nep-law New Economics Papers
on Law and Economics
Issue of 2019‒09‒09
fourteen papers chosen by
Eve-Angeline Lambert, Université de Lorraine

  1. Data-sharing in IoT Ecosystems from a Competition Law Perspective: The Example of Connected Cars By Wolfgang Kerber
  2. Co-enforcement of Common Pool Resources: Experimental Evidence from TURFs in Chile By Carlos A. Chávez; James J. Murphy; John K. Stranlund
  3. Formal Employment and Organized Crime: Regression Discontinuity Evidence from Colombia By Gaurav Khanna; Carlos Medina; Anant Nyshadham,; Jorge Tamayo
  4. Crime and Networks: 10 Policy Lessons By Lindquist, Matthew J.; Zenou, Yves
  5. Strict Voter Identification Laws, Turnout, and Election Outcomes By Mark Hoekstra; Vijetha Koppa
  6. The Impact of Mass Shootings on Gun Policy By Michael Luca; Deepak Malhotra; Christopher Poliquin
  7. Decentralising the Patent System By Gaetan de Rassenfosse; Kyle Higham
  8. Does Halting Refugee Resettlement Reduce Crime? Evidence from the United States Refugee Ban By Masterson, Daniel; Yasenov, Vasil
  9. How Effective Are Monetary Incentives to Vote? Evidence from a Nationwide Policy By Gonzales, Mariella; León-Ciliotta, Gianmarco; Martinez, Luis
  10. What if dividends were tax-exempt? Evidence from a natural experiment By Isakov, Dusan; Pérignon, Christophe; Weisskopf, Jean-Philippe
  11. The Health-Related Consequences to Police Stops as Pathways to Risks in Academic Performance for Urban Adolescents By Juan Del Toro; Alvin Thomas; Ming-Te Wang; Diane Hughes
  12. Electoral Campaign Financing and Criminal Policy By Brunela Kullolli; Ilirjan Hysa
  13. Homicide and Social Media: Global Empirical Evidence By Simplice A. Asongu; Joseph I. Uduji; Elda N. Okolo-Obasi
  14. The persistence of global terrorism By Simplice A. Asongu

  1. By: Wolfgang Kerber (Philipps University Marburg)
    Abstract: This paper analyses whether competition law can help to solve problems of access to data and interoperability in IoT ecosystems, where often one firm has exclusive control of the data produced by a smart device (and of the technical access to this device). Such a gatekeeper position can lead to the elimination of competition for after-market and other complementary services in such IoT ecosystems. This problem is analysed both from an economic and a legal perspective, and also generally for IoT ecosystems as well as for the much discussed problems of “access to in-vehicle data and resources†in connected cars, where the “extended vehicle†concept of the car manufacturers leads to such positions of exclusive control. The paper analyses, in particular, the competition rules about abusive behavior of dominant firms (Art. 102 TFEU) and of firms with “relative market power†(§ 20 (1) GWB) in German competition law. These provisions might offer (if appropriately applied and amended) at least some solutions for these data access problems. Competition law, however, might not be sufficient for dealing with all or most of these problems, i.e. that also additional solutions might be needed (data portability, direct data (access) rights, or sector-specific regulation).
    Keywords: data access, Internet of Things, data sharing, data access, competition, digital economy, connected cars
    JEL: K23 L62 L86 O33
    Date: 2019
  2. By: Carlos A. Chávez (Universidad de Talca and Interdisciplinary Center for Aquaculture Research (INCAR)); James J. Murphy (Department of Economics, University of Alaska Anchorage and Economic Science Institute, Chapman University); John K. Stranlund (Department of Resource Economics, University of Massachusetts-Amherst)
    Abstract: This work presents the results of framed field experiments designed to study the co-enforcement of access to common pool resources. The experiments were conducted in the field with participants in the territorial use rights in fisheries (TURFs) management scheme that regulates access to nearshore fisheries along the coast of Chile. In the experiments, TURF members not only decided on harvest but also invested in monitoring to deter poaching by outsiders. Treatments varied whether the monitoring investment was an individual decision or determined by a group vote. Per-unit sanctions for poaching were exogenous as if provided by a government authority, and we varied the sanction level. Our results suggest that co-enforcement, in which monitoring for poaching is provided by resource users and sanctions are levied by the government, can reduce poaching levels. Monitoring investments were not high enough to lift the expected marginal penalty for poaching above the marginal gain from poaching when the sanction for poaching was low, but expected marginal penalties were higher than the marginal gain from poaching when the sanction was high. Despite this, poaching levels were not sensitive to changes in monitoring levels and sanctions. While co-enforcement did not eliminate poaching, it did eliminate the gains from poaching in all but one treatment.
    Keywords: experimental economics, Common pool resources; enforcement; field experiments; poaching; territorial use rights fisheries; social dilemma; fisheries management; development economics; co-enforcement
    JEL: C72 C90 C93 D70 H41 K42 Q22 Q28 Q56
    Date: 2019
  3. By: Gaurav Khanna (University of California San Diego); Carlos Medina (Banco de la Republica de Colombia); Anant Nyshadham, (Boston College & NBER); Jorge Tamayo (Harvard University. Harvard Business School,)
    Abstract: Canonical models of crime emphasize economic incentives. Yet, causal evidence of sorting into criminal occupations in response to individual-level variation in incentives is limited. We link administrative socioeconomic microdata with the universe of arrests in Medellίn over a decade. We exploit exogenous variation in formal-sector employment around a socioeconomic-score cutoff, below which individuals receive benefits if not formally employed, to test whether a higher cost to formal-sector employment induces crime. Regression discontinuity estimates show this policy generated reductions in formal-sector employment and a corresponding spike in organized crime, but no effects on crimes of impulse or opportunity.
    Keywords: Colombia; organized crime, informality, occupational choice, gangs, Medellίn
    JEL: K42 J24
    Date: 2019–08
  4. By: Lindquist, Matthew J. (SOFI, Stockholm University); Zenou, Yves (Monash University)
    Abstract: Social network analysis can help us understand more about the root causes of delinquent behavior and crime and provide practical guidance for the design of crime prevention policies. To illustrate these points, we first present a selective review of several key studies and findings from the criminology and police studies literature. We then turn to a presentation of recent contributions made by network economists. We highlight 10 policy lessons and provide a discussion of recent developments in the use of big data and computer technology.
    Keywords: co-offending, crime, criminal networks, social networks, peer effects, key player
    JEL: A14 K42 Z13
    Date: 2019–08
  5. By: Mark Hoekstra; Vijetha Koppa
    Abstract: Since 2000, ten states have enacted strict voter identification laws, which require that voters show identification in order for their votes to count. While proponents argue these laws prevent voter fraud and protect the integrity of elections, opponents argue they disenfranchise low-income and minority voters. In this paper, we document the extent to which these laws can affect voter turnout and election outcomes. We do so using historical data on more than 2,000 races in Florida and Michigan, which both allow and track ballots cast without identification. Results indicate that at most only 0.10% and 0.31% of total votes cast in each state were cast without IDs. Thus, even under the extreme assumption that all voters without IDs were either fraudulent or would be disenfranchised by a strict law, the enactment of such a law would have only a very small effect on turnout. Similarly, we also show under a range of conservative assumptions that very few election results could have been flipped due to a strict law. Collectively, our findings indicate that even if the worst fears of proponents or critics were true, strict identification laws are unlikely to have a meaningful impact on turnout or election outcomes.
    JEL: J15 J16 K42
    Date: 2019–08
  6. By: Michael Luca; Deepak Malhotra; Christopher Poliquin
    Abstract: There have been dozens of high-profile mass shootings in recent decades. This paper presents three main findings about the impact of mass shootings on gun policy. First, mass shootings evoke large policy responses. A single mass shooting leads to a 15% increase in the number of firearm bills introduced within a state in the year after a mass shooting. This effect increases with the extent of media coverage. Second, mass shootings account for a small portion of all gun deaths, but have an outsized influence relative to other homicides. Third, when looking at bills that were actually enacted into law, the impact of mass shootings depends on the party in power. The annual number of laws that loosen gun restrictions doubles in the year following a mass shooting in states with Republican-controlled legislatures. We find no significant effect of mass shootings on laws enacted when there is a Democrat-controlled legislature, nor do we find a significant effect of mass shootings on the enactment of laws that tighten gun restrictions.
    JEL: D0 I1 K0
    Date: 2019–08
  7. By: Gaetan de Rassenfosse (Ecole polytechnique federale de Lausanne); Kyle Higham (Ecole polytechnique federale de Lausanne)
    Abstract: This paper proposes a substantive re-think of the modern patent system. The patent system has come under intensive criticism in the past, and many scholars have proposed ways to improve it. Ideas for improvement include, e.g., prior-art bounties, contracting out examination and dynamic fee setting. However, many of these ideas have gone unheeded due to the cost of administering them and the rigidity of the patent system. We explore how distributed ledger technologies enable these major changes.
    Keywords: blockchain, distributed ledger, intellectual property, patent, smart contract
    JEL: K11 K23 L24 O34 O38
    Date: 2019–09
  8. By: Masterson, Daniel (Stanford University); Yasenov, Vasil (University of California, Berkeley)
    Abstract: Many countries have reduced refugee admissions in recent years, in part due to fears that refugees and asylum seekers increase crime rates and pose a national security risk. Existing research presents ambiguous expectations about the consequences of refugee resettlement on crime. We leverage a natural experiment in the United States, where an Executive Order by the president in January 2017 halted refugee resettlement. This policy change was sudden and significant – it resulted in the lowest number of refugees resettled on US soil since 1977 and a 66% drop in resettlement from 2016 to 2017. We find that there is no discernible effect on county-level crime rates. These null effects are consistent across all types of crime and precisely estimated. Overall, the results suggest that crime rates would have been similar had refugee arrivals continued at previous levels.
    Keywords: refugees, immigration, crime
    JEL: F22 J15 K42
    Date: 2019–08
  9. By: Gonzales, Mariella; León-Ciliotta, Gianmarco; Martinez, Luis
    Abstract: We combine two natural experiments, multiple empirical strategies and administrative data to study voters' response to marginal changes to the fi ne for electoral abstention in Peru. A smaller fi ne leads to a robust decrease in voter turnout. However, the drop in turnout caused by a full fi ne reduction is less than 20% the size of that caused by an exemption from compulsory voting, indicating the predominance of the non-monetary incentives provided by the mandate to vote. Additionally, almost 90% of the votes generated by a marginally larger fi ne are blank or invalid, lending support to the hypothesis of rational abstention. Higher demand for information and larger long-run eff ects following an adjustment to the value of the fine point to the existence of informational frictions that limit adaptation to institutional changes.
    Keywords: compulsory voting; External Validity; Informational frictions; Peru; voter registration; Voter turnout
    JEL: D72 D78 D83 K42
    Date: 2019–07
  10. By: Isakov, Dusan; Pérignon, Christophe; Weisskopf, Jean-Philippe
    Abstract: We study the effect of dividend taxes on the payout and investment policy of listed firms and discuss their implications for agency problems. To do so, we exploit a unique setting in Switzerland where some, but not all, firms were suddenly able to pay tax-exempted dividends to their shareholders following the corporate tax reform of 2011. Using a difference-in-differences specification, we show that treated firms increased their payout by around 30% compared to control firms after the tax cut. Differently, treated firms did not concurrently or subsequently increase investment. We show that the tax-inelasticity of investment was due to a significant drop in retained earnings ̶ as the rise in dividends was not compensated by an equally-sized reduction in share repurchases. Furthermore, treated firms did not raise more equity than control firms. Lastly, we show that an unintended consequence of cutting dividend taxes is to mitigate the agency problems that arise between insiders and minority shareholders.
    Keywords: corporate taxes; dividends; payouts; investment; agency problems.
    JEL: G35 G38 H25 K34
    Date: 2019–02–19
  11. By: Juan Del Toro (University of Pittsburgh); Alvin Thomas (University of Wisconsin – Madison); Ming-Te Wang (University of Pittsburgh); Diane Hughes (New York University)
    Abstract: Several heuristic models posited that environmental stress disrupt adolescents' engagement and performance in school, but few studies have identified police as a source of such stress. We examined whether police stops, direct and vicarious instances, predicted decrements in adolescents' grades via their psychological (i.e., depressive and anxiety symptoms) and health(i.e., sleep problems and self-rated health statuses) stress responses. We also examined whether the observed correlates varied across ethnic-racial and gender groups. To do so, we used two waves of longitudinal survey data from the Fragile Families and Child Well-Being Study.Children completed surveys when they were, on average, ages 9 and 15. Results illustrated that direct and vicarious police stops at age 15 predicted lower grades contemporaneously,controlling for adolescents’ self-rated health, sleep, and performance on the Woodcock-Johnson tests at age 9. Psychological distress, sleep problems, and self-rated health at age 15 partially mediated the relations between police stops and grades. The negative consequences of vicarious police stops were specific to the boys and girls of color; vicarious police contact did not predict adolescents' grades for White boys and White girls. We discussed the implications of our results as they pertain to policing and adolescent development.
    Keywords: ethnicity-race, gender, policing, health, academic achievement
    JEL: K42 I24 I29 I14
    Date: 2019
  12. By: Brunela Kullolli (?Aleksander Moisiu? University of Durres); Ilirjan Hysa (I.S.K Law Firm Durres)
    Abstract: Money is power, prestige and status in a society. In a democratic society, money-giving power can be as great as it can affect every aspect of society, especially in a state's policy. The power of money is even more powerful in countries where democracy is fragile. The money control power on political influence is weak in countries where democracy is not consolidated and in transitional societies. Through the present paper, I will contribute by analyzing the impact of money on the Albanian state politics, examined from the point of view of electoral financing as well as of political parties' and individuals' financing during the electoral campaigns.The first part will address and analyze the influence of money and electoral financing on the constitutional principles of the right to vote and on the right to a fair representation of the elected representatives in state institutions through the electoral elections. The present part is also on constitutional requirements for electoral and fair elections and on the principles of election campaigns.The second part will analyze the way of financing of the electoral subjects, the Albanian legal framework for financing political parties and individuals in electoral campaigns, and the legal framework of the Albanian political parties in the way of financing. It will also analyze the state mechanisms of the financial control of electoral campaigns, the illegal financing of election campaigns as well as the violation of the constitutional principles for free and fair elections.The third part will deal with and analyze the criminal policies in ensuring the principle of free and fair elections in the terms of unlawful campaign financing, the incriminating actions that affect the electoral elections in the Criminal Code, the incrimination of illegal financing of the subjects participating in campaigns and electoral elections, the criminal policy that the Albanian state should follow in preventing illegal financing and the due legal mechanisms for the financial control of the electoral campaign subjects.ConclusionsIllegal financing of the electoral campaigns is a current phenomenon of the Albanian society which leads to the incrimination of Albanian politics. The illegal financing of the subjects that participate in the electoral campaigns comes from the organized crime or from people with suspicion in criminal activities and this leads to the decision to give power to those who protect the interests of the latter and not the interests of the electorate or the democratic interests of a state.The intensification of the fight against illegal financing in electoral campaigns has created not only the full legal framework for the prevention of illegal financing, but also mechanisms in practice for the implementation not only of the law, but also for the practical prevention of uncontrolled financing of electoral subjects.The imposition of harsh criminal policies on the illicit financing of electoral campaigns and the revision of the Criminal Code in incriminating all illegal anti-trust actions that affect free and fair elections may be the most important step towards combating illegal funding of electoral campaigns. Illegal financing of electoral campaigns in Albania calls into question free and fair elections and discusses the fundamental principles of representation of political entities in governmental institutions so intervention in law and criminal policy is current and immediate.
    Keywords: Money, electoral campaigns, unlawful financing, criminal policy, legal mechanisms.
    JEL: K14
    Date: 2019–07
  13. By: Simplice A. Asongu (Yaoundé/Cameroon); Joseph I. Uduji (University of Nigeria, Nsukka, Nigeria); Elda N. Okolo-Obasi (University of Nigeria, Nsukka, Nigeria)
    Abstract: This study investigates the relationship between social media and homicide in a cross section of 148 countries for the year 2012. The empirical evidence is based on Ordinary Least Squares, Tobit and Quantile regressions. The findings from Ordinary Least Squares and Tobit regressions show a negative relationship between Facebook penetration and the homicide rate. The negative relationship is driven by the 75th quantile of the conditional distribution of the homicide rate. The negative nexus is also driven by upper middle income countries and “Europe and Central Asia†. Three main implications are apparent when the findings are compared and contrasted. First, established findings from OLS and Tobit regressions are driven by countries with above-median levels of homicide. Second, such above-median countries are largely associated with upper middle income countries and nations in “Europe and Central Asia†. Third, modelling the relationship between Facebook penetration and homicide at the conditional mean of homicide may be misleading unless it is contingent on initial levels of homicide and tailored differently across income levels and regions of the world.
    Keywords: Homicide; Social media
    JEL: K42 D83 O30 D74 D83
    Date: 2019–01
  14. By: Simplice A. Asongu (Yaoundé/Cameroon)
    Abstract: This study investigates persistence of global terrorism in a panel of 163 countries for the period 2010 to 2015. The empirical evidence is based on Generalised Method of Moments. The following findings are established. First, persistence in terrorism is a decreasing function of income levels because it consistently increases from high income (through upper middle income) to lower middle income countries. Second, compared to Christian-oriented countries, terrorism is more persistent in Islam-oriented nations. Third, landlocked countries also reflect a higher level of persistence relative to their coastal counterparts. Fourth, Latin American countries show higher degrees of persistence when compared with Middle East and North African (MENA) countries. Fifth, the main determinants of the underlying persistence are political instability and weapons import. The results are discussed to provide answers to four main questions which directly pertain to the reported findings. These questions centre on why comparative persistence in terrorism is based on income levels, religious orientation, landlockedness and regions.
    Keywords: Terrorism; Persistence; Development
    JEL: C52 D74 F42 K42 O38
    Date: 2019–01

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