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Optimal Sanctions When Individuals are Imperfectly Informed About the Probability of Apprehension

  • Lucian Arye Bebchuk
  • Louis Kaplow

This paper considers optimal enforcement when individuals may be imperfectly informed about the probability of apprehension. When individuals are perfectly informed, optimal sanctions are maximal because, as Gary Becker (1968) suggested, society can economize on enforcement resources by reducing the probability of apprehension while increasing sanctions. But when individuals imperfectly observe the probability of apprehension, it may be optimal to apply lower sanctions while expending more enforcement resources.

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File URL: http://www.nber.org/papers/w4079.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 4079.

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Date of creation: May 1992
Date of revision:
Publication status: published as The Journal of Legal Studies, Vol. XXI, No. 2, pp. 365-370 (June 1992).
Handle: RePEc:nbr:nberwo:4079
Note: LE
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  1. Sah, Raaj K, 1991. "Social Osmosis and Patterns of Crime," Journal of Political Economy, University of Chicago Press, vol. 99(6), pages 1272-95, December.
  2. Kaplow, Louis, 1990. "Optimal Deterrence, Uninformed Individuals, and Acquiring Information about Whether Acts Are Subject to Sanctions," Journal of Law, Economics and Organization, Oxford University Press, vol. 6(1), pages 93-128, Spring.
  3. Arun S. Malik, 1990. "Avoidance, Screening and Optimum Enforcement," RAND Journal of Economics, The RAND Corporation, vol. 21(3), pages 341-353, Autumn.
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