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Convictions versus Conviction Rates: The Prosecutor’s Choice

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  • Eric Rasmusen

    (Department of Business Economics and Public Policy, Indiana University Kelley School of Business)

  • Manu Raghav,

    (Department of Economics and Management, Depauw University)

  • Mark Ramseyer

    (Harvard Law School)

Abstract

Is it better to move first, or second— to innovate, or to imitate? We look at this in a context with both asymmetric information and payoff externalities. Suppose two players, one with superior information about market quality, consider entering one of two new markets immediately or waiting until the last possible date. We show that the more accurate the informed player’s information, the more he wants to delay to keep his information private. The less-informed player also wants to delay, but in order to learn. The less accurate the informed player’s information, the more both players want to move first to foreclose a market. More accurate information can lead to inefficiency by increasing the players’ incentive to delay. Thus, a moderate delay cost can increase industry profits.

Suggested Citation

  • Eric Rasmusen & Manu Raghav, & Mark Ramseyer, 2008. "Convictions versus Conviction Rates: The Prosecutor’s Choice," Working Papers 2008-16, Indiana University, Kelley School of Business, Department of Business Economics and Public Policy.
  • Handle: RePEc:iuk:wpaper:2008-16
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    References listed on IDEAS

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    1. repec:clg:wpaper:2009-05 is not listed on IDEAS
    2. Crystal S. Yang, 2016. "Resource Constraints and the Criminal Justice System: Evidence from Judicial Vacancies," American Economic Journal: Economic Policy, American Economic Association, vol. 8(4), pages 289-332, November.
    3. Siddhartha Bandyopadhyay & Bryan C McCannon, 2010. "Re-election Concerns and the Failure of Plea Bargaining," Discussion Papers 10-28, Department of Economics, University of Birmingham.
    4. Dincer, Oguzhan, 2019. "Does corruption slow down innovation? Evidence from a cointegrated panel of U.S. states," European Journal of Political Economy, Elsevier, vol. 56(C), pages 1-10.
    5. Christian Almer & Timo Goeschl, 2011. "The political economy of the environmental criminal justice system: a production function approach," Public Choice, Springer, vol. 148(3), pages 611-630, September.
    6. Marcin, Isabel & Robalo, Pedro & Tausch, Franziska, 2019. "Institutional endogeneity and third-party punishment in social dilemmas," Journal of Economic Behavior & Organization, Elsevier, vol. 161(C), pages 243-264.
    7. Germani, Anna Rita & Morone, Andrea & Morone, Piergiuseppe & Scaramozzino, Pasquale, 2013. "Discretionary enforcement and strategic interactions between firms, regulatory agency and justice department: a theoretical and empirical investigation," MPRA Paper 51369, University Library of Munich, Germany.
    8. Siddhartha Bandyopadhyay & Bryan McCannon, 2014. "The effect of the election of prosecutors on criminal trials," Public Choice, Springer, vol. 161(1), pages 141-156, October.
    9. S. Avdasheva & S. Golovanova & Y. Katsoulacos, 2019. "Optimal Institutional Structure of Competition Authorities Under Reputation Maximization: A Model and Empirical Evidence from the Case of Russia," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 54(2), pages 251-282, March.
    10. SIDDHARTHA BANDYOPADHYAY & BRYAN C. McCANNON, 2015. "Prosecutorial Retention: Signaling by Trial," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 17(2), pages 219-256, April.
    11. Engel, Christoph & Reuben, Alicja, 2015. "The people's hired guns? Experimentally testing the motivating force of a legal frame," International Review of Law and Economics, Elsevier, vol. 43(C), pages 67-82.
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    16. Garoupa, Nuno, 2009. "Some reflections on the economics of prosecutors: Mandatory vs. selective prosecution," International Review of Law and Economics, Elsevier, vol. 29(1), pages 25-28, March.
    17. Siddhartha Bandyopadhyay & Bryan C McCannon, 2014. "Queuing Up For Justice: Elections and Case Backlogs," Discussion Papers 14-10, Department of Economics, University of Birmingham.
    18. Dhammika Dharmapala & Nuno Garoupa & Richard H. McAdams, 2016. "Punitive Police? Agency Costs, Law Enforcement, and Criminal Procedure," The Journal of Legal Studies, University of Chicago Press, vol. 45(1), pages 105-141.
    19. Fleck Robert K. & Hanssen F. Andrew, 2012. "On the Benefits and Costs of Legal Expertise: Adjudication in Ancient Athens," Review of Law & Economics, De Gruyter, vol. 8(2), pages 367-399, October.
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