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Crime as a local public bad, neighbourhood observation and reporting

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Author Info

  • Siddhartha Bandyopadhyay
  • Kalyan Chatterjee

Abstract

We examine the effects of giving incentives for people to report crime on crime rates. In particular, we look at what happens when the costs of reporting are negligible and the cost of being interrogated by the police are high in a rational choice model of crime and crime reporting. Perverse equilibria where everyone reports or no one reports (and thus reports have no informational value) emerge. This happens both in a model where police make rational inferences about crime based on reports as well as in a model where police investigate according to fixed rules, operating under a fixed budget. Importantly, generating more reports about crime could actually increase equilibrium crime rates. This occurs via a resource thinning effect caused by "too many" reports. Hence, from a policy perspective increasing incentives for neighbours to report suspicious activities may prove to be counterproductive. We also show how different ways of profiling certain groups of people can either increase or decrease crime rates in the profiled group.

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File URL: ftp://ftp.bham.ac.uk/pub/RePEc/pdf/crimemay9_06.pdf
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Bibliographic Info

Paper provided by Department of Economics, University of Birmingham in its series Discussion Papers with number 06-04.

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Length: 27 pages
Date of creation: May 2006
Date of revision:
Handle: RePEc:bir:birmec:06-04

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Postal: Edgbaston, Birmingham, B15 2TT
Web page: http://www.economics.bham.ac.uk
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Related research

Keywords: Neighbourhood; crime reporting and multiple equilibria;

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References

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  1. Glaeser, Edward L & Sacerdote, Bruce & Scheinkman, Jose A, 1996. "Crime and Social Interactions," The Quarterly Journal of Economics, MIT Press, vol. 111(2), pages 507-48, May.
  2. Gary S. Becker, 1968. "Crime and Punishment: An Economic Approach," Journal of Political Economy, University of Chicago Press, vol. 76, pages 169.
  3. Fender, John, 1999. "A general equilibrium model of crime and punishment," Journal of Economic Behavior & Organization, Elsevier, vol. 39(4), pages 437-453, July.
  4. Canice Prendergast, 2001. "Selection and Oversight in the Public Sector, With the Los Angeles Police Department as an Example," NBER Working Papers 8664, National Bureau of Economic Research, Inc.
  5. Steven Shavell & A. Mitchell Polinsky, 2000. "The Economic Theory of Public Enforcement of Law," Journal of Economic Literature, American Economic Association, vol. 38(1), pages 45-76, March.
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Cited by:
  1. Siddhartha Bandyopadhyay & Kalyan Chatterjee, 2008. "Crime Reporting: Profiling and Neighbourhood Observation," Discussion Papers 08-07, Department of Economics, University of Birmingham.

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