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Cycles in Crime and Economy: Leading, Lagging and Coincident Behaviors

Author

Listed:
  • Claudio Detotto

    (LISA - Laboratoire « Lieux, Identités, eSpaces, Activités » (UMR CNRS 6240 LISA) - CNRS - Centre National de la Recherche Scientifique - Università di Corsica Pasquale Paoli [Université de Corse Pascal Paoli])

  • Edoardo Otranto

    (UniMe - Università degli Studi di Messina = University of Messina)

Abstract

In the last decades, the interest in the relationship between crime and business cycle has widely increased. It is a diffused opinion that a causal relationship goes from economic variables to criminal activities, but this causal effect is observed only for some typology of crimes, such as property crimes. In this work we examine the possibility of the existence of some common factors (interpreted as cyclical components) driving the dynamics of Gross Domestic Product and a large set of criminal types by using the nonparametric version of the dynamic factor model. A first aim of this exercise is to detect some comovements between the business cycle and the cyclical component of some typologies of crime, which could evidence some relationships between these variables; a second purpose is to select which crime types are related to the business cycle and if they are leading, coincident or lagging. Italy is the case study for the time span 1991:1–2004:12; the crime typologies are constituted by the 22 official categories classified by the Italian National Statistical Institute. The study finds that most of the crime types show a counter-cyclical behavior with respect to the overall economic performance, and only a few of them have an evident relationship with the business cycle. Furthermore, some crime offenses, such as bankruptcy, embezzlement and fraudulent insolvency, seem to anticipate the business cycle, in line with recent global events.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Claudio Detotto & Edoardo Otranto, 2012. "Cycles in Crime and Economy: Leading, Lagging and Coincident Behaviors," Post-Print hal-01972851, HAL.
    • Handle: RePEc:hal:journl:hal-01972851
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    Cited by:

    1. Litany Eldest Nurbasuni & Khoirunurrofik Khoirunurrofik, 2024. "Between crime and economic growth: the asymmetric role of public expenditure and unemployment," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 44(1), pages 21-45, March.
    2. Beqiraj, Elton & Fedeli, Silvia & Giuriato, Luisa, 2025. "Shadow economy or economic driver? The impact of counterfeiting on Italy's growth," Economic Analysis and Policy, Elsevier, vol. 87(C), pages 1275-1291.
    3. Marcus Box & Karl Gratzer & Xiang Lin, 2020. "Destructive entrepreneurship in the small business sector: bankruptcy fraud in Sweden, 1830–2010," Small Business Economics, Springer, vol. 54(2), pages 437-457, February.
    4. R Pickering & K Y Lim, 2024. "Does crime type matter in understanding the nexus between universal credit and crime? Evidence from England and Wales," Economic Issues Journal Articles, Economic Issues, vol. 29(1), pages 93-131, March.
    5. Pengfei Jia & King Yoong Lim, 2021. "The stabilization role of police spending in a neo‐Keynesian economy with credit market imperfections," Scottish Journal of Political Economy, Scottish Economic Society, vol. 68(1), pages 103-125, February.
    6. Claudio Detotto & Manuela Pulina, 2013. "Does more crime mean fewer jobs and less economic growth?," European Journal of Law and Economics, Springer, vol. 36(1), pages 183-207, August.
    7. Cerro, Ana Maria & Michel Rivero, Andrés, 2012. "Business cycles and crime. the case of Argentina," MPRA Paper 44515, University Library of Munich, Germany.
    8. Oliviero A. Carboni & Claudio Detotto, 2016. "The economic consequences of crime in Italy," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 43(1), pages 122-140, January.
    9. Pengfei Jia & King Yoong Lim & Ali Raza, 2020. "Crime, different taxation, police spending and embodied human capital," Manchester School, University of Manchester, vol. 88(5), pages 664-698, September.
    10. Víctor Hugo Torres Preciado, 2017. "Desempleo y criminalidad en los estados de la frontera norte de México: un enfoque espacial bayesiano de vectores auto-regresivos. (Unemployment and crime in the Northern-border states of Mexico: a spatial-Bayesian autoregressive vector approach)," Ensayos Revista de Economia, Universidad Autonoma de Nuevo Leon, Facultad de Economia, vol. 0(1), pages 25-58, May.

    More about this item

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • K0 - Law and Economics - - General

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