nep-law New Economics Papers
on Law and Economics
Issue of 2019‒06‒17
eight papers chosen by
Eve-Angeline Lambert, Université de Lorraine

  1. Injunctions against false advertising By Baumann, Florian; Rasch, Alexander
  2. The Impact of Abortion on Crime and Crime-Related Behavior By Hjalmarsson, Randi; Mitrut, Andreea; Pop-Eleches, Cristian
  3. The Right to Life: Global Evidence on the Role of Security Officers and the Police in Modulating the Effect of Insecurity on Homicide By Simplice A. Asongu; Jacinta C. Nwachukwu; Chris Pyke
  4. Jihadi Attacks, Media and Local Hate Crime By Ivandic, Ria; Kirchmaier, Tom; Machin, Stephen
  5. Scarcity without Leviathan: The Violent Effects of Cocaine Supply Shortages in the Mexican Drug War By Juan Camilo Castillo; Daniel Mejia; Pascual Restrepo
  6. Paid Sick Leave and Employee Absenteeism By Annalisa Scognamiglio
  7. The Impact of Car Pollution on Infant and Child Health: Evidence from Emissions Cheating By Alexander, Diane; Schwandt, Hannes
  8. Dishonesty behaviors under time pressure By Manami Tsuruta; Keigo Inukai

  1. By: Baumann, Florian; Rasch, Alexander
    Abstract: Rules of consumer protection or fair competition can be publicly or privately enforced. We consider the possibility of false advertising by a firm in duopolistic competition where consumers can be distinguished according to whether or not they form rational beliefs about the trustworthiness of advertising claims. We compare private and public law enforcement in the form of the demand for injunctions against false advertising. From a welfare perspective, we show that it can be optimal either to have the private entity (the competitor/a consumer protection agency) or the government agency as plaintiff, where the optimal regime depends on the share of naive consumers and the level of trial costs in a non-trivial way.
    Keywords: injunction suits,false advertising,law enforcement,naive consumers,product differentiation
    JEL: K41 K42 L13 L15
    Date: 2019
  2. By: Hjalmarsson, Randi (Department of Economics, School of Business, Economics and Law, Göteborg University); Mitrut, Andreea (Department of Economics, School of Business, Economics and Law, Göteborg University); Pop-Eleches, Cristian (SIPA, Columbia University, USA)
    Abstract: The 1966 abolition and 1989 legalization of abortion in Romania immediately doubled and decreased by about a third the number of births per month, respectively. To isolate the link between abortion access and crime while abstracting from cohort and general equilibrium effects, we compare birth month cohorts on either side of the abortion regime. For both the abolition and legalization of abortion, we find large and significant effects on the level of crime and risky-behavior related hospitalization, but an insignificant effect on crime and hospitalization rates (i.e. when normalizing by the size of the birth month cohort). In other words, the Romanian abortion reforms did affect crime, but all of the effect appears to be driven by cohort size effects rather than selection or unwantedness effects.
    Keywords: Abortion; crime; Risky behavior
    JEL: I18 J13 J18 K42
    Date: 2019–06
  3. By: Simplice A. Asongu (Yaoundé/Cameroon); Jacinta C. Nwachukwu (Preston, United Kingdom); Chris Pyke (Preston, United Kingdom)
    Abstract: The study investigates the role of security officers and the police in dampening the effect of insecurity on homicides. Insecurity dynamics are measured in terms of access to weapons, violent crime, perception of criminality and political instability. The geographical and temporal scopes are respectively 163 countries and 2010-2015. The empirical evidence is based on Negative Binomial regressions. Three main findings are established. First, security officers and the police significantly lessen the effect of political instability and perception of criminality on homicides. Second, an extended analysis with thresholds suggest that a maximum deployment of security officers and the police is required in order to completely cancel out the impact of both insecurity dynamics on homicides. The concept of threshold represents the critical mass at which the negative conditional effect from the interaction between security officers and the police completely dampens the effect of insecurity dynamics on homicides. Third, the use of security officers and the police is a necessary but not a sufficient condition for the complete eradication of insecurity-related homicides. Policy implications are discussed.
    Keywords: Homicides; Global evidence; security
    JEL: K42 P50
    Date: 2018–01
  4. By: Ivandic, Ria; Kirchmaier, Tom; Machin, Stephen
    Abstract: Empirical connections between local anti-Muslim hate crimes and international jihadi terror attacks are studied. Based upon rich administrative data from Greater Manchester Police, event studies of ten terror attacks reveal an immediate big spike up in Islamophobic hate crimes and incidents when an attack occurs. In subsequent days, hate crime is amplified by real-time media. It subsequently attenuates, but hate crime incidence cumulates to higher levels than prior to the series of attacks. The overall conclusion is that, even when they reside in places far away from where jihadi terror attacks take place, local Muslim populations face a media magnified likelihood of hate crime victimization following international terror attacks. This matters for community cohesion in places affected by discriminatory hate crime and, from both a policy and research perspective, means that the process of media magnification of hate crime needs to be better understood.
    Keywords: Islamophobic hate crime; jihadi terror attacks; media
    JEL: K42
    Date: 2019–05
  5. By: Juan Camilo Castillo (Stanford University); Daniel Mejia (Universidad de los Andes); Pascual Restrepo (Boston University)
    Abstract: This paper asks whether scarcity increases violence in markets that lack a centralized authority. We construct a model in which, by raising prices, scarcity fosters violence. Guided by our model, we examine the link between scarcity and violence in the Mexican cocaine trade. At a monthly frequency, scarcity created by cocaine seizures in Colombia—Mexico’s main cocaine supplier—increases violence in Mexico. The effects are larger in municipalities near the US, with multiple cartels, and with strong PAN support. Between 2006 and 2009 the decline in cocaine supply from Colombia could account for 10%-14% of the increase in violence in Mexico.
    Keywords: War on Drugs, Violence, Illegal Markets, Mexico, Cocaine Trade
    JEL: D74 K42
    Date: 2018–10
  6. By: Annalisa Scognamiglio (CSEF, Università di Napoli)
    Abstract: This paper studies the response of sickness absences to changes in the replacement rate for sick leave. In June 2008 a national law modified both the strength of monitoring and the monetary cost of sick leaves for public sector employees in Italy. This paper focuses on the National Health Service, which accounts for about 21% of the total number of workers employed in the Italian public administration. Using administrative data I show that absenteeism largely decreased following the reform. I identify the effects of an increase in the monetary cost of an absence using a difference-in-differences strategy that exploits variation in changes to the replacement rate for sick leave. Under the assumption that changes in monitoring had the same proportional impact on absenteeism within the same institutions, I estimate that a 1 percentage point decrease in the replacement rate reduces absenteeism by 1%. JEL Classification: J88, J08.
    Keywords: Public sector absenteeism, paid sick leave, incentives.
    Date: 2019–06–06
  7. By: Alexander, Diane (Federal Reserve Bank of Chicago); Schwandt, Hannes
    Abstract: Car exhaust is a major source of air pollution, but little is known about its impacts on population health. We exploit the dispersion of emissions-cheating diesel cars across the United States from 2008–2015 as a natural experiment to measure the health impact of car pollution—each cheating diesel car secretly polluted up to 150 times as much as gasoline cars. Using the universe of vehicle registrations, we demonstrate that a 10 percent cheating-induced increase in car exhaust increases fine particulate matter by 2 percent and rates of low birth weight and acute asthma attacks among children by 1.9 and 8.0 percent, respectively. These health impacts occur at all pollution levels and across the entire socioeconomic spectrum.
    Keywords: car pollution, health, emissions-cheating
    JEL: I10 I14 K32 J13
    Date: 2019–06
  8. By: Manami Tsuruta (Graduate School of Economics, Osaka University); Keigo Inukai (Department of Economics, Meiji Gakuin University)
    Abstract: Many people sometimes engage in dishonest behavior to get own material payoff. We conducted a laboratory experiment to investigate whether intuitive decisions were to lieor to be honest. Using a task that the experimenter does not know whether the subject is lying or not, and the analysis was performed using only the subjects who were aware that it was possible to lie in the experiment. We found that there was no difference in the degree of lie between time limit condition and no time limit condition. There are two possible interpretations of the result. One is that the decision system of intuition (system 1) and consideration (system 2) does not apply to lie decision-making. In other words, whether thinking about it carefully or making decisions in a hurry doesn ft change the degree of lie. Another possibility is that the time limit in the experimentwas too long. It takes only a very short time for the subject to press the numbers on the keyboard after the choices are displayed, and even under unlimited time, the average is about 1.3 seconds. Therefore, even if the time limit is 5 seconds, the subject may not have been given a sufficient load. In other words, it maybe considered that intuitive (system 1) decision-making was not performed. In a future research, we want to conduct an experiment with a shorter time limit and investigate whether the experimental result changes.
    Keywords: Time pressure, Dishonesty, Decision making, Laboratory experiment
    JEL: C91 D91 K42
    Date: 2019–04

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