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on Law and Economics |
| By: | Ana Isabel López Garciá; Seung-hun Lee; Juan P. Figueroa Mansur |
| Abstract: | Do criminal groups which help maintain order strengthen the fiscal contract or weaken it? This paper examines how the presence of organized-crime groups shapes Mexican municipalities' ability to collect revenue, deliver public goods, and earn citizens' trust. Survey data show that residents living in neighbourhoods home to organized crime report lower levels of trust in local government, regardless of whether those groups provide 'order' or engage in extortion and violence. |
| Keywords: | Local government, Trust, Fiscal policy, Public goods, Crime |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:unu:wpaper:wp-2025-72 |
| By: | Ilona Dielen (Université Paris-Est Créteil, ERUDITE, France; Université Côte d’Azur, CNRS, GREDEG, France); Jeanne Mouton (European Commission, Brussels) |
| Abstract: | This study assesses the effect of Directive 2014/104/EU on the likelihood of success of private actions for damages related to abuse of a dominant position. Based on an original database of 194 decisions between 1988 and 2022 in France, Italy and the United Kingdom, the analysis is based on an identification by difference in differences with fixed country and sector effects. The effect is estimated by targeting the cases most likely to be affected by the Directive, namely stand-alone actions for damages. The results reveal a significant differential effect of the Directive, contributing to the empirical assessment of its impact on the effectiveness of the right to compensation in private competition litigation. |
| Keywords: | Competition law, damages actions, private remedies, abuse of dominant position, EU directive, impact assessment, law economy |
| JEL: | K21 K41 C21 H83 |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:gre:wpaper:2025-42 |
| By: | Gambato, Jacopo; Ganglmair, Bernhard; Krämer, Julia |
| Abstract: | In a model of asymmetric regulation, a firm can comply with two regulatory targets, and a regulator can audit the firm for compliance. Inspection by the regulator is imperfect, and it assesses the firm's compliance with the targets with different success probabilities. The firm fully complies only if compliance costs are low. Otherwise, the firm always prioritizes the requirement that is easier to enforce. Expanding regulatory capacity positively affects compliance with the easy-to-enforce target; however, a higher capacity can harm compliance with the hard-to-enforce target. |
| Keywords: | agency resources, asymmetric enforcement, compliance, multi-tasking, regulation |
| JEL: | H32 K20 L51 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:zewdip:330314 |
| By: | Seungwhan Chun; Marco Duarte; Cici McNamara; Jason M. Lindo |
| Abstract: | Are state-imposed behavioral remedies effective substitutes for federal antitrust enforcement? We evaluate state regulation of hospital mergers under Certificates of Public Advantage (COPAs). Using hospital data from 1996-2022, we compare COPA-regulated mergers to unregulated mergers with similar anticompetitive potential. In highly concentrated markets, COPA mergers result in 11.1 p.p. lower price growth but 0.5 p.p. greater increases in 30-day mortality rates. We find a negative correlation between price and mortality effects for COPA mergers, consistent with theoretical predictions that binding price caps exacerbate quality deterioration. Our findings suggest that COPA contracts are poor substitutes for traditional antitrust enforcement. |
| JEL: | G38 I11 K21 |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:34373 |
| By: | Gutmann, Jerg; Voigt, Stefan |
| Abstract: | This chapter surveys economic perspectives on the separation of powers, revealing how contemporary research in political economics and the economic analysis of law conceptualize and assess institutional checks on government authority. Emphasizing principal-agent theory, it unpacks how constitutional structures-ranging from presidentialism and bicameralism to federalism-help align the interests of political agents with those of citizens and mitigate moral hazard. The analysis extends to the judiciary's role as a credible commitment device, highlighting empirical evidence on the economic significance of judicial independence. Moving beyond the traditional tripartite model, the chapter explores the rationale and effects of delegating authority to independent agencies and so-called fourth branch agencies such as audit offices and anti-corruption commissions. The chapter concludes by addressing the resilience of separation-of-powers systems in the face of democratic erosion and the idea of militant constitutionalism. It argues that the economic approach offers helpful tools for understanding both the potential and limitations of institutional design in promoting accountable, stable, and adaptive governance, while underscoring the need for further research into how separation of powers can be fortified against contemporary authoritarian threats. |
| Keywords: | Political economy, judicial independence, independent agencies, fourth branch agencies, militant constitutionalism |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ilewps:87 |
| By: | Simon Varaine (GAEL - Laboratoire d'Economie Appliquée de Grenoble - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - UGA - Université Grenoble Alpes - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - UGA - Université Grenoble Alpes, IEPG - Sciences Po Grenoble-UGA - Institut d'études politiques de Grenoble - UGA - Université Grenoble Alpes, CEE-M - Centre d'Economie de l'Environnement - Montpellier - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Institut Agro Montpellier - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - UM - Université de Montpellier); Raul Magni-Berton (ANTHROPO LAB - Laboratoire d'Anthropologie Expérimentale - ETHICS EA 7446 - Experience ; Technology & Human Interactions ; Care & Society : - ICL - Institut Catholique de Lille - UCL - Université catholique de Lille); Sebastian Roché (PACTE - Pacte, Laboratoire de sciences sociales - CNRS - Centre National de la Recherche Scientifique - UGA - Université Grenoble Alpes - IEPG - Sciences Po Grenoble-UGA - Institut d'études politiques de Grenoble - UGA - Université Grenoble Alpes); Paul Le Derff (CED - Centre Émile Durkheim - IEP Bordeaux - Sciences Po Bordeaux - Institut d'études politiques de Bordeaux - UB - Université de Bordeaux - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | Street riots often follow police killings of citizens. Yet, the majority of police killings do not lead to riots. Why do some police homicides lead to riots while others do not? This paper analyzes the intensity of riots in France using monthly data on arsons targeting private property at the department (sub-regional) level from January 1996 to August 2022 (N = 32, 080), in relation to an original dataset on the occurrence and characteristics of police homicides. The results suggest that police homicides have a small overall effect on riots: fewer than 0.3% of arsons in a given department can be attributed to police killings in that department. While most police homicides do not have the potential to trigger riots, certain characteristics significantly increase the likelihood that a riot will occur: the victim has a non-European migratory background, is a French citizen, and the perpetrators belong to specific police forces. The impact also increases when there are multiple victims. We provide suggestive evidence that identification with the victim plays a key role among potential rioters, as does the social integration of the victim. |
| Keywords: | Police, France, Ethnicity, Police homicides, Riots |
| Date: | 2025–10–17 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05322723 |
| By: | Gutmann, Jerg; Voigt, Stefan |
| Abstract: | A new consensus appears to have emerged among academics and policy practitioners: Governments can be made to respect constitutional rules by establishing and constitutionally entrenching watchdogs, such as anti-corruption commissions, electoral commissions, or ombudspersons. In this article, we evaluate the consequences of what we propose to call the New York Consensus. We find that fourth branch agencies can increase constitutional compliance, but their effects are largely limited to higher income countries with a democratic political system. |
| Keywords: | New York Consensus, fourth branch, integrity branch, guarantor branch, constitutional compliance, de jure-de facto gap, separation of powers |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ilewps:88 |
| By: | Adereth, Maya |
| Abstract: | Scholars of the welfare state have long argued that, in liberal democracies, welfare state expansion depends on successful coalitions in its favour. Under what circumstances do these coalitions form? Party systems, economic interest, and political mobilisation have all been thought to influence the emergence of coalitions for welfare state expansion. In this article, I argue that law plays a critical role in facilitating the last of these factors. Drawing on a growing body of literature that sees law as constitutive of, rather than merely reflective of, social relations, I demonstrate that available legal forms meaningfully inform opportunities for welfare coalitions. In particular, I examine how debates over what a trade union is—a voluntary association of individuals, or a corporate body deserving of a state statute—shaped coalitions for welfare reform in the US and the UK at the turn of the twentieth century. |
| Keywords: | comparative politics; historical sociology; institutional political economy; law; trade unions; welfare state |
| JEL: | P16 K00 J51 |
| Date: | 2025–10–17 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:129715 |
| By: | Makofske, Matthew |
| Abstract: | Mandatory disclosure can regulate product quality, but also motivate manipulation of disclosed information. While information collection by regulatory agents prevents direct manipulation, indirectly, firms may persuade those agents to manipulate. Los Angeles County food-service health inspections are numerically scored—violations deduct from 100—but only letter grades are disclosed. Dubious bunching of scores at 90—the A-grade threshold—has long been evident. In 2017, the county responded with a new rule: committing multiple 4-point violations in an inspection incurs an additional 3-point penalty. While most health-code violations are prescribed a single deduction, a subset carry 2- or 4-point penalties depending on severity. Before the new rule, severity under-reporting in response to letter-grade implications is evident. Among otherwise very similar inspection performances, the new rule introduces letter-grade implications in some contexts, but not others, and difference-in-differences estimates suggest these new letter-grade implications caused a 46% relative increase in lesser-deduction propensity—i.e., severity under-reporting not only persists, it appears to adapts in opposition to the new rule's apparent intent. Response heterogeneity reveals inspectors whose reporting is highly sensitive to, and some whose reporting is insensitive to, letter-grade implications. Interestingly, while the highly-sensitive types exhibit bias favoring firms when letter-grade implications exist, they appear to be the more stringent inspectors, generally. The insensitive types assess the lesser deduction at relatively high frequencies irrespective of letter-grade implications, and comparisons suggest the highly-sensitive types may be more reliable reporters of non-compliance overall. |
| Keywords: | mandatory disclosure, product quality, manipulation, restaurant hygiene |
| JEL: | D82 I18 K32 L15 |
| Date: | 2025–09–23 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:126440 |