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The structure of fines in the light of political competition

Author

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  • Eric Langlais

    (EconomiX - EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique)

Abstract

Why infractions to some environmental legislations (protection of natural habitats) or antitrust law (collusion) are punished with fines based on damages, while other kinds of offenses (lack of adequate permits; cartels) are punished per se? This paper analyzes the determinants of public law enforcement policies when citizens vote for the timing and level of fines. We consider situations where citizens and politicians disagree on the value of the expected social harm associated with some activities. We find that a strong law enforcement equilibrium (high level of deterrence) emerges when citizens expect a high level of harm. On the reverse, a weak law enforcement equilibrium emerges when citizens expect a low level of harm. Furthermore, citizens vote for act-based (respectively harm-based) sanctions when they expect a level of harm lower than that of the government (respectively higher).
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Eric Langlais, 2015. "The structure of fines in the light of political competition," Post-Print hal-01411810, HAL.
    • Handle: RePEc:hal:journl:hal-01411810
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    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • H1 - Public Economics - - Structure and Scope of Government
    • K14 - Law and Economics - - Basic Areas of Law - - - Criminal Law
    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
    • K32 - Law and Economics - - Other Substantive Areas of Law - - - Energy, Environmental, Health, and Safety Law
    • K4 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior
    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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