Criminals and risk attitude
AbstractWe show that whatever the representation of criminals' preferences under risk, the assumption according to which they are strongly risk averse individuals is not consistent with the available observations establishing that criminals are more sensitive to shifts in the probability of sanction than to changes in the level of the sanction. We suggest that: 1/ while a weakening of the risk aversion assumption may be useful, the risk seeking assumption may be better suited for criminals; 2/ the relevant assumption regarding criminals' risk attitude may depend on the policy instruments that models of crime deterrence take into account; 3/ additional experiments, including both monetary penalties and non monetary sanctions would be useful in order to learn more about their sensibility to probability, monetary and non monetary sanctions.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 1149.
Date of creation: Jun 2006
Date of revision: 15 Sep 2006
Risk aversion; monetary and non monetary sanctions; State Dependent preferences and RDEU models;
Find related papers by JEL classification:
- K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
- K40 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - General
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
- K41 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Litigation Process
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-01-14 (All new papers)
- NEP-LAW-2007-01-14 (Law & Economics)
- NEP-UPT-2007-01-14 (Utility Models & Prospect Theory)
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