A simple model of crime waves, riots, and revolutions

Standard economic models of criminal behavior analyze the criminal's decision in a partial equilibrium context. The standard model does not recognize that the probability of being punished is a function of the total amount of crime that occurs. As the total amount of crime increases, police resources become strained, courts become congested, and prisons become overcrowded. As a result, proportionately fewer criminals are apprehended, convicted, and imprisoned. The feedback effects from one criminal's decision to participate in crime to another criminal's decision can be highly significant. In one parameterization of the model developed here, the individual commits twice as many crimes for a given parameter shift than is implied by the standard model. The model also sheds light on other areas where criminal actions are interdependent such as riots, crime waves, and revolutions.