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State executions, deterrence, and the incidence of murder

This study employs a panel of U.S. state-level data over the years 1978-1997 to estimate the deterrent effect of capital punishment. Particular attention is paid to problems of endogeneity bias arising from the non-random assignment of death penalty laws across states and a simultaneous relationship between murders and the deterrence probabilities. The primary innovation of the analysis lies in the estimation of a simultaneous equations system whose identification is based upon the employment of instrumental variables motivated by the theory of public choice. The estimation results suggest that structural estimates of the deterrent effect of capital punishment are likely to be downward biased due to the influence of simultaneity. Correcting for simultaneity, the estimates imply that a state execution deters approximately fourteen murders per year on average. Finally, the results also suggest that the announcement effect of capital punishment, as opposed to the existence of a death penalty provision, is the mechanism actually driving the deterrent effect associated with state executions.

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Article provided by Universidad del CEMA in its journal Journal of Applied Economics.

Volume (Year): VII (2004)
Issue (Month): (May)
Pages: 163-193

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Handle: RePEc:cem:jaecon:v:7:y:2004:n:1:p:163-193
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  1. Lawrence Katz & Steven D. Levitt & Ellen Shustorovich, 2003. "Prison Conditions, Capital Punishment, and Deterrence," American Law and Economics Review, Oxford University Press, vol. 5(2), pages 318-343, August.
  2. Benson, Bruce L, 1999. " An Economic Theory of the Evolution of Governance and the Emergence of the State," The Review of Austrian Economics, Springer, vol. 12(2), pages 131-60, November.
  3. Hashem Dezhbakhsh & Paul H. Rubin & Joanna M. Shepherd, 2003. "Does Capital Punishment Have a Deterrent Effect? New Evidence from Postmoratorium Panel Data," American Law and Economics Review, Oxford University Press, vol. 5(2), pages 344-376, August.
  4. Benson, Bruce L. & Rasmussen, David W. & Kim, Iljoong, 1998. "Deterrence and Public Policy: Trade-Offs in the Allocation of Police Resources," International Review of Law and Economics, Elsevier, vol. 18(1), pages 77-100, March.
  5. Raphael, Steven & WINTER-EBMER, RUDOLF, 1998. "Identifying the Effect of Unemployment on Crime," University of California at San Diego, Economics Working Paper Series qt5hb4h56g, Department of Economics, UC San Diego.
  6. Brumm, Harold J. & Cloninger, Dale O., 1996. "Perceived risk of punishment and the commission of homicides: A covariance structure analysis," Journal of Economic Behavior & Organization, Elsevier, vol. 31(1), pages 1-11, October.
  7. Benson, B.L. & Kim, I. & Rasmussen, D.W., 1992. "Estimating Deterrence Effects: A Public Choice Perspective on the Economics of Crime Literature," Working Papers 1992_12_01, Department of Economics, Florida State University.
  8. Marvell, Thomas B & Moody, Carlisle E, 2001. "The Lethal Effects of Three-Strikes Laws," The Journal of Legal Studies, University of Chicago Press, vol. 30(1), pages 89-106, January.
  9. Mocan, H Naci & Gittings, R Kaj, 2003. "Getting Off Death Row: Commuted Sentences and the Deterrent Effect of Capital Punishment," Journal of Law and Economics, University of Chicago Press, vol. 46(2), pages 453-78, October.
  10. John Gist & R. Hill, 1981. "The economics of choice in the allocation of Federal grants: An empirical test," Public Choice, Springer, vol. 36(1), pages 63-73, January.
  11. Lott, John R, Jr & Mustard, David B, 1997. "Crime, Deterrence, and Right-to-Carry Concealed Handguns," The Journal of Legal Studies, University of Chicago Press, vol. 26(1), pages 1-68, January.
  12. Cameron, Samuel, 1994. "A review of the econometric evidence on the effects of capital punishment," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 23(1-2), pages 197-214.
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