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Crime and punishment: Does it pay to punish?

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  • Iglesias, J.R.
  • Semeshenko, V.
  • Schneider, E.M.
  • Gordon, M.B.

Abstract

Crime is the result of a rational distinctive balance between the benefits and costs of an illegal act. This idea was proposed by Becker more than forty years ago (Becker (1968) [1]). In this paper, we simulate a simple artificial society, in which agents earn fixed wages and can augment (or lose) wealth as a result of a successful (or not) act of crime. The probability of apprehension depends on the gravity of the crime, and the punishment takes the form of imprisonment and fines. We study the costs of the law enforcement system required for keeping crime within acceptable limits, and compare it with the harm produced by crime. A sharp phase transition is observed as a function of the probability of punishment, and this transition exhibits a clear hysteresis effect, suggesting that the cost of reversing a deteriorated situation might be much higher than that of maintaining a relatively low level of delinquency. Besides, we analyze economic consequences that arise from crimes under different scenarios of criminal activity and probabilities of apprehension.

Suggested Citation

  • Iglesias, J.R. & Semeshenko, V. & Schneider, E.M. & Gordon, M.B., 2012. "Crime and punishment: Does it pay to punish?," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 391(15), pages 3942-3950.
    • Handle: RePEc:eee:phsmap:v:391:y:2012:i:15:p:3942-3950
    DOI: 10.1016/j.physa.2012.03.001
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    References listed on IDEAS

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    1. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
    2. M. B. Gordon & J. R. Iglesias & V. Semeshenko & J. P. Nadal, 2009. "Crime and punishment: the economic burden of impunity," The European Physical Journal B: Condensed Matter and Complex Systems, Springer;EDP Sciences, vol. 68(1), pages 133-144, March.
    3. Isaac Ehrlich, 1996. "Crime, Punishment, and the Market for Offenses," Journal of Economic Perspectives, American Economic Association, vol. 10(1), pages 43-67, Winter.
    4. Ehrlich, Isaac, 1975. "The Deterrent Effect of Capital Punishment: A Question of Life and Death," American Economic Review, American Economic Association, vol. 65(3), pages 397-417, June.
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