The New York Times reported Thursday that Wal-Mart has adopted a new policy of not prosecuting shoplifting if $25 or less is involved. Why has Wal-Mart gone soft? It costs too much to enforce the law, too much for Wal-Mart, and that is with Wal-Mart just focusing on its costs. The costs to the police of enforcing those laws are substantial; indeed, South Strabane Township in Pennsylvania (population 9,000) has one of its 16 officers tied up on Wal-Mart shoplifting duty. And Dan Filler notes how much of the local court docket is chewed up by shoplifting.
As Stephen Dubner points out, the change could give rise to some interesting empirical effects. He focuses on what the police will do now that they are not hanging out at Wal-Mart. I want to know how many more shoplifters well head to Wal-Mart and will they be careful to choose the $24.99 headphones rather than the really nice ones?
But my real interest here, raised before, is whether we would benefit by lowering the cost of enforcement, should we have such a technology available? If Wal-Mart and the police could drop the cost of enforcement 50% or more, is there any reason we shouldn’t want that?