This paper develops a model of crime analyzing how such behavior is associated with individual and neighborhood poverty. The model shows that even under relatively minimal assumptions, a connection between individual poverty and both property and violent crimes will arise, and moreover, "neighborhood" effects can develop, but will differ substantially in nature across crime types. A key implication is that greater economic segregation in a city should have no effect or a negative effect on property crime, but a positive effect on violent crime. Using IV methods, I show this implication to be consistent with the empirical evidence.
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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number
4470.
Find related papers by JEL classification: K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law I38 - Health, Education, and Welfare - - Welfare and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
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