Working Paper: CEPR ID: DP3782
Authors: Louis Hotte; Fabrice Valognes; Tanguy Van Ypersele
Abstract: We propose a market-for-offenses model of property crime, which explicitly accounts for protection expenditures among heterogeneous individuals. The crime equilibrium is modeled as a free-access equilibrium in which the match between criminals and victims equates the average returns to crime. We borrow from the literature on the economics of conflicts in order to define an appropriation function that combines the efforts of criminals with the protection efforts of the victims. The supply and demand for crime are endogenized taking into account incentives to participate in criminal activities and individual protection decisions. The effects of changes in public enforcement, redistribution policies and economic development are analyzed, as well as the distribution of the burden of crime among heterogeneous individuals.
Keywords: crime; economic development; inequality; private protection; public enforcement; redistribution
JEL Codes: D63; D74; K42; O17
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| protection expenditures (H56) | property crime (K11) |
| public enforcement policies (K40) | property crime (K11) |
| economic development (O29) | protection expenditures (H56) |
| economic development (O29) | property crime (K11) |