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Deterrence and Geographical Externalities in Auto Theft

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  • Marco Gonzalez-Navarro

Abstract

Understanding the degree of geographical crime displacement is crucial for the design of crime prevention policies. This paper documents changes in automobile theft risk that were generated by the plausibly exogenous introduction of Lojack, a highly effective stolen vehicle recovery device, into a number of new Ford car models in some Mexican states, but not others. Lojack-equipped vehicles in Lojack-coverage states experienced a 48 percent reduction in theft risk due to deterrence effects. However, 18 percent of the reduction in thefts was displaced toward unprotected Lojack models in non-Lojack states, providing new evidence of geographical crime displacement in auto theft.

Suggested Citation

  • Marco Gonzalez-Navarro, 2013. "Deterrence and Geographical Externalities in Auto Theft," American Economic Journal: Applied Economics, American Economic Association, vol. 5(4), pages 92-110, October.
    • Handle: RePEc:aea:aejapp:v:5:y:2013:i:4:p:92-110
    Note: DOI: 10.1257/app.5.4.92
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • H76 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Other Expenditure Categories
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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