Thomas J. Miceli
Escalating Penalties for Repeat Offenders: Why are they So Hard to Explain?
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- 10.1628/093245613X671193
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Escalating penalties for repeat offenders are a pervasive feature of punishment schemes in various contexts, but economic theory has had a hard time rationalizing the practice. This paper reviews the literature on escalating penalties, and then develops a theory based on uncertainty on the part of enforcers about offenders' gains from committing socially undesirable acts. The analysis derives the conditions under which escalating penalties are both optimal (cost-minimizing) and subgame-perfect. It goes on to discuss several extensions and qualifications.