2
CRIME AND PUNISHMENT:
AN ECONOMIC APPROACH
victed and the nature and extent of punishments differ greatly from person
to person and activity to activity. Yet, in spite of such diversity, some
common properties are shared by practically all legislation, and these
properties form the subject matter of this essay.
in the first place, obedience to law is not taken for granted, and
public and private resources are generally spent in order both to prevent
offenses and to apprehend offenders. In the second place, conviction is not
generally considered sufficient punishment in itself; additional and some-
times severe punishments are meted out to those convicted. What deter-
mines the amount and type of resources and punishments used to enforce
a piece of legislation? In particular, why does enforcement differ so
greatly among different kinds of legislation?
The main purpose of this essay is to answer normative versions of
these questions, namely, how many resources and how much punish-
ment should be used to enforce different kinds of legislation? Put
equivalently, although more strangely, how many offenses should
be per-
mitted and how many offenders should
go
unpunished? The method used
formulates a measure of the social loss from offenses and finds those ex-
penditures of resources and punishments that minimize this loss. The
general criterion of social loss is shown to incorporate as special cases,
valid under special assumptions, the criteria of vengeance, deterrence,
compensation, and
rehabilitation
that
historically have figured
so
prominently in practice and criminological literature.
The optimal amount of enforcement is shown to depend on, among
other things, the cost of catching and convicting offenders, the nature of
punishments—for example, whether they are fines or prison terms—and
the responses of offenders to changes in enforcement. The discussion,
therefore, inevitably enters into issues in penology and theories of
criminal behavior. A second, although because of lack of space subsidiary,
aim of this essay is to see what insights into these questions are provided
by our "economic" approach. It is suggested, for example, that a useful
theory of criminal behavior can dispense with special theories of anomie,
psychological inadequacies, or inheritance of special traits and simply
extend the economist's usual analysis of choice.
II. BASIC ANALYSIS
A. THE COST OF CRIME
Although the word "crime" is used in the title to minimize terminologi-
cal innovations, the analysis is intended to be sufficiently general to cover
Crimes against persont
Crimes against propert
Illegal goods and
Some other crimes
Total
Public expenditures on
Corrections
Some private costs of
Overall total
SOURCE. —
Presidet
all violations, not jus
receive so much new:
white-collar crimes,
broadly, "crime" is
notwithstanding the
evidence recently pu
Enforcement and Adi
reproduced in Table
and local levels on po
amounted to over $'
guards, counsel, and
lion. Unquestionably
significantly understa
the course of enforcii
I. This neglect probat
merit any systematic sciei
analysis is seen most clearl
gambling is an "economic
true that this loss of proba
the excitement of gamblin
pleasures of gambling are
are likely to engender a r
for the higher and more
Appendix).
