Corruption and Optimal Law Enforcement

26 Pages Posted: 14 Jul 2000 Last revised: 12 Oct 2010

See all articles by A. Mitchell Polinsky

A. Mitchell Polinsky

Stanford Law School; National Bureau of Economic Research (NBER)

Steven Shavell

Harvard Law School; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: February 1999

Abstract

This article analyzes corruption of law enforcement agents: payment of bribes to agents so that they will not report violations. Corruption dilutes deterrence because bribe payments are less than sanctions. The state may not be able to offset this effect of bribery by raising sanctions for the underlying offense. Thus, it may be optimal to expend resources to detect and penalize corruption. At the optimum, however, corruption may not be deterred. Nonetheless, it may be desirable to attempt to control corruption in order to raise the offender's costs -- the sum of the bribe payment and the expected sanction for bribery -- and thereby increase deterrence of the underlying violation.

Suggested Citation

Polinsky, A. Mitchell and Shavell, Steven, Corruption and Optimal Law Enforcement (February 1999). NBER Working Paper No. w6945. Available at SSRN: https://ssrn.com/abstract=226399

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Steven Shavell

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