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    • br Concluding remarks Among other relevant results special

    2018-10-25


    Concluding remarks Among other relevant results, special mention must be made of the evidence found that the relationship between income and the risk of victimization for property crimes in Brazil has an inverted-U shape. Our evidence based on comprehensive geographical coverage data is in line with the results obtained by Gomes and Paz (2008) and Justus and Kassouf (2013). We found that as the income of an individual increases, the risk of victimization increases to a certain point, from which it special info decreases as the income rises. Despite the existence of an inverted U-shape relationship between income and victimization risk and, consequently, of an income level at which the risk of victimization reaches its peak, this level corresponds to the income earned by the wealthiest 1%. In other words, for 99% of the Brazilian population, increases in income are associated with increased victimization by theft and attempted theft or robbery. For the crime of robbery, the relationship between the risk of victimization and personal income appears to be negative, which conflicts with the initial conjecture and some of the results found in the literature (Justus et al., 2015). However, data from the PNAD 2009 suggests that most robberies occur outside one\'s home, on the street (70.48%). We therefore believe that the chance of falling victim to robbery is more related to the individual\'s behavior (routine activities) and to public security policies than to personal income level (attractiveness).
    Introduction The literature on capture offers an answer. It may be optimal to separate regulators when they may collude with the agent in order to appropriate public resources. A simple way to model this effect is to drop the assumption of complete contracts, which may be written by the regulators themselves, possibly corrupt. In this case, the resulting coordination problem may be beneficial as it decreases the rent lost to corruption. One problem with this model is that if the regulator is corrupt, he will not write a contract that maximizes social welfare in the first place. Laffont and Martimort (1999) justified this approach based on a model in which the agent\'s type may be unveiled due to some technology operated by regulators. These latter are corrupt, while the central authority that writes the contracts is benevolent. Their paper shows that separating monitoring technologies among regulators increases welfare. However, their model assumes centralized contracting: only the central authority writes contracts, and the middleman is defined as the regulator. The contribution of the present paper is to determine under which conditions it is worth to split not only monitoring technologies, but also the power to write contracts. In this context, I show that separation is not necessarily better than integration of regulators. Still, separation is the optimal choice as long as it decreases corruption (with respect to integrated regulators) in the sense of Laffont and Martimort (1999). Therefore, it may be the best institutional answer in some cases. I relate the choice of the optimal regulatory structure to the size of regulated projects. The present paper relates to two major strands in the literature that help understand the internal organization of governments. The first is the literature on multiple principals, or common agency. Bernheim and Whinston (1986) established, in a moral hazard framework, a basic result: under asymmetric information, the equilibrium under competing principals is less efficient than the equilibrium under centralized contracting. This happens because each principal free-rides on the payment made by the others to elicit effort from the agent.Martimort (1992) and Stole et al. (1991) extended this result to an adverse selection setting, as in the setup I use. Moreover, I use the delegation principle developed in Martimort and Stole (2002) as it is not possible to apply directly the Revelation Principle under multiple principals. Martimort and Stole (2009) established the differences in intrinsic common agency games, as studied in the present paper, in which the agent must decide between all contracts or no contract, and delegated agency, in which further distortions arise as the agent may choose only some contracts. Bond and Gresik (1996) and Calzolari (2001) applied the theory of common agency to the regulation of multinational firms, a study that lends itself naturally to the multi-principal setup since national governments are separated.