nep-law New Economics Papers
on Law and Economics
Issue of 2023‒10‒30
ten papers chosen by
Yves Oytana, Université de Franche-Comté

  1. On the Tension Between Due Process Protection and Public Safety: The Case of an Extensive Procedural Reform in Colombia By Acosta, Camilo; Mejía, Daniel; Zorro Medina, Angela
  2. The Role of Sanctions and Spillovers in Forest Conservation By João Pedro Vieira; Ricardo Dahis; Juliano Assunção
  3. Weeding out the Dealers? The Economics of Cannabis Legalization By Auriol, Emmanuelle; Mesnard, Alice; Tiffanie Perrault,
  4. Willingness to pay for crime reduction: evidence from six countries in the Americas By Domínguez, Patricio; Scartascini, Carlos
  5. The Effects of Exposure to Refugees on Crime: Evidence from the Greek Islands By Rigissa Megalokonomou; Chrysovalantis Vasilakis
  6. The Impact of Expanding Worker Rights to Informal Workers Evidence from Child Labor Legislation By Lakdawala, Leah K.; Martínez Heredia, Diana; Vera-Cossio, Diego A.
  7. Police Discretion and Public Safety By Felipe M. Gonçalves; Steven Mello
  8. Liberty By François Facchini
  9. Economics at the cinema: learning from a story of child marriage By Souparna Maji; Katja Bergonzoli; Madhuri Agarwal; Vikram Bahure
  10. Measuring Racial Discrimination in Bail Decisions. By Dobbie, Will; Hull, Peter; Arnold, David

  1. By: Acosta, Camilo (Inter-American Development Bank); Mejía, Daniel (Universidad de los Andes); Zorro Medina, Angela (University of Chicago)
    Abstract: In this paper we exploit the arguably exogenous staggered implementation of an extensive criminal procedural reform in Colombia between 2005 and 2008 to assess its intended and unintended consequences. The reform had explicit objectives, such as guaranteeing due process protection of the accused, reducing the use of pretrial detention, making the processing of criminal cases more efficient, reducing procedural times, and improving the mechanisms for early termination of criminal processes. Our results show that the reform achieved most of its goals. Namely, a significant reduction in the use of pretrial detention of about 17%-34%; a large and significant reduction in procedural times (18%); an increase in the use of mechanisms for early termination of the criminal process through settlements (43%-66%); and a large and significant increase in the percentage of cases that reach adjudication. Nevertheless, the reform also had negative unintended consequences on arrest, clearance, and crime rates. Our results indicate that arrest rates decreased by about 33% and clearance rates by 16%-27%. The reform also directly affected the incentives for criminal behavior and led to an increase in both property crimes (19%) and violent crimes (17%) as a result of the implementation of the reform. Our paper shows that well-intended reforms aimed at increasing due process protection can create unintended consequences in the administration of justice that led to increases in crime and raises the question of how to balance constitutional protections with public safety by creating special provisions and guidelines directed to mitigate potential adverse effects on crime rates.
    Keywords: Criminal procedural reform; pretrial detention; due process protection; clearance rates; crime
    JEL: D73 D78 K14 K42
    Date: 2023–09–27
  2. By: João Pedro Vieira (Department of Economics, PUC-Rio); Ricardo Dahis (Department of Economics, Monash University); Juliano Assunção (Department of Economics, PUC-Rio)
    Abstract: We study how environmental sanctions and spillovers improve forest conservation in the Brazilian Amazon. Using a difference-in-differences framework and novel farm-level data, we show that sanctions curbed deforestation and promoted reforestation among punished farmers and their neighbors. Heterogeneity analysis reveals that even sanctions with limited incapacitation potential elicited relevant behavioral changes. In particular, farmers’ responsiveness to sanctions coincided with the government’s commitment to enforcement. We do not find substantial evidence of spatial displacement or monitoring evasion. Overall, sanctions prevented 1.6 billion tons of CO2 emissions between 2006 and 2019, equivalent to 31% of US emissions in 2021.
    Keywords: Law Enforcement, Spillovers, Deforestation
    JEL: K42 Q23 Q28 Q58
    Date: 2023–10
  3. By: Auriol, Emmanuelle; Mesnard, Alice; Tiffanie Perrault,
    Abstract: We model consumer choices for recreational cannabis in a risky environment and its supply under prohibition and legalization. While legalization reduces the profits of illegal providers, it increases cannabis consumption. This trade-off can be overcome by combining legalization with sanctions against the black market, and improvements to the quality of legal products. Numerical calibrations highlight how a policy mix can control the increase in cannabis consumption and throttle the illegal market. In the US, the eviction prices we predict to drive dealers out of business are much lower than the prices of legal cannabis in most of the states that opted for legalization, leaving room for the black market to flourish. Analyzing the compatibility of several policy goals sheds light on the less favorable outcomes of recent legalization reforms and suggests a new way forward.
    Keywords: recreational cannabis, ; legalization, ; crime; policy; regulation
    JEL: I18 K32 K42 L51
    Date: 2023–10–09
  4. By: Domínguez, Patricio; Scartascini, Carlos
    Abstract: Crime levels are a perennial development problem in Latin America and a renewed concern in the United States. At the same time, trust in the police has been falling, and questions abound about citizens' willingness to support government efforts to fight crime. We conduct a survey experiment to elicit willingness to contribute toward reducing crime across five Latin American countries and the United States. We compare homicide, robbery, and theft estimates and find a higher willingness to contribute for more severe crimes and for higher crime reductions. In addition, we examine the role of information on the willingness to contribute by conducting two experiments. First, we show that exposing respondents to crime-related news increases their willingness to pay by 5 percent. Furthermore, while we document a 7 percent gap in willingness to pay for crime reduction between people who under- and over-estimate the murder rate, we find that this gap can be wholly eliminated by informing them about the actual level of crime. On average, our estimates suggest that households are willing to contribute around $140 per year for a 20 percent reduction in homicide. This individual-level predisposition would translate into additional investment in public security efforts of up to 0.5 percent of GDP.
    Keywords: willingness to pay;Cost of crime;Latin America;United States
    JEL: K42 H53 H27
    Date: 2022–10
  5. By: Rigissa Megalokonomou (Monash University, Monash Business School, Department of Economics, IZA and CESifo); Chrysovalantis Vasilakis (University of Bangor, Business School)
    Abstract: Recent political instability in the Middle East has triggered one of the largest influxes of refugees into Europe. The different departure points along the Turkish coast generate exogenous variation in refugee arrivals across Greek islands. We construct a new dataset on the number and nature of crime incidents and arrested offenders at island level using official police records and newspaper reports. Instrumental variables and difference-in-differences are employed to study the causal relationship between immigration and crime. We find that a 1-percentage-point increase in the share of refugees on destination islands increases crime incidents by 1.7-2.5 percentage points compared with neighboring unexposed islands. This is driven by crime incidents committed by refugees; there is no change in crimes committed by natives on those islands. We find a significant rise in property crime, knife attacks, and rape, but no increase in drug crimes. Results based on reported crimes exhibit a similar pattern. Our findings highlight the need for government provision in terms of infrastructure, social benefits, quicker evaluation for asylum, and social security.
    Keywords: rime, migration, natural experiment, Greek islands, difference-in-differences
    JEL: F61 F22 K42 J15
    Date: 2023–10
  6. By: Lakdawala, Leah K.; Martínez Heredia, Diana; Vera-Cossio, Diego A.
    Abstract: We study the effects of a Bolivian law that introduced benefits and protections for child workers (who are overwhelmingly informal workers) and lowered the de facto legal working age from 14 to 10. We employ a difference-in-discontinuity approach that exploits the variation in the laws application to different age groups. Work decreased for children under 14, whose work was newly legalized and regulated under the law, particularly in areas with a higher threat of inspections. The effects appear to be driven by a reduction in the most visible forms of child work, suggesting that firms may have reduced employment of young children to minimize the risk of being inspected. In contrast, we nd that more formal channels of adjustments - such as increased costs of hiring due to the costs of complying with the new law - are unlikely to explain the overall decline in the work of young children.
    JEL: K3 K31 J08 O12
    Date: 2023–01
  7. By: Felipe M. Gonçalves; Steven Mello
    Abstract: We study the implications of police discretion for public safety. Highway patrol officers exercise discretion over fines by deviating from statutory fine rules. Relying on variation across officers in this discretionary behavior, we find that harsher sanctions reduce future traffic offending and crash involvement. We then show that officer discretion over sanctions decreases public safety by comparing observed reoffending rates with those in a counterfactual without discretion, estimated using an identification at infinity approach. About half the safety cost of discretion is due to officer decisions which result in harsh sanctions for motorists who are least deterred by them. We provide evidence that this officer behavior is attributable to a preference for allocating harsh fines to motorists with higher recidivism risk, who are also the least responsive to harsher sanctions.
    JEL: D73 J45 K42
    Date: 2023–09
  8. By: François Facchini (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Freedom raises questions, on the one hand, about the relationship between human beings and nature (via the question of determinism) and, on the other hand, about the relationship between one human being and another (via the topics of duty and obligation). The response of human beings to the constraints that nature places upon the will is exemplified in technology. The response of human beings to the constraints that can be imposed by other human beings is exemplified by law. Fundamentally, a free action is something done that could have been done in a different way. It is distinguished from a reflex action. A free act or action has three characteristics: (i) it is intentional (an act of will), (ii) it comes with a justification in the form of reasons for acting or motives (one wishes to enjoy looking at a landscape), and (iii) it is not the determinate result of some other act or action. Regarding free action, it is not immediately certain that it exists in reality. Perhaps my reasons for acting or my motives in acting were, after all, determined by my conditions of existence. Determinism develops this doctrine. Everything that happens must happen as it does and could not have happened any other way. The acts of the will are determined by antecedent causes. There are two kinds of determinism: external determinism and internal determinis. Determinism has three consequences: (i) The opposite of the absence of choice is freedom; (ii) determinism denies the being of "non necessitating ends, " and the role of free will, entrepreneurialism and imagination in the explanation of human behavior; and (iii) if freedom does not exist, the law does not need to protect it. At the contrario, Affirming the existence of nonnecessitating ends has therefore several consequences. In particular, that restores the place of entrepreneurs as a change agent in the analysis of the dynamics of institutions : culture and law. The entrepreneur has space in which to manoeuver regarding all the laws that do not establish necessitating ends. If human laws, that is, morality and law, have this characteristic, then human beings can liberate themselves from laws that constrain them by refusing to apply them. They have the power to stand apart from their conditioning.
    Keywords: liberty, entrepreneur, action, determinism, property right, morality
    Date: 2022–11–26
  9. By: Souparna Maji (University of Geneva); Katja Bergonzoli (University of Lausanne); Madhuri Agarwal (NFER); Vikram Bahure (King’s College London)
    Abstract: This study examines the impact of a public education policy targeting women’s education on the domestic violence faced by women in India. We use the 2015-16 Demographic Health Survey (DHS) and exploit a regression discontinuity design for a large-scale school construction program, the District Primary Education Program (DPEP), launched in 1994 in India. We find that the program increases women’s education by 0.95 years and decreases different forms of domestic violence: a 13% decrease in emotional domestic violence, a 27% decrease in less severe physical domestic violence, a 9% decrease in sexual violence, and a 10% decrease in injuries due to domestic violence. We explore potential mechanisms and find no improvement in female labor force participation, cash income, and the intrahousehold decision-making power of women. However, we find a significant improvement in the gender beliefs and attitudes of women, as they do not justify domestic violence. Educated women also marry wealthier men who have better gender attitudes and beliefs. Finally, we find that treated and more educated women have better access to information and potentially seek more help from law enforcement authorities, which means an increase in the likelihood of reporting domestic violence to authorities. This could lead to a higher opportunity cost of committing domestic violence for husbands/partners and translate into less domestic violence. Overall, we find strong evidence for improvement in gender attitudes and beliefs, better partner quality, and improved access to information for women.
    Keywords: Domestic Violence, Education Reforms, Women’s Education, India, Human Capital, Gender Role Beliefs, Marriage Market, Reporting Crime
    JEL: I21 I28 J12 J16 J24 K42
    Date: 2023–04
  10. By: Dobbie, Will; Hull, Peter; Arnold, David
    Abstract: We develop new quasi-experimental tools to measure disparate impact, regardless of its source, in the context of bail decisions. We show that omitted variables bias in pretrial release rate comparisons can be purged by using the quasi-random assignment of judges to estimate average pretrial misconduct risk by race. We find that two-thirds of the release rate disparity between white and Black defendants in New York City is due to the disparate impact of release decisions. We then develop a hierarchical marginal treatment effect model to study the drivers of disparate impact, finding evidence of both racial bias and statistical discrimination.
    Keywords: C26, J15, K42
    Date: 2022–09–01

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