Pandering Judges

Tenured public officials such as judges are often thought to be indifferent to theconcerns of the electorate and, as a result, potentially lacking in discipline butunlikely to pander to public opinion. We investigate this proposition empiricallyusing data on promotion decisions taken by senior English judges between 1985 and2005. Throughout this period the popular view was one of ill-disciplined elitism:senior judges were alleged to be favouring candidates from elite backgrounds overtheir equally capable non-elite counterparts. We find no evidence of such illdiscipline;most of the unconditional difference in promotion prospects between thetwo groups can simply be explained by differences in promotion-relevantcharacteristics. However, exploiting an unexpected proposal to remove control overpromotions from the judiciary, we do find evidence of pandering. When faced by theprospect of losing autonomy, senior judges began to favour non-elite candidates, aswell as candidates who were unconnected to members of the promotion committee.Our finding that tenured public officials can display both the upsides and downsidesof electoral accountability has implications for the literature on political agency, aswell as recent constitutional reforms.Electoral Accountability, Judges, Promotion Decisions

Team adaptation

We model an organization as a team choosing between a status quo project and a potentially superior alternative. We show that the members’ concern for each other’s motivation leads to a lack of communication, resulting in a failure to adapt (i.e. the status quo is maintained even when evidence for the alternative’s superiority has been observed). Adaptation failures are particularly severe when production exhibits strong complementarities. Improving the organization’s aggregate information has the adverse effect of reducing communication. In the long run, the organization can become “locked-in” with the status quo, in that adaptation is impaired for every adoptable alternative

The returns to lobbying

Research by Mirko Draca and colleagues on Washington's 'revolving door' lobbyists gives an indication of the value of political connections in the UK.

Revolving Door Lobbyists

Washington's 'revolving door' - the movement from government service into the lobbying industry- is regarded as a major concern for policy-making. We study how ex-government staffers benefit from the personal connections acquired during their public service. Lobbyists with experience in the office of a US Senator suffer a 24% drop in generated revenue when that Senator leaves office. The effect is immediate, discontinuous around the exit period and long-lasting. Consistent with the notion that lobbyists sell access to powerful politicians, the drop in revenue is increasing in the seniority of and committee assignments power held by the exiting politician.Lobbying, revolving door, US Congress, political connections, political elites

In brief: 'Revolving door' lobbyists

Jordi Blanes i Vidal, Mirko Draca and Christian Fons-Rosen estimate the value of political connections in Washington

The effect of police response time on crime detection

Police agencies devote vast resources to minimising the time that it takes them to attend the scene of a crime. Despite this, the long-standing consensus is that police response time has no meaningful effect on the likelihood of catching offenders. We revisit this question using a uniquely rich dataset from the Greater Manchester Police. To identify causal effects, we exploit discontinuities in distance to the response station across locations next to each other, but on different sides of division boundaries. Contrary to previous evidence, we find large and strongly significant effects: in our preferred estimate, a 10% increase in response time leads to a 4.6 percentage points decrease in the likelihood of detection. A faster response time also decreases the number of days that it takes for the police to detect a crime, conditional on eventual detection. We find stronger effects for thefts than for violent offenses, although the effects are large for every type of crime. We identify the higher likelihood that a suspect will be named by a victim or witness as an important mechanism though which response time makes a difference

Is distance dead? Face-to-face communication and productivity in teams

Has technology made face-to-face communication redundant? We investigate using a natural experiment in an organisation where a worker must communicate complex electronic information to a colleague. Productivity is higher when the teammates are (exogenously) in the same room and, inside the room, when their desks are closer together. We establish face-to-face communication as the main mechanism, and rule out alternative channels such as higher effort by co-located workers. The effect is stronger for urgent and complex tasks, for homogeneous workers, and for high pressure conditions.We highlight the opportunity costs of face-to-face communication and their dependence on organisational slack

Strategic information transmission in the stock market and the firm.

In this thesis I apply the tools of information economics to analyse the way that information is transmitted in the stock market and the firm. In particular, I use models of asymmetric information to explain a number of empirical regularities that affect the modem corporation and the modern capital market. In the first chapter I show that delegation of decision-making rights can stimulate the career concerns of subordinates in organisations. I show that, when an employer takes a decision following the proposal of her subordinate, a winner's curse reduces the subordinate's prospects in the labour market, muting incentives. This can be solved by delegating decision-making rights to the worker. The second chapter is a joint work with Marc Moller. We use tools of information economics to propose a model of leadership in order to understand why many leaders are unduly confident in their own judgment, a fact that frequently afflicts modern organisations. We show that overconfidence can improve a leader's use of private information although it harms the aggregation of external advice. Overconfidence can therefore improve overall efficiency if the cost of consulting externally is sufficiently high. In the last chapter I apply similar tools to study how investors in the stock market react to public messages that may be optimistically biased. I first construct a communication game between an investor and a (possibly) biased securities analyst. I find an equilibrium characterized by the following properties: first, the investor reacts more to bad news than to good news, and second, the difference in this reaction is higher when the investor has a greater prior suspicion that the analyst is a biased type. I then use parametric and nonparametric techniques and a large database of earnings and forecasts to test these predictions, and find that the evidence supports them