The Hyperbolic Punishment Function

al-Nowaihi Ali M. and Sanjit Dhami
Additional contact information
al-Nowaihi Ali M.: University of Leicester, England

Review of Law & Economics, 2012, vol. 8, issue 3, 759-787

Abstract: All models in Law and Economics use punishment functions (hereafter, PF) that incorporate a trade-off between probability of detection, p, and punishment, F. Suppose society wishes to minimize the total costs of enforcement and damages from crime, T( p,F). For a given p, an optimal punishment function (OPF) determines an F that minimizes T( p,F). A popular and tractable PF is the hyperbolic punishment function (HPF). We show that the HPF is an OPF for a large class of total cost functions. Furthermore, the HPF is an upper (lower ) bound for an even larger class of punishment functions. If the HPF cannot (can) deter crime, then none (all ) of the PF’s for which the HPF is an upper (lower ) bound can deter crime. Thus, if one can demonstrate that a particular policy is ineffective (effective) under the HPF, there is no need to even compute the OPF. Our results should underpin an even greater use of the HPF. We give illustrations from mainstream and behavioral economics.

Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1515/1555-5879.1570 (text/html)
For access to full text, subscription to the journal or payment for the individual article is required.

Related works:
Working Paper: Hyperbolic Punishment Function (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bpj:rlecon:v:8:y:2012:i:3:p:759-787:n:5

Ordering information: This journal article can be ordered from
https://www.degruyter.com/journal/key/rle/html

DOI: 10.1515/1555-5879.1570

Access Statistics for this article

Review of Law & Economics is currently edited by Francesco Parisi

More articles in Review of Law & Economics from De Gruyter
Bibliographic data for series maintained by Peter Golla ().