nep-law New Economics Papers
on Law and Economics
Issue of 2022‒04‒18
ten papers chosen by
Eve-Angeline Lambert, Université de Lorraine

  1. When Do More Police Induce More Crime? By Casilda Lasso de la Vega; Oscar Volij; Federico Weinschelbaum
  2. The Effects of Legal Representation on Tenant Outcomes in Housing Court: Evidence from New York City’s Universal Access Program By Mike Cassidy; Janet Currie
  3. Jewish Law and Ethics: The Case of the Revolving Door By Elise S. Brezis
  4. Essays on the Social Cost of Reduced Access to Land and Housing By Stefano Falcone
  5. A Dynamic Analysis of Criminal Networks By Luca Colombo; Paola Labrecciosa; Agnieszka Rusinowska
  6. Tackling Legal Impediments to Women’s Economic Empowerment By Francisca Fernando; Juliet Johnson; Katharine Christopherson; Audrey Yiadom; Hanan Yazid; Clara Thiemann
  7. Confidential and legal access to abortion and contraception in the United States, 1960-2020 By Myers, Caitlin Knowles
  8. Exposure to conflict, migrations and long-run education and income inequality: Evidence from Bosnia and Herzegovina By Efendic, Adnan; Kovaéc, Dejan; Shapiro, Jacob N.
  9. Nurses without Borders: The Impact of Licensing Barriers on Employment By Anne Portlock
  10. Collusion and Artificial Intelligence: A Computational Experiment with Sequential Pricing Algorithms under Stochastic Costs By Gonzalo Ballestero

  1. By: Casilda Lasso de la Vega (University of the Basque Country); Oscar Volij (Ben Gurion University); Federico Weinschelbaum (UTDT/CONICET)
    Abstract: We provide a necessary and sufficient condition on the equilibrium of a Walrasian economy for an iincrease in police expenditure to induce an increase in crime. This perverse effect is consistent with any appropriation technology and could arise even if the level of police protection is the socially optimal one.
    JEL: D72 D74 H23 K42
    Date: 2022–02
  2. By: Mike Cassidy (Princeton University); Janet Currie (Princeton University)
    Abstract: Housing is one of the areas where it may be most critical for poor people to have access to legal representation in civil cases. We study the roll-out of New York City’s Universal Access to Counsel program (UA), using detailed address-level housing court data from 2016 to 2019. The program, which became law in August 2017, offers free legal representation in housing court to tenants with income at or below 200 percent of the federal poverty guideline. We find that tenants who gain access to lawyers are less likely to be subject to possessory judgments, face smaller monetary judgments, and are less likely to have eviction warrants issued against them. Lawyers have larger effects in poorer places and in those with larger shares of non-citizens. UA also reduces executed evictions in these locations. Our results support the idea that legal representation in civil procedures can have an important positive impact on the lives of poor people.
    Keywords: Housing, Legal, Universal Access to Counsel program, Legal Representation
    JEL: R39 K40 K49
    Date: 2022–03
  3. By: Elise S. Brezis (Bar-Ilan University)
    Abstract: What is ethics and how is it related to the legal system and to economics? Are there ethical values in Jewish Law, and could it be that we find in the writing of Hazal [the sages] an interest in job turnover? The purpose of this paper is to answer to those questions by focusing on a specific element of our economic life: the revolving door.
    Keywords: corruption; ethics; legal system; revolving door; social norms.
    JEL: H10 H70 O11 O43
    Date: 2022–03
  4. By: Stefano Falcone
    Abstract: Property rights are a central feature of well-functioning economic systems. By shaping incentives to participate in economic activities, property rights lead to investment, development and growth. However, the exercise of property rights over assets necessary to our daily lives may come at a social cost. Employing quasi-experimental designs, I show that the exclusion of individuals from secure access to land and housing leads to the forcible appropriation of these assets for subsistence purposes. First, the expansion of commercial farming induced by a market-oriented reform in the mid-90s in Brazil led to an increase in cases of contested land. Results suggest that the effect on land disputes is mainly driven by the reduction of land informally accessible to local communities. Second, in the same context, local organizations facilitated political mobilization and this latter advanced land redistribution by the government. Third, the adoption of a policy inducing evictions in Ohio's cities from 2000 to 2016 led to an increase in property crime over potentially inhabitable assets. Findings seems to be driven by evicted women losing employment, hence leading to a reduction in income. Overall, this dissertation shows that individuals excluded from access to land and housing are pushed to employ force to use these assets.
    Keywords: Conflict, Contested Land, Property Rights, Property Crime
    Date: 2021–10–28
  5. By: Luca Colombo (Deakin University, Burwood, Australia - Deakin University [Burwood]); Paola Labrecciosa (Monash Business School); Agnieszka Rusinowska (CNRS - Centre National de la Recherche Scientifique, CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)
    Abstract: The paper presents a novel approach based on di¤erential games to the study of criminal networks. We extend the static crime network game (Ballester et al., 2004, 2006) to a dynamic setting. First, we determine the relationship between the Markov Perfect Equilibrium (MPE) and the vector of Bonacich centralities. The established proportionality between the Nash equilibrium and the Bonacich centrality in the static game does not hold in general in the dynamic setting. Next, focusing on regular networks, we provide an explicit characterization of equilibrium strategies, and conduct comparative dynamic analysis with respect to the network size, network density, and implicit growth rate of total wealth in the economy. Contrary to the static game, where aggregate equilibrium increases with network size and density, in the dynamic setting, more criminals or more connected criminals can lead to a decrease in total crime, both in the short run and at the steady state. We also examine another novel issue in the network theory literature, i.e., the existence of a voracity e¤ect, occurring when an increase in the implicit growth rate of total wealth in the economy lowers economic growth. We do identify the presence of such a voracity e¤ect in our setting.
    Keywords: differential games,Markov Perfect Equilibrium,social networks,criminal networks,Bonacich centrality
    Date: 2022–02–28
  6. By: Francisca Fernando; Juliet Johnson; Katharine Christopherson; Audrey Yiadom; Hanan Yazid; Clara Thiemann
    Abstract: It is well established that a wide range of legal impediments in countries’ domestic laws have prevented women from achieving full economic empowerment, which in turn has negative macroeconomic implications. In many countries, laws often reflect and perpetuate gender norms that limit women’s economic participation, and removal of these impediments through legal reform has been shown to be an effective method to catalyze greater participation of women in the economy—along with the related macroeconomic benefits. Once legal barriers are removed and provisions for more equal treatment under the law are embedded, the law can also be employed as a powerful tool to incentivize women to pursue equal opportunities, change mindsets regarding the role of women, and hold institutions and individuals accountable for achieving results. Accordingly, it is imperative for countries to focus on eliminating existing legal impediments and designing appropriate incentives to increase women’s participation in the economy. This paper goes beyond previous Fund work by categorizing the key sources of laws that impede women’s economic empowerment, as well as ways in which the law can be used as a tool to create behavioral changes and shifts in perceptions of women in the economy. Case studies of six countries (Iceland, Peru, Rwanda, The Philippines, Tunisia, and the United States) that rank high in gender equality in their respective regions demonstrate how legal reforms have been implemented in differing contexts to help achieve women’s economic empowerment. Given the relevance to the Fund’s mandate, the paper also notes the case for a stepped-up role for the IMF in advising on legal reforms that remove barriers to, and incentivize, women’s economic empowerment. Although this paper highlights dominant belief systems and cultural norms that have contributed to limiting the economic empowerment of women, it does not intend to render any judgment on these systems or norms.
    Keywords: gender gap, inequality, inclusive growth
    Date: 2022–02–18
  7. By: Myers, Caitlin Knowles
    Abstract: An expansive empirical literature estimates the causal effects of policies governing young women's confidential and legal access to contraception and abortion. I present a new review of changes in the historical policy environment in the United States that serve as the foundation of this work. I consult primary sources including annotated statutes, judicial rulings, attorney general opinions, and advisory articles in medical journals, as well as secondary sources including newspaper articles and snapshots of various policy environments prepared by scholars, advocates, and government organizations. Based on this review, I provide a suggested coding of the policy environment over the past 60 years. I also present and compare the legal coding schemes used in the empirical literature and where possible I resolve numerous and substantial discrepancies.
    Keywords: Contraception,abortion,policy
    JEL: J13 J18
    Date: 2022
  8. By: Efendic, Adnan; Kovaéc, Dejan; Shapiro, Jacob N.
    Abstract: We investigate the long-term relationship between conflict-related migration and individual socioeconomic inequality. Looking at the post-conflict environment of Bosnia and Herzegovina (BiH), a former Yugoslav state most heavily impacted by the conflicts of the early 1990s, the paper focuses on differences in educational performance and income between four groups: migrants, internally displaced persons, former external migrants, and those who did not move. The analysis leverages a municipality-representative survey (n≈6,000) that captured self-reported education and income outcomes as well as migration histories. We find that individuals with greater exposure to conflict had systematically worse educational performance and lower earnings two decades after the war. Former external migrants now living in BiH have better educational and economic outcomes than those who did not migrate, but these advantages are smaller for individuals who were forced to move. We recommend that policies intended to address migration-related discrepancies should be targeted on the basis of individual and family experiences caused by conflict.
    Keywords: conflict,education,forced migration,inequality
    JEL: D74 F22 K42 Z18
    Date: 2022
  9. By: Anne Portlock (Department of Economics and Geosciences, US Air Force Academy)
    Abstract: The Nurse Licensure Compact forged an environment of multi-state professional licensing. Under the compact, registered nurses licensed in one of the now twenty-five party states may legally practice in the other participating states. This paper examines how mutual reciprocity of occupational licensing reduces barriers to employment. A sample of active duty military spouses, who do not have the luxury of making relocation decisions based on license transferability, was constructed using the American Communities Survey from 2001 to 2015 in order to identify effects on labor market participation. One would otherwise be confounded by the influence of employment opportunities on location selection. Both logistic regression and a linear probability model with state and year fixed effects are used to estimate the effect of multistate licensing. The treatment group consists of nurses whose military spouse was relocated from one party state to another participating state and consequently would be eligible for license reciprocity. The control group is composed of similar nurses whose spouse's military reassignment was not between compact states for whom re-entering the workforce would require certification in the new state. Results indicate significant reductions in departures from the labor force, identifying the labor market inefficiencies created by single-state professional licensing.
    Keywords: Occupational Licensing, Professional Licensing, Nurse Licensure Compact, License Reciprocity, Multi-state Licensing, Military Assignments, Military Spouses, Geographic Mobility in Health Professions
    JEL: J44 I18 J08
    Date: 2022–04
  10. By: Gonzalo Ballestero (Universidad de San Andrés)
    Abstract: Firms increasingly delegate their strategic decisions to algorithms. A potential concern is that algorithms may undermine competition by leading to pricing outcomes that are collusive, even without having been designed to do so. This paper investigates whether Q-learning algorithms can learn to collude in a setting with sequential price competition and stochastic marginal costs adapted from Maskin and Tirole (1988). By extending a previous model developed in Klein (2021), I find that sequential Q-learning algorithms leads to supracompetitive profits despite they compete under uncertainty and this finding is robust to various extensions. The algorithms can coordinate on focal price equilibria or an Edgeworth cycle provided that uncertainty is not too large. However, as the market environment becomes more uncertain, price wars emerge as the only possible pricing pattern. Even though sequential Q-learning algorithms gain supracompetitive profits, uncertainty tends to make collusive outcomes more dicult to achieve.
    Keywords: Competition Policy, Artificial Intelligence, Algorithmic Collusion
    JEL: D43 K21 L13
    Date: 2022–02

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