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TIME, MONEY, AND OPTIMAL CRIMINAL PENALTIES
Author(s) -
Baum Sandy,
Kamas Linda
Publication year - 1995
Publication title -
contemporary economic policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.454
H-Index - 49
eISSN - 1465-7287
pISSN - 1074-3529
DOI - 10.1111/j.1465-7287.1995.tb00733.x
Subject(s) - economics , liberian dollar , earnings , punishment (psychology) , prison , unit (ring theory) , welfare , marginal utility , marginal cost , public economics , actuarial science , microeconomics , finance , law , market economy , psychology , social psychology , mathematics education , mathematics , political science
The economic approach to optimal criminal penalties measures the welfare effects of crime and punishment in dollar terms, ignoring differences in the marginal utility of money among people. This paper alternatively proposes using time as the unit of measure in determining optimal criminal penalties, measuring the costs and benefits of crime in hours or days instead of dollars. The policy implications differ substantially from those in the existing economic literature. Equal prison terms impose similar time costs on all individuals rather than being more costly for those with higher foregone earnings. Equal fines impose the same cost on all individuals in the dollar‐based economic models but in a time‐denominated system are costlier to those who require more time to earn the money to pay the fines. In principle, one can use either money or time in setting penalties. However, time‐based penalties are more consistent with the fundamental and widely held principles of justice on which the U.S. legal system rests.