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on Law and Economics |
| By: | Diaz, Adriano |
| Abstract: | This article examines the phenomenon of "Bad Law" ("Mal Derecho") within Argentina's legal tradition, where laws are crafted based on idealistic conceptions of what the legal framework ought to be but lack the practical mechanisms necessary for effective enforcement. This disconnect between a law's design and its implementation fosters a dysfunctional legal system and widespread non-compliance. Rather than addressing the structural flaws within these laws, legal scholars often invoke the “Protective Hypothesis of Bad Law, ” attributing non-compliance to a moral failure of the populace instead of recognizing the inherent deficiencies in the legal framework. This issue is starkly illustrated by Law 27, 442 on Antitrust. Although ostensibly designed to promote competition and prevent market distortions, the law suffers from critical design flaws that render enforcement—both public and private—ineffective. Public enforcement is undermined by a lack of political incentives to establish the necessary enforcement authority, a shortcoming embedded within the law itself. Meanwhile, private enforcement remains largely theoretical, as potential plaintiffs are discouraged by the prohibitive complexity and costs of litigation. As a result, Argentina's competition law fails to achieve its intended objectives, leaving the country’s antitrust system largely ineffective and illusory. |
| Date: | 2025–01–04 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:t8j6g |
| By: | Amy Finkelstein; Sarah Miller; Katherine Baicker |
| Abstract: | Those involved with the criminal justice system have disproportionately high rates of mental illness and substance use disorders, prompting speculation that health insurance, by improving treatment of these conditions, could reduce crime. Using the 2008 Oregon Health Insurance Experiment, which randomly made some low-income adults eligible to apply for Medicaid, we find no statistically significant impact of Medicaid coverage on criminal charges or convictions. These null effects persist for high-risk subgroups, such as those with prior criminal cases and convictions or mental health conditions. In the full sample, our confidence intervals can rule out most quasi-experimental estimates of Medicaid's crime-reducing impact. |
| JEL: | I10 I13 K42 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33244 |
| By: | Luca Colombo (ESC [Rennes] - ESC Rennes School of Business); Paola Labrecciosa; Agnieszka Rusinowska (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | We take a novel approach based on differential games to the study of criminal networks. We extend the static crime network game (Ballester et al., 2006, 2010) to a dynamic setting where criminal activities negatively impact the accumulation of total wealth in the economy. We derive a Markov Feedback Equilibrium and show that, unlike in the static crime network game, the vector of equilibrium crime rates is not necessarily proportional to the vector of Bonacich centralities. Next, we conduct a comparative dynamic analysis with respect to the network size, the network density, and the marginal expected punishment, finding results in contrast with those arising in the static crime network game. We also shed light on a novel issue in the network theory literature, i.e., the existence of a voracity effect. Finally, we study the problem of identifying the optimal target in the population of criminals when the planner's objective is to minimize aggregate crime at each point in time. Our analysis shows that the key player in the dynamic and the static setting may differ, and that the key player in the dynamic setting may change over time. |
| Keywords: | Differential games, Markov equilibrium, Criminal networks, Bonacich centrality, Key player |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04850675 |
| By: | Randi Hjalmarsson (University of Gothenburg); Stephen Machin (London School of Economics and Political Science); Paolo Pinotti (Bocconi University) |
| Abstract: | The economics of crime has emerged as a critical field over the past 30 years, with economists increasingly exploring the causes and consequences of criminal behavior. This chapter surveys key contributions and developments from labor economists, who investigate the (often two-way) intersection of crime with labor market factors, such as education, wages, and unemployment. The chapter underscores the importance of understanding criminal decision-making in economic analysis through the lens of opportunity costs and labor market conditions. Methodological advancements, particularly those addressing causation, have propelled the field forward, enabling more accurate conclusions to be drawn for policy recommendations. The chapter also explores the role of social policies and international contexts, emphasizing the need for evidence-based reforms to effectively reduce crime. This comprehensive review underscores the transformative impact of economics on crime research and its potential to influence real-world policies. |
| Keywords: | economics of crime; labor market; criminal record; education; research directions |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:crm:wpaper:2426 |
| By: | Daniel L. Chen (TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - UT - Université de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, CNRS - Centre National de la Recherche Scientifique); Eric Reinhart |
| Abstract: | The impartiality and apolitical nature of the American judiciary are key to its legitimacy and the liberal constitutional legal system it supports. Though less than 1% of U.S. Federal judges admit to political motivations for retirement or resignation, our research suggests these influences are more widespread. Examining data from 1802 to 2019, we found 11% of retirements and 23% of resignations from the U.S. Courts of Appeals may be linked to political cycles. Judges are less likely to retire before a Presidential election when the President is from a different party than their appointing party, and more likely to resign after the election if the President is from their appointing party. These politically motivated exits have grown, accounting for 14% of retirements since 1975, which points to a more politically charged and polarized judiciary. Previous studies relying on self-reports or annual analyses have missed these political dynamics in judges' departure timing. Our quarter-to-election level analysis reveals that significant decisions by Federal judges may often be influenced by unconscious bias or conscious partisan loyalty, both of which challenge the idea of judicial neutrality and the common law precedents judges must uphold. Our findings support growing concerns about undemocratic political power being exercised through the courts, giving rise to juristocracy – the practice of engaging in politics under the guise of legal proceedings. |
| Keywords: | judicial tenure, political polarization, juristocracy, legitimacy, court reform |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04850358 |
| By: | Henry A. Thompson |
| Abstract: | I argue that generative AI will have an uneven effect on the evolution of the law. To do so, I consider generative AI as a labor-augmenting technology that reduces the cost of both writing more complete contracts and litigating in court. The contracting effect reduces the demand for court services by making contracts more complete. The litigation effect, by contrast, increases the demand for court services by a) making contracts less complete and b) reducing litigants' incentive to settle, all else equal. Where contracts are common, as in property and contract law, the change in the quantity of litigation is uncertain due to offsetting contracting and litigation effects. However, in areas where contracts are rare, as in tort law, the amount of litigation is likely to rise. Following Rubin (1977) and Priest (1977) generative AI will accelerate the evolution of tort law toward efficiency. |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2412.05090 |
| By: | Mary Kate Batistich; William N. Evans; Tyler Giles; Rebecca Margolit-Chan |
| Abstract: | We evaluate the impact of Step Up, a cognitive behavioral therapy program administered to inmates at the Lubbock County Detention Center in Lubbock, Texas. Step Up aims to address self-destructive thought and behavior patterns through a combination of group classes, one-on-one counseling, and a structured workbook. We compare individuals over time who enter the Step Up program to a group of eligible and interested nonparticipants in an unbalanced two-way fixed effects framework. Despite similarities in observable characteristics and initial behavior metrics, individuals who enter Step Up exhibit a 49% reduction in monthly behavioral incident rates compared to the untreated group, which is about an 8-percentage point decline. The typical participant spends about 3 months in the program, and we find evidence that the behavioral improvements persist after program completion. |
| JEL: | I18 K42 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33147 |
| By: | Güneş Aşık; Naci H. Mocan |
| Abstract: | We analyze the expressive content of government action, focusing on Istanbul Convention, an international treaty aimed at protecting women against violence, signed and ratified by 39 countries. In 2021, ten years after signing the Convention, the Turkish government withdrew from it, on the grounds that it "was hijacked by a group of people attempting to normalize homosexuality, which is incompatible with Turkey’s social and family values.” Although this withdrawal did not alter existing laws or law enforcement practices, women's rights advocates viewed it as a signal of tolerance for violence against women. We use two separate datasets on female murders from independent sources. Analyses, including a difference-in-difference model with male homicide data, show that the withdrawal led to an additional 70 female murders per year, primarily committed by intimate partners. The effect is more pronounced in provinces where the long-governing religious-conservative coalition parties have stronger voter support and in provinces with lower education levels. We also show that Turkey's entry into the Convention in 2011 had the opposite impact, leading to a decrease in female murders. The signing of the Convention, which acted as a normative signal against violence, and the subsequent enactment of comprehensive legislation strengthening deterrence, had distinct effects. The signaling effect of the Entry was more significant in the same provinces that reacted more strongly to the Exit: those with lower education levels, stronger support for the governing party, and the Eastern region of the country. These findings indicate that government actions are interpreted as normative signals by society. |
| JEL: | D70 I0 J12 K0 Z1 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33169 |