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Individual Protection Against Property Crime: Decomposing the Effects of Protection Observability

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  • Hotte, Louis
  • van Ypersele, Tanguy

Abstract

We revisit the question of the efficiency of individual decisions to be protected against crime for the cases of both observable and unobservable protection. We obtain that observable protection is unambiguously associated with a negative externality and that at the individual level, it has a deterrence effect but no payoff reduction effect. Unobservable protection has a global deterrence effect and is associated with a private payoff reduction effect but no private deterrence effect. A decrease in the global crime payoff is detrimental to a victim if protection is observable, while it is beneficial with unobservable protection. While protection has a positive diversion effect when observable, it has the equivalent of a negative diversion effect when unobservable.

Suggested Citation

  • Hotte, Louis & van Ypersele, Tanguy, 2005. "Individual Protection Against Property Crime: Decomposing the Effects of Protection Observability," CEPR Discussion Papers 5293, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:5293
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    Cited by:

    1. Marceau, Nicolas & Mongrain, Steeve, 2011. "Competition in law enforcement and capital allocation," Journal of Urban Economics, Elsevier, vol. 69(1), pages 136-147, January.
    2. Baumann, Florian & Friehe, Tim, 2013. "Private protection against crime when property value is private information," International Review of Law and Economics, Elsevier, vol. 35(C), pages 73-79.
    3. Guillaume Cheikbossian & Nicolas Marceau, 2007. "Why Is Law Enforcement Decentralized?," Cahiers de recherche 0719, CIRPEE.
    4. Curry Philip A., 2017. "Malice Aforethought," Review of Law & Economics, De Gruyter, vol. 13(1), pages 1-18, March.
    5. repec:oup:amlawe:v:19:y:2017:i:2:p:464-485. is not listed on IDEAS
    6. Kangoh Lee & Santiago M. Pinto, 2009. "Crime In A Multi-Jurisdictional Model With Private And Public Prevention," Journal of Regional Science, Wiley Blackwell, vol. 49(5), pages 977-996.
    7. Baumann, Florian & Denter, Philipp & Friehe, Tim, 2013. "Hide or show? Endogenous observability of private precautions against crime when property value is private information," DICE Discussion Papers 115, University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    8. Tim Friehe & Thomas J. Miceli, 2017. "On Punishment Severity and Crime Rates," American Law and Economics Review, Oxford University Press, vol. 19(2), pages 464-485.
    9. Philip A. Curry & Matthew Doyle, 2012. "Social Welfare and the Benefits to Crime," Working Papers 1205, University of Waterloo, Department of Economics, revised Jul 2012.
    10. Decreuse, Bruno & Mongrain, Steve & van Ypersele, Tanguy, 2015. "Property crime and private protection allocation within cities: theory and evidence," CEPR Discussion Papers 10707, C.E.P.R. Discussion Papers.

    More about this item

    Keywords

    crime; efficiency; private protection;

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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