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thomblake comments on The Wrath of Kahneman - Less Wrong
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Why should the money automatically go to the state?
To partially answer my own question: possibly, to compensate for court costs. However, if that were the rationale, then this cost should be levied for every trial.
It should probably not go to the claimant because this would encourage spurious lawsuits for the sole purpose of trying to gather lots of money. Assuming a non-corrupt government, it should go to the state (or other level of government) so that it could benefit everybody, e.g. via tax breaks, or more investment in science, medicine, education, etc.
In practice governments are corrupt, so the answer is a bit more complicated. If the money does go to the government, how do we make sure the government isn't tempted to cause the punishment to become unfairly severe in order to gather more income?