No Free Lunch: Unintended consequences of unfunded mandates on the justice system

• In Event: Drugs and Alcohol

Abstract

Legal reforms have the potential to spur development. However, these are not typically accompanied by an appropriate increase in capacity to implement and enforce the reforms, particularly in developing countries. This is akin to the phenomenon of unfunded mandates, wherein a responsibility devolved to a public institution is not accompanied by resources to fulfill the mandate.

This paper evaluates the effect of such unfunded mandates on the judiciary - an important public institution given the importance of law enforcement for economic development. I argue that unfunded mandates cause workloads to increase - adding responsibilities and demands on scarce judicial capacity, thereby worsening judicial productivity. Further, such crowded courts dissuade litigants from filing complaints, weakening the rule of law and access to justice.

I test the theoretical propositions by using data and evidence in the context of an unfunded mandate that affected the courts in Bihar, India. In 2016, Bihar prohibited the manufacture, consumption and sale of alcohol and charged violators with criminal penalties - having large effects on the criminal justice system due to the large number of violations and subsequent crackdown by the police. More specifically, I ask (1) if the unfunded mandate leads to increased workloads and demands on the justice system; (2) whether the mandate led to decreased judicial productivity and (3) what mechanisms caused the decrease in productivity.

I use micro-level data on over five million court cases and measures of judicial productivity to provide evidence on how the unfunded mandate affected the justice system. I leverage a difference-in-differences analysis using a neighboring state as a control group due to shared geography and a history of common judicial institutions, and show that the alcohol ban increased the demands on the justice system and worsened productivity. I evaluate and rule out possible mechanisms pertaining to judicial capacity, and find evidence for changes in the judge’s behavior pertaining to time management. In doing so, I provide a micro-level perspective on the unintended consequences of unfunded mandates on state capacity and judicial institutions in the Global South.

Author

• Saloni Bhogale, University of Wisconsin-Madison
  Presenting Author