nep-law New Economics Papers
on Law and Economics
Issue of 2021‒03‒29
fourteen papers chosen by
Eve-Angeline Lambert, Université de Lorraine

  1. Collective Bargaining Rights, Policing, and Civilian Deaths By Cunningham, Jamein; Feir, Donna; Gillezeau, Rob
  2. How to align formal land rights with farmers’ perceptions in Central Asia? By Akhmadiyeva, Zarema; Herzfeld, Thomas
  3. The Economics of Platform Liability By Yassine Lefouili; Leonardo Madio
  4. Judicial efficiency and bank credit to firms By Giacomo Rodano
  5. Evidence Production in Merger Control: The Role of Remedies By Markus Dertwinkel-Kalt; Christian Wey
  6. Immigration and Crime: The Role of Self-Selection and Institutions By Mariani, Fabio; Mercier, Marion
  7. Crime is in the air: the contemporaneous relationship between air pollution and crime By Bondy, Malvina; Roth, Sefi; Sager, Lutz
  8. The impact of Presidential appointment of judges: Montesquieu or the Federalists? By Sultan Mehmood
  9. Does Envelopment through Data Advantage Call for New Regulation? By Gregor Langus; Vilen Lipatov
  10. Gender Norms and Domestic Abuse: Evidence From Australia By Zhang, Yinjunjie; Breunig, Robert
  11. Avoiding Taxes: Escaping the Exchange of Information: Tax Evasion via Citizenship-by-Investment By Dominika Langenmayr; Lennard Zyska
  12. Legal Aspects of the Implementation of a Pledge of a Bill of Lading as a Security: National Legal Realities By Mykola Haliantych; Anatoliy Kostruba; Nataliia Maydanyk
  13. Survivors Benefits and Conjugal Behavior. Evidence from the Netherlands By Julie Tréguier; Simon Rabaté
  14. Measuring Unmeasurable: How to Map Laws to Numbers Using Leximetrics By Konstantin A. Kholodilin; Linus Pfeiffer

  1. By: Cunningham, Jamein (University of Memphis); Feir, Donna (University of Victoria); Gillezeau, Rob (University of Victoria)
    Abstract: Do collective bargaining rights for law enforcement result in more civilian deaths at the hands of the police? Using an event-study design, we find that the introduction of duty to bargain requirements with police unions has led to a significant increase in non-white civilian deaths at the hands of police during the late twentieth century. We find no impact on various crime rate measures and suggestive evidence of a decline in police employment, consistent with increasing compensation. Our results indicate that the adoption of collective bargaining rights for law enforcement can explain approximately 10 percent of the total non-white civilian deaths at the hands of law enforcement between 1959 and 1988. This effect is robust to a contiguous county approach, accounting for heterogeneity in treatment timing, and numerous other specifications. While the relationship between police unions and violence against civilians is not clear ex-ante, our results show that the popular notion that police unions exacerbate police violence is empirically grounded.
    Keywords: police unions, policing, deaths by legal intervention, collective bargaining, discrimination
    JEL: J15 K42 J45 J58 N3
    Date: 2021–03
  2. By: Akhmadiyeva, Zarema; Herzfeld, Thomas
    Abstract: Kazakhstan and Uzbekistan still undergo the process of establishing a land legislative system, implementing agricultural reforms that aim at increasing land productivity. The effectiveness of these reforms is often dependent on the level of law enforcement that varies in accordance with whether political elites in these countries have an interest in enacting certain reforms. As a result, legal land rights and farmers' perceptions of land rights may contradict each other and may create an uncertain and insecure environment for the farmers. Based on the findings of a farm-level survey conducted in 2019 in Kazakhstan and Uzbekistan, this policy brief claims that legal rights and farmers' actual farming practices do not coincide in many cases. Deviations appear in both directions: 1) farmers engage in activities which they are not allowed to be, and 2) farmers do not use all the opportunities provided by the national land legislation. These deviations indicate the ineffectiveness not only of land policies but of administrative monitoring and law enforcement mechanisms, too. Policy makers are recommended reconsidering the legal restrictions of land use in how far they are necessary to reach policy objectives. Furthermore, governments should reform the judicial system in particular enabling farmers and land users to appeal to courts for dispute resolutions in an effective, transparent, and fair manner. Finally, international donors should support future research on land rights and tenure security to improve policy design.
    Keywords: Agricultural and Food Policy, Land Economics/Use
    Date: 2020
  3. By: Yassine Lefouili; Leonardo Madio
    Abstract: Public authorities in many jurisdictions are concerned about the proliferation of illegal content and products on online platforms. In this paper, we provide an economic appraisal of platform liability that highlights the effects of a stricter liability rule on several key variables such as prices, terms and conditions, business models, and investments. We also discuss the impact of the liability regime applying to online platforms on competition between them and the incentives of third parties relying on them. Finally, we analyze the potential costs and benefits of measures that have received much attention in recent policy discussions.
    Keywords: liabilities rules, online platforms, illegal content and products, intellectual property
    JEL: K40 K42 K13 L22 L86
    Date: 2021
  4. By: Giacomo Rodano (Bank of Italy)
    Abstract: This paper analyses empirically the effect of judicial efficiency on bank credit contractual terms for the universe of Italian corporations borrowing from the banking sector. Exploiting within-country variation in the length of bankruptcy proceedings across different jurisdictions, the paper uses a spatial regression discontinuity design that compares credit conditions applied to firms located in municipalities on different sides of jurisdiction borders, controlling for bank characteristics. The results show that judicial efficiency is associated with a reduction in the cost of credit as well as with an increase in its availability for firms, in particular for those at high risk of default. Judicial efficiency increases leverage and investment for high risk firms. All these results suggest that the banking system tilts credit conditions in favor of safe firms as court inefficiency increases. Finally, court efficiency is also associated with a reduction in both the stock and the flow of Non Performing Loans.
    Keywords: judicial efficiency, creditor rights, loan contractual terms, spatial discontinuity approach
    JEL: G21 G33 K12 K15
    Date: 2021–03
  5. By: Markus Dertwinkel-Kalt; Christian Wey
    Abstract: We analyze evidence production in merger control as a delegation problem in an inquisitorial competition policy system. The antitrust agency’s incentives to produce evidence on the efficiency of a merger proposal depend critically on its action set. Allowing for a compromising remedy solution reduces information acquisition incentives, and could therefore reduce consumer welfare. The effort-frustrating effect of the remedy solution can be eliminated if a remedy solution can be implemented only after evidence on the efficiency of a merger proposal has been produced.
    Keywords: merger remedies, merger control, antitrust
    JEL: L13 L40 K21
    Date: 2021
  6. By: Mariani, Fabio (Université catholique de Louvain); Mercier, Marion (Université Paris-Dauphine)
    Abstract: Contrary to popular perception, empirical evidence suggests that immigrants do not necessarily commit more crimes than natives, in spite of having lower legitimate earning opportunities. To make sense of this, we propose a novel theoretical framework based on a predator/prey model of crime, where endogenous migration decisions and career choices (between licit and illicit activities) are jointly determined. In this setting, we show that the involvement of migrants in crime crucially depends on self-selection into migration, as well as on productivity and institutional quality in the host economy. In particular, immigrants may display a lower crime rate than natives even if they are less productive on the honest labor market – and this result can still hold if career choices are revised after migration. We also find that stricter immigration policies could induce an adverse selection of migrants, and eventually attract more foreign-born criminals. Finally, a dynamic extension of our model can account for the higher crime rates of second-generation immigrants, and highlights the critical role of immigration and assimilation for the long-run evolution of crime and institutions in host countries.
    Keywords: migration, crime
    JEL: F22 K42 O17
    Date: 2021–03
  7. By: Bondy, Malvina; Roth, Sefi; Sager, Lutz
    Abstract: Many empirical studies have examined the various determinants of crime. However, the link between crime and air pollution has been largely overlooked. In this paper we study whether exposure to ambient air pollution affects crime using daily administrative data for London in 2004-05. For identification, we estimate models with ward fixed effects and implement two instrumental variable strategies, using atmospheric inversions and wind direction as exogenous shocks to local pollution. We find that air pollution has a positive and statistically significant impact on overall crime and on several major crime categories, including those with economic motives. Importantly, the effect also occurs at pollution levels which are well below current regulatory standards and appears to be unevenly distributed across income groups. Our results suggest that reducing air pollution in urban areas may be an effective measure to reduce crime and that air pollution forecasts can be used to improve predictive policing.
    Keywords: air pollution; crime; economic incentives
    JEL: H23 K42 Q53
    Date: 2020–03–20
  8. By: Sultan Mehmood (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique, NES - New Economics School - New Economics School)
    Abstract: A central idea in the institutions and development literature is whether the executive is adequately checked by the legislature and judiciary (North, 1990; Acemoglu et al., 2001; La Porta et al., 2004). This paper provides plausibly causal evidence on how increased constraints on the executive, through removal of Presidential discretion in judicial appointments, impacts judicial decision-making. In particular, we find that when the judge selection procedure in Pakistan changed, from the President appointing judges to appointments by judge peers, rulings in favor of the government decreased significantly and the quality of judicial decisions improved. The age structure of judges at the time of the reform and the mandatory retirement age law provide us with an exogenous source of variation in the implementation of the selection reform. We test for and provide evidence against potential threats to identification and alternative explanations for our findings. The analysis of mechanisms reveals that our results are explained by rulings in politically salient cases and by "patronage" judges who hold political office prior to their appointments. According to our estimates, Presidential appointment of judges results in additional land expropriations by the government worth 0.14 percent of GDP every year.
    Keywords: president,court subversion,property rights,judges,expropriation risk
    Date: 2021–03
  9. By: Gregor Langus; Vilen Lipatov
    Abstract: Envelopment is an effective form of market entry that facilitates competition among platforms. Nevertheless, many commentators have focused on the anticompetitive potential of envelopment, and some have argued for regulation of platforms because of that concern. These calls for regulation are not supported by robust formal analysis or comprehensive empirical evidence. We analyze a visible recent contribution by Condorelli and Padilla (2020a,b) and explain why the model that they put forward is not ripe for policy advice in relation to concerns with envelopment.
    Keywords: envelopment, entry deterrence, data, competition of multi-market platforms
    JEL: K21 L13 L40
    Date: 2021
  10. By: Zhang, Yinjunjie (Australian National University); Breunig, Robert (Australian National University)
    Abstract: Australia conforms to the gender norm that women should earn less than their male partners. We investigate the impact of violating this cultural norm on the incidence of domestic violence and emotional abuse against women and men in Australia. Violating the male breadwinning norm results in a 35 per cent increase in the likelihood of partner violence and a 20 per cent increase in emotional abuse against women. We find no effect on abuse against men. The strong effect of violating the gender norm on abuse against women is present across age ranges, income groups and cultural and educational backgrounds.
    Keywords: domestic violence, gender identity norm, relative income
    JEL: J12 K42 D31
    Date: 2021–03
  11. By: Dominika Langenmayr; Lennard Zyska
    Abstract: With (automatic) exchange of tax information among countries now common, tax evaders have had to find new ways to hide their offshore holdings. One such way are citizenship-by-investment programs, which offer foreigners a new passport for a local investment or a fixed fee. We show analytically that high-income individuals acquire a new citizenship to lower the probability that their tax evasion is detected through information exchange. Using data on cross-border bank deposits, we find that deposits in tax havens increase after a country starts offering a citizenship-by-investment program, providing indirect evidence that tax evaders use these programs.
    Keywords: Citizenship-by-investment programs, tax havens, tax evasion
    JEL: H26 H24 F53 K37
    Date: 2021–03
  12. By: Mykola Haliantych; Anatoliy Kostruba (Vasyl Stefanyk Precarpathian National University); Nataliia Maydanyk
    Abstract: The purpose of this article is a detailed study of the legal aspects of the implementation of the bill of lading in the context of the peculiarities of state legislation. Since the bill of lading is a security that gives the owner the legal authority to receive the goods, it can be accepted as collateral, as it is supported by a specific material value-its market value. At the moment, the problem of the bill of lading in the realities of Ukraine has become particularly relevant, as the world economy is now on the brink of crisis due to external factors, and the market needs additional investment, financing, budget expansion at various structural levels crisis. The methods used in the study are an analysis of the relevant legislation of Ukraine and Germany, as well as a comparative analysis, which leads to a vision of the lack of relevant functionalities in particular legislation. As a result of research, the authors found out whether the national conditions for obtaining a pledge under the bill of lading are favourable and what problems a legal entity may face in the case of this procedure. In conclusion, a number of additions were made that would need to be added to the actual legislation to facilitate the procedure for issuing funds secured by a bill of lading.
    Keywords: Civil legislation,pledger,pledgee,deposit,undocumented bill of lading
    Date: 2021–02–02
  13. By: Julie Tréguier (INED - Institut national d'études démographiques, IPP - Institut des politiques publiques, EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique); Simon Rabaté (CPB - Netherlands Bureau for Economic Policy Analysis)
    Abstract: This paper investigates the impact of survivors insurance on marital behavior. We study the 1996 Dutch reform which considerably tightened eligibility rules to survivors' benefits. Exploiting a discontinuity in date of birth eligibility to survivors insurance and using a rich and exhaustive of the Dutch population administrative dataset, we carry out a regression discontinuity design and we find no evidence of the reform on divorce probability. Exploring possible explanations for our zero-effect result, we study how labor supply responses can compensate the income drop the reform induced. We find a strong increase in the labor force participation of widows after the reform. However this response does not completely offset the decrease in income generated form the cut in survivors benefits.
    Date: 2021–03–02
  14. By: Konstantin A. Kholodilin; Linus Pfeiffer
    Abstract: As the institutional literature convincingly shows, socioeconomic phenomena are to a large extent shaped by the formal institutions, that is, legal acts (laws and ordinances). However, the latter are formulated in a specific language that is difficult to understand, let alone to measure. However, since the early 1990s, a whole branch of economic analysis of governmental regulations has evolved. It is known as leximetrics, i.e., the measuring of laws. It covers a wide range of economic sectors, such as financial, labor, housing, and product markets, among others. The two most popular methods are codification and surveys. Under the first method, the legal texts are analyzed, relevant provisions extracted, and numeric values assigned depending on these provisions. Under the surveys method, local experts are asked to provide their assessment of currently valid legal provisions and sometimes also their enforcement. In both cases, the legal texts are mapped onto real-valued indices with the objective of gauging the intensity of governmental regulations. These indices can be and are successfully used to explain the economic phenomena. This study provides a comprehensive overview of the leximetric literature and demonstrates interdependences between different types of governmental regulations.
    Keywords: Leximetrics, governmental regulations, economics
    JEL: C43 H24 K25 R38
    Date: 2021

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