Prosecutors enjoy wide discretion in the decisions they make but are largely unstudied by quantitative empirical scholars. This paper explores gender bias in prosecutorial decision-making. I find that male and female prosecutors exhibit small and statistically insignificant differences in their treatment of defendants overall but demonstrate relative leniency toward defendants of their own gender. Such favoritism at charging translates into a sentencing gap of roughly 5 months of incarceration for defendants who are paired with an own-gender prosecutor versus an opposite-gender prosecutor, which represents a roughly 8 percent reduction in sentence length at the mean. The estimates do not appear to be driven by differences in case assignments for male and female prosecutors.
{"title":"Gender Favoritism among Criminal Prosecutors","authors":"S. Didwania","doi":"10.1086/718463","DOIUrl":"https://doi.org/10.1086/718463","url":null,"abstract":"Prosecutors enjoy wide discretion in the decisions they make but are largely unstudied by quantitative empirical scholars. This paper explores gender bias in prosecutorial decision-making. I find that male and female prosecutors exhibit small and statistically insignificant differences in their treatment of defendants overall but demonstrate relative leniency toward defendants of their own gender. Such favoritism at charging translates into a sentencing gap of roughly 5 months of incarceration for defendants who are paired with an own-gender prosecutor versus an opposite-gender prosecutor, which represents a roughly 8 percent reduction in sentence length at the mean. The estimates do not appear to be driven by differences in case assignments for male and female prosecutors.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"12 1","pages":"77 - 104"},"PeriodicalIF":0.0,"publicationDate":"2022-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87622582","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Using a sample of 1,103 Chinese private-sector firms that went public during 2004–16, we find that founders of firms from regions with stronger collectivist cultures engage more family members as managers, retain more ownership in the family, and share the controlling ownership with more family members. These findings are robust to a battery of diagnostic tests to account for alternative institutional factors that may induce the relationships. The results are consistent with the hypothesis that because the collectivist culture reduces information asymmetry, shirking problems, and associated monitoring costs among family members, more family ownership and management are expected in firms when founders are from collectivist regions. The overall evidence supports the theory of the firm pioneered by Harold Demsetz and his coauthors.
{"title":"Collectivist Cultures and the Emergence of Family Firms","authors":"Joseph P. H. Fan, Qiankun Gu, Xin Yu","doi":"10.1086/718853","DOIUrl":"https://doi.org/10.1086/718853","url":null,"abstract":"Using a sample of 1,103 Chinese private-sector firms that went public during 2004–16, we find that founders of firms from regions with stronger collectivist cultures engage more family members as managers, retain more ownership in the family, and share the controlling ownership with more family members. These findings are robust to a battery of diagnostic tests to account for alternative institutional factors that may induce the relationships. The results are consistent with the hypothesis that because the collectivist culture reduces information asymmetry, shirking problems, and associated monitoring costs among family members, more family ownership and management are expected in firms when founders are from collectivist regions. The overall evidence supports the theory of the firm pioneered by Harold Demsetz and his coauthors.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"65 1","pages":"S293 - S325"},"PeriodicalIF":0.0,"publicationDate":"2022-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78191448","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
I study the determinants of regulation in an emerging industry by analyzing the uptake and evolution of local wind energy zoning laws. I do so by assembling a novel database of county wind energy conversion system ordinances. Using a duration analysis, I find that counties adopt regulations when potential benefits from doing so are high and regulatory costs are low. Although counties mimic the standards of their neighbors, regulations eventually become spatially heterogeneous, presumably as governments better align policies with local preferences. The findings highlight the dynamic nature of regulation in a formal environment, building on the seminal study of property rights by Harold Demsetz. I also contribute to an ongoing policy debate about which levels of government can effectively regulate wind power. I find that current state proposals to reclaim centralized control will likely stunt the local adaptation observed unless the counties have insufficient regulatory capacity to create regulations.
{"title":"Learning by Regulating: The Evolution of Wind Energy Zoning Laws","authors":"Justin B. Winikoff","doi":"10.1086/718912","DOIUrl":"https://doi.org/10.1086/718912","url":null,"abstract":"I study the determinants of regulation in an emerging industry by analyzing the uptake and evolution of local wind energy zoning laws. I do so by assembling a novel database of county wind energy conversion system ordinances. Using a duration analysis, I find that counties adopt regulations when potential benefits from doing so are high and regulatory costs are low. Although counties mimic the standards of their neighbors, regulations eventually become spatially heterogeneous, presumably as governments better align policies with local preferences. The findings highlight the dynamic nature of regulation in a formal environment, building on the seminal study of property rights by Harold Demsetz. I also contribute to an ongoing policy debate about which levels of government can effectively regulate wind power. I find that current state proposals to reclaim centralized control will likely stunt the local adaptation observed unless the counties have insufficient regulatory capacity to create regulations.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"11 1","pages":"S223 - S262"},"PeriodicalIF":0.0,"publicationDate":"2022-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87657311","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Many US states have regulations that restrict the ability of franchisors to terminate franchise contracts. We estimate the economic effects of these regulations with a focus on how they impact market structure. Using data from the quick-service restaurant industry, we find that implementing franchise regulations results in 4–5 percent fewer establishments in the average county. Our results imply that franchise regulation leads to increased concentration in a large number of markets, as the number of counties in the bottom quartile of concentration would increase by between 12 percent and 15 percent with regulation.
{"title":"Franchise Contract Regulations and Local Market Structure","authors":"C. Murry, Peter Newberry","doi":"10.1086/717159","DOIUrl":"https://doi.org/10.1086/717159","url":null,"abstract":"Many US states have regulations that restrict the ability of franchisors to terminate franchise contracts. We estimate the economic effects of these regulations with a focus on how they impact market structure. Using data from the quick-service restaurant industry, we find that implementing franchise regulations results in 4–5 percent fewer establishments in the average county. Our results imply that franchise regulation leads to increased concentration in a large number of markets, as the number of counties in the bottom quartile of concentration would increase by between 12 percent and 15 percent with regulation.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"108 1","pages":"105 - 130"},"PeriodicalIF":0.0,"publicationDate":"2022-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"76428815","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The contributions of Harold Demsetz offer key insights on how property rights and transaction costs shape economic organization. These guide our comparison of agricultural organization in the early 20th century in two comparable regions, the Argentine Pampas and the US Midwest. In the United States, land was distributed in small parcels and actively traded. In the Pampas, land was distributed in large plots, and trade was limited because land was a social and political asset, as well as a commercial one. We analyze why the absence of trade led to persistently larger farms, specialization in ranching, and peculiar tenancy contracts in Argentina relative to the United States. Our empirical analysis, based on county-level data for both regions, shows that geoclimatic factors cannot explain the observed differences in agricultural organization. We discuss implications for long-term economic development in Argentina.
{"title":"Property Rights to Land and Agricultural Organization: An Argentina–United States Comparison","authors":"E. Edwards, Martín Fiszbein, G. Libecap","doi":"10.1086/719197","DOIUrl":"https://doi.org/10.1086/719197","url":null,"abstract":"The contributions of Harold Demsetz offer key insights on how property rights and transaction costs shape economic organization. These guide our comparison of agricultural organization in the early 20th century in two comparable regions, the Argentine Pampas and the US Midwest. In the United States, land was distributed in small parcels and actively traded. In the Pampas, land was distributed in large plots, and trade was limited because land was a social and political asset, as well as a commercial one. We analyze why the absence of trade led to persistently larger farms, specialization in ranching, and peculiar tenancy contracts in Argentina relative to the United States. Our empirical analysis, based on county-level data for both regions, shows that geoclimatic factors cannot explain the observed differences in agricultural organization. We discuss implications for long-term economic development in Argentina.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"48 1","pages":"S1 - S33"},"PeriodicalIF":0.0,"publicationDate":"2022-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"84363095","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Concentration and price-cost margins have increased since the 1980s in many industries. These developments have raised concern about weakened competition and resulting harm to consumers and the need for tougher antitrust enforcement. In 1973 Harold Demsetz cautioned against inferring weakened competition from high or rising margins and concentration. He argued that this correlation between margins and concentration could arise from productivity differences across competitive firms. This paper studies the interplay between concentration, prices, and productivity across US manufacturing industries over two 15-year periods from 1982 to 2012. The consistent pattern is that high and rising concentration has been associated with better productivity growth. I show that widening margins, whether related to concentration or not, are mainly driven by productivity gains rather than prices, as in the competitive process outlined by Demsetz. Skepticism about tougher antitrust policy may be warranted: this would risk harm to productivity without benefiting consumers.
{"title":"Productivity, Prices, and Concentration in Manufacturing: A Demsetzian Perspective","authors":"S. Peltzman","doi":"10.1086/718855","DOIUrl":"https://doi.org/10.1086/718855","url":null,"abstract":"Concentration and price-cost margins have increased since the 1980s in many industries. These developments have raised concern about weakened competition and resulting harm to consumers and the need for tougher antitrust enforcement. In 1973 Harold Demsetz cautioned against inferring weakened competition from high or rising margins and concentration. He argued that this correlation between margins and concentration could arise from productivity differences across competitive firms. This paper studies the interplay between concentration, prices, and productivity across US manufacturing industries over two 15-year periods from 1982 to 2012. The consistent pattern is that high and rising concentration has been associated with better productivity growth. I show that widening margins, whether related to concentration or not, are mainly driven by productivity gains rather than prices, as in the competitive process outlined by Demsetz. Skepticism about tougher antitrust policy may be warranted: this would risk harm to productivity without benefiting consumers.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"30 1","pages":"S121 - S153"},"PeriodicalIF":0.0,"publicationDate":"2022-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"79738875","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We examine whether corporate boards factor the potential cost of competitive harm caused by a departing chief executive officer (CEO) into their forced-turnover decisions. Using staggered changes in the state-level enforceability of a covenant not to compete (CNC) for identification, we find that enhanced enforceability of CNCs increases both the likelihood of forced CEO turnover and the sensitivity of forced CEO turnover to firm performance. We present additional cross-sectional evidence that shows that such effects are more pronounced when firms face more severe product market threats or operate in industries with greater potential threats of predatory hiring. Investors react to turnover announcements more positively when enforceability increases, which indicates that enhanced enforceability of CNCs increases efficiency in decisions to replace CEOs.
{"title":"Enforceability of Noncompetition Agreements and Forced Turnovers of Chief Executive Officers","authors":"Yupeng Lin, Florian S. Peters, Hojun Seo","doi":"10.1086/716172","DOIUrl":"https://doi.org/10.1086/716172","url":null,"abstract":"We examine whether corporate boards factor the potential cost of competitive harm caused by a departing chief executive officer (CEO) into their forced-turnover decisions. Using staggered changes in the state-level enforceability of a covenant not to compete (CNC) for identification, we find that enhanced enforceability of CNCs increases both the likelihood of forced CEO turnover and the sensitivity of forced CEO turnover to firm performance. We present additional cross-sectional evidence that shows that such effects are more pronounced when firms face more severe product market threats or operate in industries with greater potential threats of predatory hiring. Investors react to turnover announcements more positively when enforceability increases, which indicates that enhanced enforceability of CNCs increases efficiency in decisions to replace CEOs.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"3 1","pages":"177 - 209"},"PeriodicalIF":0.0,"publicationDate":"2022-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"83439966","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Garrett Hardin’s article “The Tragedy of the Commons” is widely influential but fundamentally incorrect. Hardin characterizes the commons problem as arising from the exercise of free will in a world with limited carrying capacity. Hardin’s solutions to this problem emphasize coercive policies, including traditional command-and-control environmental and natural resource regulations. In contrast, the property rights literature that preceded Hardin shows that the commons problem arises from nonexclusive-use rights. Nonexclusivity is part of a broader class of restrictions on private ownership, any of which fosters dissipative rent seeking. The property rights literature focuses on value creation rather than just the physical exhaustion of the commonly owned resource. It is therefore more general and highlights solutions that are less coercive and dissipative than the more widely known views espoused by Hardin.
加勒特·哈丁(Garrett Hardin)的文章《公地悲剧》(The Tragedy of The Commons)影响广泛，但根本上是错误的。哈丁将公地问题描述为在一个承载能力有限的世界中自由意志的行使所产生的问题。哈丁对这个问题的解决方案强调强制性政策，包括传统的命令与控制的环境和自然资源法规。相比之下，哈丁之前的产权文献表明，公地问题产生于非独占使用权。非排他性是对私有制的更广泛限制的一部分，任何一种限制都会助长耗散性寻租行为。产权文献关注的是价值创造，而不仅仅是共同拥有资源的物质消耗。因此，与哈丁所支持的更广为人知的观点相比，它更普遍，并突出了不那么强制和耗散的解决方案。
{"title":"The Tragedy of “The Tragedy of the Commons”: Hardin versus the Property Rights Theorists","authors":"Jonathan M. Karpoff","doi":"10.1086/718857","DOIUrl":"https://doi.org/10.1086/718857","url":null,"abstract":"Garrett Hardin’s article “The Tragedy of the Commons” is widely influential but fundamentally incorrect. Hardin characterizes the commons problem as arising from the exercise of free will in a world with limited carrying capacity. Hardin’s solutions to this problem emphasize coercive policies, including traditional command-and-control environmental and natural resource regulations. In contrast, the property rights literature that preceded Hardin shows that the commons problem arises from nonexclusive-use rights. Nonexclusivity is part of a broader class of restrictions on private ownership, any of which fosters dissipative rent seeking. The property rights literature focuses on value creation rather than just the physical exhaustion of the commonly owned resource. It is therefore more general and highlights solutions that are less coercive and dissipative than the more widely known views espoused by Hardin.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"30 1","pages":"S65 - S84"},"PeriodicalIF":0.0,"publicationDate":"2022-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"76483310","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Harold Demsetz famously emphasized that the relationship between industry structure and competition runs in both directions. Competition thus can lead industries to adjust to demand increases through larger firms rather than more firms. We investigate this insight empirically by examining how local gasoline retail markets adjusted to interstate highway openings. We find that when a new highway was close to a previous route, average producer size increased beginning 1 year before it opened. If instead the interstate substantially displaced traffic, the number of producers increased beginning only after it opened. These results empirically illustrate how the role of entry in the competitive process depends on whether entry makes product space more crowded.
{"title":"The Economics of Radiator Springs: Dynamics, Sunk Costs, and Spatial Demand Shifts","authors":"Jeffrey R. Campbell, T. Hubbard","doi":"10.1086/718858","DOIUrl":"https://doi.org/10.1086/718858","url":null,"abstract":"Harold Demsetz famously emphasized that the relationship between industry structure and competition runs in both directions. Competition thus can lead industries to adjust to demand increases through larger firms rather than more firms. We investigate this insight empirically by examining how local gasoline retail markets adjusted to interstate highway openings. We find that when a new highway was close to a previous route, average producer size increased beginning 1 year before it opened. If instead the interstate substantially displaced traffic, the number of producers increased beginning only after it opened. These results empirically illustrate how the role of entry in the competitive process depends on whether entry makes product space more crowded.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"45 1","pages":"S85 - S120"},"PeriodicalIF":0.0,"publicationDate":"2022-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85961571","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We study contracting practices in the market for paintings in Renaissance Italy. Building on insights from the economic analysis of contracts and qualitative analysis of primary sources, we first show that transaction costs threatened the relationship between buyer—the patron—and seller—the painter. We empirically investigate the channels through which transaction costs influenced contracting practices using a novel data set measuring the content and structure of 90 commission documents from the later 13th to the early 16th century. We find strong evidence that patrons used formal contracts to mitigate painters’ opportunism but little evidence that artists’ age-related reputation for honest dealing had a systematic effect on contracting practices.
{"title":"Bargaining over Beauty: The Economics of Contracts in Renaissance Art Markets","authors":"E. Piano, Clara E. Piano","doi":"10.1086/722761","DOIUrl":"https://doi.org/10.1086/722761","url":null,"abstract":"We study contracting practices in the market for paintings in Renaissance Italy. Building on insights from the economic analysis of contracts and qualitative analysis of primary sources, we first show that transaction costs threatened the relationship between buyer—the patron—and seller—the painter. We empirically investigate the channels through which transaction costs influenced contracting practices using a novel data set measuring the content and structure of 90 commission documents from the later 13th to the early 16th century. We find strong evidence that patrons used formal contracts to mitigate painters’ opportunism but little evidence that artists’ age-related reputation for honest dealing had a systematic effect on contracting practices.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"16 1","pages":"225 - 257"},"PeriodicalIF":0.0,"publicationDate":"2021-12-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"81991360","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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