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on Law and Economics |
| By: | Natasha Aggarwal (TrustBridge Rule of Law Foundation); Bhavin Patel (TrustBridge Rule of Law Foundation) |
| Abstract: | A 2023 decision of the Supreme Court underscored the importance of judicial deference to expert bodies, stating that the High Court should have remanded a technical matter to the Appellate Tribunal for Electricity ('APTEL') instead of adjudicating it itself. Judicial review of erc orders cannot be eliminated, but the grounds and scope of judicial review should be confined within well-settled principles of administrative law. Many challenges against the Telangana State Electricity Regulatory Commission's ('TSERC') orders are filed before the Telangana High Court: in 2021-22, 12 appeals from TSERC were filed before aptel, while 85 appeals were filed before the Telangana High Court (i.e., over seven times the number of appeals before aptel). We analysed writ petitions and appeals involving TSERC before the Telangana High Court between 2014-2022 and examined whether judicial review of the TSERC's orders by the Telangana High Court is within the permitted limits in administrative law. We propose to conduct similar studies for other SERCAs and a comparative study across SERCs. |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:bjd:wpaper:7 |
| By: | Klaus M. Miller; Julia Schmitt; Bernd Skiera |
| Abstract: | Privacy regulations often necessitate a balance between safeguarding consumer privacy and preventing economic losses for firms that utilize consumer data. However, little empirical evidence exists on how such laws affect firm performance. This study aims to fill that gap by quantifying the impact of the European Union's General Data Protection Regulation (GDPR) on online usage behavior over time. We analyzed data from 6, 286 websites across 24 industries, covering 10 months before and 18 months after the GDPR's enactment in 2018. Employing a generalized synthetic control estimator, we isolated the short- and long-term effects of the GDPR on user behavior. Our results show that the GDPR negatively affected online usage per website on average; specifically, weekly visits decreased by 4.88% in the first 3 months and 10.02% after 18 months post-enactment. At the 18-month mark, these declines translated into average revenue losses of about USD 7 million for e-commerce websites and nearly USD 2.5 million for ad-based websites. Nonetheless, the GDPR's impact varied across website size, industry, and user origin, with some large websites and industries benefiting from the regulation. Notably, the largest 10% of websites pre-GDPR suffered less, suggesting that the GDPR has increased market concentration. |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2411.11589 |
| By: | Ronan Lyons (Trinity College Dublin); Maximilian Guennewig-Moenert (University of Cologne) |
| Abstract: | This paper examines the impact of early 20th-century rent control laws in New York City (NYC), using a Regression Discontinuity Design (RDD) to analyze the effects on market rents near municipal court district boundaries. We focus on rent regulations introduced in 1920, where judges had discretion to determine rent increases and did so influenced by their partisan affiliations. Using a dataset of over 12, 000 rental listings from the New York Times and records of 125 district judges, we find that market rents jumped by almost 10% crossing from Democrat- to Republican-controlled districts after the policy was implemented. A causal interpretation is supported not only by a rich set of controls but also by the lack of any discontinuity just before these controls were introduced or after. Our findings contribute new evidence on judicial discretion's role in shaping housing market outcomes and provide insights into early rent control policies, highlighting their distortionary effects on rental markets before World War II. |
| Keywords: | Rent control; New York City; 1920s |
| JEL: | O18 R21 R31 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:tcd:tcduee:tep0924 |
| By: | Joshua Ball; Günther G. Schulze; Nikita Zakharov (Department of International Economic Policy, University of Freiburg) |
| Abstract: | We revisit the effect of gun laws on suicide rates in the US states in the past 30 years by departing from the correlational analysis inherent in the previous literature and, instead, leveraging an instrumental variable (IV) approach based on policy convergences between contiguous states. The empirical analysis relies on the estimated gun law stringency constructed as the number of gun laws per state-year. Our causal results show that the gun control stringency significantly reduces firearm suicide rates (both in correlational and IV estimations), corroborating previous findings; yet this decline does not translate into fewer overall suicides â contrary to what was previously found in correlational studies. This novel finding suggests that gun laws are not effective in curbing overall suicide rates. |
| Keywords: | Gun laws, Suicides, Endogeneity, Instrumental variables, US states. |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:fre:wpaper:51 |
| By: | Gabriela Chmelikova (Department of Regional and Business Economics, Faculty of Regional Development and International Studies, Mendel University in Brno, Czech Republic); Renata Kucerova (Department of Management, Faculty of Business and Economics, Mendel University in Brno, Czech Republic); Helena Chladkova (Department of Management, Faculty of Business and Economics, Mendel University in Brno, Czech Republic); Jindrich Spicka (Department of Statistics, Faculty of Economics and Management, Czech University of Life Sciences, Prague, Czech Republic) |
| Abstract: | This paper investigates the role of the institutional business environment with favourable conditions for conducting business in the process of the EU transition towards sustainability. We draw on the theory of institutional economics and empirically investigate our overarching research question as to which extent the conditions conducive to do business are linked to increased levels of irresponsible corporate behaviour in the EU.. Pursuing an econometric approach, we test a set of hypotheses using various measures of favourable conditions for conducting business as drivers for corporate social irresponsibility. We build a unique dataset that includes observations of irresponsible corporate behaviour in 16 EU countries over the period 2015 – 2020. Our findings show that institutions conducive to support the ease of doing business lead to an increased ESG (Environmental, Social, and Governance) crime rate measured by the share of firms acting irresponsibly and that the intensity of past ESG incidents is associated with a lower current occurrence of offences against sustainability. Our conclusion could help drive progress toward sustainability by the recommendation to orient policies more toward countries with attractive business environments, as they tend to harbour a concentration of the most harmful firms. Further, it is recommended to harmonise corporate tax rates and other business conditions across EU member states. |
| Keywords: | Corporate Social Irresponsibility, Institutional Economics, Attractive Business Environments, Sustainability, ESG |
| JEL: | K42 L51 M14 O17 Q56 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:men:wpaper:97_2024 |
| By: | Claudia Biancotti; Carolina Camassa; Andrea Coletta; Oliver Giudice; Aldo Glielmo |
| Abstract: | Advancements in large language models (LLMs) have renewed concerns about AI alignment - the consistency between human and AI goals and values. As various jurisdictions enact legislation on AI safety, the concept of alignment must be defined and measured across different domains. This paper proposes an experimental framework to assess whether LLMs adhere to ethical and legal standards in the relatively unexplored context of finance. We prompt nine LLMs to impersonate the CEO of a financial institution and test their willingness to misuse customer assets to repay outstanding corporate debt. Beginning with a baseline configuration, we adjust preferences, incentives and constraints, analyzing the impact of each adjustment with logistic regression. Our findings reveal significant heterogeneity in the baseline propensity for unethical behavior of LLMs. Factors such as risk aversion, profit expectations, and regulatory environment consistently influence misalignment in ways predicted by economic theory, although the magnitude of these effects varies across LLMs. This paper highlights both the benefits and limitations of simulation-based, ex post safety testing. While it can inform financial authorities and institutions aiming to ensure LLM safety, there is a clear trade-off between generality and cost. |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2411.11853 |
| By: | Romain Espinosa (CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École nationale des ponts et chaussées - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique); Fabien Moizeau (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique, TEPP - Travail, Emploi et Politiques Publiques - UPEM - Université Paris-Est Marne-la-Vallée - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | We investigate the long-run evolution of Catholics' view on State secularism in France. We explore the roots of the opposition of Catholics to secularism that can be traced back as far as the 1789 French Revolution. We provide evidence that the divide between Catholics and supporters of secularism persisted throughout the 19 th and early 20 th Centuries, affecting votes on the major secularization Laws during the Third Republic. We argue that the dual French educational system, partitioned into Catholic and secular schools, may have contributed to this persistence. We then show that Catholics eventually became supporters of secularism in France, closing the political divide on the issue. However, this shift in opinion can be explained by Catholics viewing secularism as a way of limiting the influence of Islam. We argue that views about the involvement of Muslim/Catholic authorities in public debate are significant determinants of political supply in France. Last, we show that Catholics, who now support secularism, continue to exhibit different voting behavior and attitudes than Atheists (regarding women's rights and same-sex legislation). |
| Keywords: | Secularism, cultural persistence, voting behavior, Catholicism |
| Date: | 2024–11–27 |
| URL: | https://d.repec.org/n?u=RePEc:hal:ciredw:halshs-04806416 |