So, a shady character approaches you and offers a deal that would make you $1K richer. You know that worst case scenario if you accept and they get caught is that you will just have to return the $1K, so you have no incentive to refuse to deal with them. No, you need something like 3x damages to properly disincentivise people from turning a blind eye.
The case I had in mind was philantropy, where the $1000 would go to some charitable project. This creates a more difficult situation if you have to hand it back, because you’ve presumably spent it, and not on something that makes you personally stronger. So you are suddenly faced with the potentially-diffocult task of scraping together money to pay back.
I do agree that optimal incentives would weight things inversely to the probability of them getting caught. I’m not sure how necessary perfectly optimal incentives are, since telling your community’s other donors that one of the donors turned out to be a bad actor and now we need a bunch of their money to pay back the bad actor’s victims seems like it would suck.
A shady character donated $1K to starving children in Africa, using me as an intermediary. Now I need to make sure those children will return 3× the amount.
Nope, it’s now on you, not on them. Do not let shady people route their money through you; if you do, now people get to blame you. (Not saying it’s necessary a good thing, just what it is).
So, a shady character approaches you and offers a deal that would make you $1K richer. You know that worst case scenario if you accept and they get caught is that you will just have to return the $1K, so you have no incentive to refuse to deal with them. No, you need something like 3x damages to properly disincentivise people from turning a blind eye.
The case I had in mind was philantropy, where the $1000 would go to some charitable project. This creates a more difficult situation if you have to hand it back, because you’ve presumably spent it, and not on something that makes you personally stronger. So you are suddenly faced with the potentially-diffocult task of scraping together money to pay back.
I do agree that optimal incentives would weight things inversely to the probability of them getting caught. I’m not sure how necessary perfectly optimal incentives are, since telling your community’s other donors that one of the donors turned out to be a bad actor and now we need a bunch of their money to pay back the bad actor’s victims seems like it would suck.
A shady character donated $1K to starving children in Africa, using me as an intermediary. Now I need to make sure those children will return 3× the amount.
Nope, it’s now on you, not on them. Do not let shady people route their money through you; if you do, now people get to blame you. (Not saying it’s necessary a good thing, just what it is).
No, you need to return that out of your own pocket.