New Perspectives on Economic Crime

New Perspectives on Economic Crime

New Horizons in Law and Economics series

Edited by Hans Sjögren and Göran Skogh

Economic crime is, by definition, crime committed to gain profit within an otherwise legitimate business. Examples are illegal pollution, brand name infringement and tax evasion. The victims of such crimes may be private citizens, businesses and the state. The leading authors in this vital new book survey recent advances in the study of economic crime from a variety of disciplinary perspectives.

Chapter 5: Law and economics of environmental crime

Michael G. Faure and Marjolein Visser

Extract

Michael G. Faure and Marjolein Visser INTRODUCTION In the economic analysis of law, much attention has been paid to the instruments to be used for the control of environmental pollution. However, lawyers seem to focus mainly on environmental standards (emission standards and quality standards) and on the question of how these standards should be set, whereas economists (mostly interested in environmental economics) focus mainly on ‘economic instruments’ (emission trading and taxes). Environmental law is often categorized as administrative law for an integrated approach (Faure and Skogh, 2003). However, in practice the whole body of environmental law is, to a large extent, also criminal law. The usual way in which environmental law is structured consists of the imposition on industry of specific administrative requirements, specifying the permissible amounts and quality of polluting emissions, and the punishment, as environmental crimes, of violations of these requirements. In legal literature, much attention has been paid to the way in which the law should use penal sanctions to deter environmental pollution, but environmental criminal law has not, so far, been very often subjected to an economic analysis. The goal of this chapter is to provide an overview of the way in which traditional theories on the economics of crime have been applied to environmental criminal law. We will therefore begin by addressing the question of why, according to the economist literature, criminal law should be used at all to deter environmental pollution. An inevitable question in that respect, obviously, is whether other instruments, such as...

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