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Efficient Deterrence does not Require that the Wealthy should be Able to Buy Justice


  • Nuno Garoupa
  • Hugh Gravelle


It has been argued that it is inefficient to restrict the ability of the rich to buy better legal defense than the poor because such restrictions lead to overdeterrence of the wealthy, who have a higher opportunity cost of imprisonment. We show that the ability of the rich to buy a lower conviction probability can never lead to the expected sanction for a crime being the same at all income levels. Thus whilst a restriction on legal defense expenditure increases the proportion of individuals who are inefficiently overdeterred, it also reduces the proportion who are inefficiently underdeterred. Hence the efficiency implications are ambiguous.

Suggested Citation

  • Nuno Garoupa & Hugh Gravelle, 2003. "Efficient Deterrence does not Require that the Wealthy should be Able to Buy Justice," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 159(3), pages 545-545, September.
  • Handle: RePEc:mhr:jinste:urn:sici:0932-4569(200309)159:3_545:eddnrt_2.0.tx_2-q

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    References listed on IDEAS

    1. Hugh Gravelle & Nuno Garoupa, 2002. "Optimal Deterrence with Legal Defense Expenditure," Economic Inquiry, Western Economic Association International, vol. 40(3), pages 366-379, July.
    2. Lott, John R, Jr, 1987. "Should the Wealthy Be Able to "Buy Justice"?," Journal of Political Economy, University of Chicago Press, vol. 95(6), pages 1307-1316, December.
    3. Kaplow, Louis & Shavell, Steven, 1999. "The Conflict between Notions of Fairness and the Pareto Principle," American Law and Economics Review, Oxford University Press, vol. 1(1-2), pages 63-77, Fall.
    4. Garoupa, Nuno, 1997. " The Theory of Optimal Law Enforcement," Journal of Economic Surveys, Wiley Blackwell, vol. 11(3), pages 267-295, September.
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    Cited by:

    1. Garoupa, Nuno & Stephen, Frank, 2003. "A Note on Optimal Law Enforcement with Legal Aid," CEPR Discussion Papers 4113, C.E.P.R. Discussion Papers.
    2. Polinsky, A. Mitchell, 2006. "The optimal use of fines and imprisonment when wealth is unobservable," Journal of Public Economics, Elsevier, vol. 90(4-5), pages 823-835, May.
    3. Nuno Garoupa & Jonathan Klick & Francesco Parisi, 2006. "A law and economics perspective on terrorism," Public Choice, Springer, vol. 128(1), pages 147-168, July.

    More about this item

    JEL classification:

    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation


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