International Review of Law and Economics最新文献

People often appear to use irrelevant information in forming judgments about others. Using survey experiments, we show that seemingly irrelevant facts may actually be informative of actors’ choices, which third parties can use to update their beliefs. Specifically, we show that subjects’ perceived severity and recommended punishment for offenses are significantly increasing in the number of lawyers representing defendants. However, once subjects are informed that the defendant was randomly assigned a specific number of lawyers, the significant relationship between the perceived seriousness of the offense and the number of lawyers largely vanishes. Thus, third parties in our benchmark analysis may be using the defendant’s legal team size as a proxy to update their beliefs regarding the nature of the offense committed, as opposed to being affected by irrelevant factors in forming judgments. This is because randomization makes it impossible for third parties to draw inferences regarding the nature of the offense committed by the defendant based on the number of lawyers. However, for some offenses, we find that increasing the number of lawyers raises third parties’ recommended sanctions even when the number of lawyers is randomly determined, which is consistent with a psychological phenomenon called ‘luck envy’.

Digital content today is governed by online providers like Facebook or YouTube. Increasingly, these providers are expected to enforce the law by removing illegal content, such as copyright infringement or hate speech. Typically, once they are notified of its existence, they have to assess it and, if infringing, remove it. Otherwise, they face liability. This system of content moderation is a form of delegation of the state’s tasks to private parties. In literature, it is empirically established that some schemes of delegated enforcement can trigger substantial false positives, mostly due to over-compliance by providers and under-assertion of rights by affected content creators. This results in a phenomenon known as over-blocking: collateral removal of lawful content. We conduct a laboratory experiment to test a possible solution to this issue, as proposed by Husovec (2016). Our results show that an external dispute resolution mechanism subject to a particular fee structure can significantly reduce over-compliance by providers and improve the accuracy of their decisions, largely thanks to the content creators taking initiative. It does so by re-calibrating the typical asymmetry of incentives under the delegated enforcement schemes. The principles behind the solution have the potential to improve also other schemes of delegated enforcement where providers have weak incentives to properly execute delegated tasks in the public interest.

The voting gender gap characterises several countries and is likely to translate into the composition of elected assemblies and governments. Starting from the given preferences of the electors, different electoral rules may translate this gap into different outcomes in terms of parliament composition. To amplify or attenuate this gap results in generating a sort of gender representation bias. This paper investigates if and to what extent different electoral rules generate gender representation bias when translating votes into seats. It proposes a theoretical framework to capture the potential of an electoral system to amplify or attenuate the voting gender gap. Then, using survey data and different indices of representativeness and governability, this paper provides empirical tests for the theoretical framework. Both the theory and the simulations indicate that majority systems magnify the gender gap while proportional rules are likely to reproduce it with minimal distortions.

Economic analyses of antitrust institutions have thus far focused predominantly on optimal penalties and the design of substantive legal rules, and have largely ignored the standard of proof used in trials as a policy tool in shaping behavior. This neglected tool can play a unique role in the antitrust context, where a given firm may have the choice to engage in exceptional anticompetitive or procompetitive behavior, or simply follow more conventional business practices. The standard of proof used in determining the legality of a firm’s conduct affects not only whether the firm chooses to engage in pro- versus anticompetitive behavior, but also whether it chooses to remain passive. We introduce a model to investigate the effects of this additional tradeoff on the optimal standard of proof. The nature of these effects depends upon the relationship between the beneficial impact of procompetitive behavior versus the harmful impacts of anticompetitive behavior, since this relationship is what determines the costs associated with Type I and Type II error. Adopting Judge Easterbrook’s presumption that preventing procompetitive behavior is more harmful than allowing anticompetitive behavior, we show that the standard of proof facing plaintiffs in antitrust cases ought to be stronger than preponderance of the evidence.

In this paper, we investigate the performance of corporate legal insiders in the Korean market from January 2010 to December 2020. This market has received very little attention from the academic community, while being one of the leading emerging economies. As per prior studies, we consider mainly buy transactions in order to draw robust conclusions as to insiders’ performance, since sales transactions do not necessarily represent a strong signal from insiders, as different reasons could push an investor to close her position. Our three-level analysis allows us to conclude that corporate insiders in the Korean market do possess market timing skills that enable them to consistently outperform random, outside investors over time. However, we note that this market timing ability is, to a large extent, linked to the hierarchical level of the insider in question, and consequently to its access to more crucial information. This brings us to the conclusion that information asymmetry is not only important between corporate insiders and outsiders, but even within organizations.

We assess the corporate performance and corporate governance consequences of mandatory employee board representation through a natural experiment: the passage of the 2015 Rebsamen law in France, which requires 1 or 2 board seats to be allocated to employee representatives. We hypothesize that such formal institutional arrangements to give workers a voice in corporate governance are irrelevant for family firms, which have been shown to commit to implicit contracts with their employees. We find evidence that affected family firms’ share prices reacted negatively to the passage of the law. Moreover, standard OLS regressions of operating performance suggest that family control neutralizes the positive effect associated with employee directors. A more sophisticated difference-in-differences approach shows that affected family firms experienced a significant subsequent decrease in their return on assets. Our investigations of board composition also suggest that family firms rely on avoidance strategies to offset the influence of employee representatives. Overall, this paper casts doubt on the efficiency of minority worker representation in the boardrooms of family-owned companies and thus cautions against a “one-size-fits-all” approach to corporate governance practices.

There is a consensus that the proportion of suicides committed with a firearm is the best proxy for gun ownership prevalence. Cerqueira et al. (2018) exploit socioeconomic characteristics of suicide victims in order to develop more refined prevalence indicators. They rest on location fixed effects of the victim's place of residence from a discrete-choice model for the likelihood of committing suicide with gun. We empirically assess this new indicator using gun ownership data from the Behavioral Risk Factor Surveillance System (BRFSS) and suicide registers of the US National Center for Health Statistics (NCHS) from 1995 to 2004. We show that the panel-based proxy variables correlate more with the percentage of households with firearms than the conventional proxy based on the proportion of suicides committed with a firearm does. We further estimate gun prevalence across Mexican states. This is a relevant application because there is no representative household survey in Mexico with information about gun ownership at the state level.

While there is widespread evidence that sentences for similar cases tend to differ across courts, the production of sentencing disparities by prosecutors versus judges has received very limited attention to date. In this paper, we focus on this issue using traffic offenses data from neighboring courts in South-East France. First, we measure disparities for observably similar cases both at the extensive margin (type of sentences) and intensive margin (quantum) and find large differences in sentencing across courts. Second, we decompose those disparities between the influence of prosecutors through their procedural choices (simplified versus classical criminal procedures) and that of judges who always have the final word on sentences. While there is heterogeneity in the role of prosecutors between courts, we find that most sentencing disparities cannot be explained by the sole decisions of prosecutors.

In this paper, we argue that the availability of colleges incentivizes college enrollment and, by increasing the opportunity cost of incarceration, it has the potential to reduce crime. We provide empirical evidence from college expansions in the US over the years 1974–2019 and implement a triple-difference identification strategy to compare the arrest rates of different age groups over time in counties that differ by their college expansions. The reduced-form results suggest significant reductions in arrest rates. The effects hold across main categories of crime and over a variety of specifications and a wide array of robustness checks. We utilize an event-study analysis and a series of placebo tests to rule out the problems of pre-trend and endogenous migration. We discuss the policy implications and potential social savings of college opening through reductions in crime.