Does uncertainty deter crime?

Abstract

When the probability of apprehension and conviction is observed with noise, the decision to commit a crime is influenced by the uncertainty about the true probability. In this note we show that increases in the uncertainty discourage criminal behavior only in societies with high criminal rates -- where individuals are already highly prone to act illegally. Our findings also show that severity of punishment and uncertainty about the probability of apprehension and conviction are substitute (complementary) anti-crime policy instruments whenever the size of sanction is high (low, respectively) enough.