Crime and social norms

In this paper, we develop a general equilibrium model of crime. It is shown that law and norms are substitutes in achieving a stable equilibrium. Here we offer a new interpretation of different theories of social norms in the context of crime and deterrence. The law and economics theory is presented as an opportunism-limiting approach to norms whereas the evolutionary theory is presented as an opportunity cost approach.Received: January 2003, Accepted: July 2003, JEL Classification: D59, K14, K42Paper presented at the 3rd annual meeting of SPIE Portuguese Association for Research in Economics, June 22-23, 1998, Braga and at the 15th annual meeting of the European Association of Law and Economics, September 24-26, 1998, Utrecht. I am grateful to two referees and the editor for helpful comments that much improved the paper, and to Dorothea Kübler, Eric Posner, Dieter Schmidtchen, and Stergios Skaperdas for suggestions that much improved this paper, and to Kelly Markva for research assistantship. The author acknowledges the financial support of FCT, Lisbon, Portugal. Part of this paper was written while the author visited Stanford Law School. The usual disclaimer applies.