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on Law and Economics |
| By: | Woodcock, Ramsi |
| Abstract: | The emerging law and political economy movement (LPE) in the United States is characterized by an anti-economism that has prevented it from drawing upon a rich tradition of left-wing law and economic scholarship to achieve progressive goals. That tradition began with the first law and economics movement a century ago. It rejected the division of wealth implied by competitive markets. And it showed that neoclassical economics supports the redistribution of wealth in either of two basic ways. One is to reallocate endowments, broadly defined to include all aspects of value that are influenced by legal rules. The other is to manipulate the prices at which inframarginal buyers and sellers transact. The first law and economics movement focused on price manipulation and its alter ego, taxation. The critical legal studies movement that eventually succeeded the first law and economics movement focused on endowments. It sought to redistribute them by changing background rules of private law. In rejecting neoclassical economics as enemy propaganda, LPE has been unable to make progress along either of these two policy dimensions. The movement has treated as new the now century-old proposition that endowments influence market outcomes—in other words, that law determines the market. The movement seems unaware that conservative law and economics long ago accepted this proposition and parried by arguing that the market also determines the law. LPE has also constituted itself around the vague concept of “concentrations of economic power” and placed antitrust at the center of its policy agenda. That is a poor choice because antitrust generates the distribution of wealth that prevails in competitive markets, which is precisely the outcome that progressives have been trying for a century to avoid. |
| Date: | 2023–03–31 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:twbrk&r=law |
| By: | Gillian K. Hadfield; Jack Clark |
| Abstract: | Appropriately regulating artificial intelligence is an increasingly urgent policy challenge. Legislatures and regulators lack the specialized knowledge required to best translate public demands into legal requirements. Overreliance on industry self-regulation fails to hold producers and users of AI systems accountable to democratic demands. Regulatory markets, in which governments require the targets of regulation to purchase regulatory services from a private regulator, are proposed. This approach to AI regulation could overcome the limitations of both command-and-control regulation and self-regulation. Regulatory market could enable governments to establish policy priorities for the regulation of AI, whilst relying on market forces and industry R&D efforts to pioneer the methods of regulation that best achieve policymakers' stated objectives. |
| Date: | 2023–04 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2304.04914&r=law |
| By: | Ram Mohan, M.P.; Prasad, Sriram |
| Abstract: | The Insolvency and Bankruptcy Code 2016 (IBC) introduces different categories of claims as well as different categories of creditors. The IBC also introduces a moratorium on all ongoing cases once the Corporate Insolvency Reorganisation Process is initiated. The moratorium results in any ongoing claim being classified as a contingent claim. The treatment of contingent claims varies from case to case, lacking clarity. Similarly, the IBC is silent on the treatment of decree holders apart from recognizing decree-holders as creditors. The Supreme Court in Subhankar Bhowmik v Union of India (2022) refused to interfere with a Tripura High Court judgment classifying decree-holders as "other creditors". With growing environmental and climate change risks, companies may face environmental claims within the insolvency and restructuring framework. In India, the Public Liability Insurance Act 1991 mandates companies handling hazardous substances to take insurance schemes to guard against environmental liability. In this context, analyzing the treatment of environmental claims under insolvency becomes the perfect catalyst for understanding the interplay between insurance, insolvency and environmental law. This paper examines the classification of environmental claims and the treatment of environmental contingent claimants and decree holders under insolvency. As IBC is still evolving in India, the paper briefly analyses the treatment and classification of environmental claims in other jurisdictions to better inform the discussion. |
| Date: | 2023–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:iim:iimawp:14692&r=law |
| By: | Ogundari, Kolawole |
| Abstract: | Conventional wisdom shows that crime exhibits a countercyclical pattern-trending up during recessions and down during economic expansion. This observation makes the analyzes of the determinants of the crime of interest to researchers to inform policy. To this end, the present study employs historical data to analyze the effects of economic conditions on crime rates in the U.S. The analysis is based on balanced panel data from all 50 states and the district of Columbia on violent and property crime rates covering from 1976-2019. We employed the linear and dynamic panel models, while four indicators of economic conditions were considered in this study. The empirical results show that these commonly used economic indicators significantly affect crime rates. Specifically, we found that unemployment rates and income inequality increased crime rates, while personal income and economic growth decreased crime rates. This shows that continued efforts to reduce unemployment and inequality coupled with policies to boost personal income and economic growth are vital to restrain future crime increases in the U.S. However, these findings are supported by the linear and dynamic model specifications employed in this study. |
| Keywords: | Crime rates, Property crime, Violent crime, economic conditions, determinants, U.S |
| JEL: | K00 O1 |
| Date: | 2021–09–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:116944&r=law |
| By: | Thurman, Neil; Sly, James; Wilczek, Bartosz; Fletcher, Richard |
| Abstract: | In May 2018, hundreds of websites located outside the European Union (EU), including USAToday.com, became completely or partially unavailable to EU citizens as a number of publishers decided to comply with an EU data protection regulation (GDPR) by blocking access. Several of the sites that started to exclude EU users continued to do so for months or years, even though some of their competitors, like the New York Times, never adopted a policy of exclusion. These differing strategies allowed us to conduct a quasi-experimental study on the effects of temporary product unavailability and temporary rationing. We find that both temporary product withdrawal and temporary rationing can have long-term effects. In our case, monthly unique visitors in the months and even years after full access was restored were between 44% and 61% lower than they had been before the restrictions were imposed, with a wider market contraction explaining only part of these falls. We also find distinct differences between the effects of temporarily rationing and temporarily withdrawing websites. Although both strategies lead to a long-term loss in visitors, rationing appears to increase a website's desirability for some consumers. After rationing was lifted, USAToday.com's reduced audience consumed the title more deeply and frequently than had been the case before rationing was imposed. |
| Keywords: | General Data Protection Regulation; lock-in; product availability; rationing; restricted availability; status quo bias; switching costs; transnational news audiences; unavailability; website consumption |
| JEL: | D11 D12 D21 D22 D45 H3 K20 K33 L82 M15 M38 |
| Date: | 2022–07–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:116909&r=law |
| By: | Rosanna Smart; David Powell; Rosalie Liccardo Pacula; Evan D. Peet; Rahi Abouk; Corey S. Davis |
| Abstract: | Despite efforts to address the opioid crisis, opioid-related overdoses remain a significant contributor to mortality. State efforts to reduce overdose deaths by removing barriers to naloxone have recently focused on pharmacy channels, but the specifics of these laws and the contexts in which they are implemented vary widely. In this paper, we use novel methods robust to heterogeneous effects across states and time-varying policy effects to estimate the effects on naloxone pharmacy distribution of two types of laws: laws authorizing non-patient-specific prescription distribution of naloxone and laws granting pharmacists prescriptive authority for naloxone. We find that both types of laws significantly increase the volume of naloxone dispensed through pharmacies. However, relative to laws authorizing non-patient-specific prescription distribution, effects are significantly larger for pharmacist prescriptive authority laws. These larger effects only partially derive from increased naloxone prescribing by pharmacists. We also estimate large, significant increases in pharmacy dispensation of naloxone prescribed by non-pharmacist prescribers, with particularly large increases among family medicine physicians, with particularly large increases among family medicine physicians. The relative benefits of pharmacist prescriptive authority laws versus non-patient-specific distribution are larger among Non-Hispanic Black individuals, suggesting an important role of these policies for reducing disparities in access to naloxone. |
| JEL: | H75 I18 K32 |
| Date: | 2023–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31142&r=law |
| By: | Melissa Newham; Marica Valente |
| Abstract: | This paper studies how gifts – monetary or in-kind payments – from drug firms to physicians in the US affect prescriptions and drug costs. We estimate heterogeneous treatment effects by combining physician-level data on antidiabetic prescriptions and payments with causal inference and machine learning methods.We find that payments cause physicians to prescribe more brand drugs, resulting in a cost increase of $ 30 per dollar received. Responses differ widely across physicians, and are primarily explained by variation in patients’ out-of-pocket costs. A gift ban is estimated to decrease drug costs by 3-4 %. Taken together, these novel findings reveal how payments shape prescription choices and drive up costs. |
| Keywords: | public health, payments to physicians, gift ban, heterogeneous treatment effects, causal machine learning |
| JEL: | I11 I18 M31 |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:inn:wpaper:2023-03&r=law |
| By: | Elena Bastianelli (Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti", Università di Firenze); Raffaele Guetto (Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti", Università di Firenze); Daniele Vignoli (Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti", Università di Firenze) |
| Abstract: | The existing literature on the (changing) socioeconomic gradient of divorce is not without shortcomings. First, virtually all studies have operationalized individuals’ socioeconomic status through education, downplaying that class differences may be equally (or even more) important. While education may proxy cultural and cognitive skills, social class could more accurately capture individuals’ economic means. Second, most studies have only focused on married couples, despite non-marital cohabitation having become commonplace. Third, the majority of studies have exclusively focused on women. This study addresses such oversights by analyzing the educational and social class gradients of marriage and cohabitation in Italy—a country widely-known as a latecomer of the Second Demographic Transition (SDT) and long characterized by a limited diffusion of union dissolution. We adopted non-proportional hazard models to estimate survival curves and probabilities of union dissolution for married and cohabiting women and men, stratifying by education, social class, and cohort. We found that education and social class play an important and independent role as antecedents of union dissolution in Italy. Our results suggest a vanishing, among women, and a reversal from positive to negative, among men, of the educational and social class gradients of marital dissolution across cohorts. We found no clear socioeconomic gradient in the dissolution of cohabiting unions, neither in terms of education nor social class. However, cohabiting men who are not employed were found to face a much higher risk of union dissolution. |
| Keywords: | Socioeconomic gradient; education; social class; union dissolution; divorce; marriage; cohabitation; Italy. |
| JEL: | J13 J21 J12 J19 J29 |
| Date: | 2023–04 |
| URL: | http://d.repec.org/n?u=RePEc:fir:econom:wp2023_03&r=law |
| By: | David W. Berger; Thomas Hasenzagl; Kyle F. Herkenhoff; Simon Mongey; Eric A. Posner |
| Abstract: | While the labor market implications of mergers have been historically ignored as “out of market” effects, recent actions by the Department of Justice (DOJ) place buyer market power (i.e., monopsony) at the forefront of antitrust policy. We develop a theory of multi-plant ownership and monopsony to help guide this new policy focus. We estimate the model using U.S. Census data and demonstrate the model’s ability to replicate empirically documented paths of employment and wages following mergers. We then simulate a representative set of U.S. mergers in order to evaluate merger review thresholds. Our main exercise applies the DOJ and FTC’s product market concentration thresholds to local labor markets. Assuming mergers generate efficiency gains of 5 percent, our simulations suggest that workers are harmed, on average, under the enforcement of the more lenient 2010 merger guidelines and unharmed, on average, under enforcement of the more stringent 1982 merger guidelines. We also provide a framework for further research evaluating alternative concentration thresholds based on assumptions about the efficiency effects of mergers and the resource constraints of regulators. Finally, we provide guidance for using the Gross Downward Wage Pressure method for evaluating the impact of mergers on labor markets. |
| JEL: | D40 E20 H0 J0 K0 L0 |
| Date: | 2023–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31147&r=law |