Competition in Crime Deterrence.

This paper studies competition between jurisdictions in the eradication of crime. In one story, criminals choose the jurisdiction in which they will commit their crimes while jurisdictions choose the amount of resources devoted to deterrence to protect local production. In another story, the criminals cannot change jurisdictions but they can not rob the owners of mobile capital. Jurisdictions choose the amount of resources devoted to the deterrence of local crime so as to secure property rights and to attract capital. In both stories, competition between jurisdictions leads to overdeterrence relative to the Pareto optimal level.