Leniency Can Increase Deterrence

•Police are given broad discretion to be lenient with citizens.•Leniency can increase deterrence for some types of crime.•Leniency can also make both police and citizens happier. Police discretion raises deterrence if the odds of lenient treatment fall with the severity of the crime. Leniency also provides an incentive for citizens to cooperate with law enforcement. When the police discover a crime, a guilty citizen decides whether to share any information. If such cooperation ever reveals a secondary crime, a citizen only shares information if the police sometimes reduce penalties for the initial crime. Thus, when citizens are multiply active in crime, discretion is a further tool for deterrence. Generous discounts induce universal cooperation, and the possibility of being caught for a secondary crime reduces the incentive to invest in every crime.