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A Von Thünen Model of Crime, Casinos and Property Values in New Jersey


  • Andrew J. Buck

    (Department of Economics, Temple University, Philadelphia, PA 19122, USA)

  • Joseph Deutsch

    (Department of Economics, Bar-Ilan University, Ramat-Gan 52900, Israel)

  • Simon Hakim

    (Department of Economics, Temple University, Philadelphia, PA 19122, USA)

  • Uriel Spiegel

    (Department of Economics, Bar-Ilan University, Ramat-Gan 52900, Israel)

  • J. Weinblatt

    (Department of Economics, Ben Gurion University, Beer-Sheva 84/O5, Israel)


Urban economic models suggest that, ceteris paribus, land values diminish with distance from a central business district (CBD) which 'produces' employment, income and other amenities. A new industry like casino gaming may have jobs and increased income associated with it. These amenities will induce an increase in property values. The size of that increase diminishes with distance from the city centre. The new industry may have the negative by-product of crime, which is hypothesised to have a reversed, although systematic, effect upon land values. That is, it pays to live in the hinterlands far from the source of crime. Thus, theoretically, the net effect of amenities as a function of distance from the central city is ambiguous. Applying the model to Atlantic City shows that the casinos have brought jobs, additional income and greater real estate values to the region, but the positive impact diminishes with distance from the city centre. However, crime has increased at a rate greater than that which existed prior to the casinos. The cost of crime resulting from casinos, as reflected in unrealised assessed real estate valuation, appears to be on average $5.2m per square mile in 1986 (current prices) in the South Jersey area. For an average community in the area it would amount in 1986 to a total of approximately $105m.

Suggested Citation

  • Andrew J. Buck & Joseph Deutsch & Simon Hakim & Uriel Spiegel & J. Weinblatt, 1991. "A Von Thünen Model of Crime, Casinos and Property Values in New Jersey," Urban Studies, Urban Studies Journal Limited, vol. 28(5), pages 673-686, October.
  • Handle: RePEc:sae:urbstu:v:28:y:1991:i:5:p:673-686

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    Cited by:

    1. Karla Hoff & Arijit Sen, 2005. "Homeownership, Community Interactions, and Segregation," American Economic Review, American Economic Association, vol. 95(4), pages 1167-1189, September.
    2. Fleishman Larisa & Gubman Yury & Tur-Sinai Aviad, 2015. "Dwelling Price Ranking versus Socioeconomic Clustering: Possibility of Imputation," Journal of Official Statistics, Sciendo, vol. 31(2), pages 205-229, June.
    3. STEVEN C. DELLER & Thomas Ottem, 2001. "Crime and the Quality of Life in Wisconsin Counties," Wisconsin-Madison Agricultural and Applied Economics Staff Papers 442, Wisconsin-Madison Agricultural and Applied Economics Department.
    4. repec:eee:touman:v:62:y:2017:i:c:p:253-263 is not listed on IDEAS
    5. Christopher L Ambrey & Christopher M Fleming & Matthew Manning, 2013. "The life satisfaction approach to estimating the cost of crime: An individual's willingness-to-pay for crime reduction," Discussion Papers in Economics economics:201301, Griffith University, Department of Accounting, Finance and Economics.
    6. Jörgen Johansson & Krister Sandberg, 2001. "Hedonic Prices for Co-operative Flats in the City of Umeå estimated with Spatial Autoregressive GMM," ERSA conference papers ersa01p111, European Regional Science Association.
    7. Julie Smith, 1999. "Australian Gambling Taxation," CEPR Discussion Papers 402, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    8. Sandberg, Krister, 2002. "On Space-Time Changes of Hedonic Prices for Single Family Houses," ERSA conference papers ersa02p196, European Regional Science Association.
    9. Schwer, Keith & Daneshvary, Rennae, 1999. "The Impact of Casino Gambling on Charitable Contributions: The Willingness to Contribute to a Local Public Television Station," The Review of Regional Studies, Southern Regional Science Association, vol. 29(1), pages 77-90, Summer.

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