The New Deterrence: Crime and Policy in the Age of Globalization

• Author: Patrick J. Keenan
• Position: Assistant Professor of Law and Richard W. and Marie L. Corman Scholar, University of Illinois College of Law
• Pages: 02

Patrick J. Keenan: Assistant Professor of Law and Richard W. and Marie L. Corman Scholar, University of Illinois College of Law. J.D., Yale Law School. I am grateful to Margareth Etienne, Tom Ginsburg, Anna-Maria Marshall, Richard McAdams, Michael Moore, Jim Pfander, and Tom Ulen for helpful comments and discussions. I am also grateful to Laura Fernandez, Marlene Siedlarz, and Amy Tomaszewski for excellent research assistance and to law librarians Paul Healey and Jane Williams for their help tracking down difficult sources. Page 507

Introduction

Crime has historically been a local phenomenon. Most murder victims know their killers;¹ most victims of child abuse know their abusers;²victims of theft often need not look beyond their own neighborhoods for the thieves. Crime is regulated locally. In the United States, it is the states, not the federal government, that prosecute the vast majority of criminal cases.³ Law enforcement budgets may rely on funds from the federal government, but enforcement priorities are set locally. Although there is some coordination among law enforcement agencies from different states in the United States and between agencies from different countries, crime remains a local problem.

Globalization is changing this in ways that have yet to be fully explored. Although crime as an event will always have a substantial local component because it is typically responded to by officials and victims in the place it occurs, it is becoming much more of a transnational phenomenon. It is increasingly common for activity that is regulated in one country because it is dangerous or unwanted to become more common in other countries where the activity is equally (or almost equally) unwanted but much less effectively regulated. What happens when activity that is unwanted in two places is more effectively regulated in one place than in the other? Does the unwanted activity migrate from the first state to the second? How much of it migrates, and what factors influence the amount of displacement? How should scholars and policymakers conceive of regulation in these circumstances-as a local response to a local problem or as part of a broader effort to reduce the overall incidence of the unwanted activity? These questions are fundamental to determining what globalization will mean in the new century, but so far have not been fully explored. The existing scholarship on deterrence will be of limited use in a globalized context.

This Article is the first attempt to fill the gap by developing a richer approach to deterrence for a globalized world. I draw insights from both law-and-economics and criminology literature to enrich our understanding of deterrence. To ground my theoretical discussion in a real-world problem, throughout the Article I use sex tourism as an example of the kind of Page 508 unwanted activity that now crosses borders and has complicated our understanding of deterrence. I focus on two issues central to deterrence in a globalized world that have not received sufficient scholarly attention: the phenomenon of displacement and the role of status. I add three important considerations. First, I argue that informal sanctions, as opposed to formal, legal sanctions, are increasingly important and must be part of any effective deterrence policy. Second, I argue that substitution-when activity migrates from one location to another because of changes in enforcement policy in the first place-is a complicated process that can be manipulated to enhance deterrence. Finally, I argue that when unwanted behavior involves people from different countries, scholars must consider the role of status in deterrence. Differences in status can distort the social processes of judgment and disapproval that allow communities to control unwanted behavior without recourse to law. These are vitally important issues. Because globalized crime is so widely dispersed, it will be almost impossible for the local communities affected to get together and develop a coordinated plan. If law enforcement successes in the West are not to turn into social disasters for those in the developing world, scholars and policymakers must bring theory into step with the ways that globalization has changed the reality of crime.

This Article proceeds in five parts. Part I begins with an illustration of the kind of phenomenon that drives my analysis: sex tourism, the practice of tourists traveling abroad to engage in sex with prostitutes, often children. Any discussion of deterring unwanted activity on a global scale could have significance in the spheres of terrorism, white collar crime, money laundering, environmental activity, and commercial regulation. But I use the example of sex tourism because it contains stark examples of the kinds of legal and social issues at the heart of deterrence. In this Part, I describe the ways that the tools of globalization have allowed sex tourism to grow and thrive.

Part II presents and critiques the literature that frames the current discourse on crime and its deterrence. The literature fits into two broad categories: economics and sociology (or criminology). The law-and- economics literature assumes that people deciding whether to engage in activity that is unwanted by the larger society behave rationally. That is, potential offenders weigh the utility they will receive from the activity against two factors: the probability of being caught engaging in the activity and the sanction they would suffer if caught. The law-and-economics approach is general: it simplifies complex phenomena so they can be modeled and examined. But simplification can render the results of the model of only marginal use in a world populated by individual people, each motivated by her own reasons and emotions. At the other extreme is the work of sociologists and criminologists. This literature often considers the Page 509 motivations of individual offenders in an attempt to understand the amalgam of reasons offered to explain why people commit crimes (or, for that matter, engage in any activity, criminal or not).⁴ This literature is often too specific to be of use in shaping policy.

Parts III and IV are the heart of the Article. Part III contains the first of my refinements of the traditional view of deterrence. The most basic model draws on a straightforward law-and-economics framework and considers three variables: the utility that the desired illegal behavior will bring to the offender, the probability that he will be detected, and the expected legal sanction. This rational choice framework underlies most discussions of deterrence. More sophisticated law-and-economics models attempt to account for the possibility that an increase in the cost of one crime (either through a harsher punishment or stricter enforcement) will lead the offender to substitute another activity for the preferred crime.⁵ These models compare two deterrence equations to ask if the benefit from new activity, reduced by the costs mentioned above, is greater than the benefit from the original activity (also reduced by the two costs). I argue that these models, in their attempt at simplicity, leave out an important factor. In most models, substitution is assumed to be a costless transaction. This assumption-dubious even with regard to domestic crime-is at odds with the reality of transnational activity. There are substantial risks associated with displacement or substitution,⁶ including the costs of switching from one activity to another, gathering information on the second activity, and the cost of violating norms against the new activity. When these factors are Page 510 included in the equation, what seem to be adequate policy responses begin to look inadequate.

Part IV addresses the complicated role that status plays in deterrence. Most considerations of deterrence do not consider the effect of status differences in deterring transnational crimes.⁷ Status is important to deterrence in a variety of ways. My discussion centers on its role in the creation, enforcement, and erosion of social norms, the social rules and customs that guide and govern the behavior of most people. In Part v. I briefly conclude by attempting to apply the lessons of theory to policy options.

Before moving on, three clarifications are in order. First, "globalization" is a slippery term that is used to explain any number of ills and benefits. I use a definition adopted from Joseph Stiglitz, formerly chief economist at the World Bank and the head of President Bill Clinton's Council of Economic Advisors. As I use it, globalization means the closer integration of the countries and peoples of the world due to a radical reduction in the transaction costs associated with transnational activity. This is due mostly to a reduction in costs of transportation and communication.⁸ It means that transnational activity happens more quickly, more easily, and more often than in the past. In other words, it is now possible for vast numbers of people to do very often what small...