Reversible Rewards

41 Pages Posted: 13 Jun 2011 Last revised: 16 Sep 2013

Omri Ben-Shahar

University of Chicago Law School

Anu Bradford

Columbia University

Multiple version iconThere are 2 versions of this paper

Date Written: June 8, 2011

Abstract

This article offers a new mechanism of law enforcement, combining sanctions and rewards into a scheme of “reversible rewards.” A law enforcer sets up a pre-committed fund and offers it as reward to another party to refrain from violation. If the violator turns down the reward, the enforcer can use the money in the fund for one purpose only - to pay for punishment of the violator. The article shows that this scheme doubles the effect of funds invested in enforcement, and allows enforcers to stop violations that would otherwise be too costly to deter. It argues that reversible rewards could be used to bolster enforcement in selective areas of private and public law, and could also be applied strategically in litigation.

Suggested Citation

Ben-Shahar, Omri and Bradford, Anu, Reversible Rewards (June 8, 2011). University of Chicago Law & Economics, Olin Working Paper No. 557. Available at SSRN: https://ssrn.com/abstract=1864043 or http://dx.doi.org/10.2139/ssrn.1864043

Omri Ben-Shahar (Contact Author)

University of Chicago Law School ( email )

1111 E. 60th St.
Chicago, IL 60637
United States

Anu Bradford

Columbia University ( email )

3022 Broadway
New York, NY 10027
United States

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