Laffer's Day in Court: The Revenue Effects of Criminal Justice Fees and Fines

Samuel Norris and Evan K. Rose

No 31806, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Many jurisdictions levy sizable fines and fees (legal financial obligations, or LFOs) on criminal defendants. Proponents argue LFOs are a “tax on crime” that funds courts and provides deterrence; opponents argue they do neither. We examine the fiscal implications of lowering LFOs. Incentives to default generate a “Laffer” curve with revenue eventually decreasing in LFOs. Using detailed administrative data, however, we find few defendants demonstrably on the right-hand side of the curve. Those who are tend to be poor, Black, and charged with felonies. As a result, decreasing LFOs for the average defendant would come at substantial cost to governments.

JEL-codes: H2 (search for similar items in EconPapers)
Date: 2023-10
New Economics Papers: this item is included in nep-law and nep-ure
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