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Rewarding Policemen Increases Crime. Another Surprising Result from the Inspection Game

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Author Info
Luciano Andreozzi ()
Abstract

Inspection games are 2x2 games in which one playermust decide whether to inspect the other player, who in turnmust decide whether to infringe a norm or a regulation.Inspection games have a single, mixed strategy Nashequilibrium, which has counter-intuitive comparative staticsproperties. This result has been used by Tsebelis (1989) andHoller (1992) to show that the economic approach to lawenforcement is not likely to generate clear-cut predictions.In this paper I discuss a variant of the inspection game inwhich the inspector can act as a Stackelberg leader. I willalso show that this version of the inspection game hascounter-intuitive comparative statics properties. Inparticular, increasing inspector’s incentives to enforce thelaw increases the frequency of law infractions. Copyright Kluwer Academic Publishers 2004

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Article provided by Springer in its journal Public Choice.

Volume (Year): 121 (2004)
Issue (Month): 1 (October)
Pages: 69-82
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Handle: RePEc:kap:pubcho:v:121:y:2004:i:1:p:69-82

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. A. Mitchell Polinsky & Steven Shavell, 2000. "The Economic Theory of Public Enforcement of Law," Journal of Economic Literature, American Economic Association, vol. 38(1), pages 45-76, March. [Downloadable!] (restricted)
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  2. Wittman, Donald, 1993. "Nash equilibrium vs. maximin : A comparative game statics analysis," European Journal of Political Economy, Elsevier, vol. 9(4), pages 559-565, November. [Downloadable!] (restricted)
  3. Gary S. Becker, 1968. "Crime and Punishment: An Economic Approach," Journal of Political Economy, University of Chicago Press, vol. 76, pages 169. [Downloadable!] (restricted)
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  4. Cox, Gary W, 1994. " A Note on Crime and Punishment," Public Choice, Springer, vol. 78(1), pages 115-24, January.
  5. Wittman, Donald, 1985. "Counter-intuitive results in game theory," European Journal of Political Economy, Elsevier, vol. 1(1), pages 77-89. [Downloadable!] (restricted)
  6. Cheng Leonard K. & Zhu Min, 1995. "Mixed-Strategy Nash Equilibrium Based upon Expected Utility and Quadratic Utility," Games and Economic Behavior, Elsevier, vol. 9(2), pages 139-150, May. [Downloadable!] (restricted)
  7. Garoupa, Nuno, 1997. " The Theory of Optimal Law Enforcement," Journal of Economic Surveys, Blackwell Publishing, vol. 11(3), pages 267-95, September. [Downloadable!] (restricted)
  8. Fudenberg, Drew & Levine, David K, 1989. "Reputation and Equilibrium Selection in Games with a Patient Player," Econometrica, Econometric Society, vol. 57(4), pages 759-78, July. [Downloadable!] (restricted)
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  9. Fudenberg, Drew & Levine, David K, 1992. "Maintaining a Reputation When Strategies Are Imperfectly Observed," Review of Economic Studies, Blackwell Publishing, vol. 59(3), pages 561-79, July. [Downloadable!] (restricted)
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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Luciano Andreozzi, 2008. "Inspection games with long-run inspectors," Department of Economics Working Papers 0821, Department of Economics, University of Trento, Italia. [Downloadable!]
  2. Ehud Guttel & Barak Medina, 2007. "Less Crime, More (Vulnerable) Victims: Game Theory and the Distributional Effects of Criminal Sanctions," Discussion Paper Series dp472, Center for Rationality and Interactive Decision Theory, Hebrew University, Jerusalem. [Downloadable!]
  3. Tim Friehe, 2008. "Correlated payoffs in the inspection game: some theory and an application to corruption," Public Choice, Springer, vol. 137(1), pages 127-143, October. [Downloadable!] (restricted)
  4. Ehud Guttel & Barak Medina, 2007. "Less Crime, More (Vulnerable) Victims: Game Theory and the Distributional Effects of Criminal Sanctions," Levine's Bibliography 122247000000001799, UCLA Department of Economics. [Downloadable!]
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