Putting the Trial Penalty on Trial

The trial penalty is a concept widely accepted by all the major actors in the criminal justice system: defendants, prosecutors, defense attorneys, court employees, and judges. The notion is that defendants receive longer sentences at trial than they would have through plea bargain, often substantially longer. The concept is intuitive: longer sentences are necessary in order to induce settlements and without a high settlement rate it would be impossible for courts as currently structured to sustain their immense caseload. While intuitively appealing, this view of the trial penalty is completely at odds with economic prediction. Since both prosecutors and defendants have the ability to reject unappealing settlements,sentences at trial should be nearly the same as those arrived at through pleas. This is a straightforward application of the shadow of the law concept articulated by Mnookin and Kornhauser, as well as others. This article attempts to answer two questions relating to the trial penalty. Why is belief in its existence so widespread, given that it is at odds with basic economic theory? Which theory does empirical analysis of actual sentencing data support? I argue that there is a fundamental misunderstanding that is largely responsible for the belief in the trial penalty: the failure to distinguish between conditional and unconditional expected values. I also provide a brief overview of an empirical study that attempts to distinguish between the two theories. The results of that study are surprising and support neither theory-not only is there no evidence for a trial penalty, there appears to be a trial discount

Estimating the Deterrent Effect of Incarceration using Sentencing Enhancements

Increasing criminal sanctions may reduce crime through two primary mechanisms: deterrence and incapacitation. Disentangling their effects is crucial, since each mechanism has different implications for optimal policy setting. I use the introduction of state add-on gun laws, which enhance sentences for defendants possessing a firearm during the commission of a felony, to isolate the deterrent effect of incarceration. Defendants subject to add-ons would be incarcerated in the absence of the law change, so any short-term impact on crime can be attributed solely to deterrence. Using cross-state variation in the timing of law passage dates, I find that the average add-on gun law results in a roughly 5 percent decline in gun robberies within the first three years. This result is robust to a number of specification tests and does not appear to be associated with large spillovers to other types of crime

COVID and Crime: An Early Empirical Look

Data from 25 large U.S. cities is assembled to estimate the impact of the onset of the COVID-19 pandemic on crime. There is a widespread immediate drop in both criminal incidents and arrests most heavily pronounced among drug crimes, theft, residential burglaries, and most violent crimes. The decline appears to precede stay-at-home orders, and arrests follow a similar pattern as reports. There is no decline in homicides and shootings, and an increase in non-residential burglary and car theft in most cities, suggesting that criminal activity was displaced to locations with fewer people. Pittsburgh, New York City, San Francisco, Philadelphia, Washington DC and Chicago each saw overall crime drops of at least 35%. Evidence from police-initiated reports and geographic variation in crime change suggests that most of the observed changes are not due to changes in crime reporting

Putting the Trial Penalty on Trial

The trial penalty is a concept widely accepted by all the major actors in the criminal justice system: defendants, prosecutors, defense attorneys, court employees, and judges. The notion is that defendants receive longer sentences at trial than they would have through plea bargain, often substantially longer. The concept is intuitive: longer sentences are necessary in order to induce settlements and without a high settlement rate it would be impossible for courts as currently structured to sustain their immense caseload

The Imprisoner\u27s Dilemma: A Cost-Benefit Approach to Incarceration

Depriving an individual of life or liberty is one of the most intrusive powers that governments wield. Decisions about imprisonment capture the public imagination. The stories are told daily in newspapers and on TV, dramatized in literature and on film, and debated by scholars. The United States has created an ever-increasing amount of material for discussion as the state incarceration rate quadrupled between 1980 and 2000. While the decision to incarcerate an individual is given focused attention by a judge, prosecutor, and (occasionally) a jury, the overall incarceration rate is not. In this article, I apply a cost-benefit approach to incarceration with the goal of informing public policy. An excessive rate of incarceration not only deprives individuals of freedom, but also costs the taxpayers large amounts of money. Too little imprisonment harms society in a different way – through costs to victims and even non-victims who must increase precautions to avoid crime. Striking the right balance of costs and benefits is what good law and public policy strive for. Changes to the inmate population may be made in several different ways. One insight that I stress in this article is that the precise form of a proposed incarceration policy change is crucial to properly evaluating the impact of the change. Therefore, I analyze several potential policy changes and their implications for sentencing and imprisonment. The calculations are informed by recent empirical work on the various ways in which imprisonment impacts overall welfare. I find that the benefits of limited one-time prisoner releases, as well as the reclassification of some crimes exceed the costs

Estimating the Deterrent Effect of Incarceration using Sentencing Enhancements

Increasing criminal sanctions may reduce crime through two primary mechanisms: deterrence and incapacitation. Disentangling their effects is crucial, since each mechanism has different implications for optimal policy setting. I use the introduction of state add-on gun laws, which enhance sentences for defendants possessing a firearm during the commission of a felony, to isolate the deterrent effect of incarceration. Defendants subject to add-ons would be incarcerated in the absence of the law change, so any short-term impact on crime can be attributed solely to deterrence. Using cross-state variation in the timing of law passage dates, I find that the average add-on gun law results in a roughly 5 percent decline in gun robberies within the first three years. This result is robust to a number of specification tests and does not appear to be associated with large spillovers to other types of crime

Putting the Trial Penalty on Trial

The trial penalty is a concept widely accepted by all the major actors in the criminal justice system: defendants, prosecutors, defense attorneys, court employees, and judges. The notion is that defendants receive longer sentences at trial than they would have through plea bargain, often substantially longer. The concept is intuitive: longer sentences are necessary in order to induce settlements and without a high settlement rate it would be impossible for courts as currently structured to sustain their immense caseload. While intuitively appealing, this view of the trial penalty is completely at odds with economic prediction. Since both prosecutors and defendants have the ability to reject unappealing settlements,sentences at trial should be nearly the same as those arrived at through pleas. This is a straightforward application of the shadow of the law concept articulated by Mnookin and Kornhauser, as well as others. This article attempts to answer two questions relating to the trial penalty. Why is belief in its existence so widespread, given that it is at odds with basic economic theory? Which theory does empirical analysis of actual sentencing data support? I argue that there is a fundamental misunderstanding that is largely responsible for the belief in the trial penalty: the failure to distinguish between conditional and unconditional expected values. I also provide a brief overview of an empirical study that attempts to distinguish between the two theories. The results of that study are surprising and support neither theory-not only is there no evidence for a trial penalty, there appears to be a trial discount

Poisoning the Next Apple? The America Invents Act and Individual Inventors

The Leahy-Smith America Invents Act, the most significant patent law reform effort in two generations, has a dark side: It seems likely to decrease the patenting behavior of small inventors, a category which occupies special significance in American innovation history. In this paper we empirically predict the effects of the major change in the law: a shift in the patent priority rules from the United States’ traditional “first-to-invent” system to the predominant “first-to-file” system. While there has been some theoretical work on this topic, we use the Canadian experience with a similar change as a natural experiment to shed the first empirical light on the question. Our analysis uses a difference-in-difference framework to estimate the impact of the Canadian law change on small inventors. Using data on all patents granted by the Canadian Intellectual Property Office and the US Patent and Trademark Office, we find a significant drop in the fraction of patents granted to small inventors in Canada coincident with the implementation of first-to-file. We also find no measurable changes in patent quality and perform several additional analyses to rule out alternative explanations. While the net welfare impact that can be expected from a shift to first-to-file is unclear, our results do reveal that, contrary to the conventional wisdom, the March 2013 implementation of a first-to-file rule in the U.S. is likely to result in reduced patenting behavior by individual inventors

Poisoning the Next Apple? The America Invents Act and Individual Inventors

The Leahy-Smith America Invents Act, the most significant patent law reform effort in two generations, has a dark side: It seems likely to decrease the patenting behavior of small inventors, a category which occupies special significance in American innovation history. In this paper we empirically predict the effects of the major change in the law: a shift in the patent priority rules from the United States’ traditional “first-to-invent” system to the predominant “first-to-file” system. While there has been some theoretical work on this topic, we use the Canadian experience with a similar change as a natural experiment to shed the first empirical light on the question. Our analysis uses a difference-in-difference framework to estimate the impact of the Canadian law change on small inventors. Using data on all patents granted by the Canadian Intellectual Property Office and the US Patent and Trademark Office, we find a significant drop in the fraction of patents granted to small inventors in Canada coincident with the implementation of first-to-file. We also find no measurable changes in patent quality and perform several additional analyses to rule out alternative explanations. While the net welfare impact that can be expected from a shift to first-to-file is unclear, our results do reveal that, contrary to the conventional wisdom, the March 2013 implementation of a first-to-file rule in the U.S. is likely to result in reduced patenting behavior by individual inventors