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on Law and Economics |
| By: | Maya Mikdash; Mark Hoekstra; Suhyeon Oh |
| Abstract: | Racial disparities permeate the criminal justice system, yet indigent defense attorneys remain understudied despite representing 80% of defendants. Using quasi-randomly court-appointed attorneys in a large Texas county, we show that higher-quality attorneys are less experienced and attended lower-quality law schools. Low-quality representation disproportionately harms Black defendants: a one-standard-deviation increase in quality raises Black dismissal rates nearly twice that of Whites’ (7.1% versus 3.9%), and top-10% representation increases dismissals by 12–17% and reduces jail by 13-22% relative to Whites. Back-of-the-envelope calculations suggest if half of court-appointed attorneys were top-10% quality, the racial gap in jail sentencing would decline by 11%. |
| JEL: | H76 J15 K14 K42 |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35234 |
| By: | Rigissa Megalokonomou |
| Abstract: | This paper studies how gender representation affects collective decision-making in expert committees. I exploit quasi-random assignment of judges to panels in the Greek Supreme Court using newly digitized data on 3, 700 criminal appeals. I find that panels with more female judges are more likely to reject appeals and less likely to delegate cases. Effects are nonlinear and emerge primarily once at least three of five judges are female; below this level, representation has no detectable effect. The mechanism appears to operate at the panel rather than the individual level-panels with a higher share of female judges take significantly longer to decide, especially in complex cases and in familiar panel compositions, consistent with more thorough deliberation rather than coordination costs. These findings suggest that diversity policies targeting modest increases in female representation will have limited impact unless they shift the deliberative composition of the group itself. |
| Keywords: | panel decisions, gender composition, quasi-random assignment, Supreme Court |
| JEL: | J16 D03 D71 J78 |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:crm:wpaper:26136 |
| By: | Falcone, Stefano |
| Abstract: | Although the adoption of third-party policies (i.e., policies targeting non-offending parties to address misconduct by individuals within their control) is growing worldwide, its effect on crime remains unclear. Using Ohio data from 2000 to 2014, this study examines the impact of nuisance ordinances, a policy that penalises landlords for disturbances on their properties. The findings indicate an 18% increase in burglaries and a 28% rise in vehicle thefts. Indirect evidence suggests that these effects are driven by an increase in homelessness, prompting more individuals to seek shelter in buildings and vehicles. These findings highlight that third-party policing may backfire. |
| Keywords: | D04 - Microeconomic Policy: Formulation; Implementation, and Evaluation D10 - General I3 - Welfare, Well-Being, and Poverty K4 - Legal Procedure, the Legal System, and Illegal Behavior R21 - Housing Demand |
| JEL: | D04 D10 I3 K4 R21 |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:129186 |
| By: | Pierluigi Murro; Valentina Peruzzi |
| Abstract: | This paper examines whether judicial enforcement shapes firms' participation in global value chains (GVCs). Exploiting Italy's 2013 court reorganization as a natural experiment, we combine firm-level survey data with administrative records and implement a spatial discontinuity IV design. We find that longer trials significantly reduce the probability of GVC participation: even delays of just a few weeks in civil proceedings translate into sizeable declines, underscoring the economic value of timely enforcement. The effect is concentrated among downstream firms and in trade with advanced markets, and operates through external finance, product complexity, and firm opacity. |
| Keywords: | Global value chains, Judicial enforcement, Regional development, Product complexity |
| JEL: | F10 F61 K41 R11 |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:ter:wpaper:00190 |
| By: | Matthew Gudgeon; Andrew Jordan; Taeho Kim |
| Abstract: | We study how frontline supervisors shape outcomes in public organizations with competing objectives and limited monitoring. We examine lieutenants in the Chicago Police Department, exploiting its rotational operations calendar for identification. We document dispersion in lieutenant fixed effects on team arrests and find race to be a key predictor. We then compare days Black and Hispanic lieutenants are predicted on duty to days supervised by white lieutenants. Teams under Black and Hispanic lieutenants make fewer low-level arrests while improving 911 call dispatch time. Lieutenants shape effort allocation by differentially granting overtime and awards for serious rather than discretionary arrests. |
| JEL: | J15 J45 K42 M54 |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35306 |
| By: | Alex Chan |
| Abstract: | I study medical liability when artificial intelligence acts as a doctor rather than as a passive clinical tool. The central object is the legally usable medical record: the inputs, logs, warnings, prescriptions, follow-up instructions, and outcomes on which courts, contracts, insurers, and regulators can condition responsibility. I show that AI medical liability is an institutional design problem under imperfect legal information. If the record separates AI-controllable error from patient nonadherence and natural disease progression, high-powered AI-fault liability implements the standard accident-law ideal. If the record is coarse, the first best may be infeasible: the same transfer that disciplines the AI also insures the patient's hidden action. With joint causation, the relevant object is a marginal-responsibility score rather than a posterior cause label. I characterize the feasible set of liability incentives generated by the record and show when the optimal rule is no liability, strict liability, negligence, a safe harbor, comparative fault, or a continuous warranty. I then study algorithmic defensive design, through which AI developers can design not only medical recommendations but also the record on which future liability depends. Adoption, learning, enterprise liability, insurance, no-fault compensation, and regulation enter as ways to change the record, the liable entity, or the financing of compensation. The framework yields conditional implications rather than a one-size-fits-all rule. |
| JEL: | D47 D82 D86 D9 G22 I1 I13 I18 K12 K13 L51 |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35321 |
| By: | Massimo Pulejo |
| Abstract: | How do citizens react to the criminal capture of state institutions? Do they simply reduce their engagement with public life or do they reallocate it across different channels of participation? With an event-study design, I show that revealing collusion between Italian public officials and organized criminal groups leads to a modest reduction in electoral turnout. However, collusion episodes are also followed by a sizable increase in the participation of citizens to the activities of civil society organizations fighting organized crime. I analyze the causal mechanisms behind this effect with an original survey experiment. Receiving information about the incidence of collusion increases citizens’ concerns about organized criminal groups while decreasing their confidence that the state will contrast them. This induces reallocation: collusion weakens electoral participation while strengthening civic engagement. These findings complement the existing literature about the effects of state capture on citizens’ behavior, showing that it can foster their engagement in non-traditional forms of political participation. |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:baf:cbafwp:cbafwp26275 |
| By: | Enrico Miglino (Bank of Italy); Giacomo Roma (Bank of Italy) |
| Abstract: | Regulation often relies on size thresholds to determine the applicable legal and tax regime. Using data on the universe of Italian firms, this paper estimates the costs of firm growth by measuring the extent to which firms bunch just below such thresholds in order to avoid more burdensome rules. We first identify all the rules, defined in terms of revenues, assets and employment, which generate bunching. We then embed the estimated bunching in a profit maximization model and estimate a behavioural elasticity specific to each underlying variable, leveraging directly observable costs to calibrate the model. Finally, we combine the estimated elasticities with the observed bunching at each threshold to quantify the costs of all regulations. The largest costs, relative to the average value added for firms located near the threshold, are associated with the loss of a flat-tax regime for the self-employed, followed by the loss of simplified bookkeeping and quarterly VAT settlement, the mandatory appointment of a board of statutory auditors, and the increase in worker protection in the event of dismissal. |
| Keywords: | regulatory costs, firm growth, size thresholds, bunching |
| JEL: | D22 L51 H25 H32 K22 |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:bdi:opques:qef_1018_26 |
| By: | Joshua S. Gans |
| Abstract: | Rules against persuasion often focus on beliefs: an institution should not manipulate the information on which a decision rests. We show that such rules can miss a distinct source of directional influence. An institution can steer an outcome without changing beliefs by selecting among authorised procedures that translate the same belief into different actions. Jury instructions provide the leading example: a judge may alter no juror’s assessment of the facts yet still affect the verdict through the permissible formulation of the law. The gap is sharpest near a decision threshold. There, the scope for belief movement that preserves the default action vanishes, while procedural steering can remain maximal whenever authorised procedures disagree near the boundary, even with genuinely informative communication. In general, exposure to procedural steering is the concavification of a local steering score. The geometry of Bayesian persuasion thus reappears in reverse: it measures not the value of manipulating beliefs, but the directional discretion left open by institutional rules. |
| JEL: | D82 D83 K40 |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35312 |