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on Law and Economics |
| By: | Enriques, Luca; Nigro, Casimiro A.; Tröger, Tobias |
| Abstract: | European debates on competitiveness increasingly treat corporate law as a lever to help innovative firms scale. The European Commission's Proposal for a new "28th regime" seeks to introduce an optional, EU-wide corporate legal form designed, inter alia, to facilitate the cross-border scaling of innovative firms. A central instrument of the Proposal is the use of model articles of association to be adopted through future implementing acts. This Article argues that, while standardised articles may ease incorporation and lower drafting costs for ordinary unlisted firms, they fall short for VC-backed companies-the very cases that motivated the initiative. Building on prior work on venture capital contracting under mandatory corporate law, we identify four shortcomings. First, the architecture is incomplete: the Proposal omits a model shareholder agreement, even though effective VC contracting depends on the interaction between articles of association and shareholder arrangements. Second, the drafting process is overly generalist and unlikely to yield genuinely VC-specific templates. Third, the Proposal's fairness-oriented logic risks producing terms that clash with the asymmetric, statecontingent structures typical of VC deals. Fourth, the legal protection offered by the template is limited, focusing on formation-stage effects while leaving subsequent judicial intervention unconstrained. We propose four adjustments: introduce a model shareholders' agreement; create a dedicated VC drafting track; abandon fairness as the organising principle for VC templates; and provide a robust safe harbour covering both ex ante design and ex post enforcement. |
| Keywords: | 28th Regime, Entrepreneurship, EU Company Law, EU Inc., Innovation, Private Ordering, Startups, Venture Capital |
| JEL: | G38 K22 L26 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:lawfin:342486 |
| By: | Duso, Tomaso; Bernhardt, Lea; Piechucka, Joanna |
| Abstract: | We discuss the main Theories of Harm in EU merger control and their evolution since the 1990s. We present stylised facts and trends using data extracted from EU merger decisions by natural language processing tools. EU merger policy has adapted over time, both in terms of legislation and theories of harm, as well as in terms of the investigative tools and evidence used. The introduction of the new Merger Regulation in 2004, which led to a change in the substantive test, also brought about significant changes in the use of Theories of Harm. Unilateral theories are now used more frequently and have developed further, in particular in relation to the assessment of closeness of competition. Non-horizontal conglomerate and vertical Theories of Harm focusing on foreclosure issues are now much more common and are a standard tool in most in-depth investigations. More novel Theories of Harm related to innovation and digital markets have been developed and implemented since the 2010’s. While market shares remain a central tool for merger assessment, the use of internal documents has increased, accompanied by the use of quantitative tools. With respect to Commission interventions, structural remedies are used more frequently, although behavioural remedies are also increasingly deployed, especially in Phase II. |
| Keywords: | Innovation; Merger control; Foreclosure; Coordinated effects; Unilateral effects; Merger remedies; Theory of Harm; Ecosystem |
| JEL: | K21 L4 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19237 |
| By: | Ullrich, Hannes; Hannane, Jonas; Peukert, Christian; Aguiar, Luis; Duso, Tomaso |
| Abstract: | Tracking online user behavior is essential for targeted advertising and is at the heart of the business model of major online platforms. We analyze tracker-specific web browsing data to show how the prediction quality of consumer profiles varies with data size and scope. We find decreasing returns to the number of observed users and tracked websites. However, prediction quality increases considerably when web browsing data can be combined with demographic data. We show that Google, Facebook, and Amazon, which can combine such data at scale via their digital ecosystems, may thus attenuate the impact of regulatory interventions such as the GDPR. In this light, even with decreasing returns to data small firms can be prevented from catching up with these large incumbents. We document that proposed data-sharing provisions may level the playing field concerning the prediction quality of consumer profiles. |
| Keywords: | Prediction quality; Web tracking; Cookies; Data Protection; Competition policy; Internet regulation; Gdpr |
| JEL: | C53 D22 D43 K21 L13 L4 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19266 |
| By: | Fieles-Ahmad, Omar Martin; Kvasnicka, Michael |
| Abstract: | Following reunification, anti-foreigner crimes rose sharply in the former GDR. Using county-level data for the early 1990s, we study if regional access to Western TV, i.e. non-socialist media, prior to the fall of the Berlin Wall had an impact on regional levels of serious anti-foreigner crime (murder and arson) in East Germany. We find that East German counties with no access to Western TV exhibit higher rates of such crimes, as in the 'valley of the clueless' around Dresden. This crime-attenuating effect of Western TV proves robust in a battery of robustness checks and underscores the importance of media for anti-foreigner attitudes and crimes well before the rise of the internet and social media. |
| Abstract: | Nach der Wiedervereinigung stieg die Zahl ausländerfeindlicher Straftaten in der ehemaligen DDR stark an. Mithilfe von Landkreis-Daten aus den frühen 1990er-Jahren untersuchen wir, ob der regionale Zugang zu westlichem Fernsehen, also zu nichtsozialistischen Medien, vor dem Mauerfall Einfluss auf die regionale Häufigkeit schwerer fremdenfeindlicher Straftaten (Mord und Brandstiftung) in Ostdeutschland hatte. Unsere Ergebnisse zeigen, dass ostdeutsche Landkreise ohne Zugang zu "Westfernsehen" höhere Raten solcher Straftaten aufwiesen, wie beispielsweise im "Tal der Ahnungslosen" rund um Dresden. Dieser kriminalitätsmindernde Effekt des westlichen Fernsehens erweist sich in einer Reihe von Robustheitsprüfungen als stabil und unterstreicht die Bedeutung der Medien für Einstellungen gegenüber Ausländern und für fremdenfeindliche Straftaten - und zwar lange vor dem Aufkommen des Internets und der sozialen Medien. |
| Keywords: | Crimes Against Foreigners, Western TV, Immigration, East Germany |
| JEL: | F22 J15 K42 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:rwirep:342545 |
| By: | , KuoRayMao; Zhu, Yiliang; Zhao, Zhong; Yan, Shan |
| Abstract: | This chapter offers one of the first studies to examine critically the connection between deficiencies in China’s regulatory apparatus and the criminality associated with illegal dumping and trading of medical waste—specifically as it pertains to waste dumping in rural northwestern China. The authors begin with a brief review of green criminology’s approach to waste crime and summarise the literature on top-down environmental regulation enforcement in China. Next, they describe the development of the medical waste regulation framework and highlight the current obstacles to enforcement in China. The chapter then introduces a case study to illustrate how institutional incentives in the job performance evaluation system of bureaucrats resulted in the under-enforcement of medical waste regulations at the level of rural governance. Their chapter concludes by suggesting that to study environmental offenses in China, green criminologists must examine how the institutional practices of the fragmented bureaucracy shape the economic, political, and social contexts that have structured the complexity of environmental regulation enforcement in this illiberal and restrictive society. |
| Date: | 2026–07–27 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:45uh2_v1 |
| By: | Dhammika Dharmapala; Nuno Garoupa |
| Abstract: | This paper develops an economic analysis of the application of the law of restitution to the case of void contracts, when agreements may be unenforceable due to legal invalidity. It develops a simple model in which contracting parties’ agreements potentially impose external harms. The analysis focuses on how alternative restitution regimes affect contracting incentives when there is a possibility that agreements may turn out to be unenforceable. A central insight is that in a setting in which contract invalidity is possible, contracting requires not merely that the parties’ joint surplus is positive but also that a participation constraint is satisfied for each party (as there are states of the world in which the parties cannot redistribute the surplus between themselves). We show that full restitution can induce socially excessive contracting, while the denial of restitution can inefficiently deter welfare-enhancing transactions. A regime of partial restitution can potentially implement first-best outcomes by calibrating parties’ incentives to the probability and magnitude of potential external harms. In essence, this regime can serve as a substitute for a Pigovian tax on the contracting parties. The paper discusses applications of this framework to the interest rate swap cases of the 1990s and to other contexts. |
| Keywords: | restitution, void contracts, transactions tax |
| JEL: | K10 H20 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12917 |
| By: | Alberto Chong (Department of Economics, Georgia State University and Department of Economics, Universidad del Pacifico) |
| Abstract: | Does deeper trade integration advance or undermine women's civil liberties, their freedom of movement, property rights, freedom from forced labor, and access to justice? Trade can raise women's civil standing by expanding female employment and bargaining power, by importing legal commitments through labor and dispute-settlement chapters, and through rule-of-law spillovers. However, it can erode that standing through coercive export-sector labor practices, competitive deregulation, and the displacement of women from protected sectors. We estimate the effect of entering a free trade agreement with the United States on women's civil liberties for all the countries with bilateral agreements drawing on an annual panel of 182 countries observed from 1970 to 2025. When applying a staggered difference-in-differences estimator with common support we find a decline of roughly five percent of a cross-country standard deviation, which is robust to a broad battery of empirical tests. Our results caution against the optimistic view that trade agreements diffuse women's rights. |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:ays:ispwps:paper2626 |
| By: | Yehonatan Givati; Oren Rigbi |
| Abstract: | Secure property rights support efficient allocation and investment, yet their effects in affluent urban markets remain understudied. We examine Jerusalem properties built on church-owned land under 99-year leases approaching expiration, creating substantial legal and political uncertainty. Using all residential transactions from 2004–2024, we compare nearby properties with secure and insecure rights within the same blocks. Insecure rights reduce transaction likelihood by about 20 percent and prices by 10–15 percent on average, revealing large costs of legal uncertainty. A present-value framework implies that market participants assign a substantial, but far from certain, probability to losing rights. |
| Keywords: | Property law, housing supply and markets, property rights |
| JEL: | K11 R31 D23 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12899 |
| By: | Martino, Edoardo; Parchimowicz, Katarzyna |
| Abstract: | We investigate the hurdles to the effective implementation of sustainable banking regulation. We argue that existing approaches rest on an implicit assumption of verifiable asset quality, which is inconsistent with the informational structure of banking. Accordingly, we develop an analytical framework centred on structural asset opacity and information asymmetry: banks operate through opaque balance sheets and possess superior information about asset quality relative to both markets and supervisors. This opacity generates moral hazard in the asset classification when regulatory incentives tied to 'green' or 'brown' labels induce strategic misrepresentation and adverse selection. We recast the main regulatory tools proposed in the literature. The analysis shows that incorporating sustainability objectives into prudential requirements, particularly capital regulation, is prone to distortion under conditions of unverifiable information, while supervisory tools remain constrained by their reliance on bank-generated data. We advance an alternative approach based on mandatory contractual mechanisms embedded in lending relationships. Properly designed and supervised, these private law tools operate as sorting devices that differentiate between green and brown activities without requiring full information about asset quality. |
| Keywords: | bank capital, green transition, information asymmetry, bank supervision, regulatory private law |
| JEL: | G21 K22 K23 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:lawfin:342485 |