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on Law and Economics |
| By: | Mastrobuoni, Giovanni; Owens, Emily |
| Abstract: | This study proposes a new framework to investigate whether criminals exhibit strategic behavior in response to the legal and enforcement environment. Utilizing a unique dataset on commercial robberies in Milan from 2008 to 2010, we examine the decisions robbers make regarding weapon choice, number of accomplices, and the type of business targeted. Our analysis explores the relationship between these decisions, the expected return from the robbery, and the probability of arrest, considering the constraints imposed by Italian law, which prescribes differential punishments based on certain criminal choices. We find some evidence that robbers act in accordance with expected utility maximization, particularly when operating in groups. Our findings suggest that at least some robberies are conducted in a way consistent with rational strategic behavior. |
| Keywords: | Police; Crime |
| JEL: | K42 K14 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20237 |
| By: | Humphries, John; Ouss, Aurelie; Stavreva, Kamelia; Stevenson, Megan; Van Dijk, Winnie |
| Abstract: | Noncarceral conviction is a common outcome of criminal court cases: for every individual incarcerated, there are approximately three who were recently convicted but not sentenced to prison or jail. We extend the binary-treatment judge IV framework to settings with multiple treatments and use it to study the consequences of noncarceral conviction. We outline assumptions under which widely-used 2SLS regressions recover margin-specific treatment effects, relate these assumptions to models of judge decision-making, and derive an expression that provides intuition about the direction and magnitude of asymptotic bias when a key assumption on judge decision-making is not met. We find that noncarceral conviction (relative to dismissal) leads to a large and long-lasting increase in recidivism for felony defendants in Virginia. In contrast, incarceration (relative to noncarceral conviction) leads to a short-run reduction in recidivism, consistent with incapacitation. Our empirical results suggest that noncarceral felony conviction is an important and overlooked driver of recidivism. |
| Keywords: | Conviction |
| JEL: | K42 J24 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20162 |
| By: | Giulietti, Corrado; McConnell, Brendon; Zenou, Yves |
| Abstract: | How can crime be disrupted most effectively without increasing resources? To answer this question, we develop a spatial network model to analyse crime diffusion, using London as a case study. Moving beyond traditional hot spot policing, we identify key player neighbourhoods- highly connected areas in the network. Our analysis reveals that while hot spots mainly attract crime locally, key player neighbourhoods predominantly propagate it. Simulations show that targeting the top 10% of key players reduces crime by 10.7% (5.8 percentage points) more than hot spot strategies. This approach offers a cost-effective solution, with potential annual savings exceeding 130 million pounds. |
| JEL: | C23 D85 H50 K42 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20065 |
| By: | Alessandra Foresta1 Rigissa Megalokonomou2 Michael Vlassopoulos3 |
| Abstract: | This paper investigates whether fiscal crises affect how the judiciary handles tax evasion. We study this question in the context of the Greek debt crisis, in which tax evasion was publicly blamed for the fiscal collapse, and judges themselves experienced substantial salary cuts as part of the resulting austerity programme. Using a novel dataset compiled from Greek Supreme Court rulings between 2006 and 2014, we compare tax evasion appeals with appeals in other serious crimes not directly related to the fiscal crisis, such as homicide and rape, in a difference-in-differences framework. We find that the probability that the Supreme Court rejects tax-evasion appeals increases by about 25 percentage points relative to these control offences after January 2010—about a 43% increase relative to the pre-crisis baseline. Effects are larger in months with greater public attention to tax evasion, as measured by Google Trends, suggesting a role for salience. Our findings suggest that fiscal crisis conditions can alter the judicial treatment of tax offences. |
| Keywords: | fiscal capacity, judicial decision-making, tax evasion, financial crisis, narrative economics |
| JEL: | D91 P16 K40 K42 H20 H26 |
| Date: | 2026–07–01 |
| URL: | https://d.repec.org/n?u=RePEc:mos:moswps:paper_1785128734527_482 |
| By: | Liu, Zhuang; Peng, Wenwei; Wang, Shaoda; Xu, Daniel Yi |
| Abstract: | This paper examines how power lawyers shape judicial and economic outcomes by studying the “revolving door†between judges and lawyers in China’s judicial system — namely, former judges who quit the bench to practice law. In otherwise identical lawsuits, revolving-door lawyers deliver 8 − 23% higher win rate for their clients. Their performance in home versus away courts suggests these gains stem from both “know how†and “know who.†We extend the theoretical framework of Dewatripont and Tirole (1999) to show that revolving-door lawyers create countervailing forces in society: they enhance judicial decision-making through evidence and reasoning, but also exploit strategic arguments and connections to bias outcomes in favor of their clients. We estimate a structural model of the judicial process to quantify these trade-offs and find that increasing the supply of power lawyers can have a non-monotonic effect on equilibrium judicial quality. |
| JEL: | K0 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20145 |
| By: | Yann Lecorps (Université Paris Panthéon Assas, CRED, Paris, France); Marie Obidzinski (Université Paris Panthéon Assas, CRED, Paris, France); Yves Oytana (Université Marie et Louis Pasteur, CRESE (UR 3190), F-25000 Besançon, France) |
| Abstract: | This paper examines how technological progress, by lowering the costs of both disseminating and fabricating information, affects the work of fact-finding missions investigating human rights violations. Using a game-theoretic model, we show that when (i) authentication costs are sufficiently low and (ii) technology makes it harder to distinguish false from genuine information, a positive technological shock increases the expected authentication cost while reducing information quality: although the circulation of genuine information increases, false information spreads even faster. When these conditions do not hold, the effects are ambiguous. |
| Keywords: | disinformation; fake news; fact-finding missions; human rights violations; open-source investigations |
| JEL: | K42 K38 |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:afd:wpaper:2601 |
| By: | Arold, Benjamin W.; Ash, Elliott; MacLeod, Bentley; Naidu, Suresh |
| Abstract: | Collective bargaining agreements (CBAs) specify the contractual rights of unionized workers, but their full legal content has not yet been analyzed by economists. This paper develops novel natural language methods to analyze the empirical determinants and economic value of these rights using a new collection of 30, 000 CBAs from Canada in the period 1986-2015. We parse legally binding rights (e.g., “workers shall receive…†) and obligations (e.g., “the employer shall provide…†) from contract text, and validate our measures through evaluation of clause pairs and comparison to firm surveys on HR practices. Using time-varying province-level variation in labor income tax rates, we find that higher taxes increase the share of worker-rights clauses while reducing pre-tax wages in unionized firms, consistent with a substitution effect away from taxed wages toward untaxed rights. Further, an exogenous increase in the value of outside options (from a leave-one-out instrument for labor demand) increases the share of worker rights clauses in CBAs. Combining the regression estimates, we infer that a one-standard-deviation increase in worker rights is valued at about 5.7% of wages. |
| Keywords: | Collective bargaining; Text as data; Labor laws; Incomplete contracts; Workplace amenities |
| JEL: | J32 J52 K31 H24 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20081 |
| By: | Giovanni Immordino (University of Naples Federico II and CSEF); Tommaso Oliviero (University of Naples Federico II, CSEF, Mofir and Cefes); Matteo Vasca (University of Naples Federico II) |
| Abstract: | Public decision makers often repeatedly interact with the same specialized agents. These interactions may generate relationship–specific capital which can affect information transmission and, ultimately, outcomes. We study this mechanism in appellate adjudication, using all judgments issued by the Italian Supreme Court of Cassation from 2017 to 2022. We reconstruct the interaction history between each lawyer and judge panel and find that a one-standard-deviation increase in cumulative number of matches is associated with a 5–7% higher probability of victory relative to the mean. Survey evidence, fielded of lawyers admitted to practice before the Court, points to panel–specific learning as the most plausible mechanism, with ambiguous normative implications for equal access to public decision makers. |
| Keywords: | Repeated interactions; Relationship–specific capital; Public decision-making. |
| JEL: | D73 K41 D02 K40 |
| Date: | 2026–07–22 |
| URL: | https://d.repec.org/n?u=RePEc:sef:csefwp:790 |
| By: | Calamunci, Francesca; Daniele, Gianmarco; Mastrobuoni, Giovanni; Terlizzese, Daniele |
| Abstract: | In 143 countries incarcerated women serve their sentence in a typically small separate section within prisons that mainly house male inmates, while 79 countries have prisons exclusively dedicated to women. Exploiting data from Italy, where both prison types coexist, and a quasi-random institutional assignment rule, we find that women-only prisons lower three-year recidivism by up to 16 percentage points. We use policy-relevant treatment effects to identify the optimal location of an additional women-only prison. As for the mechanisms, a driver is the presence of a large enough number of women for a given facility. |
| Keywords: | Women |
| JEL: | K14 K42 H54 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20236 |
| By: | Mattsson, Martin; Mobarak, Ahmed |
| Abstract: | Dispute resolution in low-income countries is typically done by either a costly and slow formal court or an informal institution without state-sanctioned enforcement powers. Can access to justice be increased by combining the best aspects of formal and informal institutions? We evaluate the effects of “Village Courts†(VCs) in rural Bangladesh using a large-scale field experiment. The introduction of VCs more than doubles the share of disputes resolved in state-sanctioned courts, but an informal institution called shalish remains dominant. There is some substitution from shalish to VCs, but congestion in higher-level courts, village social dynamics, and economic activity remain unaffected. |
| Keywords: | Courts; Institutional change |
| JEL: | K4 O17 P48 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20265 |
| By: | Humphries, John; Macaire, Cecile; Ouss, Aurelie; Stevenson, Megan; Van Dijk, Winnie |
| Abstract: | Using newly-linked administrative and commercial data from Virginia spanning 25 years, we study the consequences of incarceration. While previous research has examined labor market outcomes and recidivism, we focus on two of the primary channels through which low-income households build wealth: asset ownership (homes and cars) and human capital formation. To identify causal effects, we use a matched difference-in-differences design. In line with much of the literature on the impact of incarceration in the U.S., we find no evidence of scarring effects on labor market outcomes or changes in recidivism beyond the incapacitation period. However, we find that incarceration leads to a persistent reduction in asset accumulation: seven years after sentencing, homeownership has declined by 1.1 percentage points (12.1%) and car ownership by 2.7 percentage points (18.1%). Incarceration also lowers human capital formation, reducing college enrollment by 1.4 percentage points (15.1%). |
| Keywords: | Incarceration |
| JEL: | J24 K42 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20288 |
| By: | Willem Boshoff (University of Stellenbosch) |
| Abstract: | South African competition policy has long pursued industrial-policy objectives alongside its core competition mandate. Public-interest considerations were embedded in merger control from 1998, and the 2018 amendments gave them equal legal status with the competition assessment. These developments preceded the current European debate on using competition policy to advance innovation and other industrial policy objectives in the EU. This paper examines how industrial-policy objectives have been pursued in South African competition policy over the past thirty years. In merger control, these are often advanced through conditions involving ESOPs, HDP ownership commitments, and supplier and enterprise-development funds, as well as through potential-competition theories of merger harm. They are also advanced by similar types of remedies following market inquiries and, increasingly, abuse and cartel investigations. |
| Keywords: | competition policy, industrial policy, merger control, public interest, ownership transformation, market inquiries, South Africa, potential competition |
| JEL: | L40 K21 O25 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:rza:ersawp:360 |
| By: | Besley, Tim; Bogart, Dan; Chapman, Jonathan; Palma, Nuno |
| Abstract: | We show that state legal capacity contributed to economic development during the Industrial Revolution. The British parliament relied on local magistrates, known as Justices of the Peace (JPs), to enforce property rights, resolve disputes, and administer public services. Areas with greater legal capacity – more JPs – in 1700 experienced greater population growth and structural change over 140 years. More legal capacity also led to more human capital, fiscal capacity, and infrastructure development. Plausibly exogenous variation in the location of JPs supports a causal interpretation of the findings. These results illustrate the importance of street-level legal institutions for economic outcomes. |
| Keywords: | Law and economics; Industrial revolution; British industrial revolution; Historical political economy; State capacity |
| JEL: | H80 K40 N13 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20214 |
| By: | Natasha Aggarwal (TrustBridge Rule of Law Foundation); Amol Kulkarni (TrustBridge Rule of Law Foundation); Shruti Aji Murali (Axiom5); Bhavin Patel (TrustBridge Rule of Law Foundation); Vishnu Suresh (TrustBridge Rule of Law Foundation) |
| Abstract: | The Competition Commission of India (CCI) operates under significant capacity constraints, with nearly half its sanctioned posts vacant and a growing backlog of pending cases. The efficiency with which it allocates scarce resources in its thresholdstage screening function under Section 26(2) of the Competition Act, 2002 therefore assumes considerable importance. We analyse a sample of 111 Section 26(2) orders issued between 2014 and 2024, interview practitioners and CCI officials, and survey screening practices across six jurisdictions. We find that approximately 42% of the orders in our dataset arise from "peripheral matters", that is, complaints falling outside competition law's scope or unsupported by evidence, which are nonetheless processed through the same institutional procedures as substantive complaints, with a median disposal time of 30 days. Werecommend a layered approach, including clearer public guidance, guided digital filing mechanisms, AI-assisted review tools, and statutory prioritisation frameworks, to improve resource allocation while preserving access to competition law enforcement. |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:bjd:wpaper:21 |
| By: | O'Hare, Jennifer |
| Abstract: | The conventional wisdom is that the puffery defense is inapplicable in securities regulation. However, appellate courts in almost every federal circuit have recently used the puffery defense to dismiss private securities fraud actions that were based on vague statements of corporate optimism. This Article demonstrates that the courts have misused the puffery defense and have improperly insulated companies from liability for their misrepresentations. It contends that the assumptions justifying the use of the puffery defense are not present in securities transactions and that the federal securities laws have expressly rejected the very doctrine underlying the puffery defense-caveat emptor. Arguing that the courts have erroneously substituted the puffery defense for a full materiality analysis, this Article offers a framework for addressing the materiality of vague statements of corporate optimism. |
| Date: | 2026–07–08 |
| URL: | https://d.repec.org/n?u=RePEc:osf:lawarc:s243k_v1 |
| By: | Porter, Britney |
| Abstract: | Artificial intelligence systems now function as allocative economic infrastructure, determining access to credit, employment, housing, and public benefits at scale. This paper argues that they must be governed accordingly through "repair by design" instead of harm-based remediation. This paper examines how artificial intelligence is reconfiguring contemporary economic and consumer systems by structuring access to credit, employment, housing, and public benefits through computational decision-making infrastructures. It argues that existing civil rights and consumer protection frameworks remain oriented toward individualized, retrospective enforcement and are therefore insufficient to address inequality generated through system-level design, data architecture, and algorithmic optimization. The analysis develops a theory of algorithmic economic repair, advancing the claim that civil rights law, consumer protection doctrine, algorithmic accountability frameworks, and access-to-justice mechanisms operate most effectively when understood as an integrated governance architecture for regulating economic participation. In this framework, artificial intelligence systems function both as regulated subjects and as allocative infrastructures that determine the distribution of wealth and opportunity at scale. Discrimination is conceptualized as structural and economic in nature, operating through barriers to capital creation, limited access to resources, and restricted pathways to long-term mobility that are now reproduced through computational systems. It further argues that effective governance requires a shift from harm-based remediation toward design-centered regulation, including auditability, institutional oversight, and measurable equity outcomes. The study closes by considering the transnational implications of AI governance, emphasizing that algorithmic systems circulate between jurisdictions and reproduce structural inequality globally. It concludes that "repair by design" is a governance requirement in digitally structured economies, requiring enforceable civil rights principles, accountable computational design, and access-to-justice systems capable of producing measurable economic repair. Also available on SSRN, Abstract ID No. 7159000. |
| Date: | 2026–07–27 |
| URL: | https://d.repec.org/n?u=RePEc:osf:lawarc:q7xw4_v1 |
| By: | Iglesias-Osores, Sebastian |
| Abstract: | This working paper examines the intellectual property regime applicable to firms conducting research and innovation in Peru. Using a doctrinal and institutional approach, it integrates Andean Community rules, national legislation, rulings of the Court of Justice of the Andean Community and administrative decisions of Indecopi. It compares the requirements, duration, ownership and remedies associated with patents, utility models, industrial designs, trademarks, copyright, trade secrets, plant breeders’ rights and regulatory data exclusivity. The central argument is that appropriation of innovation returns requires a portfolio of mechanisms coordinated with disclosure timing, contracts and enforcement capacity. Agribusiness and bioindustry face additional requirements concerning genetic resources, traditional knowledge, biological material and sanitary regulation. The paper concludes that protection decisions must be made before disclosure and aligned with R&D strategy and freedom-to-operate analysis. It is not legal advice and does not provide a patentability opinion for specific products. |
| Keywords: | intellectual property; innovation; patents; trade secrets; agribusiness; Peru. |
| JEL: | K11 K29 L20 O31 O34 |
| Date: | 2026–07–24 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:130209 |