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on Law and Economics |
| By: | Mitu Gulati; Ugo Panizza (IHEID, Graduate Institute of International and Development Studies, Geneva); |
| Abstract: | For multiple decades, activists have sought to institute an international legal regime that limits the ability of despotic governments to borrow money and then shift those obligations onto more democratic successor governments. Our goal in this article is to raise the possibility of an alternate legal path to raising the costs of borrowing for despotic regimes. All countries have systems of domestic laws that regulate agency relationships and try to deter corruption; otherwise the domestic economy would not function. Despotic governments, we conjecture, are especially likely to engage in transactions that are legally problematic. The reason being that despotic governments, by definition, lack the support of the populace; meaning that there is a high likelihood that actions that they take on behalf of the populace can be challenged as unrepresentative and contrary to the interests of the true principals. The foregoing conditions, if one translates them into the context of an ordinary principal-agent relationship, would constitute a voidable transaction in most modern legal systems. That means that if opposition parties in countries with despotic governments today were to monitor and make public the potential problems with debt issuances by their despotic rulers under their own local laws, it would raise the cost of capital for those despots. To support our argument, we use both the concrete example of the debt issuance shenanigans of the Maduro government in Venezuela and a more general analysis of the relationship between corruption, democracy and a nation’s borrowing costs. |
| Keywords: | Venezuela; Odious Debt; Sovereign Default |
| JEL: | G15 H63 K34 O54 |
| Date: | 2018–09 |
| URL: | http://d.repec.org/n?u=RePEc:gii:giihei:heidwp12-2018&r=law |
| By: | Bryant Walker Smith |
| Abstract: | This discussion paper introduces several legal considerations for shared automated driving with a view toward grounding a broader policy discussion. It begins by discussing likely implementations of shared automated driving. It next considers the kinds of legal actions that developers and regulators of these automated driving systems might take to promote or police them. It then connects these potential actions to existing law by describing three ways of adapting that law to automated driving. Finally, it provides specific perspectives and recommendations on this and any legal change. |
| Date: | 2017–07–20 |
| URL: | http://d.repec.org/n?u=RePEc:oec:itfaab:2017/08-en&r=law |
| By: | Bielecki, Marcin; Stähler, Nikolai |
| Abstract: | We use a New Keynesian DSGE model with search frictions on the housing market to evaluate how financing a labor tax reduction by higher property taxation affects the real economy and welfare. Search on the housing market enables us to explicitly model stocks and flows, which is necessary to differentiate between recurrent property taxes (levied on stocks) and property transaction taxes (levied to flows). We find that using recurrent property taxation as financing instrument outperforms other instruments although all policy measures increase aggregate economy-wide welfare. Our simulations suggest that using property transaction taxation as financing instrument is the least favorable measure. |
| Keywords: | Search Frictions in Housing Markets,Property Taxation,Tax Reform,General Equilibrium |
| JEL: | E51 E6 R31 K34 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bubdps:302018&r=law |
| By: | Gaurav Khanna (University of California); Carlos Medina (Banco de la República de Colombia); Anant Nyshadham (Boston College & NBER); Jorge Tamayo (Harvard University) |
| Abstract: | Canonical models of criminal behavior highlight the importance of economic incentives and employment opportunities in determining crime (Becker, 1968). Yet, there is little causal evidence leveraging individual-level variation in support of these claims. Over a decade, we link administrative micro-data on socio-economic measures with the universe of criminal arrests in Medellin. We test whether increasing the relative costs to formal-sector employment led to more crime. We exploit plausibly exogenous variation in employment around a cutoff in the socio-economic score, below which individuals receive health care if they are not formally employed. Using a regression discontinuity design, we show that the policy had the unintended consequence of inducing a fall in formal-sector employment and a corresponding spike in organized criminal activity. There are no effects on less economically motivated crimes like those of impulse or opportunity. Our results confirm the relationship between formal employment and crime, validating models of criminal activity as a rational economic choice **** RESUMEN: Los modelos canónicos del comportamiento criminal resaltan la importancia de los incentivos económicos y las oportunidades de empleo como determinantes del crimen (Becker, 1968). A pesar de esto, existe poca evidencia causal que soporte estos modelos a nivel de individuos. Nosotros pareamos, a lo largo de una década, información socioeconómica de individuos con el censo de todos los arrestos en Medellín. Nosotros probamos si incrementar el costo relativo del empleo formal conlleva a un incremento del crimen. Se explota una variación exógena en el empleo alrededor de un corte en el puntaje socioeconómico, por debajo del cual los individuos reciben aseguramiento en salud si no están formalmente empleados. Utilizando un diseño de regresión discontinua, mostramos que la política tuvo como consecuencia inducir una reducción en el empleo formal y un correspondiente incremento en la actividad del crimen organizado. No se encuentran efectos en crímenes con una motivación económica menor como aquellos de impulso u oportunidad. Nuestros resultados confirman la relación entre empleo formal y crimen, validando los modelos que explican la actividad criminal como una decisión racional. |
| Keywords: | Gangs, informality, Medellin, Bandas criminales, informalidad |
| JEL: | K14 K42 |
| Date: | 2018–09 |
| URL: | http://d.repec.org/n?u=RePEc:bdr:borrec:1054&r=law |
| By: | Mark Hoekstra; Brittany Street |
| Abstract: | This paper examines the extent to which criminal conviction rates are affected by the similarity in gender of the defendant and jury. To identify effects, we exploit random variation in both the assignment to jury pools and the ordering of potential jurors. We do so using detailed administrative data on the juror selection process and trial proceedings for two large counties in Florida. Results indicate that own-gender juries result in significantly lower conviction rates on drug charges, though we find no evidence of effects for other charges. Estimates indicate that a one standard deviation increase in expected own-gender jurors (~10 percentage points) results in an 18 percentage point reduction in conviction rates on drug charges, which is highly significant even after adjusting for multiple comparisons. This results in a 13 percentage point decline in the likelihood of being sentenced to at least some jail time. These findings highlight how drawing an opposite-gender jury can impose significant costs on defendants, and demonstrate that own-gender bias can occur even in settings where the importance of being impartial is actively pressed on participants. |
| JEL: | J16 K41 K42 |
| Date: | 2018–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25013&r=law |