• Criminal Deterrence when There Are Offsetting Risks: Traffic Cameras. Vehicular Accidents. and Public Safety

      Gallagher, Justin; Fisher, Paul J.; Univ Arizona, Dept Econ (AMER ECONOMIC ASSOC, 2020-08)
      Numerous cities have enacted electronic monitoring programs at traffic intersections in an effort to reduce the high number of vehicle accidents. The rationale is that the higher expected fines for running a red light will induce drivers to stop and lead to fewer cross-road collisions. However, the cameras also incentivize drivers to accept a greater accident risk from stopping. We evaluate the termination of a monitoring program via a voter referendum using 12 years of geocoded police accident data. We find that the cameras changed the composition of accidents but no evidence of a reduction in total accidents or injuries.
    • Delegated Expertise, Authority, and Communication

      Deimen, Inga; Szalay, Dezs˝o; Univ Arizona, Eller Coll Management (AMER ECONOMIC ASSOC, 2019-04)
      A decision maker needs to reach a decision and relies on an expert to acquire information. Ideal actions of expert and decision maker are partially aligned and the expert chooses what to learn about each. The decision maker can either get advice from the expert or delegate decision making to him. Under delegation, the expert learns his privately optimal action and chooses it. Under communication, advice based on such information is discounted, resulting in losses from strategic communication. We characterize the communication problems that make the expert acquire information of equal use to expert and decision maker. In these problems, communication outperforms delegation. (JEL, D82, D83)
    • Escalation of Scrutiny: The Gains from Dynamic Enforcement of Environmental Regulations

      Blundell, Wesley; Gowrisankaran, Gautam; Langer, Ashley; Univ Arizona (AMER ECONOMIC ASSOC, 2020-08)
      The US Environmental Protection Agency (EPA) uses a dynamic approach to enforcing air pollution regulations, with repeat offenders subject to high fines and designation as high priority violators (HPV). We estimate the value of dynamic enforcement by developing and estimating a dynamic model of a plant and regulator, where plants decide when to invest in pollution abatement technologies. We use a fixed grid approach to estimate random coefficient specifications. Investment, fines, and HPV designation are costly to most plants. Eliminating dynamic enforcement would raise pollution damages by 164 percent with constant fines or raise fines by 519 percent with constant pollution damages.
    • The Evolution of Cooperation: The Role of Costly Strategy Adjustments

      Romero, Julian; Rosokha, Yaroslav; Univ Arizona, Dept Econ, Eller Coll Management (AMER ECONOMIC ASSOC, 2019-02)
      We study the evolution of cooperation in the indefinitely repeated prisoner's dilemma when it is costly for players to adjust their strategy. Our experimental interface allows subjects to design a comprehensive strategy that then selects actions for them in every period. We conduct lab experiments in which subjects can adjust their strategies during a repeated game but may incur a cost for doing so. We find three main results. First, subjects learn to cooperate more when adjustments are costless than when they are costly. Second, subjects make more adjustments to their strategies when adjustments are costless, but they still make adjustments even when they are costly. Finally, we find that cooperative strategies emerge over time when adjustments are costless hut not when adjustments are costly. These results highlight that within-game experimentation is critical to the rise of cooperative behavior We provide simulations based on an evolutionary algorithm to support these results.
    • Local Economic Conditions and Fertility from the Great Depression through the Great Recession

      Schaller, Jessamyn; Fishback, Price; Marquardt, Kelli; Univ Arizona, Dept Econ (AMER ECONOMIC ASSOC, 2020-05-01)