IDEAS home Printed from https://ideas.repec.org/a/bpj/bejtec/v16y2016i2p545-578n3.html
   My bibliography  Save this article

Optimal Penalties for Repeat Offenders – The Role of Offence History

Author

Listed:
  • Endres Alfred

    (Department of Economics, University of Hagen, Universitätsstr. 11, 58084 Hagen, Germany University of Witten/Herdecke, 58448 Witten, Germany)

  • Rundshagen Bianca

    (Department of Economics, University of Hagen, Universitätsstr. 11, 58084 Hagen, Germany)

Abstract

Within an infinite and a corresponding finite game framework we analyse intertemporal punishment for repeat offenders. The legal authority is assumed to maximize social welfare by minimizing the sum of harm from crimes and cost of punishment. We show that the time horizon considerably affects the structure of the optimal penalty scheme. In the finite game framework decreasing as well as escalating penalty schemes may be optimal. For the more appropriate infinite game framework we show three main results: First, any penalty scheme can be replaced by a (weakly) escalating penalty scheme that leads to the same criminal activity and the same social penalization cost. Second, the optimal penalty scheme is of the escalating type. Third, the socially optimal level of crime under escalating penalties may be higher than the level which would be optimal under uniform penalties.

Suggested Citation

  • Endres Alfred & Rundshagen Bianca, 2016. "Optimal Penalties for Repeat Offenders – The Role of Offence History," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 16(2), pages 545-578, June.
    • Handle: RePEc:bpj:bejtec:v:16:y:2016:i:2:p:545-578:n:3
    DOI: 10.1515/bejte-2014-0098
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/bejte-2014-0098
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.
    File URL: https://libkey.io/10.1515/bejte-2014-0098?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Matthew J. Baker & Niklas J. Westelius, 2013. "Crime, expectations, and the deterrence hypothesis," Chapters, in: Thomas J. Miceli & Matthew J. Baker (ed.), Research Handbook on Economic Models of Law, chapter 12, pages 235-280, Edward Elgar Publishing.
    2. Thomas J. Miceli & Matthew J. Baker, 2013. "Introduction to: Research Handbook on Economic Models of Law," Working papers 2013-07, University of Connecticut, Department of Economics.
    3. Thomas J. Miceli & Matthew J. Baker (ed.), 2013. "Research Handbook on Economic Models of Law," Books, Edward Elgar Publishing, number 14720.
    4. Alessandro Barbarino & Giovanni Mastrobuoni, 2014. "The Incapacitation Effect of Incarceration: Evidence from Several Italian Collective Pardons," American Economic Journal: Economic Policy, American Economic Association, vol. 6(1), pages 1-37, February.
    5. Binmore, Ken, 2007. "Playing for Real: A Text on Game Theory," OUP Catalogue, Oxford University Press, number 9780195300574.
    6. Mailath, George J. & Samuelson, Larry, 2006. "Repeated Games and Reputations: Long-Run Relationships," OUP Catalogue, Oxford University Press, number 9780195300796.
    7. Evgenia Motchenkova, 2014. "Cost minimizing sequential punishment policies for repeat offenders," Applied Economics Letters, Taylor & Francis Journals, vol. 21(5), pages 360-365, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Leshem, Shmuel & Tabbach, Avraham, 2023. "The option value of record-based sanctions," Games and Economic Behavior, Elsevier, vol. 137(C), pages 1-22.
    2. Wolfgang Eggert & Steffen Minter & Maximilian Stephan & Handirk Ungern-Sternberg, 2017. "Sanctions for repeat offenders: a question of wealth?," Scottish Journal of Political Economy, Scottish Economic Society, vol. 64(5), pages 467-482, November.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rundshagen, Bianca, 2013. "Mediation - Boon or Bane for the Stability and Efficiency of Marriage?," VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79840, Verein für Socialpolitik / German Economic Association.
    2. Juan‐Pablo Montero & Juan Ignacio Guzman, 2010. "Output‐Expanding Collusion In The Presence Of A Competitive Fringe," Journal of Industrial Economics, Wiley Blackwell, vol. 58(1), pages 106-126, March.
    3. Tobias Salz & Emanuel Vespa, 2020. "Estimating dynamic games of oligopolistic competition: an experimental investigation," RAND Journal of Economics, RAND Corporation, vol. 51(2), pages 447-469, June.
    4. Daron Acemoglu & Matthew O. Jackson, 2017. "Social Norms and the Enforcement of Laws," Journal of the European Economic Association, European Economic Association, vol. 15(2), pages 245-295.
    5. Kimmo Berg & Gijs Schoenmakers, 2017. "Construction of Subgame-Perfect Mixed-Strategy Equilibria in Repeated Games," Games, MDPI, vol. 8(4), pages 1-14, November.
    6. , & ,, 2015. "A folk theorem for stochastic games with infrequent state changes," Theoretical Economics, Econometric Society, vol. 10(1), January.
    7. Ernesto Dal Bó & Pedro Dal Bó & Rafael Di Tella, 2007. "Reputation When Threats and Transfers Are Available," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 16(3), pages 577-598, September.
    8. Carmona, Guilherme & Carvalho, Luís, 2016. "Repeated two-person zero-sum games with unequal discounting and private monitoring," Journal of Mathematical Economics, Elsevier, vol. 63(C), pages 131-138.
    9. Laruelle, Annick & Valenciano, Federico, 2008. "Noncooperative foundations of bargaining power in committees and the Shapley-Shubik index," Games and Economic Behavior, Elsevier, vol. 63(1), pages 341-353, May.
    10. Bramoullé, Yann & Goyal, Sanjeev, 2016. "Favoritism," Journal of Development Economics, Elsevier, vol. 122(C), pages 16-27.
    11. Sander Heinsalu, 2018. "Corrigendum to "Managerial Incentive Problems: A Dynamic Perspective"," Papers 1811.00455, arXiv.org, revised Nov 2018.
    12. Nicolas Vieille, 2010. "Recursive Methods in Discounted Stochastic Games: An Algorithm for - 1 and a Folk Theorem," Post-Print hal-00543616, HAL.
    13. Christian Hilbe & Moshe Hoffman & Martin A. Nowak, 2015. "Cooperate without Looking in a Non-Repeated Game," Games, MDPI, vol. 6(4), pages 1-15, September.
    14. Ian Gregory‐Smith, 2021. "Wages And Labor Productivity: Evidence From Injuries In The National Football League," Economic Inquiry, Western Economic Association International, vol. 59(2), pages 829-847, April.
    15. Strobl, Günter, 2022. "A theory of procyclical market liquidity," Journal of Economic Dynamics and Control, Elsevier, vol. 138(C).
    16. Larionov, Daniil, 2023. "Full surplus extraction from colluding bidders," ZEW Discussion Papers 23-029, ZEW - Leibniz Centre for European Economic Research.
    17. Loukas Dimitriou & Theodore Tsekeris, 2009. "Evolutionary game-theoretic model for dynamic congestion pricing in multi-class traffic networks," Netnomics, Springer, vol. 10(1), pages 103-121, April.
    18. , H. & ,, 2016. "Approximate efficiency in repeated games with side-payments and correlated signals," Theoretical Economics, Econometric Society, vol. 11(1), January.
    19. Matsushima Hitoshi, 2020. "Behavioral Theory of Repeated Prisoner’s Dilemma: Generous Tit-For-Tat Strategy," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 20(1), pages 1-11, January.
    20. Alcalde, Pilar & Vial, Bernardita, 2016. "Willingness to Pay for Firm Reputation: Paying for Risk Rating in the Annuity Market," MPRA Paper 68993, University Library of Munich, Germany.

    More about this item

    Keywords

    crime prevention; repeat offenders; infinite time horizon;
    All these keywords.

    JEL classification:

    • K14 - Law and Economics - - Basic Areas of Law - - - Criminal Law
    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:bejtec:v:16:y:2016:i:2:p:545-578:n:3. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.