The severity of the sanction for a given offense is often determined by the offense history of the offender. We establish that this policy can be welfare-maximizing if individuals are imperfectly informed about the magnitude of the sanction. Imperfect information distorts individuals' perception...

Research in criminology has shown that the perceived risk of apprehension often differs substantially from the true level. To account for this insight, we extend the standard economic model of law enforcement (Becker, 1968) by considering two types of offenders, sophisticates and naïves. The...

Offenders differ with respect to their detection probability in reality. Bebchuk and Kaplow [Bebchuk, L. A., & Kaplow, L. (1993). Optimal sanctions and differences in individuals’ likelihood of avoiding detection. International Review of Law and Economics, 13, 217–224] conclude that optimal...