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Interior optimal imprisonment under diminishing marginal disutility

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  • Friehe, Tim
  • Mungan, Murat C.

Abstract

This note revisits the important question of how fines and imprisonment should be optimally employed. In D’Antoni et al. (2022), a monotone hazard rate condition implies a corner solution for imprisonment in the observable-wealth benchmark when imprisonment disutility is linear. We show that this result is not robust to offenders facing diminishing marginal disutility of imprisonment. The optimal prison term is interior as long as the marginal disutility associated with large imprisonment terms are low and the harms from the offense are large enough to warrant imprisonment. The sentence length thus becomes a genuine policy margin rather than a boundary instrument.

Suggested Citation

  • Friehe, Tim & Mungan, Murat C., 2026. "Interior optimal imprisonment under diminishing marginal disutility," Economics Letters, Elsevier, vol. 265(C).
    • Handle: RePEc:eee:ecolet:v:265:y:2026:i:c:s0165176526002144
    DOI: 10.1016/j.econlet.2026.113020
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    JEL classification:

    • K41 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Litigation Process
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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