcoholic unit, implying a 20% increase with respect to the current average price.
    Keywords: alcohol, health, road accidents, arrests, externalities
    JEL: I12 I18 K42
    Date: 2015–02

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