Revising a Model of Crime and Punishment
We study a model of society consisting of agents and a government interacting according to decisions regarding cost-effective punishment of crime. We evaluate different strategies for the government in order to reduce the criminal activity, considering degrees of honesty and a possible cost for monitoring and apprehension. We extend a previous model by introducing a contagion effect for the degrees of honesty, and study properties which may lead to a crime-free society, including a game-theoretic formulation.
Becker, C. (1968). Crime and Punishment: An Economic Approach, Journal of Political Economy, vol. 76, pp. 169-217.
Friedland, N., Maital, S., Rutenberg, A. (1978). A simulation study of income tax evasion. Journal of Public Economics 10, pp. 107-116.
Iglesias, J. R., Semeshenko, V., M. Schneider E. M. and Gordon, M. B. (2012). Crime and punishment: Does it pay to punish? Physica A: Statistical Mechanics and its Applications, vol. 391 issue 15, pp. 3942–3950, August.
Nash, J. F. (1950). Equilibrium points in n-person games, Proc. Nat. Acad. Sci. Wash. 36.
Van Eeghen, W. and Fernández, R. (2016). How to audit income tax - two models combined, Utrecht University, January.
Von Neumann, J. and Morgenstern, O. (1947). Theory of Games and Economic Behavior, Princeton University Press.