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Self-reporting in Optimal Law Enforcement when there are Criminal Teams

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  • Eberhard Feess
  • Markus Walzl

Abstract

We extend the analysis of self-reporting schemes to criminal teams. When the violators behave non-cooperatively, maximum deterrence can be reached at virtually no cost by designing a prisoners' dilemma. One drawback of such a scheme is that it might induce cooperative behaviour in the self-reporting stage. If the cooperation rate is increasing the benefits from cooperation, it is optimal to impose less than the maximum fine if both individuals self-report. The same result occurs for imperfect self-reporting technologies where the conviction of one agent does not necessarily lead to a conviction of his accomplice. Copyright (c) The London School of Economics and Political Science 2004.

Suggested Citation

  • Eberhard Feess & Markus Walzl, 2004. "Self-reporting in Optimal Law Enforcement when there are Criminal Teams," Economica, London School of Economics and Political Science, vol. 71(283), pages 333-348, August.
  • Handle: RePEc:bla:econom:v:71:y:2004:i:283:p:333-348
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    References listed on IDEAS

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    Cited by:

    1. Muehlheusser, Gerd & Roider, Andreas, 2004. "Black Sheep and Walls of Silence," IZA Discussion Papers 1171, Institute for the Study of Labor (IZA).
    2. Graf Lambsdorff, Johann, 2010. "Deterrence and constrained enforcement: Alternative regimes to deal with bribery," Passauer Diskussionspapiere, Volkswirtschaftliche Reihe V-60-10, University of Passau, Faculty of Business and Economics.
    3. Olivier Bochet, 2007. "Implementation of the Walrasian correspondence: the boundary problem," International Journal of Game Theory, Springer;Game Theory Society, vol. 36(2), pages 301-316, October.
    4. Landeo, Claudia M. & Spier, Kathryn E., 2015. "Incentive contracts for teams: Experimental evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 119(C), pages 496-511.
    5. Buccirossi, Paolo & Spagnolo, Giancarlo, 2006. "Leniency policies and illegal transactions," Journal of Public Economics, Elsevier, pages 1281-1297.
    6. Eberhard Feess & Markus Walzl, 2005. "Optimal Self-Reporting Schemes with Multiple Stages and Option Values," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 12(3), pages 265-279, May.
    7. Johann Graf Lambsdorff, 2011. "Economic Approaches to Anticorruption," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 9(2), pages 25-30, 07.
    8. Gerd Muehlheusser & Andreas Roider, 2004. "Black Sheep and Walls of Silence," Diskussionsschriften dp0410, Universitaet Bern, Departement Volkswirtschaft.
    9. repec:ces:ifodic:v:9:y:2011:i:2:p:16132634 is not listed on IDEAS
    10. Marvão, Catarina, 2014. "Heterogeneous Penalties and Private Information," Konkurrensverket Working Paper Series in Law and Economics 2014:1, Konkurrensverket (Swedish Competition Authority).
    11. repec:oup:amlawe:v:19:y:2017:i:2:p:464-485. is not listed on IDEAS
    12. Tim Friehe & Thomas J. Miceli, 2017. "On Punishment Severity and Crime Rates," American Law and Economics Review, Oxford University Press, vol. 19(2), pages 464-485.
    13. Marvao, Catarina, 2014. "Heterogeneous Penalties and Private Information," SITE Working Paper Series 29, Stockholm School of Economics, Stockholm Institute of Transition Economics.
    14. repec:kap:regeco:v:52:y:2017:i:2:d:10.1007_s11149-017-9329-7 is not listed on IDEAS
    15. Marvao, Catarina & Spagnolo, Giancarlo, 2016. "Cartels and Leniency: Taking stock of what we learnt," SITE Working Paper Series 39, Stockholm School of Economics, Stockholm Institute of Transition Economics, revised 16 Nov 2016.
    16. Evgenia MOTCHENKOVA & Daniel LELIEFELD, 2010. "Adverse Effects Of Corporate Leniency Programs In View Of Industry Asymmetry," Journal of Applied Economic Sciences, Spiru Haret University, Faculty of Financial Management and Accounting Craiova, vol. 5(2(12)/Sum), pages 114-128.
    17. repec:ebl:ecbull:v:11:y:2006:i:2:p:1-7 is not listed on IDEAS
    18. Feess,Eberhard & Walzl,Markus, 2005. "Quid-Pro-Quo or Winner-Takes-It-All? An Analysis of Corporate Leniency Programs and Lessons to Learn for EU and US Policies," Research Memorandum 039, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).

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