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Youth Gangs as Pseudo-Governments: Implications for Violent Crime

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  • Russell S. Sobel

    (Department of Economics, West Virginia University)

  • Brian J. Osoba

    (Department of Economics, Central Connecticut State University)

Abstract

We hypothesize the failure of government to protect the rights of individuals from violence committed by youths has led to the formation of youth gangs as protective agencies. Our theory predicts an opposite direction of causality between gang activity and violent crime than is widely accepted. While areas with more gang activity also have more violence, our results suggest gangs form as protection agencies precisely in areas with high violent crime rates. While gangs, like governments, use violence to enforce rules, the net impact of gangs is likely to lower violent crime. We test this hypothesis and offer policy implications.

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File URL: http://www.be.wvu.edu/phd_economics/pdf/09-09.pdf
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Bibliographic Info

Paper provided by Department of Economics, West Virginia University in its series Working Papers with number 09-09.

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Length: 39 pages
Date of creation: 2009
Date of revision:
Handle: RePEc:wvu:wpaper:09-09

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  1. Davis, Michael L, 1988. "Time and Punishment: An Intertemporal Model of Crime," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 96(2), pages 383-90, April.
  2. Leeson, Peter T., 2007. "Better off stateless: Somalia before and after government collapse," Journal of Comparative Economics, Elsevier, vol. 35(4), pages 689-710, December.
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  5. Steven D. Levitt & Sudhir Alladi Venkatesh, 1998. "An Economic Analysis of a Drug-Selling Gang's Finances," NBER Working Papers 6592, National Bureau of Economic Research, Inc.
  6. Isaac Ehrlich, 1996. "Crime, Punishment, and the Market for Offenses," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 10(1), pages 43-67, Winter.
  7. Hamilton, James D, 1983. "Oil and the Macroeconomy since World War II," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 91(2), pages 228-48, April.
  8. Nuno Garoupa, 1999. "Optimal law enforcement and criminal organization," Economics Working Papers, Department of Economics and Business, Universitat Pompeu Fabra 366, Department of Economics and Business, Universitat Pompeu Fabra.
  9. Oriana Bandiera, 2003. "Land Reform, the Market for Protection, and the Origins of the Sicilian Mafia: Theory and Evidence," Journal of Law, Economics and Organization, Oxford University Press, Oxford University Press, vol. 19(1), pages 218-244, April.
  10. Dowd, Kevin, 1997. "Anarchy, Warfare, and Social Order: Comment on Hirshleifer," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 105(3), pages 648-51, June.
  11. Peter T. Leeson, 2007. "Trading with Bandits," Journal of Law and Economics, University of Chicago Press, University of Chicago Press, vol. 50, pages 303-321.
  12. Stergios Skaperdas, 2001. "The political economy of organized crime: providing protection when the state does not," Economics of Governance, Springer, Springer, vol. 2(3), pages 173-202, November.
  13. Baumol, William J, 1990. "Entrepreneurship: Productive, Unproductive, and Destructive," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 98(5), pages 893-921, October.
  14. Hirshleifer, Jack, 1995. "Anarchy and Its Breakdown," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 103(1), pages 26-52, February.
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Cited by:
  1. James Kostelnik & David Skarbek, 2013. "The governance institutions of a drug trafficking organization," Public Choice, Springer, Springer, vol. 156(1), pages 95-103, July.
  2. Daniel D’Amico, 2012. "Comparative political economy when anarchism is on the table," The Review of Austrian Economics, Springer, Springer, vol. 25(1), pages 63-75, March.
  3. Richard Alan Seals Jr., 2011. "Cognitive Ability and the Division of Labor in Urban Ghettos: Evidence From Gang Activity in U.S. Data," Auburn Economics Working Paper Series, Department of Economics, Auburn University auwp2011-03, Department of Economics, Auburn University.
  4. Daniel D’Amico, 2010. "The prison in economics: private and public incarceration in Ancient Greece," Public Choice, Springer, Springer, vol. 145(3), pages 461-482, December.
  5. Sean Mulholland, 2013. "White supremacist groups and hate crime," Public Choice, Springer, Springer, vol. 157(1), pages 91-113, October.
  6. Powell, Benjamin & Stringham, Edward P., 2008. "Public Choice and the Economic Analysis of Anarchy: A Survey," Working Papers, Suffolk University, Department of Economics 2008-7, Suffolk University, Department of Economics.
  7. Entorf, Horst, 2013. "Criminal Victims, Victimized Criminals, or Both? A Deeper Look at the Victim-Offender Overlap," IZA Discussion Papers 7686, Institute for the Study of Labor (IZA).
  8. T. Randolph Beard & Richard Alan Seals Jr. & Michael L. Stern, 2014. "Security and Government Credibility," Auburn Economics Working Paper Series, Department of Economics, Auburn University auwp2014-07, Department of Economics, Auburn University.
  9. Entorf, Horst, 2012. "Certainty and Severity of Sanctions in Classical and Behavioral Models of Deterrence: A Survey," IZA Discussion Papers 6516, Institute for the Study of Labor (IZA).
  10. Mulholland, Sean E., 2011. "Hate Source: White Supremacist Hate Groups and Hate Crime," MPRA Paper 28861, University Library of Munich, Germany.
  11. Skarbek, David, 2012. "Prison gangs, norms, and organizations," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 82(1), pages 96-109.

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