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Crime as a local public bad, neighbourhood observation and reporting

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Author Info
Siddhartha Bandyopadhyay and Kalyan Chatterjee

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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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Publisher 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
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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;

Find related papers by JEL classification:
C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. A. Mitchell Polinsky & Steven Shavell, 2000. "The Economic Theory of Public Enforcement of Law," Journal of Economic Literature, American Economic Association, vol. 38(1), pages 45-76, March. [Downloadable!] (restricted)
    Other versions:
  2. Fender, John, 1999. "A general equilibrium model of crime and punishment," Journal of Economic Behavior & Organization, Elsevier, vol. 39(4), pages 437-453, July. [Downloadable!] (restricted)
  3. 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. [Downloadable!] (restricted)
    Other versions:
  4. Gary S. Becker, 1968. "Crime and Punishment: An Economic Approach," Journal of Political Economy, University of Chicago Press, vol. 76, pages 169. [Downloadable!] (restricted)
    Other versions:
  5. 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. [Downloadable!] (restricted)
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This page was last updated on 2009-11-19.

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