nep-law New Economics Papers
on Law and Economics
Issue of 2020‒11‒30
nine papers chosen by
Eve-Angeline Lambert, Université de Lorraine

  1. Mandatory Retirement for Judges Improved Performance on U.S. State Supreme Courts By Elliott Ash; W. Bentley MacLeod
  2. The State, Religion, and Freedom: A Review Essay of Persecution & Toleration By Metin M. Cosgel
  3. Do Standard-Essential Patent Owners Behave Opportunistically? Evidence from U.S. District Court Dockets By Love, Brian; Lefouili, Yassine; Helmers, Christian
  4. The effect of design protection on price and price dispersion: Evidence from automotive spare parts By Herz, Benedikt; Mejer, Malwina
  5. Associated Factors with Litigation by Patients with DM and Profile of Complainants of Free Legal Aid By Vanessa Boarati; Maria Dolores Montoya Diaz
  6. Income Tax Evasion: Tax Elasticity, Welfare, and Revenue By Max Gillman
  7. Patent-related actions taken in WTO members in response to the COVID-19 pandemic By Wu, Xiaoping; Khazin, Bassam Peter
  9. Monopolies: Silent Spreaders of Poverty and Economic Inequality By David Fettig; James A. Schmitz

  1. By: Elliott Ash; W. Bentley MacLeod
    Abstract: Anecdotal evidence often points to aging as a cause for reduced work performance. This paper provides empirical evidence on this issue in a context where performance is measurable and there is variation in mandatory retirement policies: U.S. state supreme courts. We find that introducing mandatory retirement reduces the average age of working judges and improves court performance, as measured by output (number of published opinions) and legal impact (number of forward citations to those opinions). Consistent with aging effects as a contributing factor, we find that older judges do about the same amount of work as younger judges, but that work is lower-quality as measured by citations. However, the effect of mandatory retirement on performance is much larger than what would be expected from the change in the age distribution, suggesting that the presence of older judges reduces the performance of younger judges.
    JEL: D02 J26 J41 J44 K0 K4
    Date: 2020–10
  2. By: Metin M. Cosgel (University of Connecticut)
    Abstract: Persecution and Toleration offers a novel and superb analysis of the birth of religious freedom. Rather than seek an ideational account of the rise of religious freedom, Johnson and Koyama investigate changes in the institutional environment that governed the relationship between religion and the state. These changes made it in the interest of policy makers in modern Europe to grant greater religious freedom by transitioning from identity rules to impersonal laws in maintaining order. The book introduces a new thought-provoking conceptual framework that can be extended to examine the complicated history of the state’s interaction with religion, comparative analysis of the relationship between state capacity and political legitimacy, and various other issues concerning the treatment of minorities and heterodox practices around the world.
    Keywords: Persecution and Toleration, religious freedom, state capacity, political legitimacy, legal order, identity rules, general laws, heterodox practices, minorities
    JEL: H10 K4 N4 O57 P48 Z12
    Date: 2020–11
  3. By: Love, Brian; Lefouili, Yassine; Helmers, Christian
    Abstract: Do owners of standard-essential patents (SEPs) "holdup" companies that produce standard-compliant products? To explore this question, we use detailed information from the dockets of all U.S. patent cases filed 2010-2019 that assert or challenge SEPs to construct measures of opportunistic conduct by SEP licensors, including actions that took place before the lawsuit was filed. We find evidence of opportunistic behavior by the SEP enforcer in at least 75% of SEP assertions in court, and we analyze various factors that determine which opportunistic behaviors SEP enforcers rely on. We also show that opportunistic behavior can affect case outcomes, although the effect on settlement is ambiguous. Some behaviors increase the likelihood of a settlement, while others decrease it.
    Keywords: Litigation, standards, patents, holdup, U.S.
    JEL: K41 O30
    Date: 2020–11–09
  4. By: Herz, Benedikt; Mejer, Malwina
    Abstract: The design right is a widely used but poorly understood intellectual property right that allows the protection of products’ aesthetics and outer appearances. We study the influence of design right protection on price by exploiting cross-country differences in the scope of protection in the European automotive spare parts market: In some countries, repair parts are exempted from design protection, while in others they are not. Based on detailed price data, our difference-in-differences estimates imply that design protection increases prices by about 5–8%, with large differences between carmakers. We then link our findings to the literature on deviations from the law of one price. We document large cross-country price deviations for identical spare parts and provide evidence that a part of these price deviations can be explained by the lack of harmonization of design right protection in combination with carmakers’ pricing-to-market strategies.
    Keywords: design right, design patent, repair clause, law of one price, price dispersion, European car market, automotive aftermarket, spare parts
    JEL: F15 K21 L11 L62 O34
    Date: 2020–06–01
  5. By: Vanessa Boarati; Maria Dolores Montoya Diaz
    Abstract: Between 2011 and 2017, these demands increased at an annual rate of 26% per year and represented, 25% of the total amount spent on the Diabetes Mellitus(DM) patients motivated and is mainly driven by the demand for insulin analogs. Most of these claimants are the regions with the lowest social vulnerability, according to a georeferencing analysis, the place where the treatment is taking place is a private hospital with a private doctor and the attorney is a private lawyer. In the first empirical analyse (Probit Models), at the city level, the probability of judicialization of the variables of access to SUS (negative), health expenditure (negative) and supply of doctors (positive). In the second analysis, the judicial demand requested by a public lawyer, though it is a small part of the total amount, is positively associated with greater vulnerability plaintiffs and a local public hospital or UBS (SUS physician prescription).
    Keywords: Litigation; Complainants of Free Legal Aid; Health; Diabetes
    JEL: H44 H51 K41 C25
    Date: 2020–11–13
  6. By: Max Gillman
    Abstract: This paper provides a general equilibrium model of income tax evasion. As functions of the share of income reported, the paper contributes an analytic derivation of the tax elasticity of taxable income, the welfare cost of the tax, and government revenue as a percent of output. It shows how an increase in the tax rate causes the tax elasticity and welfare cost to increase in magnitude by more than with zero evasion. Keeping constant the ratio of income tax revenue to output, as shown to be consistent with certain US evidence, a rising productivity of the goods sector induces less evasion and thereby allows tax rate reduction. The paper derives conditions for a stable share of income tax revenue in output with dependence upon the tax elasticity of reporting income. Examples are provided with less and more productive economies in terms of the tax elasticity of reported income, the welfare cost of taxation and the tax revenue as a percent of output, with sensitivity analysis with respect to leisure preference and goods productivity. Discussion focuses on how the tax evasion analysis may help explain such Öscal tax policy as the postwar US income tax rate reductions with discussion of tax acts and government Öscal multipliers. Fiscal policy with tax evasion included shows how tax rate reduction induces less tax evasion, a lower welfare cost of taxation, and makes for a stable income tax share of output.
    Keywords: optimal evasion; tax law; welfare; tax elasticity; revenue; productivity; development;
    JEL: E13 H21 H26 H30 H68 K34 K42 O11
    Date: 2020–10
  7. By: Wu, Xiaoping; Khazin, Bassam Peter
    Abstract: COVID-19, caused by SARS-Cov-2, was declared to be a pandemic by the World Health Organization on 11 March 2020. Since then, the issue of the relationship between patent protection and the development of and access to medical treatments and technologies - a longstanding and enduringly important public policy issue - has become central to the debate on the linkages between IP, innovation, access, and public health between stakeholders with divergent interests. This working paper provides an overview of the patent landscape of medical treatments and technologies related to COVID-19, and of the patent status of two investigational medical treatments: remdesivir and lopinavir/ritonavir. It then presents various patent-related actions taken by legislators, policymakers, industry sectors, and civil society organizations in WTO Members since the outbreak. Furthermore, it elaborates on patent-related policy options provided by the TRIPS Agreement, and WTO Members' national implementation and utilization of these options in their response to the COVID-19 pandemic.
    Keywords: COVID-19 pandemic,patent,open innovation,patentable subject matter,repurposed medicines,exceptions and limitations,licences,government use,transition periods,LDCs,WTO,TRIPS
    JEL: K11 K15 K30 O30 O31 O34 I18
    Date: 2020
  8. By: Yu, David (The Johns Hopkins Institute for Applied Economics, Global Health, and the Study of Business Enterprise)
    Abstract: As global macroeconomic uncertainties grow, there are notable shifts and oscillations in Chinese outbound investment and cross-border investment flows. This study shows China’s key investment characteristics including geographical preferences, investment compositions, and structural changes in industrial and foreign policies, such as Made in China 2025, financial liberalization, and OBOR. While these trends seem contradictory at times, opportunities are available for nimble and creative players who could capitalize on China’s increasing demand in the new economy (“xin jing ji”), with adequate consideration of regulatory scrutinies.
    Keywords: cross-border; China; outbound; investments; regulations
    JEL: F21 F68 K23 O53
    Date: 2020–01
  9. By: David Fettig; James A. Schmitz
    Abstract: The Covid-19 crisis has exposed the vast inequalities that exist within the US economy. As the virus has spread silently, it has laid bare other crises that face our nation---especially the economic vulnerabilities of the country's poor and marginalized. Many of these vulnerabilities can, in fact, be traced back to a single cause that itself has spread silently, but over the last several decades, not months: Monopolies. That monopolies are "silent spreaders of poverty and economic inequality" was well known to economic and legal scholars of the 1930s and 1940s. Wendell Berge, who was Assistant Attorney General for Antitrust in the 1940s, wrote: "Monopoly conditions have often grown up almost unnoticed by the public until one day it is suddenly realized that an industry is no longer competitive but is governed by an economic oligarchy." The harm caused by these monopolies that have mostly avoided detection often exist in markets with small firms, low concentration levels, and small price-cost margins, as in residential construction, or wreak their harm in public institutions, where prices and concentration have no meaning. While there has been a very welcome resurgence in the concern about monopolies in the last decade or so, this has primarily involved vast corporations, and often about their threat to democratic institutions. Though greatly welcomed, we should not let apprehension with these larger companies distract us from the many hidden monopolies that have silently spread harm to the poor for the last 100 years -- not just the last 10 or so. We should stand on the shoulders of giants that taught us this about monopolies, not only Berge, but Thurman Arnold, Henry Simons, and others.
    Keywords: Monopoly; Competition; Inequality; Cournot; Sabotage; Harberger; COVID-19; Thurman Arnold; Henry Simons; Silent spreaders; Housing
    JEL: D22 D42 K0 L0 L12
    Date: 2020–09–22

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