Sensitivity Analyses of the Deterrence Hypothesis: Let's Keep the Econ in Econometrics
Leamer and McManus applied Extreme Bound Analysis (EBA) in an empirical study of the deterrent effects of capital punishment and other penalties. Their analysis has questioned the validity of the deterrence hypothesis. The thrust of our paper is twofold: first, by applying EBA to well-known econometric models of demand, production, and human-capital investment, our analysis exposes and illustrates the inherent flaws of EBA as a method of deriving valid inferences about model specification. Second, since the analysis shows Leamer and McManus's inferences about deterrence to be based on a flawed methodology, we offer an alternative, theory-based sensitivity analysis of estimated deterrent effects using similar data. Our analysis supports the deterrence hypothesis. More generally, it emphasizes the indispensable role of theory in guiding sensitivity analyses of model specification. Copyright 1999 by the University of Chicago.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- McAleer, Michael & Pagan, Adrian, 1985.
"What Will Take the Con Out of Econometrics?,"
CEPR Discussion Papers
39, C.E.P.R. Discussion Papers.
- Ehrlich, Isaac, 1977. "Capital Punishment and Deterrence: Some Further Thoughts and Additional Evidence," Journal of Political Economy, University of Chicago Press, vol. 85(4), pages 741-88, August.
- Deravi, M Keivan & Hegji, Charles E & Moberly, H Dean, 1990. "Government Debt and the Demand for Money: An Extreme Bound Analysis," Economic Inquiry, Western Economic Association International, vol. 28(2), pages 390-401, April.
- McAleer, Michael & Veall, Michael R, 1989. "How Fragile Are Fragile Inferences? A Re-evaluation of the Deterrent Effect of Capital Punishment," The Review of Economics and Statistics, MIT Press, vol. 71(1), pages 99-106, February.
- Davidson, Russell & MacKinnon, James G, 1981.
"Several Tests for Model Specification in the Presence of Alternative Hypotheses,"
Econometric Society, vol. 49(3), pages 781-93, May.
- Russell Davidson & James G. MacKinnon, 1980. "Several Tests for Model Specification in the Presence of Alternative Hypotheses," Working Papers 378, Queen's University, Department of Economics.
- McManus, Walter S, 1985. "Estimates of the Deterrent Effect of Capital Punishment: The Importance of the Researcher's Prior Beliefs," Journal of Political Economy, University of Chicago Press, vol. 93(2), pages 417-25, April.
- Ehrlich, Isaac & Brower, George D, 1987. "On the Issue of Causality in the Economic Model of Crime and Law Enforcement: Some Theoretical Considerations and Experimental Evidence," American Economic Review, American Economic Association, vol. 77(2), pages 99-106, May.
- Isaac Ehrlich, 1996. "Crime, Punishment, and the Market for Offenses," Journal of Economic Perspectives, American Economic Association, vol. 10(1), pages 43-67, Winter.
When requesting a correction, please mention this item's handle: RePEc:ucp:jlawec:v:42:y:1999:i:1:p:455-87. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Journals Division)
If references are entirely missing, you can add them using this form.