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The economic consequences of crime in Italy

  • OA. Carboni
  • C. Detotto

    ()

This paper employs provincial data to study the relationship between several crime typologies, namely murder, theft, robbery and fraud, and economic output in Italy. We employ a spatial econometric approach where the spatial proximity is defined by a measure of physical distance between locations, in order to take into account possible spill-over effects. The model used here combines a spatial autoregressive model with autoregressive disturbances. In modelling the outcome for each location depends on a weighted average of the outcomes of other locations. Outcomes are determined simultaneously. The results of the spatial two stage least square estimation suggest that the homicide rate has a negative impact on Italian gross domestic product while theft, robbery and fraud do not affect economic output and that there are beneficial spill-overs from neighbouring provinces.

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Paper provided by Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia in its series Working Paper CRENoS with number 201303.

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Date of creation: 2013
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Handle: RePEc:cns:cnscwp:201303
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  1. C. Detotto & E. Otranto, 2010. "Cycles in Crime and Economy: Leading, Lagging and Coincident Behaviors," Working Paper CRENoS 201023, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
  2. Aschauer, David Alan, 1989. "Is public expenditure productive?," Journal of Monetary Economics, Elsevier, vol. 23(2), pages 177-200, March.
  3. Norman Sedgley, 1998. "Technology gaps, economic growth and convergence across US states," Applied Economics Letters, Taylor & Francis Journals, vol. 5(1), pages 55-59.
  4. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 681-712, August.
  5. Claudio Detotto & Edoardo Otranto, 2010. "Does Crime Affect Economic Growth?," Kyklos, Wiley Blackwell, vol. 63(3), pages 330-345, 08.
  6. David M. Drukker & Hua Peng & Ingmar Prucha & Rafal Raciborski, 2011. "SPPACK: Stata module for cross-section spatial-autoregressive models," Statistical Software Components S457245, Boston College Department of Economics, revised 08 Nov 2012.
  7. Lorenzo Pellegrini & Reyer Gerlagh, 2004. "Corruption's Effect on Growth and its Transmission Channels," Kyklos, Wiley Blackwell, vol. 57(3), pages 429-456, 08.
  8. C. Detotto & M. Pulina, 2009. "Does more crime mean fewer jobs? An ARDL model," Working Paper CRENoS 200905, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
  9. Luciano Mauro & Gaetano Carmeci, 2007. "A Poverty Trap of Crime and Unemployment," Review of Development Economics, Wiley Blackwell, vol. 11(3), pages 450-462, 08.
  10. Jacint Balaguer & Manuel Cantavella-Jordá, 2000. "Tourism As A Long-Run Economic Growth Factor: The Spanish Case," Working Papers. Serie EC 2000-10, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
  11. Oliviero A. Carboni, 2013. "A spatial analysis of R&D: the role of industry proximity," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 22(8), pages 820-839, November.
  12. C. Detotto & M. Vannini, 2010. "Counting the cost of crime in Italy," Working Paper CRENoS 201013, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
  13. Demetriades, Panicos O & Mamuneas, Theofanis P, 2000. "Intertemporal Output and Employment Effects of Public Infrastructure Capital: Evidence from 12 OECD Economics," Economic Journal, Royal Economic Society, vol. 110(465), pages 687-712, July.
  14. Anselin, Luc, 1990. "Some robust approaches to testing and estimation in spatial econometrics," Regional Science and Urban Economics, Elsevier, vol. 20(2), pages 141-163, September.
  15. Hordijk, L., 1974. "Spatial correlation in the disturbances of a linear interregional model," Regional and Urban Economics, Elsevier, vol. 4(2), pages 117-140, October.
  16. Irani Arraiz & David M. Drukker & Harry H. Kelejian & Ingmar R. Prucha, 2010. "A Spatial Cliff-Ord-Type Model With Heteroskedastic Innovations: Small And Large Sample Results," Journal of Regional Science, Wiley Blackwell, vol. 50(2), pages 592-614.
  17. Daniele, Vittorio & Marani, Ugo, 2011. "Organized crime, the quality of local institutions and FDI in Italy: A panel data analysis," European Journal of Political Economy, Elsevier, vol. 27(1), pages 132-142, March.
  18. Eleftherios Goulas & Athina Zervoyianni, 2012. "Economic Growth and Crime: Does Uncertainty Matter?," Working Paper Series 51_12, The Rimini Centre for Economic Analysis.
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