Guns and crime revisited

I focus on the effect of changes in public security (policing) on private security measures that potential victims can take. In particular, I look at the tradeoff between different types of private security measures – such as using or carrying guns, carrying less cash or keeping less valuables at home, and using burglar alarms or Lojack – and study how this tradeoff is affected by changes in public security. If private householders’ direct security expenses are strongly substitutable with public policing (e.g., for guns which may be more useful in badly policed areas), an increase in policing results in a drop in these expenses; it also results in carrying or keeping less cash (an indirect security measure which reduces the prize a criminal can seize). If, however, householders’ direct security expenses are “complementary” to policing in the sense that they are more effective when police response is rapid (e.g., for burglar alarms), more policing increases these expenses unless the efficacy of joint (public and private) security expenses on combating crime encounters very sharply diminishing returns; moreover, a rise in policing also induces carrying or keeping more cash. An increase in penalties increases the tendency to keep cash on hand, and also reduces crime, provided that as private precautions increase, with policing constant, it takes a larger increment in security spending to compensate for a specific drop in penalties. The results are consistent with some empirical trends in crime rates, policing, penalties and private precautions.     

Terror and the costs of crime

This paper argues that terrorism, beyond its immediate impact on innocent victims, also raises the costs of crime, and therefore, imposes a negative externality on potential criminals. Terrorism raises the costs of crime through two channels: (i) by increasing the presence and activity of the police force, and (ii) causing more people to stay at home rather than going out for leisure activities. Our analysis exploits a panel of 120 fatal terror attacks and all reported crimes for 17 districts throughout Israel between 2000 and 2005. After controlling for the fixed-effect of each district and for district-specific time trends, we show that terror attacks reduce property crimes such as burglary, auto-theft, and thefts-from-cars. Terror also reduces assaults and aggravated assaults which occur in private homes, but increases incidents of trespassing and “disrupting the police.” Taken as a whole, the results are consistent with a stronger deterrence effect produced by an increased police presence after a terror attack. A higher level of policing is likely to catch more people trespassing, and at the same time, reduce the number of property crimes. The decline in crimes committed in private houses is likely an indication that the tendency for individuals to stay home after a terror attack further increases the costs of crime.     

Police-Monitored Cameras and Crime*

We study the effects of police monitoring on crime. We exploit detailed information on the location and date of installation of police-monitored surveillance cameras, coupled with data at the street-segment level on all reported crimes in the city of Montevideo, Uruguay. We find that the introduction of police-monitored surveillance cameras reduces crime by about 20 percent in monitored areas relative to a pure control group located outside the city. We also explore potential displacement effects, and we do not find evidence of such effects.     

Police Violence and the Underreporting of Crime

This paper examines the relationship between police violence and the reporting of crime. Utilizing original data from a large‐scale household survey conducted in Costa Rica from October 2013 to April 2014 (n = 4,200), we find that the observation of police violence significantly reduces citizens’ willingness to report crime. The implications of this finding are explored using a game‐theoretic model of crime, crime reporting, and police misconduct. The model reveals that although the prospect of police violence against criminals may generate a degree of deterrence for criminal behavior, permissiveness toward police violence also raises expectations about the likelihood of police abuse against law‐abiding citizens. Consistent with our empirics, this reduces citizens’ propensity to report crime, thereby fostering a climate of impunity for criminal activity.     

Violent crime and punishment: an application of the LISREL model

Public anxiety over violent crime has forged a broad consensus to purchase more crime control. Recently, the President brought into law a federal anti-crime bill that will put an additional 100 000 police on the nation's streets. This paper presents empirical evidence on the deterrence effect of police presence. The principal finding is that police presence deters commission of violent crimes by increasing the risk of being punished for committing those crimes. This risk is modelled as a latent variable, because the probability and severity of punishment for committing a violent crime are generally communicated in an onconsistant fashion. The violent crime commission rate is also treated as a latent variable, because it is almost certainly afflicted with measurement error.     

Individual protection against property crime: decomposing the effects of protection observability

Abstract.  We re-examine the efficiency of observable and unobservable crime protection decisions with new results and insights. Observable protection is unambiguously associated with a negative externality. At the individual level, it reduces the crime effort, but its unit payoff remains unchanged. Conversely, unobservable protection reduces the unit payoff and has no effect on the crime effort exerted, though it deters crime globally. A decrease in the global crime payoff is detrimental to a victim if protection is observable, while it is beneficial when unobservable. While observable protection has a positive diversion effect, it has the opposite effect when unobservable.     

How corruption hits people when they are down

Using Peruvian data, I show that victims of misfortune, particularly crime victims, are much more likely than non-victims to bribe public officials. Misfortune increases victims' demand for public services, raising bribery indirectly, and also increases victims' propensity to bribe certain officials conditional on using them, possibly because victims are desperate, vulnerable, or demanding services particularly prone to corruption. The effect is strongest for bribery of the police, where the increase in bribery comes principally through increased use of the police. For the judiciary the effect is also strong, and for some misfortunes is composed equally of an increase in use and an increase in bribery conditional on use. The expense and disutility of bribing thus compound the misery brought by misfortune.     

How corruption hits people when they are down

Using Peruvian data, I show that victims of misfortune, particularly crime victims, are much more likely than non-victims to bribe public officials. Misfortune increases victims' demand for public services, raising bribery indirectly, and also increases victims' propensity to bribe certain officials conditional on using them, possibly because victims are desperate, vulnerable, or demanding services particularly prone to corruption. The effect is strongest for bribery of the police, where the increase in bribery comes principally through increased use of the police. For the judiciary the effect is also strong, and for some misfortunes is composed equally of an increase in use and an increase in bribery conditional on use. The expense and disutility of bribing thus compound the misery brought by misfortune.     

Does crime deter South Africans from self-employment?

The very high crime rate in South African cities is often argued to be the main reason for the country's small share of business ownership and self-employment. This paper revisits this hypothesis. We estimate the effect of crime on business ownership and performance using a matched dataset of census, survey and police data. In contrast to previous studies, which take into account perceived rather than actual crime and often focus on specific geographic areas, we do not find robust evidence that high crime rates have a negative impact on business ownership. Even though our estimate of the effect of crime is statistically significant and negative, it is economically small. Further, we find no evidence for a negative effect of actual crime on sales, profits and investment of informal businesses. This may imply that the low share of business ownership and self-employment in South Africa must have other reasons. These results may also suggest that crime may not be in general a serious threat for small businesses in low and middle-income countries, however, this needs further empirical research.     

The social economic impact of AIDS: Accounting for intergenerational transmission,productivity and fertility

In this paper we develop a model that aims to investigate the economic and demographic impacts of three effects of the HIV-AIDS epidemic in developing countries. The direct effect of the HIV epidemic is that it increases mortality and morbidity. The two indirect effects, resulting from the first, are the reduction in productivity of adults and the transmission of the disease to their offsprings. We allow these different effects to act either separately or together, and we investigate the marginal efficiency of health expenditures on the survival probability of individuals and demographics. The direct effect of the HIV virus is that it leads adults to increase their own health expenditure and to decrease that of their children. On the contrary, the transmission effect of the HIV virus leads parents to spend more on their children than on their own. We show that the reduction in productivity of young adults decreases health expenditures for themselves and their children. Furthermore, we find that the productivity effect dominates by large the two others. Moreover, when adults decide to have fewer children because of HIV, we show that the ratio of low to high skilled workers increases. This demographic impact impoverishes the economy in the short and medium run.     

Motivation crowding‐out and green‐paradox‐like outcomes

We analyze the effectiveness of environmental policy in a framework in which households’ utility is determined by both private and social components, representing their extrinsic and intrinsic motivations to undertake green actions, respectively. Environmental policy, in the form of a subsidy aiming to incentivize the adoption of a green technology, on the one hand, directly increases households’ extrinsic motivation, while, on the other hand, indirectly decreases their intrinsic motivation. We show that, provided that the indirect effect dominates, the policy leads to crowding‐out of intrinsic motivation which ultimately undermines the effectiveness of the policy itself. Specifically, despite its positive effect on environmental outcomes in the short run, the policy will lead to a deterioration in long‐run environmental outcomes, giving rise to a reverse green‐paradox‐like outcome. Moreover, even in the case in which the direct effect dominates, provided that the indirect effect is large enough, the policy will generate a deterioration in short‐run environmental outcomes. These results clearly suggest that the optimal design of environmental policy is particularly complicated since it requires to take into account also its effects on intrinsic motivation.     

Crime and local inequality in South Africa

We examine the effects of local inequality on property and violent crime in South Africa. The findings are consistent with economic theories relating local inequality to property crime and also with sociological theories that imply that inequality leads to crime in general. Burglary rates are 25–43% higher in police precincts that are the wealthiest among their neighbors, suggesting that criminals travel to neighborhoods where the expected returns from burglary are highest. Finally, while we find little evidence that inequality between racial groups fosters interpersonal conflict at the local level, racial heterogeneity itself is highly correlated with crime.     

The political economy of enforcer liability for wrongful police stops

This article questions whether excessive policing practices can persist in an environment where law enforcement policies are subject to political pressures. Specifically, it considers a setting where the police decide whether to conduct stops based on the suspiciousness of a person's behavior and the potential liability for conducting a wrongful stop. We establish that the liability level that results in a voting equilibrium is smaller than optimal, and consequently, that excessive policing practices emerge in equilibrium.     

The Effects of a Right to Silence

Contrary to conventional wisdom, a right to silence can reduce wrongful convictions of innocent suspects who tell police the truth, and may reduce the overall conviction rate without affecting the confession rate. We establish these conclusions by modelling interrogation as a game in which suspects are privately informed of their type, but do not know the content of witness reports. Our model has testable implications which distinguish it from competing models. The best data rejects competing models, but does not reject our model.     

Agglomeration,city size and crime

This paper analyzes the relationship between crime and agglomeration where the land, labor, product, and crime markets are endogenously determined. Our main theoretical findings are the following: (i) better accessibility to jobs decreases crime in the short run but may increase crime in the long run; (ii) the per-capita crime rate increases with city size; (iii) when allowing for endogenous policing, lower commuting costs make the impact of police on crime more efficient.     

INFLATION,OUTPUT, AND WELFARE*

We study the effects of anticipated inflation on aggregate output and welfare within a search‐theoretic framework. We consider two pricing mechanisms: ex post bargaining and a notion of competitive pricing. Under bargaining, the equilibrium is generically inefficient and an increase in inflation reduces buyers' search intensities, output, and welfare. If prices are posted and buyers can direct their search, search intensities are increasing with inflation for low inflation rates and decreasing for high inflation rates. The Friedman rule achieves the efficient allocation, and inflation always reduces welfare, although it can have a positive effect on output for low inflation rates.     

Private protection and public policing

This paper looks at situations in which public and private protection are complementary, that is, when private protection must be coordinated with public protection to be effective. For example, home alarms deter theft by being connected to a local police station: if the police do not respond to a home alarm, the home alarm on its own is virtually useless in halting a crime in action. We make a distinction between gross and net complementarity and substitution, where the latter takes into account the effect on the crime rate. We show that when public and private protection are complements, the optimal provision of public protection trades off the manipulation effect of encouraging private protection with the compensatory effect of providing protection to households that do not privately invest. We discuss the implications of our results for policy and empirical research in this area.     

Can racially unbiased police perpetuate long-run discrimination?

We develop a stylized dynamic model of highway policing in which a non-racist police officer exhibits a cognitive bias: relative overconfidence. The officer is given incentives to arrest criminals but faces a per stop cost that increases when the racial mix of her stops differs from that of the population. By observing the racial composition of jail inmates, she estimates crime rates of each race. Her overconfidence regarding eventual incarceration of criminals is shown to lead her to overestimate the crime rate of one race causing the long-run racial composition of the jail population to deviate from the “fair” one.     

Modeling crime in Japan

This study aims at identifying the factors of aggregate and disaggregate crime categories in Japan over the period 1964–2009. All crime categories are related to police outlays, police numbers, unemployment, divorce and urbanization rates. Bounds testing approach to cointegration is implemented to test the existence of a long-run relationship amongst the variables. Cointegration analysis yields that the main deterrent effect on crime is the police presence and this factor is further confirmed by the real police outlays. As for the essential cause of crime, urbanization stands as the leading factor which is followed by divorce and unemployment rates. Policy implications are discussed.