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on Law and Economics |
| By: | Massimo Motta; Emanuele Tarantino |
| Abstract: | We study the effects of mergers when firms offer differentiated products and compete in prices and investments. Since it is in principle ambiguous, we use aggregative game theory to sign the net effect of the merger: We find that only if it entailed sufficient efficiency gains, could the merger raise total investments and consumer surplus. We also prove there exist classes of models for which the results obtained with cost-reducing investments are equivalent to those with quality-enhancing investments. Finally, we show that, from the consumer welfare point of view, a R&D cooperative agreement is superior to any consumer-welfare reducing merger. |
| Keywords: | horizontal mergers, innovation, investments, research joint ventures, competition |
| JEL: | K22 D43 L13 L41 |
| Date: | 2018–11 |
| URL: | http://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2018_056&r=all |
| By: | Daniel Grădinaru (Dimitrie Cantemir Christian University) |
| Abstract: | The principle of legality, in criminal law, means that only the law can define a crime and prescribe a penalty (nullum crimen, nulla poena sine lege). It also embodies, that the criminal law must not be extensively interpreted to an accused′s detriment, for instance by analogy. According to that principle, an offence must be clearly defined in the law. The concept of law comprises written as well as unwritten law and implies qualitative requirements, notably those of accessibility and foreseeability. The requirements are satisfied where the individual can now from the wording of the relevant provision and, if need be, with the assistance of courts′ interpretation of it, what acts and omissions will make him criminally liable. The principle of legality also includes the rule which prohibit the retrospective application of the criminal law to an accused′s disadvantage. That principle is enshrined in the constitutions of many countries as well as in the most important international convention that protects human rights. |
| Keywords: | accessibility, criminal law, foreseeability, legality, retrospective application |
| Date: | 2018–11 |
| URL: | http://d.repec.org/n?u=RePEc:smo:jpaper:044dg&r=all |
| By: | Sébastien Jean; Cristina Mitaritonna; Antoine Vatan |
| Abstract: | Tariff receipts are important for many countries but their collection is often problematic. To analyze why and to what extent this occurs we first model customs duty evasion as an interaction between customs officers considered to be corruptible law enforcers, and importing firms. In this context, higher tariffs generally lead to greater customs duty evasion but their marginal impact is decreasing, and may turn negative above a given threshold if customs officers adapt their inspection effort endogenously. While transparency (the probability of effective control) always limits evasion, we show that ease of enforcement (e.g. ease of establishing the shipment`s true value) matters only if customs officers do not collude with importers. Our empirical analysis spans 55 importing countries over the period 2001-2010 and confirms our predictions. This lends support to the assumptions of endogenous inspection effort and widespread collusion. World Trade Organization membership is found also to limit the extent of duty evasion. |
| Keywords: | Tax Evasion;Customs Duty;Institutions;International Trade |
| JEL: | J13 H26 K42 |
| Date: | 2018–12 |
| URL: | http://d.repec.org/n?u=RePEc:cii:cepidt:2018-24&r=all |
| By: | Markus Reisinger; Emanuele Tarantino |
| Abstract: | Patent pools are commonly used to license technologies to manufacturers. Whereas previous studies focused on manufacturers active in independent markets, we analyze pools licensing to competing manufacturers, allowing for multiple licensors and non-linear tariffs. We find that the impact of pools on welfare depends on the industry structure: Whereas they are procompetitive when no manufacturer is integrated with a licensor, the presence of vertically integrated manufacturers triggers a novel trade-off between horizontal and vertical price coordination. Specifically, pools are anticompetitive if the share of integrated firms is large, procompetitive otherwise. We then formulate information-free policies to screen anticompetitive pools. |
| Keywords: | patent pools and horizontal pricing agreements, complementary patents, vertical integration and restraints, antitrust policy |
| JEL: | K11 L41 L42 O34 |
| Date: | 2018–11 |
| URL: | http://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2018_057&r=all |
| By: | Juan Manuel Sanchez-Cartas |
| Abstract: | I study the impact of competition and taxation on the openness and the intellectual property policies of two-sided digital platforms. I model a market in which two platforms compete for users and developers. First, I find that higher competition shortens the period of exclusivity granted to developers but does not influence the degree of openness of a platform. However, the higher the degree of differentiation in the developers market, the less open the platforms are. Second, I analyze two types of taxes, ad valorem and unit taxes. Ad-valorem taxes have no effect on the length of the exclusivity period. However, they increase the degree of openness of the platform when levied on users. Unit taxes instead limit the degree of openness and increase the period of exclusivity when levied on the developers market. Lastly, I find that multi-homing reduces the exclusivity period, but does not change the qualitative effects of taxation. My findings suggest that the new digital tax proposed by the European Commission, that should come into force in 2020, may reduce openness and innovation levels in the European Union. |
| Keywords: | Two-sided markets, Digital Platforms, Taxation, Intellectual Property, Openness |
| JEL: | H22 L13 L51 L86 O34 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:frz:wpaper:wp2019_02.rdf&r=all |
| By: | Matthias Efing; Stefan Goldbach; Volker Nitsch |
| Abstract: | We study the effects of financial sanctions on cross-border credit supply. Using a differences-in-differences approach to analyze eleven sanctions episodes between 2002 and 2015, we find that banks located in Germany reduce their positions in countries with sanctioned entities by 38%. The average German branch or subsidiary located outside Germany does not adjust its positions after the imposition of sanctions. For affiliated banks located in countries with low financial standards, we even observe a relative increase in credit supply. These effects are stronger if sanctions are only imposed by EU member states and not by the entire UN. |
| Keywords: | financial sanctions, law and finance, cross-border lending, international banking |
| JEL: | F51 G18 G28 G38 K33 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7424&r=all |
| By: | Ciprian Raul Romițan (Romanian-American University, Law School, Bucharest, Romania) |
| Abstract: | In Romania, the right of the titleholder to possess, use and dispose of an asset in an exclusive, absolute and perpetual manner is guaranteed and protected equally by the law, regardless of the titleholder. In this regard, both the Constitution of Romania and the Civil Code and numerous legislative acts adopted after the December 1989 Revolution regulate private property. Also, given that the right to property is one of the fundamental human rights, in addition to the internal legal regulations, one must also take into account the international treaties and conventions ratified by Romania, such as the European Convention on Human Rights and Fundamental Freedoms and its additional Protocol no. 1 which states that “no one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law†. The study presents an analysis of how the Romanian law regulates one of the most important and ample real rights, namely the right to private property which is also a full right because the owner has full powers over his asset. |
| Keywords: | absolute right, disposal, possession, real right, right to private property, right to property, titleholder, use |
| Date: | 2018–11 |
| URL: | http://d.repec.org/n?u=RePEc:smo:jpaper:036cr&r=all |
| By: | Huttunen, Kristiina; Pekkarinen, Tuomas; Uusitalo, Roope; Virtanen, Hanna |
| Abstract: | We study the effect of post-compulsory education on crime by exploiting a regression discontinuity design generated by admission cut-offs to upper secondary schools in Finland. We combine data on school applications with data on criminal convictions and follow individuals for 10 years. Our results show that successful applicants are less likely to commit crimes during the first five years after admission. Crime is reduced both during and outside the school year, indicating that the channel through which schooling affects crime cannot be explained by incapacitation alone. We find no effect on crime committed after 6 years from admission. |
| Keywords: | crime, education, school admission, incapacitation, human capital, Labour markets and education, K42, I2, |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:fer:wpaper:114&r=all |
| By: | Filippo Belloc |
| Abstract: | We develop a simple incomplete-contract model of the relationship between worker participation to revenue sharing and innovation performance of firms, under firing regimes with different stringency. Stronger worker participation to profits is shown to increase innovation probability when employer-side hold-up is prevented by stringent layoff regulation and the human capital matters signicantly. Vice-versa, under a strict layoff regulation, when the financial capital is relatively more important, the effects of worker participation devices may be reduced or inverted. Our results may help in understanding why there is no one-size-fits-all optimal strategy in the design of worker financial participation mechanisms for knowledge-intensive productions |
| Keywords: | prot-sharing, dismissal regulation, hold-up, innovation. |
| JEL: | J54 K31 O31 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:usi:wpaper:799&r=all |
| By: | Andrew E. Clark (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Conchita D'Ambrosio (Uni.lu - Université du Luxembourg); Rong Zhu (Flinders University) |
| Abstract: | We here consider the relationship between the individual time profile of crime victimisation and sleep quality. Sleep quality worsens with contemporaneous crime victimisation, with physical violence having a larger effect than property crime. But crime history also matters, and past victimisation experience continues to reduce current sleep quality. Last, there is some evidence that the order of victimisation spells plays a role: consecutive years of crime victimisation affect sleep quality more adversely than the same number of years when not contiguous. |
| Keywords: | Sleep quality,Property crimes,Crime,Time,Physical violence |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-01976867&r=all |
| By: | Tiberiu Viorel Popescu (Acad. Andrei Radulescu Institute of Legal Research of the Romanian Academy, Romania) |
| Abstract: | A very specific aspect of drug trafficking, but which circumscribes most of the serious forms of crime, is not to provide a doctrinal and legislative definition of an operational definition. A quantitative analysis followed by another qualitative one may at best reflect criminological aspects related to the visible side of this type of crime. This study aims to analyze aspects such as routes, links and connections of drug trafficking with terrorism in the context of globalization and taking into account the diverse typology of this type of crime. Routes provide clues about the drug route from the producer to the consumer as well as the changes generated by the intensification of UN controls. The networks reflect the diverse typology of this type of crime, which has direct implications in identifying the criminological factors that potentiate trafficking. Connections between drug trafficking and terrorism have been established in the Middle East and Colombia, these being significant criminogenic areas where it is possible to identify the direct involvement of terrorist groups in drug trafficking. Addressing one of the most profitable forms of crime, such as drug trafficking, is always a challenge. |
| Keywords: | Criminology, drugs, drug trafficking, high crime, organized crime |
| Date: | 2018–11 |
| URL: | http://d.repec.org/n?u=RePEc:smo:jpaper:039tp&r=all |
| By: | Camil Tanasescu (Dimitrie Cantemir Christian University of Bucharest) |
| Abstract: | In the collective aggression, the group's supervision and leadership activity is coordinated by a single person, whom all other individuals focus on, due to the domination, prestige and influence of the person on the collectivity. The intellectual factor of the leader lies in the way of conceiving the model of leading society and dominating the social movements. The volitional factor indicates the energetic-dynamic dimension of the leader's personality, as well as the support of the intellectual element through which the meditative approach is conceived as a non-retroviral movement. The psychic identity of the leader has a unique structure, because the component elements determine the consciousness of personal identity. The behavior of the criminal leader is dynamic, his thinking and affectivity mobilizing the personality system. The criminal leader imposes on the group its own needs. In terms of association, the conduct of the members of the criminal group is different, so there are common elements of the subjective aspects specific to the offenses, an agreement of will, interests, respectively coinciding. However, committing a crime by a member of the criminal group does not automatically entail the criminal liability of all members of the criminal, aggressive group. |
| Keywords: | collective aggression, criminal liability, criminal personality, necessities, the leader of the criminal group, the volitional factor |
| Date: | 2018–11 |
| URL: | http://d.repec.org/n?u=RePEc:smo:jpaper:035ct&r=all |
| By: | Rathke, Alex A.T. |
| Abstract: | This paper proposes a model of optimal tax-induced transfer pricing with a fuzzy arm's length parameter. Fuzzy numbers provide a suitable structure for modelling the ambiguity that is intrinsic to the arm's length parameter. For the usual conditions regarding the anti-shifting mechanisms, the optimal transfer price becomes a maximising a-cut of the fuzzy arm's length parameter. Nonetheless, we show that it is profitable for firms to choose any maximising transfer price if the probability of tax audit is sufficiently low, even if the chosen price is considered a completely non-arm's length price by tax authorities. In this case, we derive the necessary and sufficient conditions to prevent this extreme shifting strategy. |
| Keywords: | fuzzy profit shifting, transfer pricing, tax evasion, tax enforcement, tax penalty. |
| JEL: | F23 H26 K34 |
| Date: | 2019–01–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:91425&r=all |
| By: | Wolfgang Kerber |
| Abstract: | Through the application of the technological solution of the “extended vehicle” concept the car manufacturers can capture exclusive control of the data of connected cars leading to serious concerns about negative effects on competition, innovation and consumer choice on the markets for aftermarket and other complementary services in the ecosystem of connected and automated driving. Therefore a controversial policy discussion has emerged in the EU about access to in-vehicle data and the connected car for independent service providers in the automotive industry. This paper claims that this problem should be seen as part of the general question of the optimal governance of data in the ecosystem of connected and automated mobility. The paper offers an overview about this policy discussion and analyzes this problem from an economic perspective by using a market failure analysis. Besides competition problems (esp. on markets for aftermarket and other services in the connected car) also market failures in regard to technological choice (extended vehicle vs. interoperable on-board application platform) and information and privacy problems (“notice and consent” solutions) can emerge, leading to the question of appropriate regulatory solutions. The paper discusses solutions through data portability, data rights, competition law, and recommends a sector-specific regulatory approach. |
| Keywords: | data governance, connected cars, data economy, data access |
| JEL: | K23 L62 L86 O33 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:mar:magkse:201840&r=all |
| By: | Simplice A. Asongu (Yaoundé/Cameroon); Jacinta C. Nwachukwu (Preston, United Kingdom); Stella-Maris I. Orim (Coventry University, UK); Chris Pyke (Preston, United Kingdom) |
| Abstract: | Purpose-The study complements the scant macroeconomic literature on the development outcomes of social media by examining the relationship between Facebook penetration and violent crime levels in a cross-section of 148 countries for the year 2012. Design/methodology/approach-The empirical evidence is based on Ordinary Least Squares (OLS), Tobit and Quantile regressions. In order to respond to policy concerns on the limited evidence on the consequences of social media in developing countries, the dataset is disaggregated into regions and income levels. The decomposition by income levels included: low income, lower middle income, upper middle income and high income. The corresponding regions include: Europe and Central Asia, East Asia and the Pacific, Middle East and North Africa, Sub-Saharan Africa and Latin America. Findings-From OLS and Tobit regressions, there is a negative relationship between Facebook penetration and crime. However, Quantile regressions reveal that the established negative relationship is noticeable exclusively in the 90th crime quantile. Further, when the dataset is decomposed into regions and income levels, the negative relationship is evident in the Middle East and North Africa (MENA) while a positive relationship is confirmed for sub-Saharan Africa. Policy implications are discussed. Originality/value- Studies on the development outcomes of social media are sparse because of a lack of reliable macroeconomic data on social media. This study primarily complemented five existing studies that have leveraged on a newly available dataset on Facebook. |
| Keywords: | Crime; Social media; ICT; Global evidence; Social networks |
| JEL: | K42 D83 O30 D74 D83 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:agd:wpaper:19/003&r=all |
| By: | Jens-Uwe Franck |
| Abstract: | The framework of EU law on cartel damages actions consists in part of rules established by the ECJ based on arts 101 and 102 TFEU in conjunction with the principle of effectiveness. These rules are an integral part of EU primary law. The notion of institutional balance, however, requires the Court to consider its own inherent limits on democratic legitimacy, accountability and expertise. In particular, the Court has to ensure that adequate scope remains for the EU legislature to exercise its legislative power pursuant to art.103 TFEU. It is argued that the ECJ has disregarded these restrictions and overstretched the principle of effectiveness––for instance, in its adjudication on liability for umbrella pricing and on access to leniency files, respectively. Consequently, the EU legislature must not consider itself bound by these standards. |
| Keywords: | Institutional balance; Principle of effectiveness; Democratic legitimacy; EU competition damages law; Courage v Crehan; Directive 2014/104; Access to leniency documents |
| JEL: | K21 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2018_037&r=all |