Deterrence Theory in Paraguay: Exploring Fraud and Violation of Trust Cases

Andreas Schneider
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Andreas Schneider: Independent Researcher at Schneider Risk & Business Consulting, 1849 Asuncion, Paraguay

Social Sciences, 2019, vol. 8, issue 1, 1-17

Abstract: This research paper contributes to the literature of deterrence theory in general, and in particular, with respect to white-collar crime, offering valuable insight by using a unique dataset of fraud and violation of trust incidents within the jurisdiction of Paraguay. Descriptive evidence shows a clear and continuous misallocation of funds and human capital, therefore providing less efficient services for the public. Regression analysis suggests that clearance rate exerts a highly significant effect in deterring fraud, but the results are not clear for violation of trust incidents. Despite the limitations of available data, results confirm the deterrence theory in Paraguay. However, for more than two-thirds of victims, not even an attempt was made to seek justice. As a side-result, it seems that a soft-on-crime strategy, induced from the former German penal code, has led to an increasing share of pre-trial diversion, therefore enhancing white-collar crimes like fraud and violation of trust, due to impunity.

Keywords: deterrence; Paraguay; fraud; crime; soft on crime (search for similar items in EconPapers)
JEL-codes: A B N P Y80 Z00 (search for similar items in EconPapers)
Date: 2019
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