Using Bounded Rationality to Fight Crime
University of Bologna - Dipartimento di Scienze Economiche; Erasmus University Rotterdam (EUR) - Rotterdam Institute of Law and Economics; University of Hamburg - Institute of Law and Economics
February 10, 2013
Law and economics scholars have traditionally modeled criminal deterrence as a function two factors: severity of punishment, and probability of punishment. Gary Becker’s (1968) seminal essay suggested that optimizing on the benefits of crime reduction and the cost of punishment and policing should be the policy objective of the criminal law (at least with respect to deterrence). However, this model has been attacked on two fronts. First, criminological data on crime rates fails to show a strong correlation between the predictions of economic models and crime rates in the real world. Second, developments in behavioral economics suggest that individuals (criminals in this case) often fail to respond rationally to incentives. This paper seeks to reconcile the tension between the results of economic theory, criminological data, and behavioral psychology, offering a more realistic goal for the criminal law: inducing second-order biases not to commit crime.
Number of Pages in PDF File: 28
Keywords: bounded rationality, bias, heuristic, deterrence, criminal deterrence, benevolent biasing, cognitive leveraging
JEL Classification: D03, K14, K42working papers series
Date posted: February 10, 2013 ; Last revised: February 25, 2013
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