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Main street business initiatives and crime in small towns

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  • Johnson, Josiah
  • Smith, Rhet A.

Abstract

Small businesses are vital to the municipalities they serve. Significant government resources and geographically-targeted economic policies are allocated toward enhancing their presence and impact on the community. In this paper, we exploit a television show contest among small towns for a $500,000 revitalization award to study the impact of place-based economic policies on crime. We use a difference-in-differences approach and synthetic control techniques and find significant declines in property crimes for two of the three winning towns examined. Our results shed light on the positive spillover effects of place-based initiatives and the effectiveness of these investments as a crime reduction strategy in small towns. We estimate a savings from fewer crimes of between $80,000 to $100,000 annually following the year the investment occurs.

Suggested Citation

  • Johnson, Josiah & Smith, Rhet A., 2023. "Main street business initiatives and crime in small towns," Journal of Economic Behavior & Organization, Elsevier, vol. 209(C), pages 91-112.
    • Handle: RePEc:eee:jeborg:v:209:y:2023:i:c:p:91-112
    DOI: 10.1016/j.jebo.2023.02.016
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    More about this item

    Keywords

    Small business; Crime; Place-based policies; Synthetic control; Crime deterrence;
    All these keywords.

    JEL classification:

    • H76 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Other Expenditure Categories
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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