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Crime, Deterrence and Punishment Revisited

Author

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  • Maurice J.G. Bun
  • Vasilis Sarafidis
  • Richard Kelaher

    (University of Sydney)

Abstract

Despite an abundance of empirical evidence on crime spanning over forty years, there exists no consensus on the impact of the criminal justice system on crime activity. We construct a new panel data set that contains all relevant variables prescribed by economic theory. Our identification strategy allows for simultaneity and controls for omitted variables and measurement error. We deviate from the majority of the literature in that we specify a dynamic model, which captures the essential feature of habit formation and persistence in aggregate behavior. Our results show that the criminal justice system exerts a large influence on crime activity. Increasing the risk of apprehension and conviction is more influential in reducing crime than raising the expected severity of punishment.

Suggested Citation

  • Maurice J.G. Bun & Vasilis Sarafidis & Richard Kelaher, 2016. "Crime, Deterrence and Punishment Revisited," UvA-Econometrics Working Papers 16-02, Universiteit van Amsterdam, Dept. of Econometrics.
  • Handle: RePEc:ame:wpaper:1602
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    More about this item

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C36 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Instrumental Variables (IV) Estimation
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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