Limited liability and mechanism design in procurement

In the presence of cost uncertainty, limited liability introduces the possibility of default in procurement with its associated bank-ruptcy costs. When financial soundness is not perfectly observable, we show that incentive compatibility implies that financially less sound contractors are selected with higher probability in any feasible mechanism. Informational rents are associated with unsound financial situations. By selecting the financially weakest contractor, stronger price competition (auctions) may not only increase the probability of default but also expected rents. Thus, weak conditions are suffcient for auctions to be suboptimal. In particular, we show that pooling firms with higher assets may reduce the cost of procurement even when default is costless for the sponsor.

Optimal negligence rule under limited liability

We study the standard economic model of unilateral accidents, in its simplest form, assumingthat the injurers have limited assets.We identify a second-best optimal rule that selects as duecare the minimum of first-best care, and a level of care that takes into account the wealth ofthe injurer. We show that such a rule in fact maximizes the precautionary effort by a potentialinjurer. The idea is counterintuitive: Being softer on an injurer, in terms of the required level ofcare, actually improves the incentives to take care when he is potentially insolvent. We extendthe basic result to an entire population of potentially insolvent injurers, and find that the optimalgeneral standards of care do depend on wealth, and distribution of income. We also show theconditions for the result that higher income levels in a given society call for higher levels of carefor accidents.

Building an honest microfinance organization: Embezzlement and the optimality of rigid repayment schedules and joint liability

We consider the agency problem of a staff member managing microfinancing programs, who can abuse his discretion to embezzle borrowers' repayments. The fact that most borrowers of microfinancing programs are illiterate and live in rural areas where transportation costs are very high make staff's embezzlement particularly relevant as is documented by Mknelly and Kevane (2002). We study the trade-off between the optimal rigid lending contract and the optimal discretionary one and find that a rigid contract is optimal when the audit cost is larger than gains from insurance. Our analysis explains rigid repayment schedules used by the Grameen bank as an optimal response to the bank staff's agency problem. Joint liability reduces borrowers' burden of respecting the rigid repayment schedules by providing them with partial insurance. However, the same insurance can be provided byborrowers themselves under individual liability through a side-contract.

Environmental conflicts, environmental justice and valuation

In this article some historical and contemporary environmental conflicts are described. The international environmental liability of mining corporations is discussed. Comparisons are made with conflicts in the United States and in South Africa which fall under the rubric of the Environmental Justice movement. Such conflicts are fought out in many languages, and the economic valuation of damages is only one of such languages. Who has the power to impose particular languages of valuation? Who rules over the ways and means of simplifying complexity, deciding that some points of view are out of order? Who has power to determine which is the bottom-line in an environmental discussion?

Settlement in tax evasion prosecution

It is often argued that even if optimal ex-post, settlement dilutes deterrence ex-ante. We analyze the interest for the tax authority of committing, ex-ante, to a settlement strategy. We show that to commit to the use of settlements is ex-ante optimal when the tax authority receives signals that provide statistical information about the taxpayers' true tax liability. The more informative the signal, the larger the additional expected evenue raised by the tax authority when using settlement as a policy tool.

El Derecho norteamericano como impulsor de la responsabilidad civil del fabricante por productos defectuosos

Investigación elaborada a partir de una estancia en la Columbia Law School of New York, Estados Unidos, entre los meses de septiembre y noviembre del 2006. El Derecho comunitario europeo y español regulan la reparación de los daños causados por el uso o la proximidad de un producto defectuoso mediante gracias al impulso ideológico ejercido por la jurisprudencia norteamericana. El principio de responsabilidad objetiva rector de la directiva europea es fruto de un transfondo operado en los Estados Unidos en los años sesenta, coincidiendo con la revolución tecnològica y el inicio de la producción y del consumo masivos. Tales fenómenos suscitaron la búsqueda de mecanismos jurídicos aptos para canalizar la reparación de los daños inherentes a las actividades industriales tecnológicamente avanzadas. Su principal efecto fue la preocupación por una más justa distribución social de los llamados “costes del progreso”, preocupación que, jurídicamente, desembocó en la solución de la responsabilidad aun sin culpa del fabricante por los daños derivados de su producción industrial. El mérito de tal solución corresponde a determinados teóricos norteamericanos de la responsabilidad empresarial, quienes, inspirándose en ideas formuladas a inicios del siglo XX por los especialistas en Derecho laboral, concluyeron que es la empresa productora quien está en mejor situación de soportar el coste del accidente industrial: al imponerse al fabricante una responsabildad desvinculada de su eventual culpa en la causación del accidente, repercutirá en el precio de sus productos el coste del seguro de responsabilidad civil que se verá abocado a contratar para hacer frente a su responsabilidad objetiva o por riesgo, de manera que el coste de los accidentes acabará siendo soportado por el público consumidor al pagar el sobreprecio de los productos que adquiere. Las repercusiones de tal construcción han sido tanto normativas como judiciales.

A priori ratemaking using bivariate poisson regression models

In automobile insurance, it is useful to achieve a priori ratemaking by resorting to gene- ralized linear models, and here the Poisson regression model constitutes the most widely accepted basis. However, insurance companies distinguish between claims with or without bodily injuries, or claims with full or partial liability of the insured driver. This paper exa- mines an a priori ratemaking procedure when including two di®erent types of claim. When assuming independence between claim types, the premium can be obtained by summing the premiums for each type of guarantee and is dependent on the rating factors chosen. If the independence assumption is relaxed, then it is unclear as to how the tari® system might be a®ected. In order to answer this question, bivariate Poisson regression models, suitable for paired count data exhibiting correlation, are introduced. It is shown that the usual independence assumption is unrealistic here. These models are applied to an automobile insurance claims database containing 80,994 contracts belonging to a Spanish insurance company. Finally, the consequences for pure and loaded premiums when the independence assumption is relaxed by using a bivariate Poisson regression model are analysed.

A theoretical and practical study on linear reforms of dual taxes

We extend the linear reforms introduced by Pf¨ahler (1984) to the case of dual taxes. We study the relative effect that linear dual tax cuts have on the inequality of income distribution -a symmetrical study can be made for dual linear tax hikes-. We also introduce measures of the degree of progressivity for dual taxes and show that they can be connected to the Lorenz dominance criterion. Additionally, we study the tax liability elasticity of each of the reforms proposed. Finally, by means of a microsimulation model and a considerably large data set of taxpayers drawn from 2004 Spanish Income Tax Return population, 1) we compare different yield-equivalent tax cuts applied to the Spanish dual income tax and 2) we investigate how much income redistribution the dual tax reform (Act ‘35/2006’) introduced with respect to the previous tax.

Did the cooperative start life as a Joint-Stock company? business law and cooperatives in Spain, 1869–1931

Studies of Spanish cooperatives date their spread from the Law on Agrarian Syndicates of 1906. But the first legislative appearance of cooperatives is an 1869 measure that permitted general incorporation for lending companies. The 1931 general law on cooperatives, which was the first act permitting the formation of cooperatives in any activity, reflects the gradual disappearance of the cooperative’s "business" characteristics. In this paper we trace the Spanish cooperative’s legal roots in business law and its connections to broader questions of the freedom of association, the formation of joint-stock enterprises, and the liability of investors in business and cooperative entities. Our account underscores the similarities of the organizational problems approach by cooperatives and business firms, while at the same time respecting the distinctive purposes cooperatives served.

Decentralization of contracts with interim sidecontracting

This paper gives a new explanation for the phenomena of subcontracting. A model in which a principal contracts two agents who work in a sequence on a project, have soft information and can collude is considered. Side-contracts between agents can be signed at any stage of the game. Due to limited liability and moral hazard agents obtain a rent. The principal’s problem is to find the preferable contracting structure. It is shown that in this setting a decentralized contracting structure can be superior to a centralized structure for the principal. The paper derives the conditions under which this holds. Journal of Economic Literature Classification Numbers: D23, D82, L14, L22. Keywords: Contract delegation, Collusion, Interim side-contracting, Moral hazard.

El perdó de l’ofés: la via adecuada per alleugerir les càrregues de la justícia? Estudi de la institució i de les alternatives per rendibilitzar els recursos de l’Administració de justícia

En aquesta recerca aportem les conclusions de la nostra investigació sobre la figura del perdó de l’ofès i la seva possible virtualitat com a mitjà per alleugerir l’Administració de Justícia. En primer lloc, analitzem la institució del perdó de l’ofès, en concret, la seva regulació en el nostre Codi penal, els seus antecedents històrics i aportem certes dades de Dret comparat que poden ajudar a l’estudi crític de la institució (1). En la segona part, estudiem els arguments a favor i en contra del perdó de l’ofès dins el sistema penal i ens pronunciem sobre la seva legitimitat com a mecanisme per rendibilitzar l’Administració de Justícia (2). En la tercera part, sobre la base de les conclusions anteriors, aportem una reflexió sobre les alternatives al perdó de l’ofès (3). Per últim, en la darrera part, formulem la nostra proposta final sobre els mecanismes per rendibilitzar els recursos de l’Administració de Justícia (4). Segons el nostre estudi, el perdó de l’ofès no és un bon mecanisme per alleugerir la feina de l’Administració de Justícia. En canvi, la reparació i la conciliació si poden operar com a substitutius de la pena en els supòsits de delictes de menor gravetat; en els processos penals per aquests delictes caldria introduir un intent obligatori de conciliació, com el del § 380 StPO alemany i, a més, convindria preveure en el Codi penal la facultat del jutge d’eliminar la responsabilitat penal en determinats supòsits de reparació de l’autor a la víctima del delicte.

El perdó de l’ofés: la via adequada per alleugerir les càrregues de la justícia? Estudi de la institució i de les alternatives per rendibilitzar els recursos de l’Administració de justícia

En aquesta recerca aportem les conclusions de la nostra investigació sobre la figura del perdó de l’ofès i la seva possible virtualitat com a mitjà per alleugerir l’Administració de Justícia. En primer lloc, analitzem la institució del perdó de l’ofès, en concret, la seva regulació en el nostre Codi penal, els seus antecedents històrics i aportem certes dades de Dret comparat que poden ajudar a l’estudi crític de la institució (1). En la segona part, estudiem els arguments a favor i en contra del perdó de l’ofès dins el sistema penal i ens pronunciem sobre la seva legitimitat com a mecanisme per rendibilitzar l’Administració de Justícia (2). En la tercera part, sobre la base de les conclusions anteriors, aportem una reflexió sobre les alternatives al perdó de l’ofès (3). Per últim, en la darrera part, formulem la nostra proposta final sobre els mecanismes per rendibilitzar els recursos de l’Administració de Justícia (4). Segons el nostre estudi, el perdó de l’ofès no és un bon mecanisme per alleugerir la feina de l’Administració de Justícia. En canvi, la reparació i la conciliació si poden operar com a substitutius de la pena en els supòsits de delictes de menor gravetat; en els processos penals per aquests delictes caldria introduir un intent obligatori de conciliació, com el del § 380 StPO alemany i, a més, convindria preveure en el Codi penal la facultat del jutge d’eliminar la responsabilitat penal en determinats supòsits de reparació de l’autor a la víctima del delicte.

La responsabilidad patrimonial de la Administración Pública Urbanística

En la memoria del trabajo se detallan las tareas realizadas durante los cuatro años en los que he sido beneficiaria de la beca FI, que me permitió incorporarme en el área de Derecho Administrativo de la Universidad de Girona, bajo la dirección del Dr. Joan M. Trayter Jiménez, para la elaboración del proyecto de investigación "La responsabilidad patrimonial de la Administración Púbica Urbanística", que una vez terminado dará lugar a la Tesis Doctoral. Durante el primer año realizé y superé los cursos del programa de Doctorado “Globalización y Derecho: el Derecho Europeo como referencia”; que me permitió obtener la renovación de la Beca FI, para la elaboración y defensa en el año posterior de la tesina titulada "La responsabilidad patrimonial de la Administración Pública por cambio de la ordenación territorial o urbanística”; con la consiguiente obtención del Diploma de Estudios Avanzados en Derecho. En líneas generales, puedo destacar -además de la investigación en la elaboración de la Tesis-, la realización de dos estancias de investigación en la University of Oxford, bajo la tutorización del Prof. Paul Craig, del St. John's College; gracias a la concesión de una beca por parte del "Institut d'Estudis Autonòmics de Catalunya" y otra, por la Generalitat de Catalunya, dirigida a estancias de investigación en el extrangero. También diversas publicaciones traducidas en la participación en dos libros, un artículo, una recensión y una comunicación; así como la asistencia a distintos Congresos de Derecho Administrativo y seminarios, la realización de distintos cursos entre ellos un Posgrado de Derecho Urbanístico en la UdG y la docencia realizada. Asimismo he devenido miembro de los proyectos de investigación del grupo de investigación del Área; importantes por formar parte del Plan Nacional I+D, financiados por el Ministerio de Educación y Ciencia.

Economic structure and key sectors analysis of greenhouse gas emissions in Uruguay

This paper identifies the key sectors in greenhouse gas emissions of the Uruguayan economy through input-output analysis. This allows to precisely determine the role played by the different productive sectors and their relationship with other sectors in the relation between the Uruguayan productive structure and atmospheric pollution. In order to guide policy design for GHG reduction, we decompose sectors liability between the pollution generated through their own production processes and the pollution indirectly generated in the production processes of other sectors. The results show that all the key polluting sectors for the different contaminants considered are relevant because of their own emissions, except for the sector Motor vehicles and oil retail trade, which is relevant in CO2 emissions because of its pure, both backward and forward, linkages. Finally, the best policy channels for controlling and reducing GHGs emissions are identified, and compared with the National Climate Change Response Plan (NCCRP) lines of action.

The Simple Economics of Conglomeration with Bankruptcy Costs: Separate or Joint Financing?

Which projects should be financed through separate non-recourse loans (or limited- liability companies) and which should be bundled into a single loan? In the pres- ence of bankruptcy costs, this conglomeration decision trades off the benefit of co- insurance with the cost of risk contamination. This paper characterize this tradeoff for projects with binary returns, depending on the mean, variability, and skewness of returns, the bankruptcy recovery rate, the correlation across projects, the number of projects, and their heterogeneous characteristics. In some cases, separate financing dominates joint financing, even though it increases the interest rate or the probability of bankruptcy.