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Encyclopedia of Criminology and Criminal Justice pp 1280–1286Cite as

Economic Theory of Criminal Behavior

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Overview

The economics of crime started with the seminal article by Nobel Laureate Gary Becker in 1968. He suggested the well-known high-fine-low-probability result, in a framework where rational criminals compare the benefit of violating the law with the possible cost (in terms of probability and severity of punishment). Legal economists have developed a theory of deterrence in the last 40 years to explain optimal punishment in multiple contexts. The main results as well as new insights provided by behavioral law and economics are reviewed.

Basic Model

The economic theory of criminal behavior is an application of the neoclassical theory of demand. Formalized by Nobel Laureate Gary Becker in 1968, it states that potential criminals are economically rational and respond significantly to the deterring incentives by the criminal justice system. They compare the gain from committing a crime with the expected cost, including the risk of punishment, the possibility of social stigma, and...

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Recommended Reading and References

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Author information

Authors and Affiliations

  1. College of Law, University of Illinois at Urbana-Champaign, Champaign, IL, USA

    Nuno Garoupa

Authors
  1. Nuno Garoupa
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Corresponding author

Correspondence to Nuno Garoupa .

Editor information

Editors and Affiliations

  1. Netherlands Institute for the Study of Crime and Law Enforcement (NSCR), Amsterdam, The Netherlands

    Gerben Bruinsma

  2. VU University Amsterdam, Amsterdam, The Netherlands

    Gerben Bruinsma

  3. Department of Criminology, Law and Society, George Mason University, Fairfax, VA, USA

    David Weisburd

  4. Faculty of Law, The Hebrew University, Mt. Scopus, Jerusalem, Israel

    David Weisburd

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Garoupa, N. (2014). Economic Theory of Criminal Behavior. In: Bruinsma, G., Weisburd, D. (eds) Encyclopedia of Criminology and Criminal Justice. Springer, New York, NY. https://doi.org/10.1007/978-1-4614-5690-2_409

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  • DOI: https://doi.org/10.1007/978-1-4614-5690-2_409

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  • Publisher Name: Springer, New York, NY

  • Print ISBN: 978-1-4614-5689-6

  • Online ISBN: 978-1-4614-5690-2

  • eBook Packages: Humanities, Social Sciences and Law

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