Judicial Errors and Crime Deterrence: Theory and Experimental Evidence

30 Pages Posted: 30 Jul 2009

See all articles by Matteo Rizzolli

Matteo Rizzolli

LUMSA University

Luca Stanca

University of Milan, Bicocca - Department of Economics; Università degli Studi di Milano-Bicocca - Center for Interdisciplinary Studies in Economics, Psychology & Social Sciences (CISEPS); Università degli Studi di Milano-Bicocca - Department of Economics, Management and Statistics (DEMS)

Date Written: July 30, 2009

Abstract

The standard economic theory of crime deterrence predicts that the conviction of an innocent (type-I error) is as detrimental to deterrence as the acquittal of a guilty individual (type-II error). In this paper, we qualify this result theoretically, showing that in the presence of risk aversion, loss-aversion or sensitivity to procedural fairness, type-I errors have a larger effect on deterrence than type-II errors. We test these predictions with a lab experiment where participants make a decision on whether to steal from other individuals, being subject to different probabilities of judicial errors. The results indicate that both types of judicial errors have a large and significant impact on deterrence, but these effects are not symmetric. An increase in the probability of type-I errors is found to have a larger negative impact on deterrence than an equivalent increase in the probability of type-II errors. This asymmetry is largely explained by risk aversion and, to a lesser extent, sensitivity to procedural fairness.

Keywords: Judicial errors, criminal procedure, procedural fairness, experimental economics, law and economics, crime, deterrence

JEL Classification: C91, K14, K41, K42

Suggested Citation

Rizzolli, Matteo and Stanca, Luca, Judicial Errors and Crime Deterrence: Theory and Experimental Evidence (July 30, 2009). Available at SSRN: https://ssrn.com/abstract=1441325 or http://dx.doi.org/10.2139/ssrn.1441325

Matteo Rizzolli (Contact Author)

LUMSA University ( email )

Via Pompeo Magno
Roma, Rome 00191
Italy

Luca Stanca

University of Milan, Bicocca - Department of Economics ( email )

Piazza dell'Ateneo, Nuovo I
Milan 20126
Italy

Università degli Studi di Milano-Bicocca - Center for Interdisciplinary Studies in Economics, Psychology & Social Sciences (CISEPS) ( email )

Piazza dell'Ateneo Nuovo, 1
Milano, 20126
Italy

Università degli Studi di Milano-Bicocca - Department of Economics, Management and Statistics (DEMS) ( email )

Piazza dell'Ateneo Nuovo, 1
Milan, 20126
Italy

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