Excessively tight and biased policy choices of rule makers can be explained as outcomes of competition among rule makers with overlapping competencies and diverging perceptions about the optimal framework. Rule makers who have extreme rather than moderate preferences are more likely to take policy action and preempt others, even if their cost of action is very high. This can lead to actionism, excessive regulatory activity, and radical rule outcomes.
{"title":"Overzealous Rule Makers","authors":"S. Barbieri, Kai A. Konrad","doi":"10.1086/711354","DOIUrl":"https://doi.org/10.1086/711354","url":null,"abstract":"Excessively tight and biased policy choices of rule makers can be explained as outcomes of competition among rule makers with overlapping competencies and diverging perceptions about the optimal framework. Rule makers who have extreme rather than moderate preferences are more likely to take policy action and preempt others, even if their cost of action is very high. This can lead to actionism, excessive regulatory activity, and radical rule outcomes.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"68 1","pages":"341 - 365"},"PeriodicalIF":0.0,"publicationDate":"2020-09-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"80336974","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 Opportunity Zone (OZ) program is one of the most comprehensive to promote development in distressed communities. A criticized feature is that state governors designate zones as OZs from many eligible tracts without scrutiny. We find that governors are more likely to select tracts with higher distress levels and tracts on an upward economic trajectory, which indicates that they select OZs in a systematic way on the basis of objective criteria. However, we also provide evidence that favoritism plays a role in governors’ decisions. The OZ designation is more likely for tracts in counties that supported the governor in an election and when executives or firms with an economic interest in the tract donated to the governor’s campaign. We further explore whether transparency and accountability measures affected states’ decisions. Our analysis suggests that while most measures had no discernible impact, publishing draft selections may mitigate favoritism and promote systematic decision-making.
{"title":"Does Government Play Favorites? Evidence from Opportunity Zones","authors":"O. Eldar, C. Garber","doi":"10.1086/722541","DOIUrl":"https://doi.org/10.1086/722541","url":null,"abstract":"The Opportunity Zone (OZ) program is one of the most comprehensive to promote development in distressed communities. A criticized feature is that state governors designate zones as OZs from many eligible tracts without scrutiny. We find that governors are more likely to select tracts with higher distress levels and tracts on an upward economic trajectory, which indicates that they select OZs in a systematic way on the basis of objective criteria. However, we also provide evidence that favoritism plays a role in governors’ decisions. The OZ designation is more likely for tracts in counties that supported the governor in an election and when executives or firms with an economic interest in the tract donated to the governor’s campaign. We further explore whether transparency and accountability measures affected states’ decisions. Our analysis suggests that while most measures had no discernible impact, publishing draft selections may mitigate favoritism and promote systematic decision-making.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"7 1","pages":"111 - 141"},"PeriodicalIF":0.0,"publicationDate":"2020-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87350122","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}
Inspired by the call in Demsetz’s “Barriers to Entry” for assessing the implications of occupational licensing, we examine how the 2015 Food Safety Law (FSL) affects e-commerce in China. The FSL requires most food sellers on e-commerce platforms to obtain off-line licenses. On the basis of its gradual rollout on Alibaba, we find that larger and more-reputable sellers display an FSL license earlier, and buyers are more willing to transact with a licensed seller, especially if the seller is younger and unestablished. This suggests that the license is informative. Market-wide, the average quality of surviving sellers has improved and seller concentration has increased since the FSL. The platform’s gross merchandise value for food did not decline, nor did the average sales price increase 1 year into full enforcement. This suggests that the FSL does not hamper long-term market performance, probably because it enhances seller quality and market transparency.
{"title":"The Effects of Government Licensing on E-commerce: Evidence from Alibaba","authors":"G. Jin, Zhentong Lu, Xiaolu Zhou, Chunxiao Li","doi":"10.1086/718851","DOIUrl":"https://doi.org/10.1086/718851","url":null,"abstract":"Inspired by the call in Demsetz’s “Barriers to Entry” for assessing the implications of occupational licensing, we examine how the 2015 Food Safety Law (FSL) affects e-commerce in China. The FSL requires most food sellers on e-commerce platforms to obtain off-line licenses. On the basis of its gradual rollout on Alibaba, we find that larger and more-reputable sellers display an FSL license earlier, and buyers are more willing to transact with a licensed seller, especially if the seller is younger and unestablished. This suggests that the license is informative. Market-wide, the average quality of surviving sellers has improved and seller concentration has increased since the FSL. The platform’s gross merchandise value for food did not decline, nor did the average sales price increase 1 year into full enforcement. This suggests that the FSL does not hamper long-term market performance, probably because it enhances seller quality and market transparency.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"17 1","pages":"S191 - S221"},"PeriodicalIF":0.0,"publicationDate":"2020-08-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"81905392","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 quantify the sensitivity of investments to policy uncertainty by drawing on the Northern Pacific’s massive land grant and the ensuing political battle that generated significant uncertainty to title from 1879 to 1894. Focusing on irrigation because of its high asset specificity, our analysis exploits the spatially exogenous extent of the grant to identify causal effects on investment, inclusive of spillovers to secure land because coordinated investment is generally necessary to capture the scale economies of irrigation. We find that the uncertainty significantly deterred and delayed irrigation investment in Montana, which lowered the state’s economic activity by up to 5 percent. Large numbers of settlers are occupying such [railroad grant] lands, and it is important to them to know whether they can receive their titles from the United States, or whether they will be required to purchase from the railroad companies. The prevailing uncertainty necessarily retards improvements and impairs values. (Noah C. McFarland, General Land Office Commissioner, US Department of the Interior 1882, p. 11) Large numbers of settlers are occupying such [railroad grant] lands, and it is important to them to know whether they can receive their titles from the United States, or whether they will be required to purchase from the railroad companies. The prevailing uncertainty necessarily retards improvements and impairs values. (Noah C. McFarland, General Land Office Commissioner, US Department of the Interior 1882, p. 11)
我们量化了投资对政策不确定性的敏感性，通过利用北太平洋的大量土地赠款和随后的政治斗争，从1879年到1894年，这些政治斗争产生了重大的不确定性。由于灌溉具有高度的资产专用性，我们的分析将重点放在灌溉上，利用赠款的空间外生程度来确定对投资的因果影响，包括确保土地的溢出效应，因为协调投资通常是实现灌溉规模经济所必需的。我们发现，不确定性极大地阻碍和推迟了蒙大拿州的灌溉投资，这使该州的经济活动降低了5%。大量的移民占用了这些土地，对他们来说，重要的是要知道他们是否可以从美国获得他们的所有权，或者他们是否需要从铁路公司购买。普遍存在的不确定性必然会阻碍改进并损害价值。(Noah C. McFarland，美国内政部土地办公室总专员，1882年，第11页)大量的移民占据着这样的[铁路许可]土地，对他们来说，重要的是要知道他们是否可以从美国获得他们的所有权，或者他们是否需要从铁路公司购买。普遍存在的不确定性必然会阻碍改进并损害价值。(Noah C. McFarland，美国内政部土地总署署长，1882年，第11页)
{"title":"Development Derailed: Policy Uncertainty and Coordinated Investment","authors":"E. Alston, Steven S. Smith","doi":"10.1086/715832","DOIUrl":"https://doi.org/10.1086/715832","url":null,"abstract":"We quantify the sensitivity of investments to policy uncertainty by drawing on the Northern Pacific’s massive land grant and the ensuing political battle that generated significant uncertainty to title from 1879 to 1894. Focusing on irrigation because of its high asset specificity, our analysis exploits the spatially exogenous extent of the grant to identify causal effects on investment, inclusive of spillovers to secure land because coordinated investment is generally necessary to capture the scale economies of irrigation. We find that the uncertainty significantly deterred and delayed irrigation investment in Montana, which lowered the state’s economic activity by up to 5 percent. Large numbers of settlers are occupying such [railroad grant] lands, and it is important to them to know whether they can receive their titles from the United States, or whether they will be required to purchase from the railroad companies. The prevailing uncertainty necessarily retards improvements and impairs values. (Noah C. McFarland, General Land Office Commissioner, US Department of the Interior 1882, p. 11) Large numbers of settlers are occupying such [railroad grant] lands, and it is important to them to know whether they can receive their titles from the United States, or whether they will be required to purchase from the railroad companies. The prevailing uncertainty necessarily retards improvements and impairs values. (Noah C. McFarland, General Land Office Commissioner, US Department of the Interior 1882, p. 11)","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"76 3 1","pages":"39 - 76"},"PeriodicalIF":0.0,"publicationDate":"2020-08-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85525745","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}
Thirty-four states have medical marijuana laws, and 10 states have recreational marijuana laws. Little research compares how these two types of laws affect drug consumption in the general population or in particular age groups. Using a difference-in-differences strategy, we find that recreational laws increase past-year marijuana use by 25 percent among adults and by 10 percent among adolescents. In contrast, medical laws increase adult use by only 5 percent and have a negligible effect on adolescent use. We also find that recreational marijuana dispensaries are an important driver of the increase in marijuana use for adults 26 and older. Our results suggest that medical laws succeed in mitigating recreational (nonmedical) use, that recreational laws produce large increases in marijuana use in the general population, and that underage marijuana use may be an important problem with existing implementations of recreational marijuana laws.
{"title":"Comparative Effects of Recreational and Medical Marijuana Laws on Drug Use among Adults and Adolescents","authors":"Alex Hollingsworth, Coady Wing, Ashley C Bradford","doi":"10.1086/721267","DOIUrl":"https://doi.org/10.1086/721267","url":null,"abstract":"Thirty-four states have medical marijuana laws, and 10 states have recreational marijuana laws. Little research compares how these two types of laws affect drug consumption in the general population or in particular age groups. Using a difference-in-differences strategy, we find that recreational laws increase past-year marijuana use by 25 percent among adults and by 10 percent among adolescents. In contrast, medical laws increase adult use by only 5 percent and have a negligible effect on adolescent use. We also find that recreational marijuana dispensaries are an important driver of the increase in marijuana use for adults 26 and older. Our results suggest that medical laws succeed in mitigating recreational (nonmedical) use, that recreational laws produce large increases in marijuana use in the general population, and that underage marijuana use may be an important problem with existing implementations of recreational marijuana laws.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"88 4 1","pages":"515 - 554"},"PeriodicalIF":0.0,"publicationDate":"2020-08-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87702861","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}
This paper investigates the effects of stolen-goods markets on crime. I focus on pawnshops, a legitimate business often associated with the illicit trade of stolen property. Within-county estimates reveal that a 10 percent increase in the rate of pawnshops increases, by around .3 percent, the rate of acquisitive crimes that yield stolen goods that might be tradeable to pawnshops. A quasi-experimental design shows that the effects of changes in gold prices on burglaries are amplified by the initial stock of pawnshops in a county. Overall, the analysis suggests that a larger market for the trade of stolen property can affect burglars’ incentives by increasing the value of criminal opportunities.
{"title":"The Effects of Stolen-Goods Markets on Crime: Pawnshops, Property Theft, and the Gold Rush of the 2000s","authors":"Rocco d'Este","doi":"10.1086/707785","DOIUrl":"https://doi.org/10.1086/707785","url":null,"abstract":"This paper investigates the effects of stolen-goods markets on crime. I focus on pawnshops, a legitimate business often associated with the illicit trade of stolen property. Within-county estimates reveal that a 10 percent increase in the rate of pawnshops increases, by around .3 percent, the rate of acquisitive crimes that yield stolen goods that might be tradeable to pawnshops. A quasi-experimental design shows that the effects of changes in gold prices on burglaries are amplified by the initial stock of pawnshops in a county. Overall, the analysis suggests that a larger market for the trade of stolen property can affect burglars’ incentives by increasing the value of criminal opportunities.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"8 1","pages":"449 - 472"},"PeriodicalIF":0.0,"publicationDate":"2020-08-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"86210330","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 contractual theory of the firm predicts that companies adopt charters that maximize firms’ value regardless of the default rule. We test this proposition around an exogenous switch of the default from a one-share-one-vote regime to tenure voting following a legal reform in France. In initial public offerings (IPOs), tenure voting is primarily adopted by families, and after the reform its use increased slightly but not significantly. The change in default rule has no significant impact on companies’ characteristics or valuations. For companies that were already listed with one-share-one-vote systems and would have been forced to switch to tenure voting by default, we observe a revealed preference for the choice they had made at the IPO; one-share-one-vote companies preserve their prereform status, unless the French state has a blocking minority. Overall, the results suggest that once firms have optimized, changing the default rule imposes transaction costs without changing outcomes.
{"title":"Loyalty Shares with Tenure Voting: Does the Default Rule Matter? Evidence from the Loi Florange Experiment","authors":"Marco Becht, Yuliya Kamisarenka, Anete Pajuste","doi":"10.1086/708162","DOIUrl":"https://doi.org/10.1086/708162","url":null,"abstract":"The contractual theory of the firm predicts that companies adopt charters that maximize firms’ value regardless of the default rule. We test this proposition around an exogenous switch of the default from a one-share-one-vote regime to tenure voting following a legal reform in France. In initial public offerings (IPOs), tenure voting is primarily adopted by families, and after the reform its use increased slightly but not significantly. The change in default rule has no significant impact on companies’ characteristics or valuations. For companies that were already listed with one-share-one-vote systems and would have been forced to switch to tenure voting by default, we observe a revealed preference for the choice they had made at the IPO; one-share-one-vote companies preserve their prereform status, unless the French state has a blocking minority. Overall, the results suggest that once firms have optimized, changing the default rule imposes transaction costs without changing outcomes.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"7 11","pages":"473 - 499"},"PeriodicalIF":0.0,"publicationDate":"2020-08-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"72610591","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}
A. Bradford, Yun-chien Chang, Adam Chilton, Nuno Garoupa
There is a large body of research in economics and law suggesting that the legal origin of a country—that is, whether its legal regime is based on English common law or French, German, or Nordic civil law—profoundly impacts a range of outcomes. However, the exact relationship between legal origin and legal substance has been disputed in the literature and not fully explored with nuanced legal coding. We revisit this debate while leveraging novel cross-country data sets that provide detailed coding of two areas of laws: property and antitrust. We find that having shared legal origins strongly predicts whether countries have similar property regimes but does little to predict whether countries have similar antitrust regimes. Our results suggest that legal origin may be an important predictor of legal substance in well-established legal regimes but does little to explain substantive variation in more recent areas of law.
{"title":"Do Legal Origins Predict Legal Substance?","authors":"A. Bradford, Yun-chien Chang, Adam Chilton, Nuno Garoupa","doi":"10.1086/712420","DOIUrl":"https://doi.org/10.1086/712420","url":null,"abstract":"There is a large body of research in economics and law suggesting that the legal origin of a country—that is, whether its legal regime is based on English common law or French, German, or Nordic civil law—profoundly impacts a range of outcomes. However, the exact relationship between legal origin and legal substance has been disputed in the literature and not fully explored with nuanced legal coding. We revisit this debate while leveraging novel cross-country data sets that provide detailed coding of two areas of laws: property and antitrust. We find that having shared legal origins strongly predicts whether countries have similar property regimes but does little to predict whether countries have similar antitrust regimes. Our results suggest that legal origin may be an important predictor of legal substance in well-established legal regimes but does little to explain substantive variation in more recent areas of law.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"1 1","pages":"207 - 231"},"PeriodicalIF":0.0,"publicationDate":"2020-06-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"76015219","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 Hollywood studio era of the 1930s and 1940s was remarkable for its abundance of glamorous stars. In this paper, we investigate whether the vertical structure of the Hollywood studios, by ensuring studios’ claims to “star capital,” spurred higher levels of investment in discovering stars than was (or is) achievable under alternate regimes (such as today’s film-by-film contracting). The vertical structure consisted of backward integration into talent through long-term contracts and forward integration into exhibition through ownership of theater chains. The investment involved the experimental casting of novice actors to gauge audience appeal. Collecting data on thousands of actors whose careers span nearly three-quarters of a century and conducting several sets of tests, we find evidence of higher levels of investment in actors working under the vertical structure of the studio era than in actors working under alternate regimes. [Those] who were running the studios at that time … gave me a chance—today, you may get one shot, and if you fail, they break your back and forget about you from that time on. Then, you were part of a system that gave you another chance. So, MGM gave me opportunity after opportunity. (Director Richard Brooks [Eyman 2005, p. 419]) You realize that the greatest stars in the picture business were made during an era when they didn’t have one single thing to say about what they did. (Director Howard Hawks [Bogdanovich 1997, p. 362]) The studios owned you, and they wanted their property in great shape. (MGM contract player Jean Porter [Davis 1993, p. 88]) [Those] who were running the studios at that time … gave me a chance—today, you may get one shot, and if you fail, they break your back and forget about you from that time on. Then, you were part of a system that gave you another chance. So, MGM gave me opportunity after opportunity. (Director Richard Brooks [Eyman 2005, p. 419]) You realize that the greatest stars in the picture business were made during an era when they didn’t have one single thing to say about what they did. (Director Howard Hawks [Bogdanovich 1997, p. 362]) The studios owned you, and they wanted their property in great shape. (MGM contract player Jean Porter [Davis 1993, p. 88])
20世纪30年代和40年代的好莱坞电影工作室时代以其丰富的迷人明星而闻名。在本文中，我们调查了好莱坞电影公司的垂直结构，通过确保电影公司声称的“明星资本”，是否刺激了在发现明星方面的更高水平的投资，而不是在其他制度下(如今天的电影承包)所能实现的。纵向结构是通过长期合同向后整合人才，通过拥有连锁影院向前整合展览。这项投资包括实验性地挑选新演员，以衡量观众的吸引力。我们收集了数千名演员的数据，他们的职业生涯跨越了近四分之三个世纪，并进行了几组测试，我们发现在工作室时代垂直结构下工作的演员比在其他制度下工作的演员投入更高的证据。那些当时经营工作室的人给了我一个机会——今天，你可能只有一次机会，如果你失败了，他们就会打断你的背，从那时起就把你忘了。然后，你成为了这个体系的一部分，给了你另一次机会。所以，米高梅给了我一个又一个机会。(导演理查德·布鲁克斯[艾曼2005，第419页])你会意识到，电影界最伟大的明星都是在一个他们对自己所做的事情毫无发言权的时代产生的。(导演霍华德·霍克斯[博格达诺维奇1997年，第362页])电影公司拥有你，他们希望他们的财产保持良好状态。(米高梅公司的合同球员吉恩·波特[戴维斯1993，第88页])那些当时经营制片厂的人……给了我一个机会——今天，你可能只有一次机会，如果你失败了，他们就会打断你的背，从那时起就把你忘了。然后，你成为了这个体系的一部分，给了你另一次机会。所以，米高梅给了我一个又一个机会。(导演理查德·布鲁克斯[艾曼2005，第419页])你会意识到，电影界最伟大的明星都是在一个他们对自己所做的事情毫无发言权的时代产生的。(导演霍华德·霍克斯[博格达诺维奇1997年，第362页])电影公司拥有你，他们希望他们的财产保持良好状态。(米高梅的合同球员Jean Porter [Davis 1993, p. 88])
{"title":"Does Vertical Integration Spur Investment? Casting Actors to Discover Stars during the Hollywood Studio Era","authors":"F. Andrew Hanssen, A. Raskovich","doi":"10.1086/710067","DOIUrl":"https://doi.org/10.1086/710067","url":null,"abstract":"The Hollywood studio era of the 1930s and 1940s was remarkable for its abundance of glamorous stars. In this paper, we investigate whether the vertical structure of the Hollywood studios, by ensuring studios’ claims to “star capital,” spurred higher levels of investment in discovering stars than was (or is) achievable under alternate regimes (such as today’s film-by-film contracting). The vertical structure consisted of backward integration into talent through long-term contracts and forward integration into exhibition through ownership of theater chains. The investment involved the experimental casting of novice actors to gauge audience appeal. Collecting data on thousands of actors whose careers span nearly three-quarters of a century and conducting several sets of tests, we find evidence of higher levels of investment in actors working under the vertical structure of the studio era than in actors working under alternate regimes. [Those] who were running the studios at that time … gave me a chance—today, you may get one shot, and if you fail, they break your back and forget about you from that time on. Then, you were part of a system that gave you another chance. So, MGM gave me opportunity after opportunity. (Director Richard Brooks [Eyman 2005, p. 419]) You realize that the greatest stars in the picture business were made during an era when they didn’t have one single thing to say about what they did. (Director Howard Hawks [Bogdanovich 1997, p. 362]) The studios owned you, and they wanted their property in great shape. (MGM contract player Jean Porter [Davis 1993, p. 88]) [Those] who were running the studios at that time … gave me a chance—today, you may get one shot, and if you fail, they break your back and forget about you from that time on. Then, you were part of a system that gave you another chance. So, MGM gave me opportunity after opportunity. (Director Richard Brooks [Eyman 2005, p. 419]) You realize that the greatest stars in the picture business were made during an era when they didn’t have one single thing to say about what they did. (Director Howard Hawks [Bogdanovich 1997, p. 362]) The studios owned you, and they wanted their property in great shape. (MGM contract player Jean Porter [Davis 1993, p. 88])","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"43 1","pages":"631 - 666"},"PeriodicalIF":0.0,"publicationDate":"2020-05-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"91187032","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}
Ruben Jacobo-Rubio, John L. Turner, Jonathan W. Williams
In paragraph iv pharmaceutical cases, a patent-litigation decision often determines whether a brand-firm monopoly continues or generic entry occurs. Using unique patent-litigation data and an event-study approach that accounts for probabilistic district court decisions and an appellate process, we estimate that brand-firm stakes in such cases average $4.3 billion while generic-firm stakes average $204.3 million. After the Schering-Plough v. FTC decision in 2002 that upheld a settlement in which the brand firm paid the generic firm in return for delayed entry, we find that settlement is more likely and stakes are significantly lower, despite greater average brand sales for the drugs in the cases. On the basis of this evidence, we conclude that pay-for-delay settlements led to less within-market competition after 2002.
{"title":"The Distribution of Surplus in the US Pharmaceutical Industry: Evidence from Paragraph iv Patent-Litigation Decisions","authors":"Ruben Jacobo-Rubio, John L. Turner, Jonathan W. Williams","doi":"10.1086/707407","DOIUrl":"https://doi.org/10.1086/707407","url":null,"abstract":"In paragraph iv pharmaceutical cases, a patent-litigation decision often determines whether a brand-firm monopoly continues or generic entry occurs. Using unique patent-litigation data and an event-study approach that accounts for probabilistic district court decisions and an appellate process, we estimate that brand-firm stakes in such cases average $4.3 billion while generic-firm stakes average $204.3 million. After the Schering-Plough v. FTC decision in 2002 that upheld a settlement in which the brand firm paid the generic firm in return for delayed entry, we find that settlement is more likely and stakes are significantly lower, despite greater average brand sales for the drugs in the cases. On the basis of this evidence, we conclude that pay-for-delay settlements led to less within-market competition after 2002.","PeriodicalId":22657,"journal":{"name":"The Journal of Law and Economics","volume":"17 1","pages":"203 - 238"},"PeriodicalIF":0.0,"publicationDate":"2020-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"89623307","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}
京公网安备 11010802042870号
京ICP备2023020795号-1
扫码关注我们
求助内容：
应助结果提醒方式：