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Testing the effects of crime on the Italian economy

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Author Info

  • Claudio Detotto

    ()
    (Dipartimento Economia, Impresa e Regolamentazione (DEIR) and CRENoS, University of Sassari)

  • Pulina Manuela

    ()
    (School of Economics and Management, Fac. of Economics, Free Univ. Bolzano; CRENoS, Univ. Sassari)

Abstract

This paper aims at assessing the causal and temporal relationships between crime and the economic indicators related to the aggregated demand function. The case study is Italy and a quarterly frequency is used (1981:1-2005:4). A Vector Autoregressive Correction Mechanism (VECM) is employed after having assessed the integration and cointegration status of the variables under investigation. Long and short run dynamics are estimated. A Granger causality test is also implemented to establish temporal interrelationships. The main findings are that, in the short run, crime positively effects GDP and government expenditure, while has a crowding out effect on exports. In the long run, crime positively leads imports and inflation, whereas negatively investments and government expenditure.

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File URL: http://www.accessecon.com/Pubs/EB/2010/Volume30/EB-10-V30-I3-P189.pdf
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Bibliographic Info

Article provided by AccessEcon in its journal Economics Bulletin.

Volume (Year): 30 (2010)
Issue (Month): 3 ()
Pages: 2063-2074

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Handle: RePEc:ebl:ecbull:eb-10-00465

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Related research

Keywords: Crime; aggregated demand; short and long run dynamics; Granger causality;

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Cited by:
  1. Biagi, Bianca & Brandono, Maria Giovanna & Detotto, Claudio, 2012. "The effect of tourism on crime in Italy: A dynamic panel approach," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 6(25), pages 1-24.

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