Asset Forfeiture Laws and Criminal Deterrence
AbstractAsset forfeiture laws allow the seizure of assets used in the commission of a crime. This paper examines the impact of such laws on deterrence by incorporating the possibility of asset forfeiture into the standard economic model of crime. When punishment is by a fine that can be optimally chosen, forfeiture is never optimal because of the deadweight loss it imposes in the capital market. When the fine is limited by the offender’s wealth, forfeiture may or may not be desirable. Extensions of the basic model include the optimal use of forfeiture when (i) partial seizure is possible, (ii) punishment is by imprisonment, (iii) the probability of apprehension is endogenous, and (iv) enforcers are rent-seekers.
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Bibliographic InfoPaper provided by University of Connecticut, Department of Economics in its series Working papers with number 2013-27.
Length: 24 pages
Date of creation: Sep 2013
Date of revision:
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Criminal punishment; asset forfeiture; law enforcement;
Find related papers by JEL classification:
- H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
- K14 - Law and Economics - - Basic Areas of Law - - - Criminal Law
- K41 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Litigation Process
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- A. Mitchell Polinsky & Steven Shavell, 1999.
"The Economic Theory of Public Enforcement of Law,"
NBER Working Papers
6993, National Bureau of Economic Research, Inc.
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- Harris, John R, 1970. "On the Economics of Law and Order," Journal of Political Economy, University of Chicago Press, vol. 78(1), pages 165-74, Jan.-Feb..
- Nuno Garoupa & Daniel Klerman, 2002. "Optimal Law Enforcement with a Rent-Seeking Government," American Law and Economics Review, Oxford University Press, vol. 4(1), pages 116-140, January.
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