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Negotiated Enforcement and Credible Deterrence

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  • Franzoni, Luigi Alberto
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    Abstract

    This paper develops a model of law enforcement in which indicted offenders and the prosecutor can negotiate the penalty prior to the completion of the investigation. The analysis focuses on the credibility of the conviction threat: the prosecutor cannot commit to any predetermined level of investigative effort should the negotiation fail. The settlement stage introduces several new features of the optimal enforcement policy, including the possibility that maximal sanctions may not be optimal. We show that the screening process associated with the negotiation stage reduces the incentives for the prosecutor to undertake thorough investigations and increases the rate of noncompliance.

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    Bibliographic Info

    Article provided by Royal Economic Society in its journal The Economic Journal.

    Volume (Year): 109 (1999)
    Issue (Month): 458 (October)
    Pages: 509-35

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    Handle: RePEc:ecj:econjl:v:109:y:1999:i:458:p:509-35

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    Cited by:
    1. Motta, Alberto & Burlando, Alfredo, 2007. "Self reporting reduces corruption in law enforcement," MPRA Paper 5332, University Library of Munich, Germany, revised 23 Jun 2007.
    2. Philippe Choné & Saïd Souam & Arnold Vialfont, 2012. "Commitments in Antitrust," EconomiX Working Papers 2012-9, University of Paris West - Nanterre la Défense, EconomiX.
    3. Ascione, Aurora & Motta, Massimo, 2008. "Settlements in cartel cases," MPRA Paper 24416, University Library of Munich, Germany.
    4. Glen Ueng, K. L. & Yang, C. C., 2001. "Plea bargaining with the IRS: extensions and further results," Journal of Public Economics, Elsevier, vol. 81(1), pages 83-98, July.
    5. Singh, Rupinder, 2000. "Bank Regulation, Compliance and Enforcement," BOFIT Discussion Papers 2/2000, Bank of Finland, Institute for Economies in Transition.
    6. Choné, Philippe & Souam, Saïd & Vialfont, Arnold, 2014. "On the optimal use of commitment decisions under European competition law," International Review of Law and Economics, Elsevier, vol. 37(C), pages 169-179.
    7. Bjerk, David, 2008. "On the role of plea bargaining and the distribution of sentences in the absence of judicial system frictions," International Review of Law and Economics, Elsevier, vol. 28(1), pages 1-7, March.
    8. Derek Pyne, 2004. "Can Making It Harder to Convict Criminals Ever Reduce Crime?," European Journal of Law and Economics, Springer, vol. 18(2), pages 191-201, September.

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