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Optimal leniency and the organization design of group crime

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  • Immordino, Giovanni
  • Piccolo, Salvatore
  • Roberti, Paolo

Abstract

We study a simple law-enforcement model where the organizational structure of a criminal group is endogenous and determined jointly with the amnesty granted to whistleblowers. We allow criminals to choose between a horizontal (partnership) and a vertical (hierarchical) organization structure, and we study how this choice affects the optimal leniency granted by a benevolent Legislator whose aim is to minimize crime. We show that the optimal amnesty with an endogenous organizational choice is less lenient than that granted when the policy targets vertical organizations only. In the equilibrium, partnerships coexist with vertical organizations.

Suggested Citation

  • Immordino, Giovanni & Piccolo, Salvatore & Roberti, Paolo, 2020. "Optimal leniency and the organization design of group crime," Journal of Public Economics, Elsevier, vol. 191(C).
    • Handle: RePEc:eee:pubeco:v:191:y:2020:i:c:s0047272720301262
    DOI: 10.1016/j.jpubeco.2020.104262
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    References listed on IDEAS

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    More about this item

    Keywords

    Criminal organizations; Leniency; Organizational structure; Partnerships; Vertical hierarchies;
    All these keywords.

    JEL classification:

    • K14 - Law and Economics - - Basic Areas of Law - - - Criminal Law
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

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