Effects of the Third Party Errors

30 Pages Posted: 29 Nov 2014

See all articles by Andrey Shastitko

Andrey Shastitko

Lomonossov Moscow State University; Russian Academy of National Economy and Public Administration under the President of the Russian Federation (RANEPA) - Moscow Campus

Date Written: July 10, 2014

Abstract

Type-I and type-II errors effects do matter both from the rules enforcement perspective and vertically upward to rules enactment. The paper support conventional idea about detrimental influence on deterrence of both types of errors. At the same time special role of type-I errors is demonstrated based on strategic interaction between economic exchange participants supported by third-party enforcement with opportunities to discriminate players. The paper highlights the issue that errors in enforcement is not whole story: the simple classification of cases is suggested from the perspective of type-I and type-II errors in rules enforcement and rules enactment.

Keywords: types-I&II errors, institutions, rules enforcement, rules enactment, discrimination, Nash equilibrium

JEL Classification: D02, K10, K42, P48

Suggested Citation

Shastitko, Andrey and Shastitko, Andrey, Effects of the Third Party Errors (July 10, 2014). Available at SSRN: https://ssrn.com/abstract=2529026 or http://dx.doi.org/10.2139/ssrn.2529026

Andrey Shastitko (Contact Author)

Russian Academy of National Economy and Public Administration under the President of the Russian Federation (RANEPA) - Moscow Campus ( email )

Moscow, 119571
Russia

Lomonossov Moscow State University ( email )

1-46 Leninskiye Gory
Moscow, 119991
Russia

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