“Here, as elsewhere in economics, the assumption of rationality does not imply that muggers (or economics professors) calculate the costs and benefits of available alternatives to seventeen decimal places-merely that they tend to choose the one that best achieves their objectives.

“If muggers are rational, we do not have to make mugging impossible in order to prevent it, merely unprofitable. If the benefits of a profession decrease or its costs increase, fewer people will enter it-whether the profession is plumbing or burglary. If little old ladies start carrying pistols in their purses, so that one mugging in ten puts the mugger in the hospital or the morgue, the number of muggers will decrease drastically-not because they have all been shot but because most will have switched to safer ways of making a living. If mugging becomes sufficiently unprofitable, nobody will do it.”

“If a crime produces a net benefit, if the gain to the speeder or the lost hunter is more than the loss to the rest of us, we are better off not deterring it. In many cases our legal system permits such "efficient crimes" by not classifying them as crimes. Every time I breath out I exhale carbon dioxide-regarded, in some contexts, as a pollutant. Most of us are confident that this particular offense is an efficient one-we are better off if we put up with a certain amount of extra carbon dioxide than if we all stop breathing. So exhaling, unlike some other forms of pollution, is not illegal. Similarly, the lost hunter of my example would probably be excused from criminal liability under the doctrine of necessity.

“How, in such situations, can we deter inefficient speeding while permitting efficient speeding? The answer is simple: Set the expected punishment equal to the damage done. Under this rule, criminal punishment functions as a probabilistic price system.”

“I am a policeman, you are a criminal, and I have the evidence that will convict you. The cost to you of being convicted is $50,000-either a fine or an equivalent jail sentence. The benefit to me of convicting you is a commendation from my superior officer and a small increase in my prospects for promotion-worth, say, $10,000 in future income.

Seen from the standpoint of Dragnet, the rest is obvious. I deliver both you and the evidence to the D.A., and the story is over. Seen from the standpoint of an economically rational police officer, it is equally obvious. I sell you the evidence for something between ten and fifty thousand dollars, and we both go home.”

Becker and Stigler suggested a simple and radical solution to this problem-privatize the catching of criminals. Instead of paying the policeman a salary, pay him the fines collected from the criminals he brings in. If the convicted criminal will owe a $50,000 fine to the policeman, the lowest bribe the policeman will accept to let him off is $50,000. If the criminal offers that much, in order to avoid the expense of defending a hopeless case in court, there is no reason we should object-the criminal has paid his fine, the policeman has received his salary, and the taxpayers have been saved the cost of a trial.

Such a system of private enforcement raises a new issue: how to allocate crimes. Since policemen are now private bounty hunters, how do we decide which one is entitled to catch a particular criminal and collect his fine? One solution is to make the crime the property of the victim. He sells the right to solve it to a (private) policeman. This process allocates crimes to enforcers-efficiently, since the enforcer best able to catch the criminal will be willing to pay the highest price. Victims receive some reimbursement for their loss, and we need no longer worry about keeping policemen from accepting bribes.

By following out the line of argument begun by Becker and Stigler, we have reinvented civil law-the law of torts as distinguished from the law of crimes. It is the victim of a tort, not the state, who has a claim against the tortfeasor. While modern American law does not permit him to sell the entire claim to the lawyer who will go to court and collect it, he can sell part of the claim by hiring the lawyer on a contingency basis. Some earlier forms of civil law permitted the outright sale of civil claims, and some modern writers have argued that we should do the same. (Friedman 1984, Shukaitis 1987).

What we call bribery in the criminal context is called an out of court settlement in civil law-and is how most civil claims are collected. Since the payment is made to the person who would have collected the fine (called a "damage payment" in the civil system), an out of court settlement achieves the same result as a trial and at lower cost.

This suggests an interesting question: Should we abolish the criminal law? Would we be better off if we turned all crimes into torts, replacing enforcement by the state with enforcement by private police selected by the victims? To put the question differently, is there any logic to our present system, where if someone assaults me I call the police but if he reneges on a contract I call my lawyer?