Abstract
Delinquents are embedded in a network of relationships. Each delinquent decides in a non-cooperative way how much delinquency effort he will exert. We characterize the Nash equilibrium and derive an optimal enforcement policy, called the key-player policy. We then extend our characterization of optimal single player network removal to optimal group removal, the key group. We also characterize and derive a policy that targets links rather than players. Finally, we endogenize the network connecting delinquents by allowing players to join the labor market instead of committing delinquent offenses. The key-player policy turns out to be much more complex because it depends on wages and on the structure of the network. (JEL: A14, C72, K42, L14). © 2010 by the European Economic Association.
Original language | English |
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Pages (from-to) | 34-61 |
Number of pages | 28 |
Journal | Journal of the European Economic Association |
Volume | 8 |
Issue number | 1 |
DOIs | |
Publication status | Published - Mar 2010 |
Externally published | Yes |