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Law and Economics

Paper Session

Sunday, Jan. 5, 2025 1:00 PM - 3:00 PM (PST)

Hilton San Francisco Union Square, Yosemite A
Hosted By: American Economic Association
  • Chair: Caroline Cecot, George Mason University

Do Judicial Assignments Matter? Evidence from Random Case Allocation

Bernhard Ganglmair
,
University of Mannheim
Christian Helmers
,
Santa Clara University
Brian Love
,
Santa Clara University

Abstract

Because judges exercise discretion in how they handle and decide cases, heterogeneity across judges can
affect case outcomes and, thus, preferences among litigants for particular judges. However, selection
obscures the causal mechanisms that drive these preferences. We overcome this challenge by studying the
introduction of random case assignment in a venue (the U.S. District Court for the Western District of
Texas) that previously experienced a high degree of case concentration before one judge (Alan Albright),
whom litigants could select with virtual certainty. To assess Albright’s importance to patent enforcers, we
examine how case filing patterns changed following the adoption of random case allocation and show that
case filings in the Western District of Texas decreased significantly at both the intensive and extensive
margins. Moreover, to shed light on why litigants prefer Judge Albright, we compare motions practice
and case management metrics across randomly assigned cases and show that cases assigned to Albright
were both scheduled to proceed to trial relatively quickly and less likely to raise the issue of patentable
subject matter.

Effect of Open Container Laws on Alcohol-Related Fatalities in U.S. States

Favour Olarewaju
,
The University of Memphis
Albert Okunade
,
The University of Memphis

Abstract

Open container laws (OCL), which do not permit drivers to have open containers of alcohol within reach in motor vehicles, are public policies designed to raise public safety. Many U.S. states have implemented this policy at different times from 1998 (the earliest treatment time) to 2017 (the latest treatment year). Moreover, OCL implementation varies across the states regarding whether passengers can possess and/or consume alcohol even if the drivers are not permitted. As such, this study seeks to provide more recent evidence on how the staggered adoption of OCL has affected alcohol-related accidents from 1990-2020 with at least 8 pre-policy intervention years and 3 years post treatment. This work advances the existing literature by using more recent data, accounting for later-treated states, and treatment heterogeneity using a more novel analytical technique. Moreover, more granular heterogeneity analysis is conducted by race, age, and gender sub-groups as an improvement on current studies rather than merely controlling for these variables. Given the heterogeneous years, we use the Callaway & Sant’Anna’s (CS) staggered Difference-in-Difference (DID) event study method. The estimated models controlled for other additional factors such as state-related traffic laws, regional variations, time-varying factors including income, unemployment, population density at the state-level, and demographic attributes. These data come from the Fatality Analysis Reporting System (FARS), Alcohol Policy Information System (APIS), Census Bureau, and Bureau of Labor Statistics (BLS). Findings indicate that OCL has a rather short-term effect of reducing alcohol-related fatalities by about 20% per 100,000 people in the year of implementation. Policy intervention effects weaken with time. Policy implications for the research findings are discussed in the context of life expectancy variations across the U.S states.

Impact of Pre-Arrest Diversion Program in Criminal Justice System

Sirazum munira Haque
,
Auburn University

Abstract

A criminal record, even an arrest record without any conviction, changes the trajectory of a person’s life. Policymakers are considering different ways to shrink the footprint of the criminal justice system in the United States. Pre-arrest Diversion programs are one such intervention that provides an opportunity to divert individuals, who have low to moderate criminogenic risk, from entering the criminal justice system at all. Despite the growing number of diversion programs in the criminal justice system, there are no causal analyses of the effect of pre-arrest diversion programs. This study provides the first causal estimates of the impact of a misdemeanor pre-arrest diversion program on individuals' subsequent criminal justice involvement. Exploiting the introduction of the pre-arrest diversion program at different times in different counties in 8th Jurisdiction, Florida, I test whether the pre-arrest diversion program reduces recidivism using a staggered difference-in-difference and instrumental variable method. All misdemeanor offenses except traffic and domestic violence, where law enforcement did not arrest the defendant, are screened for admission into this program. I use administrative data to compare the defendants whose offense date was just before and just after the program initiation date. I use individual-level administrative data to show the intent-to-treat effect among eligible people and the average treatment effect on the treated. My preliminary analysis shows that pre-arrest diversion reduces the probability of future arrest within two years by 19 percentage points and the probability of future conviction within two years by 14 percentage points for first-time misdemeanor defendants. This effect is largely driven by the reduction in future misdemeanor arrests and misdemeanor convictions.

She Means Business: From Courtroom Biases to Post-Bankruptcy Triumphs

Hadiye Aslan
,
Georgia State University

Abstract

We hypothesize that gender plays an important role in determining outcomes in business bankruptcy outcomes. We rely on the random assignment of cases among judges within a given jurisdiction to draw causal inference from our empirical analysis. Using a comprehensive dataset of individual sole proprietor and single-owner LLC bankruptcy petitions, we find that female business owners are 26 percent more likely to have their cases dismissed or converted to Chapter 7 compared to their male counterparts. The results are stronger if the presiding judge is a male and have less courtroom or industry-specific experience. We find that post-reorganization businesses owned by women are less likely to fail and show stronger sales growth compared to those owned by men. Finally, the occurrence of less favorable rulings towards women in bankruptcy court cases results in a reduction of female business start-ups by nine percent when compared to their male counterparts, with stronger effects in districts characterized by a higher degree of egalitarian values and where access to banking finance is more stringent.
JEL Classifications
  • K0 - General