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Open Access Publications from the University of California

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The Program in Law, Economics, and Institutions at U.C. Berkeley includes a weekly workshop for scholarly papers, fellowships for students, a program for visiting scholars, classes for students, and this working paper series. To find out more about us, visit our web site.

Berkeley Program in Law and Economics

There are 645 publications in this collection, published between 1990 and 2012.
Berkeley Program in Law and Economics, Working Paper Series (213)

The Impact of Legalized Abortion on Crime

We offer evidence that legalized abortion has contributed significantly to recent crime reductions. Crime began to fall roughly 18 years after abortion legalization. The 5 states that allowed abortion in 1970 experienced declines earlier than the rest of the nation, which legalized in 1973 with Roe v. Wade. States with high abortion rates in the 1970s and 1980s experienced greater crime reductions in the 1990s. In high abortion states, only arrests of those born after abortion legalization fall relative to low abortion states. Legalized abortion appears to account for as much as 50 percent of the recent drop in crime.

The Consent Problem in International Law

International law is built on the foundation of state consent. A state’s legal obligations are overwhelmingly – some would say exclusively – based on its consent to be bound. This focus on consent offers maximal protection to individual states. If a country feels that a proposed change to international law does not serve its interests, it can avoid that change by withholding its agreement. This commitment to consent preserves the power of states, but it also creates a serious problem for the international system. Because any state can object to any proposed rule of international law, only changes that benefit every single affected state can be adopted. This creates a cumbersome status quo bias. Though legal reforms that would lead to a loss of well-being are avoided, so are reforms that would increase well-being for most but not all states. This Article challenges the conventional view of consent. It argues that our existing commitment to consent is excessive and that better outcomes would result from greater use of non-consensual forms of international law. Though consent has an important role to play, we cannot address the world’s greatest problems unless we are prepared to overcome the problem it creates – the consent problem. International law has developed a variety of ways to live with the consent problem. These include the granting of concessions by supporters of change to opponents thereof, customary international law, and to the United Nations Security Council. None of these, however, provide a sufficient counterweight to the consent problem. There are also strategies employed to work around the consent problem, mostly through the use of soft law. In particular, the international system has developed a plethora of international organizations and international tribunals that generate soft law. As currently used and perceived by the international legal system, states, and commentators, these soft law strategies are helpful, but insufficiently so. We could achieve better results within the system by expanding our acceptance of the soft law promulgated by these bodies and raising the expectation of compliance placed on states. This move toward greater support for non-consensual soft law would help to overcome the consent problem, and represent a step in the right direction for the international system.

A Damage-Revelation Rationale for Coupon Remedies

This article studies optimal remedies in a setting in which damages vary among plaintiffs and are difficult to determine. We show that giving plaintiffs a choice between coupons to purchase units of the defendant's product at a discount and cash - a coupon-cash remedy - is superior to cash alone. The optimal coupon-cash remedy offers a cash amount that is less than the value of the coupons to plaintiffs who suffer relatively high harm. Such a remedy induces these plaintiffs to choose coupons, and plaintiffs who suffer relatively low harm to choose cash. Sorting plaintiffs in this way leads to better deterrence because the costs borne by defendants (the cash payments and the cost of providing coupons) more closely approximate the harms that they have caused.

210 more worksshow all
Latin American and Caribbean Law and Economics Association (ALACDE) Annual Papers (197)

Responsabilidad Civil Extracontractual en Paraguay: un enfoque económico

Los accidentes de tráfico a nivel mundial constituyen la segunda causa de muerte entre personas de 5 y 25 años de edad según la Organización de las Naciones Unidas. En lo que respecta a Paraguay, los accidentes de tráfico ocupan el primer lugar de causas de muerte. A la luz de dicha estadística, el presente trabajo ofrece un análisis de la Responsabilidad Civil Extracontractual en el Paraguay, específicamente de la derivada de accidentes de tráfico; utilizando para ello las herramientas del Law and Economics. El objetivo primordial de este trabajo (mas no el único) será analizar la función no sólo compensatoria, sino también preventiva del sistema de responsabilidad: el sistema de responsabilidad civil derivada de accidentes de tráfico puede contribuir a lograr una reducción de la cantidad de accidentes y, por lo tanto, lograr así minimizar las externalidades negativas derivadas de los mismos.

194 more worksshow all
Industrial Organization, Economic Analysis & Policy Seminar (3)

"A Model of Vertical Oligopolistic Competition"

This paper develops a model of successive oligopolies with endogenous market entry, allowing for varying degrees of product differentiation and entry costs in both markets. Our analysis shows that the downstream conditions dominate the overall profitability of the two-tier structure while the upstream conditions mainly affect the distribution of profits. We compare the welfare effects of upstream versus downstream deregulation policies and show that the impact of deregulation may be overvalued when ignoring feedback effects from the other market. Furthermore, we analyze how different forms of vertical restraints influence the endogenous market structure and provide conditions under which they are welfare enhancing.

"Monopolies in Two-Sided Markets: Comparative Statics and Identification"

Many models of monopoly in two-sided markets have been proposed (Rochet and Tirole, 2006), but little is known about them. I provide a full set of comparative statics for three models, one that generalizes that of Rochet and Tirole (2003), a second that generalizes Armstrong (2006) and a third that fuses the two models. This answers a number of questions central to the theoretical literature, such as the effects of market power and price controls and the relationship between different models. I also show how, given exogenous cost variations, these models can be almost fully (locally) identifed (e.g. market power and predatory pricing), tested and distinguished from one another. I highlight applications of the results to a wide variety of theoretical, empirical and policy questions, including merger analysis.

Berkeley Program in Law and Economics, Postprint Series (2)
Other Recent Work (1)