Can punishment generate specific deterrence without updating? Analysis of a stated choice scenario

Earnhart, Dietrich and Friesen, Lana (2013) Can punishment generate specific deterrence without updating? Analysis of a stated choice scenario. Environmental and Resource Economics, 56 3: 379-397. doi:10.1007/s10640-013-9652-0


Author Earnhart, Dietrich
Friesen, Lana
Title Can punishment generate specific deterrence without updating? Analysis of a stated choice scenario
Journal name Environmental and Resource Economics   Check publisher's open access policy
ISSN 0924-6460
1573-1502
Publication date 2013-11
Year available 2013
Sub-type Article (original research)
DOI 10.1007/s10640-013-9652-0
Volume 56
Issue 3
Start page 379
End page 397
Total pages 19
Place of publication Dordrecht, Netherlands
Publisher Springer
Collection year 2014
Language eng
Abstract This study explores the specific deterrence generated by punishment in the context of regulatory violations with a focus on the distinction between upward revisions to future punishment parameters-likelihood and severity-and the experience of being penalized. In order to avoid the pitfalls of empirically analyzing actual choices made by regulated entities, e.g., measuring entities' beliefs regarding the likelihood and size of future penalties, our study examines behavior associated with a stated choice scenario presented within a survey distributed to the environmental managers of facilities regulated under the US Clean Water Act. This choice of respondents strengthens the external validity of our empirical results. Based on a variety of statistical methods, our empirical results strongly and robustly reject the standard hypothesis that specific deterrence stems solely from upward revisions to punishment parameters while supporting the alternative hypothesis of experiential deterrence, whereby facilities focus on recent experiences to shape their compliance behavior.
Keyword Behavioral economics
Compliance
Deterrence
Wastewater discharges
Q-Index Code C1
Q-Index Status Confirmed Code
Institutional Status UQ

Document type: Journal Article
Sub-type: Article (original research)
Collections: Official 2014 Collection
School of Economics Publications
 
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Created: Wed, 01 May 2013, 11:16:53 EST by Alys Hohnen on behalf of School of Economics