Langlais, Eric (2006): Criminals and risk attitude.
Download (125kB) | Preview
We show that whatever the representation of criminals' preferences under risk, the assumption according to which they are strongly risk averse individuals is not consistent with the available observations establishing that criminals are more sensitive to shifts in the probability of sanction than to changes in the level of the sanction. We suggest that: 1/ while a weakening of the risk aversion assumption may be useful, the risk seeking assumption may be better suited for criminals; 2/ the relevant assumption regarding criminals' risk attitude may depend on the policy instruments that models of crime deterrence take into account; 3/ additional experiments, including both monetary penalties and non monetary sanctions would be useful in order to learn more about their sensibility to probability, monetary and non monetary sanctions.
|Item Type:||MPRA Paper|
|Institution:||BETA, CNRS and Nancy University|
|Original Title:||Criminals and risk attitude|
|Keywords:||Risk aversion; monetary and non monetary sanctions; State Dependent preferences and RDEU models|
|Subjects:||K - Law and Economics > K4 - Legal Procedure, the Legal System, and Illegal Behavior > K42 - Illegal Behavior and the Enforcement of Law
K - Law and Economics > K4 - Legal Procedure, the Legal System, and Illegal Behavior > K40 - General
D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D81 - Criteria for Decision-Making under Risk and Uncertainty
K - Law and Economics > K4 - Legal Procedure, the Legal System, and Illegal Behavior > K41 - Litigation Process
|Depositing User:||Eric Langlais|
|Date Deposited:||13. Dec 2006|
|Last Modified:||07. May 2014 22:30|
Beck U. (1992), Risk Society: Towards a New Modernity, London, Ed. Sage.
Becker G. (1968), Crime and punishment: an economic approach, Journal of Political Economy, 76, 169-217.
Bigus J. (2006), Tort liability and probability weighting function according to Prospect Theory, paper presented at the 2006 American Law & Economics Association Annual Meeting.
Block M. and Gerety V. (1995), Some experimental evidence on differences between student and prisoner reactions to monetary penalies and risk, Journal of Legal Studies, 123-138.
Chateauneuf, A., and Cohen, M. (1994), Risk seeking with diminishing marginal utility in a non expected utility model, Journal of Risk and Uncertainty, 9, 77-91.
Chew S., Karni E., and Safra Z. (1987), Risk aversion in the theory of expected utility with Rank Dependent preferences, Journal of Economic Theory, 42, 370-381.
Cohen M. (1995), Risk aversion concepts in expected and non-expected utility models, Geneva Papers on Risk and Insurance Theory, 20, 73-91.
Cook P. and Graham D. (1977), The demand for insurance and protection: the case of irreplaceable commodities, Quarterly Journal of Economics, 41, 143-156.
Dehez P. and Drèze J. (1987), State-dependent utility, the demand for insurance and the value of safety, in Drèze: Essays on economic decisions under uncertainty, Cambridge University Press.
Eide (2005), Accident liability with Rank Dependent Expected Utility, paper presented at the 22nd Annual Meeting of the European Association of Law & Economics, 2005.
Giddens A. (1991), Modernity and Self-Identity, Standford University Press.
Jones-Lee M. (1974), The value of changes in the probability of death or injury, Journal of Political Economy, 82, 835-849.
Grogger J. (1991), Certainty vs. severity of punishment, Economic Inquiry, 29, 297-309.
Neilson W. and Winter H. (1997), On criminals' risk attitude, Economics Letters, 55, 97-102.
Neilson W. (1998), Optimal punishment schemes with state-dependent preferences, Economic Inquiry, 36, 266-271.
Nell, M. and Richter A. (2003), The design of liability rules for highly risky activities - Is strict liability superior when risk allocation matters?, International Review of Law and Econmics, 23, 31-47.
Polinsky M. and Shavell S. (1979), The optimal trade-off between the probability and magnitude of fines, American Economic Review, 69, 880-891.
Polinsky M. and Shavell S. (1984), The optimal use of fines and imprisonment, Journal of Public Economics, 24, 89-99.
Teitelbaum J. (2006), A unilateral accident model under ambiguity, paper presented at the 2006 American Law & Economics Association Annual Meeting.
Tversky A. and Wakker P. (1995), Risk attitudes and decision weights, Econometrica, 63, 1255-1280.
Zivin, J., R. Just and D. Zilberman (2006), Risk aversion, liability rules and safety, International Review of Law and Economics, forthcoming.