nep-law New Economics Papers
on Law and Economics
Issue of 2016‒03‒10
nine papers chosen by
Eve-Angeline Lambert, Université de Lorraine

  1. Criminal Discount Factors and Deterrence By Mastrobuoni, Giovanni; Rivers, David A.
  2. In brief... Rapid response policing: the impact on crime detection By Jordi Blanes i Vidal; Tom Kirchmaier
  3. China's Sex Ratio and Crime: Behavioral Change or Financial Necessity? By Cameron, Lisa A.; Meng, Xin; Zhang, Dandan
  4. Judicial Independence, Judges’ Incentives and Efficiency By Melcarne, Alessandro; Ramello, Giovanni B.
  5. The dynamics of leniency application and the knock-on effect of cartel enforcement By Eric van Damme; Jun Zhou
  6. Inside Severance Pay By Pietro Garibaldi; Tito Boeri; Espen R Moen
  7. Can we fight drugs using communication campaigns? A framed field experiment By Marcela Ibanez; Juanita Vasquez
  8. Centralized vs. Decentralized Institutions for Expert Testimony By Kim, Chulyoung
  9. Towards a Tribunal Services Agency By Pratik Datta

  1. By: Mastrobuoni, Giovanni (University of Essex); Rivers, David A. (University of Western Ontario)
    Abstract: The trade-off between the immediate returns from committing a crime and the future costs of punishment depends on an offender's time discounting. We exploit quasi-experimental variation in sentence length generated by a large collective pardon in Italy and provide non-parametric evidence on the extent of discounting from the raw data on recidivism and sentence length. Using a discrete-choice model of recidivism, we estimate an average annual discount factor of 0.74, although there is heterogeneity based on age, education, crime type, and nationality. Our estimates imply that the majority of deterrence is derived from the first few years in prison.
    Keywords: discounting, deterrence, collective pardon, recidivism
    JEL: D9 K4
    Date: 2016–02
  2. By: Jordi Blanes i Vidal; Tom Kirchmaier
    Abstract: Rapid response policing not only boosts crime detection but also reduces the time it takes to find the offenders. That is the central finding of analysis of data from the Greater Manchester Police by Jordi Blanes i Vidal and Tom Kirchmaier. Their research examines whether it is worth police officers aiming to get to the scene of a crime as soon as possible after being alerted by a member of the public. They find that faster response times make it more likely that victims or witnesses will name a suspect. In contrast, longer response times reduce the likelihood of crimes being detected, especially thefts and robbery.
    Keywords: Police, crime, organisational performance
    JEL: D29 K40
    Date: 2016–02
  3. By: Cameron, Lisa A. (Monash University); Meng, Xin (Australian National University); Zhang, Dandan (Peking University)
    Abstract: This paper uses survey and experimental data from prison inmates and comparable non-inmates to examine the drivers of rising criminality in China. Consistent with socio-biological research on other species, we find that China's high sex-ratios are associated with greater risk-taking and impatience amongst males. These underlying behavioral impacts explain some part of the increase in criminality. The primary avenue through which the sex-ratio increases crime, however, is the direct pressure on men to appear financially attractive in order to find a partner in the marriage market. These marriage market pressures result in a higher propensity to commit financially rewarding crimes.
    Keywords: crime, marriage markets, risk-taking, time preferences, sex-ratio, one child policy, China
    JEL: O12 J12
    Date: 2016–02
  4. By: Melcarne, Alessandro; Ramello, Giovanni B.
    Abstract: Although often assumed by economic theory, an efficient judicial system sounds an oxymoron. In this work we suggest an innovative approach investigating the determinants of court performance. Our focus is on the ideal institutional environment fostering the appropriate set of incentives for judges to operate efficiently. In this setting, we find evidence that greater independence enjoyed by the judiciary from politics induces more competition among judges to obtain professional upgrades. Such environment will incentivize ambitious individuals to be more efficient, thus positively affecting the aggregate performance of the judiciary.
    Keywords: Judicial Efficiency, Judicial Independence, Judicial Decision-Making, DEA, Clearance Rate
    JEL: K41 K49 C14 C34
    Date: 2015–11
  5. By: Eric van Damme; Jun Zhou
    Abstract: HIGHLIGHTS The authors study the timing of leniency applications using a novel application of multi-spell discrete-time survival analysis for a sample of cartels prosecuted by the European Commission between 1996 and 2014. The start of a Commission investigation does not affect the rate by which conspirators apply for leniency in the market investigated, but increases the rate of application in separate markets in which a conspirator in the investigated market also engaged in collusion. The revision of the Commission’s leniency programme in 2002 increased the rate of pre-investigation applications. Our results shed light on enforcement efforts against cartels and other forms of
    Date: 2016–02
  6. By: Pietro Garibaldi (Collegio Carlo Alberto); Tito Boeri; Espen R Moen (Norwegian Business School)
    Abstract: All OECD countries have either legally mandated severance pay or compensations imposed by industry-level bargaining in case of employer initiated job separations. In the literature such transfers are either ineffective or less efficient than unemployment benefits in providing insurance against labor market risk. The paper shows that mandatory severance is optimal in presence of wage deferrals induced by workers' moral hazard. We also establish a link between optimal severance and efficiency of the legal system and characterize the effects of shifting the burden of proof from the employer to the worker. Quantitatively, the welfare effects of suboptimal severance payments vary in general equilibrium between 1 and 3 percent. The model accounts also for two neglected features of the legislation. The first is the discretion of judges in declaring the nature, economic vs. disciplinary, of the layoff. The second feature is that compensation for dismissal is generally increasing with tenure.
    Date: 2016–02
  7. By: Marcela Ibanez (Georg-August University Göttingen); Juanita Vasquez (University of Göttingen)
    Abstract: This paper uses a framed field experiment to test the effect of persuasive communication as a strategy in the fight against drugs in Colombia. Our design varies the salience and the degree of informativeness of the messages that participants receive, while highlighting particular negative effects of growing coca in the community. We find that messages that make the relation of coca cultivation with violence salient are the most effective at reducing coca investments. Our results suggest that the main mechanism at play is attitudinal change rather than a change in beliefs. Interestingly, we find that exposure to persuasive messages translates into lower intentions to cultivate coca in the future. We conclude that interventions that aim at increasing “awareness” of the negative effects that coca has in the community are a promising policy instrument in the fight against drugs.
    Keywords: Field experiment; attitudinal change; communication campaigns; illegal behavior
    JEL: A13 G11 D03 D83 K42 Z13
    Date: 2016–02–29
  8. By: Kim, Chulyoung
    Abstract: The legal community has been debating the question of who should select and provide expert witnesses at trial: the litigant or the judge? Using a persuasion-game framework, I show that there is a trade-off. On the one hand, the litigant is willing to consult an expert even when the judge is reluctant to appoint her own experts due to high costs. On the other hand, given the same amount of expert advice, the judge can make a more accurate decision when using a court-appointed expert's advice at trial. I show that the cost of expert advice is an important factor in this trade-off and, therefore, in the argument for the reform toward a centralized system for expert witnesses.
    Keywords: expert witnesses, decentralized institution, centralized institution, persuasion game, evidence distortion
    JEL: C72 D82 K41
    Date: 2015–08
  9. By: Pratik Datta (Indira Gandhi Institute of Development Research; Institute of Economic Growth)
    Abstract: The performance of Indian tribunals has been unsatisfactory. Yet, policy-makers continue to rely heavily on tribunals to achieve their end objective. One example of this are the tribunals which will adjudicate in the proposed Insolvency and Bankruptcy Code, 2015. This is premised on the assumption that the tribunals will be able to dispose of cases within hard deadlines. A natural key question that arises is how Indian tribunals can perform better in this matter when they cannot in others? This paper proposes that administrative functions of tribunals should be hived off into a separate agency - Tribunal Services Agency - which will help improve the performance of the administrative functions of tribunals and, in turn, improve their judicial functioning in general.
    Keywords: Judicial reform, judicial administration, civil court vs.tribunal
    JEL: K10 K40
    Date: 2016–02

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