nep-law New Economics Papers
on Law and Economics
Issue of 2023‒12‒18
eight papers chosen by
Yves Oytana, Université de Franche-Comté

  1. An Unintended Consequence of Gender Balance Laws: Mafia Fuels Political Violence By Anna Laura Baraldi; Giovanni Immordino; Erasmo Papagni; Marco Stimolo
  2. Equal before the (expressive power of) law? By Luise Goerges; Tom Lane; Daniele Nosenzo; Silvia Sonderegger
  3. Minimum Wage Non-compliance: The Role of Co-determination Abstract: We analyse in what way co-determination affects non-compliance with the German minimum wage, which was introduced in 2015. The Works Constitution Act (WCA), the law regulating co-determination at the plant level, provides works councils with indirect means to ensure compliance with the statutory minimum wage. Based on this legal situation, our theoretical model predicts that non-compliance is less likely in co-determined firms because works councils enhance the enforcement of the law. The economic correlates of co-determination, such as higher productivity and wages, affect non-compliance in opposite directions. The empirical analysis, using data from the German Socio-economic Panel (SOEP) for the years 2016 and 2019, demonstrates that non-compliance occurs less often for employees in co-determined establishments, while there is no impact on the difference between the minimum wage and the amount, which was actually paid. Therefore, co-determination helps to secure the payment of minimum wages. By Laszlo Goerke; Markus Pannenberg
  4. Accuracy and Preferences for Legal Error By Murat C. Mungan; Marie Obidzinski; Yves Oytana
  5. AI Ethics and Ordoliberalism 2.0: Towards A 'Digital Bill of Rights' By Manuel Woersdoerfer
  6. Hukum Jual Beli Menggunakan Robot By ; Kurniawan, Rachmad Risqy
  7. The Customary Atlas of Ancien Régime France By Victor Gay; Paula Eugenia Gobbi; Marc Goñi
  8. First, Do No Harm: Algorithms, AI, and Digital Product Liability By Marc J. Pfeiffer

  1. By: Anna Laura Baraldi (Università della Campania Luigi Vanvitelli); Giovanni Immordino (Università di Napoli Federico II and CSEF); Erasmo Papagni (Università di Napoli Federico II); Marco Stimolo (Università della Campania Luigi Vanvitelli)
    Abstract: Several studies document that women are more honest than men, so an increase in women’s political representation can be expected to improve the integrity of political institutions. However, greater honesty among politicians is an obstacle to the exercise of political influence by local criminal clans, who may respond by escalating violence. We test for this unintended consequence in Italy, exploiting an election law (Law 215/2012) whereby voters can express two preferences only if they are of different genders. Through a Difference-in-Differences analysis, we show that the introduction of Law 215 induces an increase in the probability of attacks 0.6 times its actual mean (0.031). The implementation of an alternative design, difference-in-discontinuities, provides similar results. To delve into the mechanism driving these effects, instrumental variable estimates show that it is the increase in the share of female councilors due to Law 215/2012 that induces an increase in the probability of attacks against local politicians, independently of their gender. These results are not driven by the regions most severely plagued by mafias. Several robustness checks corroborate our findings.
    Keywords: Organized Crime, Violence, Gender balance laws.
    JEL: C25 D73 D78 I38 K42
    Date: 2023–11–10
  2. By: Luise Goerges (Leuphana University Lüneburg); Tom Lane (Newcastle University Business School); Daniele Nosenzo (Department of Economics and Business Economics, Aarhus University); Silvia Sonderegger (School of Economics and Centre for Decision Research and Experimental Economics, University of Nottingham)
    Abstract: Building on findings showing that laws exert a causal effect on social norms, this paper investigates whether this “expressive power of law†differs by gender or race. We develop a model to show that such differences are theoretically plausible. We then use an incentivized vignette experiment to test whether these differences are empirically relevant. Results from an online sample of around 4000 subjects confirm that laws causally influence social norms. However, we find little evidence of a differential effect across gender or race, suggesting that gender and race biases in the legal system are driven by other mechanisms than differences in the expressive power of law.
    Keywords: Social Norms, Law, Expressive Function of Law, Gender Gap, Racial Bias
    JEL: C91 C92 D9 K1 K42
    Date: 2023–11–29
  3. By: Laszlo Goerke (Institute for Labour Law and Industrial Relations in the European Union (IAAEU), Trier University); Markus Pannenberg (University of Applied Sciences Bielefeld)
    Keywords: Negative emotions, immigration concerns, bereavement
    JEL: J30 J53 K31 K42 M54
    Date: 2023–11
  4. By: Murat C. Mungan (Texas A&M University School of Law); Marie Obidzinski (Université Paris Panthéon Assas, CRED, Paris, France); Yves Oytana (Université de Franche-Comté, CRESE, Besançon, France)
    Abstract: Legal procedures used to determine liability trade-off type-1 errors (e.g., false convictions) against type-2 errors (e.g., false acquittals). After noting that people's relative preferences for type-1 errors (compared to type-2 errors) appear to be negatively correlated with technological advancements, we study how the accuracy of evidence collection methods may affect the trade-off between these two errors. Counter-intuitively, we find that under some conditions greater accuracy may result in a higher probability of type-1 error (or type-2 error) maximizing deterrence. Then, assuming both errors are decreasing in accuracy, we characterize the type-1 error that emerges under electoral pressures (when the median voter's preferences are implemented): convictions occur more often than is socially optimal, but less often than is necessary to maximize deterrence. Moreover, as the harm from crime increases, the median voter becomes less tolerant of type-1 errors as the legal system's accuracy increases. We also show that, because the median voter is less averse towards type-1 errors than the average citizen, an increase in accuracy may reduce welfare.
    Keywords: K4
    Date: 2023–12
  5. By: Manuel Woersdoerfer
    Abstract: This article analyzes AI ethics from a distinct business ethics perspective, i.e., 'ordoliberalism 2.0.' It argues that the ongoing discourse on (generative) AI relies too much on corporate self-regulation and voluntary codes of conduct and thus lacks adequate governance mechanisms. To address these issues, the paper suggests not only introducing hard-law legislation with a more effective oversight structure but also merging already existing AI guidelines with an ordoliberal-inspired regulatory and competition policy. However, this link between AI ethics, regulation, and antitrust is not yet adequately discussed in the academic literature and beyond. The paper thus closes a significant gap in the academic literature and adds to the predominantly legal-political and philosophical discourse on AI governance. The paper's research questions and goals are twofold: First, it identifies ordoliberal-inspired AI ethics principles that could serve as the foundation for a 'digital bill of rights.' Second, it shows how those principles could be implemented at the macro level with the help of ordoliberal competition and regulatory policy.
    Date: 2023–10
  6. By: ; Kurniawan, Rachmad Risqy
    Abstract: In the era of rapidly developing digital transformation, the use of robots in purchasing transactions is an increasingly relevant topic in the fields of law and business. This article examines the legal issues related to the use of robots in the purchasing process, including ethical considerations, responsibility, and consumer protection. We analyze legal changes that may be needed to adapt to these technological developments, while maintaining justice and legal certainty. By analyzing the existing legal framework and recent cases, we aim to provide a better understanding of how buying and selling law is evolving in line with the development of robotic technology. This article also discusses case studies and current regulations in various jurisdictions, as well as providing the latest perspectives on the future of bot trading law. By exploring these questions, this article aims to provide readers with a comprehensive overview of the legal complexities involved in transactions. The research methodology uses a qualitative-descriptive method based on literature study and the legal istinbath method. The results of research on the law of inflation due to natural causes are permissible because it is a decree of Allah SWT, while inflation caused by human behavior and actions is haram, including the causes, because inflation causes damage and loss, inflation and its causes are legally prohibited/haram and must be avoided.
    Date: 2023–11–04
  7. By: Victor Gay; Paula Eugenia Gobbi; Marc Goñi
    Abstract: Customary law regulated most European societies during the middle ages and the early modern period. To better understand the roots of legalcustoms and their implications for long-run development, we introduce an atlas of customary regions of Ancien Régime France. We also describe thehistorical origins of French customs, their role as source of law, and their legal content. We then provide various insights into avenues of researchopened by this database
    Keywords: Customary law, Custom, Institution, Legal origin, Ancien Régime, France.
    Date: 2023–11
  8. By: Marc J. Pfeiffer
    Abstract: The ethical imperative for technology should be first, do no harm. But digital innovations like AI and social media increasingly enable societal harms, from bias to misinformation. As these technologies grow ubiquitous, we need solutions to address unintended consequences. This report proposes a model to incentivize developers to prevent foreseeable algorithmic harms. It does this by expanding negligence and product liability laws. Digital product developers would be incentivized to mitigate potential algorithmic risks before deployment to protect themselves and investors. Standards and penalties would be set proportional to harm. Insurers would require harm mitigation during development in order to obtain coverage. This shifts tech ethics from move fast and break things to first, do no harm. Details would need careful refinement between stakeholders to enact reasonable guardrails without stifling innovation. Policy and harm prevention frameworks would likely evolve over time. Similar accountability schemes have helped address workplace, environmental, and product safety. Introducing algorithmic harm negligence liability would acknowledge the real societal costs of unethical tech. The timing is right for reform. This proposal provides a model to steer the digital revolution toward human rights and dignity. Harm prevention must be prioritized over reckless growth. Vigorous liability policies are essential to stop technologists from breaking things
    Date: 2023–11

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