Is Inequality really a Major Cause of Violent Crime? Evidence From a Cross-National Panel of Robbery and Violent Theft Rates
AbstractThis article argues that the link between income inequality and violent property crime might be spurious, complementing a similar argument in prior an alysis by the author on the determinants of homicide. In contrast, Fajnzylber, Lederman & Loayza (1998; 2002a, b) provide seemingly strong and robust evidence that inequality causes a higher rate of both homicide and robbery/violent theft even after controlling for country-specific fixed effects. Ou r results suggest that inequality is not a statistically significant determinant, unless either country- specific effects are not controlled for or the sample is artificially restricted to a small number of countries. The reason why the link between inequality and violent property crime might be spur ious is that income inequality is likely to be strongly correlated with country- specific fixed effects such as cultural differences. A high degree of inequality might be socially undesirable for any number of reasons, but that it causes vi! olent crime is far from proven.
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Date of creation: 24 Dec 2003
Date of revision: 11 May 2004
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This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-01-05 (All new papers)
- NEP-LAW-2004-01-05 (Law & Economics)
- NEP-URE-2004-01-05 (Urban & Real Estate Economics)
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