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Down and out in Italian towns: measuring the impact of economic downturns on crime

  • Guido de Blasio


    (Bank of Italy)

  • Carlo Menon



The paper investigates the effect of local economic conditions on crime. The study focuses on Italy�s local labor markets and analyzes the short-term response of crime to the severe slump of 2007-2009. It shows that the downturn led to a significant increase in economic-related offenses that do not require particular criminal skills or tools (namely, thefts); on the other hand, for offenses for which specific skills and criminal experience are essential (say, robberies) the impact of the crisis was negative. The results also suggest that: i) labor market institutions (i.e. wage supplementary schemes and pro-worker contractual arrangements) had a role in slowing down the effect of the economy on crime; ii) the link between the downturn and crime was weaker in areas where the presence of organized crime is relatively more intensive.

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Paper provided by Bank of Italy, Economic Research and International Relations Area in its series Temi di discussione (Economic working papers) with number 925.

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Date of creation: Jul 2013
Date of revision:
Handle: RePEc:bdi:wptemi:td_925_13
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  1. Edward L. Glaeser & Bruce Sacerdote, 1996. "Why Is There More Crime in Cities?," NBER Working Papers 5430, National Bureau of Economic Research, Inc.
  2. Imbens, Guido W & Angrist, Joshua D, 1994. "Identification and Estimation of Local Average Treatment Effects," Econometrica, Econometric Society, vol. 62(2), pages 467-75, March.
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  4. Milo Bianchi & Paolo Buonanno & Paolo Pinotti, 2008. "Do Immigrants Cause Crime?," Working Papers (-2012) 0801, University of Bergamo, Department of Economics.
  5. Galbiati, Roberto & Caroli, Eve & Bignon, Vincent, 2014. "Stealing to Survive : Crime and Income Shocks in 19th Century France," Economics Papers from University Paris Dauphine 123456789/7249, Paris Dauphine University.
  6. Ichino, Andrea & Winter-Ebmer, Rudolf, 1998. "Lower and Upper Bounds of Returns to Schooling: An Exercise in IV estimation with Different Instruments," CEPR Discussion Papers 2007, C.E.P.R. Discussion Papers.
  7. repec:oup:qjecon:v:111:y:1996:i:2:p:507-48 is not listed on IDEAS
  8. Paolo Pinotti, 2012. "The economic costs of organized crime: evidence from southern Italy," Temi di discussione (Economic working papers) 868, Bank of Italy, Economic Research and International Relations Area.
  9. Steven D. Levitt, 2004. "Understanding Why Crime Fell in the 1990s: Four Factors that Explain the Decline and Six that Do Not," Journal of Economic Perspectives, American Economic Association, vol. 18(1), pages 163-190, Winter.
  10. David B. Mustard, 2010. "Labor Markets and Crime: New Evidence on an Old Puzzle," Chapters, in: Handbook on the Economics of Crime, chapter 14 Edward Elgar.
  11. Denis Fougère & Francis Kramarz & Julien Pouget, 2007. "Youth Unemployment and Crime in France," Working Papers 2007-33, Centre de Recherche en Economie et Statistique.
  12. Carlo Menon, 2012. "The bright side of MAUP: Defining new measures of industrial agglomeration," Papers in Regional Science, Wiley Blackwell, vol. 91(1), pages 3-28, 03.
  13. Stephen Machin & Costas Meghir, 2004. "Crime and Economic Incentives," Journal of Human Resources, University of Wisconsin Press, vol. 39(4).
  14. Paolo Buonanno, 2006. "Crime and Labour Market Opportunities in Italy (1993-2002)," LABOUR, CEIS, vol. 20(4), pages 601-624, December.
  15. Mehlum, Halvor & Miguel, Edward & Torvik, Ragnar, 2006. "Poverty and crime in 19th century Germany," Journal of Urban Economics, Elsevier, vol. 59(3), pages 370-388, May.
  16. Mustard, David B., 2010. "How Do Labor Markets Affect Crime? New Evidence on an Old Puzzle," IZA Discussion Papers 4856, Institute for the Study of Labor (IZA).
  17. Freeman, Richard B., 1999. "The economics of crime," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 52, pages 3529-3571 Elsevier.
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