Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/56146
Authors: 
Buccirossi, Paolo
Spagnolo, Giancarlo
Year of Publication: 
2001
Series/Report no.: 
SSE/EFI Working Paper Series in Economics and Finance 456
Abstract: 
We study the consequences of 'leniency' - reduced legal sanctions for wrongdoers who spontaneously self-report to law enforcers - on corruption, drug dealing, and other forms of sequential, bilateral, illegal trade. We find that when not properly designed, leniency may be highly counterproductive. In reality leniency is typically moderate, in the sense of only reducing, or at best cancelling the sanctions for the self-reporting party. Moderate leniency may greatly facilitate the enforcement of long-term illegal trade relations, and may even provide an effective enforcement mechanism for occasional (one-shot) illegal transactions, which would not be enforceable otherwise.
Subjects: 
Law enforcement
Self-reporting
Corruption
Crime
Illegal trade
Drug dealing
JEL: 
K00
K21
K42
Document Type: 
Working Paper

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