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Working Paper
On the political economy of income redistribution and crime
A general equilibrium analysis of the effects of income redistribution and crime, showing that while expenditures on police protection reduce crime, it is possible for the crime rate to increase with redistribution.
Journal Article
The changing relationship between income and crime victimization
This paper was presented at the conference "Unequal incomes, unequal outcomes? Economic inequality and measures of well-being" as part of session 3, " Education and crime in urban neighborhoods." The conference was held at the Federal Reserve Bank of New York on May 7, 1999. The author examines the changes in the relationship between income and crime victimization over time. He argues that the poor suffer disproportionately more from property crime today than they did twenty years ago, possibly because of the increased reliance on theft-prevention devices by higher income groups. The ...
Report
On the political economy of income redistribution and crime
We study a one-sector growth model which is standard except for the presence of an externality in the production function. The set of competitive equilibria is large. It includes constant equilibria, sunspot equilibria, cyclical and chaotic equilibria, and equilibria with deterministic or stochastic regime switching. The efficient allocation is characterized by constant employment and a constant growth rate. We identify an income tax-subsidy schedule that supports the efficient allocation as the unique equilibrium outcome. That schedule has two properties: (i) it specifies the tax rate to be ...
Working Paper
Crime and arrests: deterrence or resource reallocation?
We use monthly time-series data for 20 large U.S. cities to test the deterrence hypothesis (arrests reduce crimes) and the resource reallocation hypothesis (arrests follow from an increase in crime). We find (1) weak support for the deterrence hypothesis, (2) much stronger support for the resource reallocation hypothesis, and (3) differences in city-level estimates suggest much heterogeneity in the crime and arrest relationship across regions.
Journal Article
Murder mystery
Working Paper
'Captive markets': the impact of kidnappings on corporate investment in Colombia
This paper measures the impact of crime on firm investment by exploiting variation in kidnappings in Colombia from 1996 to 2002. Our central result is that firms invest less when kidnappings directly target firms. We also find that broader forms of crime--homicides, guerrilla attacks, and general kidnappings--have no significant effect on investment. This finding alleviates concerns that our main result may be driven by unobserved variables that explain both overall criminal activity and investment. Furthermore, kidnappings that target firms reduce not only the investment of firms that sell ...
Working Paper
What accounts for the decline in crime?
The authors? dynamic equilibrium model guides their quantitative investigation of the major determinants of property-crime patterns in the U.S. The model is capable of reproducing the drop in property crime that occurred between 1980 and 1996. The most important influences on the decline are a higher probability of apprehension, a stronger economy, and the aging of the population. The effect of unemployment on crime is negligible. Increased inequality in earnings prevented an even larger decline in crime. The authors? analysis can account for the behavior of the time series of property crime ...