Designing Crime Bounties
I’ve been thinking about how to design a bounty system for enforcing criminal law. It is turning out to be a bit more complex than I’d anticipated, so I thought I’d try to open up this design process, by telling you of key design considerations, and inviting your suggestions.
The basic idea is to post bounties, paid to the first hunter to convince a court that a particular party is guilty of a particular crime. In general that bounty might be paid by many parties, including the government, though I have in mind a vouching system, wherein the criminal’s voucher pays a fine, and part of that goes to pay a bounty.
Here are some key concerns:
There needs to be a budget to pay bounties to hunters.
We don’t want criminals to secretly pay hunters to not prosecute their crimes.
We may not want the chance of catching each crime to depend lots on one hunter’s random ability.
We want incentives to adapt, i.e., use the most cost-effective hunter for each particular case.
We want incentives to innovate, i.e., develop more cost-effective ways to hunt over time.
First hunter allowed to see a crime scene, or do an autopsy, etc., may mess it up for other hunters.
We may want suspects to have a right against double jeopardy, so they can only be prosecuted once.
Giving many hunters extra rights to penetrate privacy shields may greatly reduce effective privacy.
It may be a waste of time and money for several hunters to simultaneously pursue the same crime.
Witnesses may chafe at having to be interviewed by several hunters re the same events.
In typical ancient legal systems, a case would start with a victim complaint. The victim, with help from associates, would then pick a hunter, and pay that hunter to find and convict the guilty. The ability to sell the convicted into slavery and to get payment from their families helped with 1, but we no longer allow these, making this system problematic. Which is part of why we’ve added our current system. Victims have incentives to address 2-4, though they might not have sufficient expertise to choose well. Good victim choices give hunters incentive to address 5. The fact that victims picked particular hunters helped with 6-10.
The usual current solution is to have a centrally-run government organization. Cases start via citizen complaints and employee patrols. Detectives are then assigned mostly at random to particular local cases. If an investigation succeeds enough, the case is given to a random local prosecutor. Using government funds helps with 1, and selecting high quality personnel helps somewhat with 3. Assigning particular people to particular cases helps with 6-10. Choosing people at random, heavy monitoring, and strong penalties for corruption can help with 2. This system doesn’t do so well on issues 4-5.
The simplest way to create a bounty system is to just authorize a free-for-all, allowing many hunters to pursue each crime. The competition helps with 2-5, but having many possible hunters per crime hurts on issues 6-10. One way to address this is to make one hunter the primary hunter for each crime, the only one allowed any special access and the only one who can prosecute it. But there needs to be a competition for this role, if we are to deal well with 3-5.
One simple way to have a competition for the role of primary hunter of a crime is an initial auction; the hunter who pays the most gets it. At least this makes sense when a crime is reported by some other party. If a hunter is the one to notice a crime, it may make more sense for that hunter to get that primary role. The primary hunter might then sell that role to some other hunter, at which time they’d transfer the relevant evidence they’ve collected. (Harberger taxes might ease such transfers.)
Profit-driven hunters help deal with 3-5, but problem 2 is big if selling out to the criminal becomes the profit-maximizing strategy. That gets especially tempting when the fine that the criminal pays (or the equivalent punishment) is much more than the bounty that the hunter receives. One obvious solution is to make such payoffs a crime, and to reduce hunter privacy in order to allow other hunters to find and prosecute violations. But is that enough?
Another possible solution is to have the primary hunter role expire after a time limit, if that hunter has not formally prosecuted someone by then. The role could then be re-auctioned. This might need to be paired with penalties for making overly weak prosecutions, such as loser-pays on court costs. And the time delay might make the case much harder to pursue.
I worry enough about issue 2 that I’m still looking for other solutions. One quite different solution is to use decision markets to assign the role of primary hunter for a case. Using decision markets that estimate expected fines recovered would push hunters to accumulate track records showing high fine recovery rates.
Being paid by criminals to ignore crimes would hurt such track records, and thus such corruption would be discouraged. This approach could rely less on making such payoffs illegal and on reduced hunter privacy.
The initial hunter assignment could be made via decision markets, and at any later time that primary role might be transferred if a challenger could show a higher expected fine recovery rate, conditional on their becoming primary. It might make sense to require the old hunter to give this new primary hunter access to the evidence they’ve collected so far.
This is as far as my thoughts have gone at the moment. The available approaches seem okay, and probably better than what we are doing now. But maybe there’s something even better that you can suggest, or that I will think of later.
I like the crime security insurance angle. You take out crime victim insurance with a firm, who presumably makes agreements with other similar firms, does reinsurance, etc... all that standard stuff. You comply with their standard policies regarding preventing crime. If you are victimized, they are responsible for paying you restitution, but in your contract you sign over the right to pursue the criminal.
Their incentive is to both deter criminals from preying on their customers and to collect from criminals what restitution is available to help make up their losses. They'd typically be a professional organization at investigating crimes, or else they'd subcontract with one, similar to how current art theft insurance, for example, works.
Applying that to the numbered concerns:1. The investigatory budget is supplied by the insurance payments and primarily recouped from the caught criminals.2. The insurance company doesn't have an incentive to let criminals off the hook.3. They're involved professionally, so average quality of investigation rises.4. They have an incentive to not spend more than is optimal on a particular criminal.5. Ditto cost-effectiveness, including in defensive anti-criminal technologies.
6. Single source for investigation authorization.7. Only one prosecution per victim.8-10. Not using many hunters.
A new tack: Many of these problems arise from the assumption that some governing body must pay bounties. The example given by 18th England suggests it suffices to make criminals responsible for payment of fines. As David Friedman notes in his analysis, this gives an incentive to go after richer rather than poorer defendants. But as that same example teachers, there remain ample incentives to prosecute even criminals that own nothing.
In that system...
1. The budget for prosecutions is provided in the first instance by criminals and secondarily by as a club good by parties joined in common defense.
2. We don't care if criminals buy off prosecutions. Indeed, the prospect of settlement is a large incentive to prosecute.
3. We can accept that prosecutors' luck shapes outcomes because we expect that the right to prosecute will be transferred in due course to the party most likely to succeed. Coase.
4. The system provides incentives for "hunters" (as well as the more general class of prosecutors) to adapt; see answer 3. The right to prosecute will be transferable.
In my version, the victim has a presumptive right to prosecute but others might. In fact, maybe it would be best to vest the right in the victim(s) or estate(s) and then allow prosecutors to assume the right by payment of a transfer fee to the victim.
5. This system provides incentives to innovate.
6. Nobody need worry about the first party on the scene of the crime messing up the evidence because that evidence would constitute a valuable asset. Why? Because prosecuting the criminal can lead to gain, and having that evidence makes prosecution more efficient.
7. Agreed that there should be a double jeopardy defense.
8. As we've discussed elsewhere, the problem of privacy-invading prosecutions might be solved by making prosecutors potentially liable for intrusions into the privacy of accused parties--on condition that the parties not settle or, if it goes to trial, the prosecutor wins.
9. Several hunters will not likely simultaneously pursue the same crime assuming adequate controls on double jeopardy. There will be an incentive to file suit first, balanced by the risk of not having adequate evidence to win or otherwise misjudging the case. Presumably, losers pay winners costs. See Ulex!
10. Prosecutors need not be given a special privilege to impose on witnesses. If they want testimony, they can persuade witnesses to give it by charm, moral suasion, or cash.
Of course, you might say to all this: I *want* a bounty system! But if you can take another step towards privatization, and add a few rules, your problems seem to greatly ease.