The Becker Paradox and Type I Versus Type II Errors in the Economics of Crime

23 Pages Posted: 8 Feb 2007

See all articles by Mats Persson

Mats Persson

Stockholm University; CESifo (Center for Economic Studies and Ifo Institute)

Claes-Henric Siven

Stockholm University - Department of Economics

Abstract

Two real-world observations are not easily replicated in models of crime. First, although capital punishment is optimal in the standard Becker model, it is rarely observed in the real world. Second, criminal procedure and the evaluation of evidence vary across societies and historical periods, the standard of proof being sometimes very high and sometimes quite low. In this article, we develop a general equilibrium model of judicial procedure allowing for innocent persons being convicted. We show that the median voter theorem applies to this model, making judicial procedure endogenous. So formulated, the model can replicate both empirical observations.

Suggested Citation

Persson, Mats and Siven, Claes-Henric, The Becker Paradox and Type I Versus Type II Errors in the Economics of Crime. International Economic Review, Vol. 48, No. 1, pp. 211-233, February 2007. Available at SSRN: https://ssrn.com/abstract=961916 or http://dx.doi.org/10.1111/j.1468-2354.2007.00423.x

Mats Persson

Stockholm University ( email )

Stockholm, SE-10691
Sweden

HOME PAGE: http://www.cesifo.de

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Claes-Henric Siven (Contact Author)

Stockholm University - Department of Economics ( email )

SE-106 91 Stockholm
Sweden
+46-8-16-30-52 (Phone)
+46-8-15-94-82 (Fax)

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