This paper identifies enforcement spillovers. Our approach makes use of
micro data on compliance with TV license
fees that allow us to distinguish between households who were subject to
enforcement and those who were not.
Using snowfall as an instrument for local inspections, we find a striking
response of households to increased
enforcement in their vicinity: On average, three detections make one
additional household comply with the law. As
compliance rises significantly among those who had no exposure to
enforcement, our findings establish a substantial
externality in law enforcement.