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Social Networks and Crime Decisions: The Role of Social Structure in Facilitating Delinquent Behavior

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  • Calvó-Armengol, Antoni

    ()
    (Universitat Autònoma de Barcelona)

  • Zenou, Yves

    ()
    (The Research Institute of Industrial Economics)

Abstract

We develop a model in which delinquents compete with each other in criminal activities but may benefit from being friends with other criminals by learning and acquiring proper know-how on the crime business. By taking the social network connecting agents as given, we study the subgame perfect Nash equilibrium of this game in which individuals decide first to work or to become a criminal and then the crime effort provided if criminals. We show that this game always has a pure strategy subgame perfect Nash equilibrium that we characterize. Ex ante identical individuals connected through a network can end up with very different equilibrium outcomes: either employed, or isolated criminal or criminals in network. We also show that multiple equilibria with different number of active criminals and levels of involvement in rime activities may coexist and are only driven by the geometry of the pattern of links connecting criminals. Using the equilibrium concept of pairwise-stable networks, we then show that the multiplicity of equilibrium outcomes holds even when we allow for endogenous network formation.

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Bibliographic Info

Paper provided by Research Institute of Industrial Economics in its series Working Paper Series with number 601.

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Length: 19 pages
Date of creation: 21 Oct 2003
Date of revision:
Handle: RePEc:hhs:iuiwop:0601

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Postal: Research Institute of Industrial Economics, Box 55665, SE-102 15 Stockholm, Sweden
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Keywords: Strategic Interactions; Multiple Equilibria; Pairwise-Stable Networks;

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References

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  1. Verdier, Thierry & Zenou, Yves, 2000. "Racial Beliefs, Location And The Causes Of Crime," CEPR Discussion Papers 2455, C.E.P.R. Discussion Papers.
  2. Imrohoroglu, Ayse & Merlo, Antonio & Rupert, Peter, 1996. "On the political economy of income redistribution and crime," Bulletins 7497, University of Minnesota, Economic Development Center.
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  14. Calvó-Armengol, Antoni & Verdier, Thierry & Zenou, Yves, 2006. "Strong and Weak Ties in Employment and Crime," CEPR Discussion Papers 5448, C.E.P.R. Discussion Papers.
  15. Topa, Giorgio, 2001. "Social Interactions, Local Spillovers and Unemployment," Review of Economic Studies, Wiley Blackwell, vol. 68(2), pages 261-95, April.
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  18. Jackson, Matthew O., 1998. "The Evolution of Social and Economic Networks," Working Papers 1044, California Institute of Technology, Division of the Humanities and Social Sciences.
  19. Kenneth Burdett & Ricardo Lagos & Randall Wright, 2003. "An On-the-Job Search Model of Crime, Inequality, and Unemployment," PIER Working Paper Archive 03-030, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
  20. Jens Ludwig & Greg J. Duncan & Paul Hirschfield, 2001. "Urban Poverty And Juvenile Crime: Evidence From A Randomized Housing-Mobility Experiment," The Quarterly Journal of Economics, MIT Press, vol. 116(2), pages 655-679, May.
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