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on Law and Economics |
| By: | Christoph Koenig; David Schindler |
| Abstract: | Gun rights activists in the United States frequently argue that the right to bear arms, as guaranteed by the Second Amendment, can help deter crime. Advocates of gun control usually respond that firearm prevalence contributes positively to violent crime rates. In this paper, we provide quasi-experimental evidence that a positive and unexpected gun demand shock led to an increase in murder rates after the mass shooting at Sandy Hook Elementary School and the resulting gun control debate in December 2012. In states where purchases were delayed due to mandatory waiting periods and bureaucratic hurdles in issuing a gun permit, firearm sales exhibited weaker increases than in states without any such delays. We show that this finding is hard to reconcile with standard economic theory, but is in line with findings from behavioral economics. States that saw more gun sales then experienced significantly higher murder rates in the months following the demand shock, as murders increased by 6-15% over the course of a year. |
| Keywords: | Guns, crime, deterrence, demand shock, murder. |
| JEL: | K42 H76 H10 K14 |
| Date: | 2018–01–19 |
| URL: | http://d.repec.org/n?u=RePEc:bri:uobdis:18/694&r=law |
| By: | Simplice Asongu (Yaoundé/Cameroun); Paul Acha-Anyi (Pretoria, South Africa) |
| Abstract: | We build on literature from policy and academic circles to assess if Latin America is leading when it comes to persistence in homicides. The focus is on a global sample of 163 countries for the period 2010 to 2015. The empirical evidence is based on Generalised Method of Moments. The following main finding is established. The region with the highest evidence of persistence in homicides is sub-Saharan Africa (SSA), followed by Latin America, the Middle East and North Africa (MENA) and then by Europe & Central Asia (ECA). In order to increase room for policy implications, the dataset is decomposed into income levels, religious domination, landlockedness and legal origins. From the conditioning information set, the following factors account for persistence in global homicides: crime, political instability and weapons import positively affect homicides whereas the number of “security and police officers” has the opposite effect. |
| Keywords: | Homicides; Global evidence; Persistence; Latin America |
| JEL: | K42 P50 |
| Date: | 2017–06 |
| URL: | http://d.repec.org/n?u=RePEc:agd:wpaper:17/059&r=law |
| By: | Suzuki, Keishun |
| Abstract: | How does patent policy affect innovation when patent licensing is crucial for firms? To address this question, the present paper incorporates voluntary patent licensing between an innovator and followers, which has been discussed in the literature of industrial organization, into a dynamic general equilibrium model. Unlike in existing studies, both the licensing fee and the number of licensees are endogenously determined by the innovator’s maximization and the free-entry condition. Using this model, we show that strong patent protection does not enhance innovation, economic growth, and welfare. Furthermore, the extended analysis provides a policy implication that the effect of patent policy depends on how difficult further innovation is without patent licensing of the current leading technology. |
| Keywords: | innovation, patent protection, optimal patent licensing, endogenous market structure. |
| JEL: | L24 O31 O34 |
| Date: | 2017–11–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:82712&r=law |
| By: | Nuria Boot (KU Leuven, DIW Berlin); Timo Klein (Amsterdam School of Economics, University of Amsterdam); Maarten Pieter Schinkel (Amsterdam School of Economics and ACLE, University of Amsterdam) |
| Abstract: | The fixing of the Libor and Euribor benchmark rates has proven vulnerable to manipulation. Individual rate-setters may have incentives to fraudulently distort their submissions. For the contributing banks to collectively agree on the direction in which to rig the rate, however, their interests need to be sufficiently aligned. In this paper we develop cartel theory to show how an interbank lending rates cartel can be sustained by preemptive portfolio changes. Exchange of information facilitates front running that allows members to reduce conflicts in their trading books. Designated banks then engage in eligible transactions rigging to justify their submissions. As the cartel is not able to always find stable cooperative submissions against occasional extreme exposure values, there is episodic recourse to non-cooperative quoting. Periods of heightened volatility in the rates may be indicative of cartelization. Recent reforms to broaden the class of transactions eligible for submission may reduce the level of manipulation, but can lead to more frequent collusive quoting. |
| Keywords: | Libor; Euribor; IRD; banking; cartel; insider trading |
| JEL: | E43 G14 G21 K21 L41 |
| Date: | 2017–12–27 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20170122&r=law |
| By: | Bing Xu (Banco de España) |
| Abstract: | By allowing large classes of movable asstes to be used as collateral, the Property Law reform transformed the secured transactions in China. Difference-in-differences test show fi rms operating with ex-ante more movable assets expand access to bank credit and prolong debt maturity. However, the reform does not seem to improve the effi ciency of credit allocation, as debt capacity of ex-ante low quality fi rms expands the most following the reform. Credit expansion also does not lead to better fi rm performance. These findings are not driven by confounding factors such as improvements in creditor and property rights protection. Our results also cannot be explained by other important reforms which were introduced around the same time as the introduction of the Property Law. These include anti-tunneling and split-share reforms and amendments to the corporate tax structure in China. We conduct explicit robustness tests for these other reforms and hence contribute to the empirical literature on the reform process in China with new findings. |
| Keywords: | Collateral, movable assets, leverage, property law |
| JEL: | G21 G28 G32 K22 |
| Date: | 2017–12 |
| URL: | http://d.repec.org/n?u=RePEc:bde:wpaper:1750&r=law |