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Escalating Penalties for Repeat Offenders: Why are they So Hard to Explain?

Thomas J. Miceli

Journal of Institutional and Theoretical Economics (JITE), 2013, vol. 169, issue 4, 587-604

Abstract: Escalating penalties for repeat offenders are a pervasive feature of punishment schemes in various contexts, but economic theory has had a hard time rationalizing the practice. This paper reviews the literature on escalating penalties, and then develops a theory based on uncertainty on the part of enforcers about offenders' gains from committing socially undesirable acts. The analysis derives the conditions under which escalating penalties are both optimal (cost-minimizing) and subgame-perfect. It goes on to discuss several extensions and qualifications.

JEL-codes: K14 K42 (search for similar items in EconPapers)
Date: 2013
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DOI: 10.1628/093245613X671193

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