Fines as enforcers’ rewards or as a transfer to society at large? Evidence on deterrence and enforcement implications

Abstract

We analyze experimental data to assess whether the deterrent effect of expected fines depends on who receives the fines’ proceeds. We compare behavior in treatments when the revenue is a reward for enforcement agents to the alternative when fines are transferred to society at large. Most important, with a fixed detection probability, potential offenders’ material incentives are held constant across treatments. Our evidence suggests that the deterrent effect of expected fines is greater when enforcement agents obtain the fine revenue. Our results also document that the characteristics of enforcers who are willing to incur private costs to create a positive detection probability seem to depend on whether fines reward enforcers or are transferred to society at large.

How does Indian news media report smokeless tobacco control? A content analysis of the gutka ban enforcement

“…Likewise, enforcement was dynamic when champions led the inspection drives and there was access to information (tip-offs) and high-level support. Rewards in the form of cash (n = 2) were also a motivating factor, which relate to two studies arguing that the effect of enforcement is stronger when officials are compensated by the fines collected [ 43 , 44 ]. Several barriers raised by the news are consistent with global and Indian tobacco control literature, particularly with regard to gutka, where legal loopholes, lack of awareness and enforcement, and litigation by tobacco industries are associated with violation of the ban, sale of twin packets, without mandated health warnings [ 31 , 45 , 46 ].…”