IDEAS home Printed from https://ideas.repec.org/p/gla/glaewp/2019_13.html
   My bibliography  Save this paper

Shaking Criminal Incentives

Author

Listed:
  • Yu Aoki
  • Theodore Koutmeridis

Abstract

We study criminal incentives exploiting the devastating shock of the 1995 Kobe earthquake. Evidence shows that the earthquake decreased burglaries but left other crime types unaffected. The effect stays significant even after controlling for unemployment, policing and income. We corroborate this by instrumenting damages with the distance from the earthquake epicentre. These findings survive various robustness checks under different specifications. The evidence is consistent with a simple theory of crime, value and specialization. We conclude that burglars respond to damages that devaluate their prospective takings. Yet, they cannot shift their specialization and substitute burglaries with other crime types

Suggested Citation

  • Yu Aoki & Theodore Koutmeridis, 2019. "Shaking Criminal Incentives," Working Papers 2019_13, Business School - Economics, University of Glasgow.
  • Handle: RePEc:gla:glaewp:2019_13
    as

    Download full text from publisher

    File URL: https://www.gla.ac.uk/media/Media_700382_smxx.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Kirchberger, Martina, 2017. "Natural disasters and labor markets," Journal of Development Economics, Elsevier, vol. 125(C), pages 40-58.
    2. Mirko Draca & Stephen Machin & Robert Witt, 2011. "Panic on the Streets of London: Police, Crime, and the July 2005 Terror Attacks," American Economic Review, American Economic Association, vol. 101(5), pages 2157-2181, August.
    3. 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.
    4. Christopher Blattman & Julian C. Jamison & Margaret Sheridan, 2017. "Reducing Crime and Violence: Experimental Evidence from Cognitive Behavioral Therapy in Liberia," American Economic Review, American Economic Association, vol. 107(4), pages 1165-1206, April.
    5. Francesco Porcelli & Riccardo Trezzi, 2019. "The impact of earthquakes on economic activity: evidence from Italy," Empirical Economics, Springer, vol. 56(4), pages 1167-1206, April.
    6. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
    7. Rafael Di Tella & Ernesto Schargrodsky, 2013. "Criminal Recidivism after Prison and Electronic Monitoring," Journal of Political Economy, University of Chicago Press, vol. 121(1), pages 28-73.
    8. Eduardo Cavallo & Ilan Noy, 2009. "The Economics of Natural Disasters: A Survey," Research Department Publications 4649, Inter-American Development Bank, Research Department.
    9. Giovanni Mastrobuoni & David A Rivers, 2019. "Optimising Criminal Behaviour and the Disutility of Prison," Economic Journal, Royal Economic Society, vol. 129(619), pages 1364-1399.
    10. Mirko Draca & Theodore Koutmeridis & Stephen Machin, 2019. "The Changing Returns to Crime: Do Criminals Respond to Prices?," Review of Economic Studies, Oxford University Press, vol. 86(3), pages 1228-1257.
    11. Aaron Chalfin & Justin McCrary, 2018. "Are U.S. Cities Underpoliced? Theory and Evidence," The Review of Economics and Statistics, MIT Press, vol. 100(1), pages 167-186, March.
    12. Ben Vollaard & Jan C. van Ours, 2011. "Does Regulation of Built‐in Security Reduce Crime? Evidence from a Natural Experiment," Economic Journal, Royal Economic Society, vol. 121(552), pages 485-504, May.
    13. Lance Lochner, 2004. "Education, Work, And Crime: A Human Capital Approach," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 45(3), pages 811-843, August.
    14. Denis Fougère & Francis Kramarz & Julien Pouget, 2009. "Youth Unemployment and Crime in France," Journal of the European Economic Association, MIT Press, vol. 7(5), pages 909-938, September.
    15. Steven D. Levitt & Sudhir Alladi Venkatesh, 2000. "An Economic Analysis of a Drug-Selling Gang's Finances," The Quarterly Journal of Economics, Oxford University Press, vol. 115(3), pages 755-789.
    16. Ian Ayres & Steven D. Levitt, 1998. "Measuring Positive Externalities from Unobservable Victim Precaution: An Empirical Analysis of Lojack," The Quarterly Journal of Economics, Oxford University Press, vol. 113(1), pages 43-77.
    17. Vincent Bignon & Eve Caroli & Roberto Galbiati, 2011. "Stealing to Survive: Crime and Income Shocks in 19th Century France," PSE Working Papers halshs-00623804, HAL.
    18. Robert J. Barro, 2009. "Rare Disasters, Asset Prices, and Welfare Costs," American Economic Review, American Economic Association, vol. 99(1), pages 243-264, March.
    19. Eric D. Gould & Bruce A. Weinberg & David B. Mustard, 2002. "Crime Rates And Local Labor Market Opportunities In The United States: 1979-1997," The Review of Economics and Statistics, MIT Press, vol. 84(1), pages 45-61, February.
    20. Levitt, Steven D, 1998. "Why Do Increased Arrest Rates Appear to Reduce Crime: Deterrence, Incapacitation, or Measurement Error?," Economic Inquiry, Western Economic Association International, vol. 36(3), pages 353-372, July.
    21. Aaron Chalfin & Justin McCrary, 2017. "Criminal Deterrence: A Review of the Literature," Journal of Economic Literature, American Economic Association, vol. 55(1), pages 5-48, March.
    22. Robert J. Barro, 2006. "Rare Disasters and Asset Markets in the Twentieth Century," The Quarterly Journal of Economics, Oxford University Press, vol. 121(3), pages 823-866.
    23. Rafael Di Tella & Ernesto Schargrodsky, 2004. "Do Police Reduce Crime? Estimates Using the Allocation of Police Forces After a Terrorist Attack," American Economic Review, American Economic Association, vol. 94(1), pages 115-133, March.
    24. Patrick Bayer & Randi Hjalmarsson & David Pozen, 2009. "Building Criminal Capital behind Bars: Peer Effects in Juvenile Corrections," The Quarterly Journal of Economics, Oxford University Press, vol. 124(1), pages 105-147.
    25. Mirko Draca & Stephen Machin, 2015. "Crime and Economic Incentives," Annual Review of Economics, Annual Reviews, vol. 7(1), pages 389-408, August.
    26. Grogger, Jeff, 1998. "Market Wages and Youth Crime," Journal of Labor Economics, University of Chicago Press, vol. 16(4), pages 756-791, October.
    27. Vincent Bignon & Eve Caroli & Roberto Galbiati, 2017. "Stealing to Survive? Crime and Income Shocks in Nineteenth Century France," Economic Journal, Royal Economic Society, vol. 127(599), pages 19-49, February.
    28. Jan C. Ours & Ben Vollaard, 2016. "The Engine Immobiliser: A Non‐starter for Car Thieves," Economic Journal, Royal Economic Society, vol. 126(593), pages 1264-1291, June.
    29. Cragg, John G. & Donald, Stephen G., 1993. "Testing Identifiability and Specification in Instrumental Variable Models," Econometric Theory, Cambridge University Press, vol. 9(2), pages 222-240, April.
    30. Brian Bell & Laura Jaitman & Stephen Machin, 2014. "Crime Deterrence: Evidence From the London 2011 Riots," Economic Journal, Royal Economic Society, vol. 0(576), pages 480-506, May.
    31. Eduardo Cavallo & Ilan Noy, 2009. "The Economics of Natural Disasters - A Survey," Working Papers 200919, University of Hawaii at Manoa, Department of Economics.
    32. Reilly, Barry & Witt, Robert, 2008. "Domestic burglaries and the real price of audio-visual goods: Some time series evidence for Britain," Economics Letters, Elsevier, vol. 100(1), pages 96-100, July.
    33. Isaac Ehrlich, 1996. "Crime, Punishment, and the Market for Offenses," Journal of Economic Perspectives, American Economic Association, vol. 10(1), pages 43-67, Winter.
    34. Ehrlich, Isaac, 1973. "Participation in Illegitimate Activities: A Theoretical and Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 521-565, May-June.
    35. Rucker Johnson & Steven Raphael, 2012. "How Much Crime Reduction Does the Marginal Prisoner Buy?," Journal of Law and Economics, University of Chicago Press, vol. 55(2), pages 275-310.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    crime; burglary; value; housing damage; specialization;

    JEL classification:

    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gla:glaewp:2019_13. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Business School Research Team). General contact details of provider: http://edirc.repec.org/data/dpglauk.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.