No-Fault for Motor Vehicles: An Economic Analysis

This article compares incentives and efficiency under the puretort system (the comparative negligence rule) to those underpure and mixed no-fault systems. Under no-fault systems, driversare allowed to opt out of no-fault and file lawsuits if theirdamages exceed a certain threshold. We find that no single liabilitysystem always dominates on efficiency grounds, but the puretort system does best when costs of care are low, and pure no-faultdoes best when costs of care are high. Choice systems, in whichdrivers choose between no-fault or pure tort systems, lead toless efficient results because drivers choose the pure tortrule too often.     

Prizes for innovation of new medicines and vaccines

This article argues that prizes can help stimulate medical innovation, control costs and ensure greater access to new medicines and vaccines. The authors explore four increasingly ambitious prize options to reward medical innovation, each addressing flaws in the current patent system. The first option promotes innovation through a large prize fund linked to the impact on health outcomes; the second option rewards the sharing of knowledge, data, and technology with open source dividends; the third option awards prizes for interim benchmarks and discrete technical problems; and the final option removes the exclusive right to use patented inventions in upstream research in favor of prizes. The authors conclude that a system of prizes to reward drug development would break the link between R&D incentives and product prices, and that such a reform is needed to improve innovation and access to new medicines and vaccines.     

The Swiss regulatory framework for paediatric health research

Medical research on minors entails both risks and benefits. Under Swiss law, clinical trials on children, including nontherapeutic drug trials, are permissible. However, ethics committees must systematically verify that all clinical studies have a favorable risk-benefit profile. Additional safeguards are designed to ensure that children are not unnecessarily involved in research and that proper consent is always obtained. Federal Swiss law is undergoing revision to extend these protections beyond clinical trials to a broad array of health research. The Swiss drug agency also seeks to improve the incentives for pharmaceutical firms to develop new paediatric drugs and relevant paediatric drug labels.     

Encouraging Tax Compliance With Positive Incentives: A Conceptual Framework and Research Directions*

Drawing on learning and social psychological research, we identify the processes by which positive incentives induce compliance with regulatory laws, using tax as a specific example. We evaluate the likely effects of various positive incentives on four different dimensions of compliance decisions: instrumental consequences, normative considerations, internalized motivation, and allegiance to authority. Linking incentives specifically to compliant behavior invokes a cost/benefit analysis, lowers intrinsic motivation and allegiance to authority, and requires authorities to monitor citizens and to distinguish between compliant and noncompliant behaviors. The alternative is to present the incentives as an attempt by the enforcement authorities to cooperate with the citizens. This method is less likely to invoke cost/benefit calculations; requires less intervention by authorities; and increases intrinsic motivation, consideration of normative issues, and allegiance to authorities. Prior research suggests that respectful treatment and praise may be more effective incentives for inducing long-lasting compliance than are materialistic incentives because people have a strong tendency to reciprocate actions they receive from authorities. Our analysis leads to proposals for program implementation and evaluation and raises some theoretical questions that need additional research.     

Intellectual Property and Global Health: From Corporate Social Responsibility to the Access to Knowledge Movement

Any system for the protection of intellectual property rights (IPRs) has three main kinds of distributive effects. It will determine or influence: (a) the types of objects that will be developed and for which IPRs will be sought; (b) the differential access various people will have to these objects; and (c) the distribution of the IPRs themselves among various actors. What this means to the area of pharmaceutical research is that many urgently needed medicines will not be developed at all, that the existing medicines will not be suitable for countries with a precarious health infrastructure or not target the disease variety that is prevalent in poorer regions. Such effects are commonly captured under the rubric of the “10/90 gap” in biomedical research. High prices will also restrict access to medicines as well endanger compliance to treatment schemes. IPRs are mainly held by multinational corporations situated in the developed world, which not only raises egalitarian concerns, but also severely limits the possibilities of companies in poorer countries to realize improvements on existing inventions, as they cannot financially afford to secure freedom to operate, which systematically shrinks the number of potential innovators. Those inequities lead to an enormous burden for the global poor and since no institution is willing to assume the responsibility to fulfil the right to health and the corresponding right of access to essential medicines, we have to analyse alternatives or additions to the actual intellectual property regimes in order to create new incentives to fill this gap.     

Does counterfeiting benefit genuine manufacturer? The role of production costs

A monopolist sells a luxury genuine product which can be illegally copied and sold by a competitive fringe of counterfeiters. Fines imposed on caught counterfeiters are pocketed by the genuine firm. We prove that if production costs are low, then the genuine manufacturer would lobbying for high penalties so that counterfeiters should be thrown out of the market. In this case, the presence of counterfeiters does not provide any benefit to the producer of the original product. Whenever the production cost is neither too high nor too low, the optimal fine guarantees a positive demand for the genuine product as well as for the fake; the genuine producer is better off than in a world without counterfeiters. If production costs are too high, the genuine firm has no more incentive to produce. Its remaining goal is to collect penalty money from counterfeiters. Again, the presence of counterfeiters provides a benefit to the genuine manufacturer. Finally, a comparison between full protection and null protection policies is performed.     

Access, accountability and authority: Corruption and the democratic process

Democratic systems face the challenge of sustainingtheir political authority while simultaneouslyproviding access to the political system for theircitizens, and ensuring existence of mechanisms for theformal and political accountability of those inoffice. The connections between these threecomponents, and between them and corruption, arecomplex. The paper suggests ways in whichaccountability may undermine authority through theblurring of distinctions between formal and politicalaccountability, by ham-stringing politicalinstitutions, by creating incentives for corruptpractices, and by politicising accusations ofcorruption. Access can be similarly destabilising andcorrupting, where trust is low and compliance withrules weak; and a basic problem with securing highlevels of trust is that the materials from which suchtrust is manufactured are often the very things whichaccountability mechanisms regard as corrupt – localnetworks, clientelism, and personal loyalties andfriendships. In democratising states, attackingthese elements can eradicate rather than enhance thebasis for well-regulated access.Different democratic systems have evolved differentways of balancing these three components. Theparticular institutional form the balance takes willhave a major impact on the types of corruption thesystem will face, and on the solutions which areappropriate. However, the tendency in internationalcircles is for one highly idiosyncratic understandingof this balance to hold sway, with potentiallydestabilising consequences when applied to theanalysis of corruption, especially in democratisingstates. The paper concludes that attempts to reduce corruptionand increase accountability by increasingparticipation and access are flawed. Access mayincrease the risk of corruption, while accountabilityremains a classic public good on which free-ridingwill be widespread. Corruption control in democracieswill not be solved by more democracy – indeed, itmight need less.     

The Criminal Justice System Creates Incentives for False Convictions

Abstract

The American criminal justice system creates incentives for false conviction. For example, many public crime labs are funded in part per conviction. We show that the number of false convictions per year in the American criminal justice system should be considered “high.” We examine the incentives of police, forensic scientists, prosecutors, and public defenders in the U.S. Police, prosecutors, and forensic scientists often have an incentive to garner convictions with little incentive to convict the right person. These incentives create what economists call a “multitask problem” that seems to be resulting in a needlessly high rate of false convictions. Public defenders lack the resources and incentives needed to provide a vigorous defense for their clients. Corrective measures are discussed, along with a call for more research.     

State rate-setting and its effects on the cost of nursing-home care

The paper uses data from nursing-home cost reports to analyze the effectiveness of different approaches to nursing-home reimbursement. Our research has produced considerable evidence on the effect of states' efforts to reduce the rate of increase in nursing-home costs. First, homes in states with flat-rate reimbursement systems were found to have lower rates of increase than homes in other states, while there were no consistent differences between the results of prospective and retrospective systems. Second, efficiency incentives, inflation-projection methods, and the level of ceilings on rates appear to be very important, regardless of the general reimbursement method. For example, prospective systems with weak efficiency incentives, generous inflation adjustments, and high percentile ceilings have lesser cost-containment effects than prospective systems with stringent inflation allowances and low percentile ceilings. There is also evidence that the inherent weakness of the cost-containment incentives in retrospective systems can be offset by low percentile ceilings and efficiency bonuses.     

Racial disparities in access to long-term care: the illusive pursuit of equity

While nursing homes were insulated from civil-rights enforcement at the time of the implementation of the Medicare program and lagged behind other parts of the health sector in providing comparable access to minorities, they are the only providers for which current reporting requirements make it possible to fully assess racial disparities in use and quality of care. We find that African Americans' use of nursing homes in 2000 in the United States was 14 percent higher than Caucasians' use. The largest relative African American use of nursing homes in 2000 took place in the South and West. Average nursing-home case-mix acuity for African Americans and Caucasians were essentially identical, suggesting that shifts in payment incentives have eliminated the selective admission of easy-care private-pay (predominantly Caucasian) patients and helped fuel the growth of private pay home care and assisted living for this segment of the population. While these shifts in incentives helped increase the use of nursing homes by African Americans, a high degree of segregation and disparity in the quality of the nursing homes used by African Americans persists. Parity in use is an illusive benchmark for measuring progress in assuring equity in treatment.     

由被害人“预防投资”解构犯罪未遂的轻刑化

潜在的被害人为自我保护通常会进行预防投资,但是其投资水平并非总是处于最佳状态,从而产生负外部性,需要刑罚对之进行宏观调控。法律的经济分析表明犯罪人更倾向于选择高预防水平的被害人为目标对象,而犯罪未遂轻刑化正是防止投资过度,节约社会资源的规律使然。从经济效用看,犯罪未遂轻刑化不仅契合了市场经济的理念,实现了帕累托更优状态,更推动了预防犯罪博弈的均衡。     

Market Structure and R∧D Joint Ventures: The Case of Product Innovations

Departing from the received fact that research joint venture agreements are allowed on the grounds of a permissive ruling, we study what conditions are necessary for venture partners to carry on RD cooperation to the marketing stage. We treat the case of product innovations exploitable with different usages in unconnected markets. Two main results appear: firms always have incentives for a distribution of varieties, but not always agree on the distribution of products. The condition for the last result to happen gives a useful rule for antitrust authorities relating the degree of sustitutability across varieties and the relative profitability of the markets.     

Blind consent? A social psychological investigation of non-readership of click-through agreements

Across two studies we aimed to measure empirically the extent of non-readership of click-through agreements (CTAs), identify the dominant beliefs about CTAs contributing to non-readership, and experimentally manipulate these beliefs to decrease automatic non-reading behavior and enhance contract efficiency. In our initial questionnaire study (Study 1), as predicted, the vast majority of participants reported not reading CTAs and the most prevalent beliefs about CTAs contributing to nonreadership included: they are too long and time-consuming, they are all the same, they give one no choice but to agree, they are irrelevant, and vendors are generally reputable. Manipulating these beliefs on a simulated music website (Study 2) revealed an increase in readership. In addition, CTA comprehension and CTA rejection rates were both increased significantly by manipulating the length of the CTA. These results demonstrate support for the influence of widely held beliefs about CTAs on contract readership, provide evidence against the common "limited cognition" perspective on non-readership, and suggest that presenting CTAs in a short, readable format can increase CTA read-ership and comprehension as well as shopping of CTA terms. (PsycINFO Database Record (c) 2012 APA, all rights reserved).     

Can minimum prices assure the quality of professional services?

This paper studies the effects of a minimum price fixed by a bureaucratic non-monopolistic professional association on service quality and consumer surplus. It shows that the price set by a Niskanen-type professional association will maximize consumer surplus only if consumers demand the highest possible average quality. If consumers demand services of lesser quality, the association’s price will be too high if measured by consumer surplus. Moreover we show that a deregulated market will always reproduce the favorable result of a uniformly high price in the case of top quality demand, while delivering superior results in the case of a mixed demand for high and low quality services.     

利益视角下的大额电子资金划拨法

利益因素是研究大额电子资金划拨法的一个切入点。金融效率与金融安全是大额电子资金划拨所影响的宏观利益,它们最终落实在大额电子资金划拨各微观利益群体的利益上,即资金划拨的高速性、低成本性和确定性。美国《统一商法典》第4A编和《国际贷记划拨示范法》通过各种规则设计,在不同程度上贯彻了上述利益因素。我国大额电子资金划拨法也应以高速性、低成本性和确定性为指导,借鉴美国《统一商法典》第4A编和《国际贷记划拨示范法》,以建立和完善我国的大额电子资金划拨法。     

我国慈善事业发展的法治困境及路径选择

我国慈善事业的快速发展凸显了对法治规范的迫切需求。以法治理念观之,我国慈善领域存在立法层次低、专门性法律缺乏、现行制度对慈善事业限制过多以及政府与社会的权界尚未理清等问题,造成慈善事业公信力普遍弱化、法律激励慈善捐赠的功能没有充分实现等困境。在法治理念的指引下进行慈善法律制度的重构是走出慈善事业发展困境的路径选择。     

Open Access Arts Festivals and Artists: Who Benefits?

Abstract

Arts festivals are of interest to researchers, but the research focus is usually on the festival's economic or social impact. This approach does not usually reflect the engagement and experience of the artists involved. There has been controversy recently around the experiences of participating artists in open access arts festivals. Open access arts festivals are significant players in the festival landscape. They enable anyone to participate in a festival, if they pay a registration fee. This research, using a case study methodology, examines an open access festival from different perspectives with a focus on the experience of the participating artists.     

Patents for critical pharmaceuticals: the AZT case

Patents and other statutory types of market protections are used in the United States to promote scientific research and innovation. This incentive is especially important in research intensive fields such as the pharmaceutical industry. Unfortunately, these same protections often result in higher monopoly pricing once a successful product is brought to market. Usually this consequence is viewed as the necessary evil of an incentive system that encourages costly research and development by promising large rewards to the successful inventor. However, in the case of the AIDS drug Zidovudine (AZT), the high prices charged by the pharmaceutical company owning the drug have led to public outcry and a re-examination of government incentive systems. This Note traces the evolution of these incentive programs--the patent system, and, to a lesser extent, the orphan drug program--and details the conflicting interests involved in their development. It then demonstrates how the AZT problem brings the interest of providing inventors with incentives for risky innovative efforts into a sharp collision with the ultimate goal of such systems: ensuring that the public has access to the resulting products at a reasonable price. Finally, the Note describes how Congress and the courts have attempted to resolve these problems in the past, and how they might best try to solve the AZT problem in the near future.     

Cybercrimes in the Former Soviet Union and Central and Eastern Europe: current status and key drivers

Some economies in the Former Soviet Union and Central and Eastern Europe (FSU&CEE) are known as cybercrime hotspots. FSU&CEE economies have shown complex and varied responses to cybercrimes due partly to the differential incentives and pressures they face. This study builds upon literatures on white-collar crime, institutional theory and international relations (IR)/international political economy (IPE) perspectives to examine the low rates of prosecution and conviction of suspected cybercriminals in some economies in the FSU&CEE and variation in such rates across these economies. The findings indicate that cybercrime cases are more likely to be prosecuted and sanctions are imposed in economies that are characterized by a higher degree of cooperation and integration with the West. Cybercriminals are less likely to be jurisdictionally shielded in such economies. Our findings also suggest that a high degree of cooperation and integration with the West would lead to access to resources to enhance system capacity and law enforcement performance to fight cybercrimes.     

Exit, Loyalty, and Collective Action Among Workers in a Simulated Business Environment: Interactive Effects of Group Identification and Boundary Permeability

Past research on the effects of boundary permeability and tokenism (open boundaries with restricted access) suggests that when options for individual mobility exist, members of low status groups tend to exit their group and attempt to enter higher status groups. We hypothesized that the effects of boundary permeability on preferences for individual vs. collective action would depend upon prior levels of in-group identification, such that people who are more identified with their group would remain loyal and choose collective action, even under conditions of high boundary permeability. To test this hypothesis, a 2 (High vs. Low Group Identification) × 2 (High vs. Low Permeability) experimental design was employed to assess preferences for exit and loyalty in the context of a simulated business environment. For both rating measures and behavioral choices, the interaction hypothesis was supported. Implications for group loyalty and strategies of tokenism are discussed.