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Economic Growth and Crime: Does Uncertainty Matter?

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  • Eleftherios Goulas

    (Department of Economics, University of Patras, Greece)

  • Athina Zervoyianni

    (Department of Economics, University of Patras, Greece)

Abstract

This paper contributes to the crime literature by exploring how the crime-uncertainty interaction impacts on economic growth. Using a panel of 25 countries over the period 1991-2007, we find evidence suggesting that increased crime has an asymmetric effect on growth depending on the future prospects of the economy as reflected in the degree of macroeconomic uncertainty. In particular, our results indicate that higher-than-average macroeconomic uncertainty enhances the adverse impact of crime on growth implying that a 10% increase in the crime rate can reduce annual per-capita GDP-growth by between 0.49 and 0.62 percent.

Suggested Citation

  • Eleftherios Goulas & Athina Zervoyianni, 2012. "Economic Growth and Crime: Does Uncertainty Matter?," Working Paper series 51_12, Rimini Centre for Economic Analysis.
  • Handle: RePEc:rim:rimwps:51_12
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    References listed on IDEAS

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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Crimen y crecimiento económico
      by ? in Tiempo Económico on 2012-11-03 13:32:39

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    Cited by:

    1. Ms. Concha Verdugo Yepes & Mr. Peter L. Pedroni & Xingwei Hu, 2015. "Crime and the Economy in Mexican States: Heterogeneous Panel Estimates (1993-2012)," IMF Working Papers 2015/121, International Monetary Fund.
    2. Víctor Hugo Torres-Preciado & Mayrén Polanco-Gaytán & Miguel A. Tinoco-Zermeño, 2017. "Crime and regional economic growth in Mexico: A spatial perspective," Papers in Regional Science, Wiley Blackwell, vol. 96(3), pages 477-494, August.
    3. Eleftherios Goulas & Athina Zervoyianni, 2013. "The Growth-Crime Relationship: Are There any Asymmetries?," Working Paper series 54_13, Rimini Centre for Economic Analysis.
    4. Oliviero A. Carboni & Claudio Detotto, 2016. "The economic consequences of crime in Italy," Journal of Economic Studies, Emerald Group Publishing, vol. 43(1), pages 122-140, January.
    5. Daniel Francois Meyer & Elsabà Keyser, 2018. "Formulation and validation of an Enabling Developmental Environment Scale (EDES) for local economic development (LED," Journal of Economics and Behavioral Studies, AMH International, vol. 9(6), pages 57-66.
    6. Adekoya Adenuga Fabian & Abdul Razak Nor Azam, 2017. "The Dynamic Relationship between Crime and Economic Growth in Nigeria," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 53(1), pages 47-64, March.
    7. Ioannis Laliotis, 2016. "Crime and unemployment in Greece: Evidence before and during the crisis," Economics and Business Letters, Oviedo University Press, vol. 5(1), pages 10-16.
    8. Pina-Sánchez, Jose & Buil-Gil, David & brunton-smith, ian & Cernat, Alexandru, 2021. "The impact of measurement error in models using police recorded crime rates," SocArXiv ydf4b, Center for Open Science.
    9. Harold Glenn A. Valera & Mark J. Holmes & Gazi M. Hassan, 2018. "Is inflation targeting credible in Asia? A panel GARCH approach," Empirical Economics, Springer, vol. 54(2), pages 523-546, March.
    10. Goulas, Eleftherios & Zervoyianni, Athina, 2015. "Economic growth and crime: Is there an asymmetric relationship?," Economic Modelling, Elsevier, vol. 49(C), pages 286-295.
    11. Qamar, Alina & Safdar, Maria, 2021. "The Role of Human Capital, Corruption and Quality of Life in Determining the Crime Rate: Empirics from Pakistan," MPRA Paper 107633, University Library of Munich, Germany.
    12. 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 sp," Ensayos Revista de Economia, Universidad Autonoma de Nuevo Leon, Facultad de Economia, vol. 0(1), pages 25-58, May.
    13. Ngozi E. Egbuna (PhD) & Maimuna John-Sowe & Dauda Mohammed (PhD) & Hissan Abubakari & Eric L. Sambolah & Kormay Adams, 2020. "Uncertainty And Economic Performance In The West African Monetary Zone (Wamz): A Fixed Effect Panel Threshold Approach," Working Papers 19, West African Monetary Institute.

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    More about this item

    Keywords

    growth; crime; uncertainty;
    All these keywords.

    JEL classification:

    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • K14 - Law and Economics - - Basic Areas of Law - - - Criminal Law
    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General

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