Time-Consistent Criminal Sanctions
AbstractA classic argument in the theory of crime is that optimal enforcement policy should involve maximal sanctions and no crime. Yet this is rarely observed in the real world. We argue that one reason for this has to do with the time inconsistency of such a policy. If sanctions are only applied after a crime has been committed, the enforcement authority may be reluctant to impose a high sanction since it will no longer have any deterrent effect. We show in a simple one period setting that if the enforcement authority can commit to its announced sanctions, the classic result is obtained. However, if the enforcement authority cannot commit, a minimal sanction with no deterrence is obtained. These extreme outcomes can be avoided in a setting in which crimes and enforcement occur repeatedly and the authority is able to build a reputation.
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Bibliographic InfoPaper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 1994010.
Date of creation: 01 Jan 1994
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- BOADWAY, Robin & MARCEAU, Nicolas & MARCHAND, Maurice, . "Time-consistent criminal sanctions," CORE Discussion Papers RP -1337, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Boadway, R. & Marceau, N. & Marchand, M., 1993. "Time-Consistent Criminal Sanctions," Papers 9318, Laval - Recherche en Politique Economique.
- Robin W. Boadway & Nicolas Marceau, 1993. "Time-Consistent Criminal Sanctions," Working Papers 883, Queen's University, Department of Economics.
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- Robin Boadway & Motohiro Sato, 2000. "The Optimality of Punishing Only the Innocent: The Case of Tax Evasion," International Tax and Public Finance, Springer, vol. 7(6), pages 641-664, December.
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