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Is Economic Growth Criminogenic for Firms In Developing Economies?

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  • Islam, Asif

Abstract

Several studies have explored the relationship between economy level crime rates or individual level crime and economic growth. However, few studies have examined the relationship between economic growth and crime against firms which is an important issue especially for developing economies. Using data for about 12,000 firms in 27 developing countries we find that economic growth has a negative effect on crime. We also find that several macro-economic factors can weaken or strengthen the relationship between crime and economic growth. The results are robust to various sensitivity checks.

Suggested Citation

  • Islam, Asif, 2012. "Is Economic Growth Criminogenic for Firms In Developing Economies?," MPRA Paper 36724, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:36724
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    File URL: https://mpra.ub.uni-muenchen.de/36724/1/MPRA_paper_36724.pdf
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    References listed on IDEAS

    as
    1. Gaviria, Alejandro, 2002. "Assessing the effects of corruption and crime on firm performance: evidence from Latin America," Emerging Markets Review, Elsevier, vol. 3(3), pages 245-268, September.
    2. Soares, Rodrigo R., 2004. "Development, crime and punishment: accounting for the international differences in crime rates," Journal of Development Economics, Elsevier, vol. 73(1), pages 155-184, February.
    3. 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.
    4. Morgan Kelly, 2000. "Inequality And Crime," The Review of Economics and Statistics, MIT Press, vol. 82(4), pages 530-539, November.
    5. Norman Loayza & Pablo Fajnzylber & Daniel Lederman, 2000. "Crime and Victimization: An Economic Perspective," ECONOMIA JOURNAL, THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION - LACEA, vol. 0(Fall 2000), pages 219-302, August.
    6. Dutta, Mousumi & Husain, Zakir, 2009. "Determinants of crime rates: Crime Deterrence and Growth in post-liberalized India," MPRA Paper 14478, University Library of Munich, Germany.
    7. 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.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Crime; Firms; Economic Growth; Development;

    JEL classification:

    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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