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Enforcement Spillovers

Johannes Rincke1; Christian Traxler2

1 University of Erlangen-Nürnberg · 2 University of Marburg and Max Planck Institute for Research on Collective Goods

The Review of Economics and Statistics 2011 open access

Abstract This paper identifies spillovers from law enforcement. Our approach makes use of microdata on compliance with TV license fees that allow us to distinguish between households that were subject to enforcement and those that were not. Using snowfall as an instrument for local inspections, we find a striking response of households to increased enforcement in their vicinity: on average, three detections make one additional household comply with the law. As compliance rises significantly among those who had no exposure to field inspections, our findings establish a sizable externality in enforcement.

DOI
10.1162/rest_a_00128
Volume
93 (4)
Pages
1224-1234
Language
en
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