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Optimal Justice in a General Equilibrium Model with Non Observable Individual Productivities

Author

Listed:
  • Pierre Lasserre
  • Antoine Soubeyran
Abstract
In this general equilibrium model, justice and police institutions are treated as a mechanism that induces individuals to extend some desirable productive effort. This determines individual encroachment activities which in turn determine the proportion of aggregate production that fails to be appropriated, and the private incentives to choose productive activities. Since individuals have different productive abilities society would ideally take both equity and efficiency into consideration in the design of its institutions: encroachment is a form of redistribution from the most talented individuals to the least talented ones. We study the stylized properties that should arise when individual productivities are not observable by the system, and when both detection levels and justice accurary are costly instruments. Nous étudions dans un modèle d'équilibre général le rôle du système judiciaire comme instrument d'allocation des activités de production et de prédation. Les décisions individuelles se prennent compte tenu, à la fois des sentences que l'on peut escompter à la suite d'activités prohibées, et de la mesure dans laquelle, à l'équilibre, les producteurs peuvent s'approprier le fruit de leurs efforts. Comme les capacités productives diffèrent d'une personne à l'autre, il est socialement désirable de prendre en compte des considérations d'équité et d'efficacité dans la conception des institutions : la prédation est une forme de redistribution des plus productifs vers les moins productifs. Nous étudions les faits stylisés qui caractériseraient un tel système lorsque les productivités individuelles ne sont pas observables et que tant le niveau de détection que la précision des décisions de justice sont des caractéristiques coûteuses des institutions.

Suggested Citation

  • Pierre Lasserre & Antoine Soubeyran, 1999. "Optimal Justice in a General Equilibrium Model with Non Observable Individual Productivities," CIRANO Working Papers 99s-37, CIRANO.
    • Handle: RePEc:cir:cirwor:99s-37
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    File URL: https://cirano.qc.ca/files/publications/99s-37.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Justice; institutions; incentives; crime; information; observability; agency; general equilibrium; Justice; institutions; incitations; crime; information; observabilité; agence; équilibre général;
    All these keywords.

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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