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Dead man walking: an empirical reassessment of the deterrent effect of capital punishment using the bounds testing approach to cointegration

  • Paresh Kumar Narayan
  • Russell Smyth

This paper empirically estimates a murder supply equation for the United States from 1965 to 2001 within a cointegration and error correction framework. Our findings suggest that any support for the deterrence hypothesis is sensitive to the inclusion of variables for the effects of guns and other crimes. In the long run we find that real income and the conditional probability of receiving the death sentence are the main factors explaining variations in the homicide rate. In the short run the aggravated assault rate and robbery rate are the most important determinants of the homicide rate.

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Article provided by Taylor & Francis Journals in its journal Applied Economics.

Volume (Year): 38 (2006)
Issue (Month): 17 ()
Pages: 1975-1989

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Handle: RePEc:taf:applec:v:38:y:2006:i:17:p:1975-1989
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  1. Richard B. Freeman, 1996. "Why Do So Many Young American Men Commit Crimes and What Might We Do About It?," NBER Working Papers 5451, National Bureau of Economic Research, Inc.
  2. Passell, Peter & Taylor, John B, 1977. "The Deterrent Effect of Capital Punishment: Another View," American Economic Review, American Economic Association, vol. 67(3), pages 445-51, June.
  3. Isaac Ehrlich, 1996. "Crime, Punishment, and the Market for Offenses," Journal of Economic Perspectives, American Economic Association, vol. 10(1), pages 43-67, Winter.
  4. Paul R. Zimmerman, 2004. "State executions, deterrence, and the incidence of murder," Journal of Applied Economics, Universidad del CEMA, vol. 0, pages 163-193, May.
  5. 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.
  6. Stephen K. Layson, 1983. "Homicide and Deterrence: Another View of the Canadian Time-Series Evidence," Canadian Journal of Economics, Canadian Economics Association, vol. 16(1), pages 52-73, February.
  7. Haug, Alfred A, 2002. " Temporal Aggregation and the Power of Cointegration Tests: A Monte Carlo Study," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(4), pages 399-412, September.
  8. 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.
  9. Ehrlich, Isaac, 1982. "The optimum enforcement of laws and the concept of justice: A positive analysis," International Review of Law and Economics, Elsevier, vol. 2(1), pages 3-27, June.
  10. Cameron, Samuel, 1988. "The Economics of Crime Deterrence: A Survey of Theory and Evidence," Kyklos, Wiley Blackwell, vol. 41(2), pages 301-23.
  11. Hoenack, Stephen A & Weiler, William C, 1980. "A Structural Model of Murder Behavior and the Criminal Justice System," American Economic Review, American Economic Association, vol. 70(3), pages 327-41, June.
  12. Dezhbakhsh, Hashem & Rubin, Paul H, 1998. "Lives Saved or Lives Lost? The Effects of Concealed-Handgun Laws on Crime," American Economic Review, American Economic Association, vol. 88(2), pages 468-74, May.
  13. James A. Yunker, 2001. "A New Statistical Analysis of Capital Punishment Incorporating U.S. Postmoratorium Data," Social Science Quarterly, Southwestern Social Science Association, vol. 82(2), pages 297-311.
  14. Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, vol. 55(2), pages 251-76, March.
  15. Ehrlich, Isaac, 1977. "The Deterrent Effect of Capital Punishment: Reply," American Economic Review, American Economic Association, vol. 67(3), pages 452-58, June.
  16. 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.
  17. 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.
  18. Donohue, John J, III & Levitt, Steven D, 1998. "Guns, Violence, and the Efficiency of Illegal Markets," American Economic Review, American Economic Association, vol. 88(2), pages 463-67, May.
  19. Ehrlich, Isaac, 1973. "Participation in Illegitimate Activities: A Theoretical and Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 521-65, May-June.
  20. 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.
  21. Ehrlich, Isaac, 1977. "Capital Punishment and Deterrence: Some Further Thoughts and Additional Evidence," Journal of Political Economy, University of Chicago Press, vol. 85(4), pages 741-88, August.
  22. Ehrlich, Isaac & Liu, Zhiqiang, 1999. "Sensitivity Analyses of the Deterrence Hypothesis: Let's Keep the Econ in Econometrics," Journal of Law and Economics, University of Chicago Press, vol. 42(1), pages 455-87, April.
  23. Isaac Ehrlich, 1973. "The Deterrent Effect of Capital Punishment: A Question of Life and Death," NBER Working Papers 0018, National Bureau of Economic Research, Inc.
  24. Graham Elliott & Thomas J. Rothenberg & James H. Stock, 1992. "Efficient Tests for an Autoregressive Unit Root," NBER Technical Working Papers 0130, National Bureau of Economic Research, Inc.
  25. M. Hashem Pesaran & Yongcheol Shin & Richard J. Smith, 2001. "Bounds testing approaches to the analysis of level relationships," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 16(3), pages 289-326.
  26. Phillips, Peter C B & Hansen, Bruce E, 1990. "Statistical Inference in Instrumental Variables Regression with I(1) Processes," Review of Economic Studies, Wiley Blackwell, vol. 57(1), pages 99-125, January.
  27. Pesaran, M.H. & Shin, Y., 1995. "An Autoregressive Distributed Lag Modelling Approach to Cointegration Analysis," Cambridge Working Papers in Economics 9514, Faculty of Economics, University of Cambridge.
  28. Dale Cloninger & Roberto Marchesini, 2001. "Execution and deterrence: a quasi-controlled group experiment," Applied Economics, Taylor & Francis Journals, vol. 33(5), pages 569-576.
  29. 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.
  30. Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
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