Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments January 5, 2020 erstellt
Description:
This paper offers an option value-based rationale for the consideration of a non-compliance record in sentencing decisions. We study compliance decisions of a population of individuals who live for two periods. We show that when non-compliance benefits are random and independent across periods, increasing or decreasing sanctions produce different option values to current-period compliance and non-compliance. The difference between these option values provides incentives for present-period compliance and facilitates a more efficient allocation of sanctions across periods. The optimal sanction scheme depends on the magnitude of the overall sanction relative to the distribution of benefits from non-compliance