Subgame Perfect Punishment for Repeat Offenders

17 Pages Posted: 15 Jan 2003

See all articles by Winand Emons

Winand Emons

University of Bern - Department of Economics; Centre for Economic Policy Research (CEPR)

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Date Written: November 2002

Abstract

First we show that for wealth-constrained agents who may commit an act twice, the optimal sanctions are the offender's entire wealth for the first crime, and zero for the second. Then we ask whether this decreasing sanction scheme is subgame perfect (time consistent), i.e., does a rent-seeking government stick to this sanction scheme after the first crime has occurred? If the benefit and/or the harm from the crime are not too large, this is indeed the case; otherwise, equal sanctions for both crimes are optimal.

Keywords: Crime and punishment, repeat offenders, subgame perfection

JEL Classification: D82, K41, K42

Suggested Citation

Emons, Winand, Subgame Perfect Punishment for Repeat Offenders (November 2002). Available at SSRN: https://ssrn.com/abstract=369541

Winand Emons (Contact Author)

University of Bern - Department of Economics ( email )

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Centre for Economic Policy Research (CEPR)

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