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Reexamining Criminal Behavior: The Importance of Omitted Variable Bias

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  • David B. Mustard

    (Terry College of Business, University of Georgia)

Abstract

Recently many papers have used the arrest rate to measure punishments in crime-rate regressions. However, arrest rates account for only a portion of the criminal sanction. Conviction rates and time served are theoretically important, but rarely used, and excluding them generates omitted variable bias if they are correlated with the arrest rate. This paper uses the most complete set of conviction and sentencing data to show that arrest rates are negatively correlated with these normally excluded variables. Consequently, previous estimates of arrest-rate effects are understated by as much as 50%. Also, conviction rates, but not sentence lengths, have significant explanatory power in standard crime-rate regressions. © 2003 President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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Bibliographic Info

Article provided by MIT Press in its journal Review of Economics and Statistics.

Volume (Year): 85 (2003)
Issue (Month): 1 (February)
Pages: 205-211

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Handle: RePEc:tpr:restat:v:85:y:2003:i:1:p:205-211

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Web page: http://mitpress.mit.edu/journals/

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Cited by:
  1. Nicolas Gérard Vaillant & François-Charles Wolff, 2009. "Does punishment of minor sexual offences deter rapes? Longitudinal evidence from France," Working Papers hal-00424479, HAL.
  2. Kwabena Gyimah-Brempong, 2006. "Neighborhood income, alcohol availability, and crime rates," The Review of Black Political Economy, Springer, vol. 33(3), pages 21-44, March.
  3. Zimmerman, Paul R., 2010. "Deterrence from self-protection measures in the ‘market model’ of crime: dynamic panel data estimates from employment in private security occupations," MPRA Paper 26187, University Library of Munich, Germany.
  4. Naci Mocan & Kaj Gittings, 2010. "The Impact of Incentives on Human Behavior: Can We Make it Disappear? The Case of the Death Penalty," NBER Chapters, in: The Economics of Crime: Lessons for and from Latin America, pages 379-418 National Bureau of Economic Research, Inc.
  5. William T. Harbaugh & Naci H. Mocan & Michael S. Visser, 2011. "Theft and Deterrence," NBER Working Papers 17059, National Bureau of Economic Research, Inc.
  6. Entorf, Horst & Spengler, Hannes, 2008. "Is Being 'Soft on Crime' the Solution to Rising Crime Rates? Evidence from Germany," IZA Discussion Papers 3710, Institute for the Study of Labor (IZA).
  7. Lau, Evan & Hamzah, Siti Nur Zahara, 2012. "Crimonometric Analysis: Testing the Deterrence Hypothesis in Sabah," MPRA Paper 39297, University Library of Munich, Germany.
  8. Earl L. Grinols & David B. Mustard, 2006. "Casinos, Crime, and Community Costs," The Review of Economics and Statistics, MIT Press, vol. 88(1), pages 28-45, February.
  9. Kelaher, Richard & Sarafidis, Vasilis, 2011. "Crime and Punishment Revisited," MPRA Paper 28213, University Library of Munich, Germany.
  10. Entorf, Horst, 2012. "Certainty and Severity of Sanctions in Classical and Behavioral Models of Deterrence: A Survey," IZA Discussion Papers 6516, Institute for the Study of Labor (IZA).

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