The prison in economics: private and public incarceration in Ancient Greece

Recent histories of Ancient Greece describe a transition from customary law to public criminal justice between 800 and 400 B.C. This narrative contains three pieces of evidence against the presumption that prisons are a public good and government must provide incarcerations. First, before the rise of a formal government, Ancient Greece had a functioning system of criminal law enforcement. Second, the timeline surrounding the rise of government institutions in Ancient Greece originated with Solon’s penal reforms. Lastly, the rise of a government system was more the result of private rather than public interest.     

The size of the SOE sector and macroeconomic performance: an empirical study based on Chinese provincial data

Using a neoclassical growth model augmented with human capital, we investigate the impact of the presence of state owned enterprises (SOEs) on macroeconomic performance in China, using provincial data from 1990 to 2004. We estimate a macroeconomic model with panel methods to explain changes in labor productivity resulting from standard influences as well as presence of the SOE sector measured in five different ways. While controlling for growth in the labor force and physical capital, government size, exposure to trade and change in economic structure, we conclude that the relative share of the SOE sector has no significant influence on macroeconomic performance in China during our sample period.     

An effective punishment scheme to reduce extramarital affairs: an economic approach

By using a dynamic stochastic optimization model, this paper shows that the existence of punishment does not necessarily deter extramarital affairs. This study may help to explain why extramarital affairs are a common phenomenon in most societies even though punishment exists. This study also has an implication for family laws: extramarital affairs can be effectively reduced if the legal punishment scheme is designed in the way that makes the adulterer’s expected loss increase with the level of adultery at an increasing or constant rate.      

The legacy of Bismarck

Many mechanisms (such as auctions) efficiently allocate an asset to the firm which values it most highly. But sometimes the asset’s owner may benefit from the transfer only if the asset is not too valuable to potential buyers. In this setting, we examine the efficiency of mechanisms when the potential buyers have private information about the asset’s value. We show that rent seeking, and lobbying, rather than merely wasting resources, can lead to allocations which are close to efficient.