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March 21, 2008

When Rational Incentives and Three-Strikes Laws Collide

Ray Fisman
Lambert Family Professor of Social Enterprise
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In doing background research on my most recent Slate article, I tried to find political reasons why California set up its three-strikes law in a way that seems crazy to economists.

For me, this type of story underscores the value of understanding the basics of cost-benefit analysis and incentives, which is a big part of what I hope I’m communicating to my students in Managerial Economics. It’s central to making good decisions, whether in government, nonprofits or business.

And hopefully, pointing out such missteps in business or policy is an important role that scholars have in connecting their work to real-world practice.

I do think that the effects of the three-strikes law in its current form were simply the result of a lack of foresight. And this has mattered a lot for current and future policy.

There have been attempts to amend California’s three-strikes legislation, but laws are sticky — once they’re in place, it’s really hard to change them. So despite a recent (failed) statewide referendum on the issue, California is still saddled with a bad piece of legislation.


by Leah Smolker | March 22, 2008 at 10:46 PM

The problem is not the incentives, the problem is that marijuanna possession and golf club theft are considred felonies.

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