Behavioral Economics of Crime Rates and Punishment Levels

Saori Chiba and Kaiwen Leong

Journal of Institutional and Theoretical Economics (JITE), 2016, vol. 172, issue 4, 727-754

Abstract: Empirical studies have shown, paradoxically, that increasing the probability of apprehension can correlate with an increase in the total number of criminal actions. To examine this phenomenon, we develop a dynamic model of "personal rules" in which forgetfulness and hyperbolic discounting together can cause a potential criminal to commit more crimes as the probability of apprehension increases. At the time of the future decision, he may commit a crime due to hyperbolic discounting, even if it is not profitable. Hence, he may choose not to commit a crime today as a commitment device to abstain from crime in the future. However, increased prosecution can limit the effectiveness of the commitment device.

JEL-codes: D03 D81 K42 (search for similar items in EconPapers)
Date: 2016
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DOI: 10.1628/093245616X14631368691817

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