The principle of marginal deterrence in the economic theory of crime and punishment

Grigory Kalyagin ()
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Grigory Kalyagin: Department of Economics, Lomonosov Moscow State University

No 76, Working Papers from Moscow State University, Faculty of Economics

Abstract: This article is devoted to the analysis of one of the key principles of optimal law enforcement in the economic theory of crime and punishment – the principle of marginal deterrence. Despite the importance of marginal deterrence for organizing an effective fight against crime, there is no consensus understanding of it even at the theoretical level, which makes it difficult to empirically test the effectiveness of marginal deterrence. Here we consider in detail alternative approaches of researchers to understanding this principle, as well as the impact that different understandings have on the optimal policy of public law enforcement and crime deterrence. In this article, we also propose an original model of marginal deterrence that fills a noticeable theoretical gap: the crimes between which a potential offender chooses in our model differ from each other not in the income they can bring him, but in the probability for him to avoid punishment. The main conclusion: the severity of punishment for a crime with a higher probability of detection, in general law enforcement, not only has an internal optimum, but most likely this optimum will be lower than the traditional solution for cases where it exists, in which the optimal severity of punishment is equal to the amount of damage caused to society by the offense, divided by the probability of punishment. This result also holds for cases where the social damage from a crime with a lower probability of detection and punishment of the offender does not exceed the similar damage for an alternative crime characterized by a higher probability of detection.

Keywords: crime; deterrence; marginal deterrence; general enforcement; optimal sanctions (search for similar items in EconPapers)
JEL-codes: K14 K42 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2025-07
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