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Is Inequality really a Major Cause of Violent Crime? Evidence From a Cross-National Panel of Robbery and Violent Theft Rates

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  • Eric Neumayer

Abstract

This article argues that the link between income inequality and violent property crime might be spurious, complementing a similar argument in prior an alysis by the author on the determinants of homicide. In contrast, Fajnzylber, Lederman & Loayza (1998; 2002a, b) provide seemingly strong and robust evidence that inequality causes a higher rate of both homicide and robbery/violent theft even after controlling for country-specific fixed effects. Ou r results suggest that inequality is not a statistically significant determinant, unless either country- specific effects are not controlled for or the sample is artificially restricted to a small number of countries. The reason why the link between inequality and violent property crime might be spur ious is that income inequality is likely to be strongly correlated with country- specific fixed effects such as cultural differences. A high degree of inequality might be socially undesirable for any number of reasons, but that it causes vi! olent crime is far from proven.

Suggested Citation

  • Eric Neumayer, 2003. "Is Inequality really a Major Cause of Violent Crime? Evidence From a Cross-National Panel of Robbery and Violent Theft Rates," Law and Economics 0312002, University Library of Munich, Germany, revised 10 Aug 2004.
  • Handle: RePEc:wpa:wuwple:0312002
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    References listed on IDEAS

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    2. Deininger, Klaus & Squire, Lyn, 1996. "A New Data Set Measuring Income Inequality," World Bank Economic Review, World Bank Group, vol. 10(3), pages 565-591, September.
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    4. Paul Collier & Anke Hoeffler, 2004. "Greed and grievance in civil war," Oxford Economic Papers, Oxford University Press, vol. 56(4), pages 563-595, October.
    5. Fajnzylber, Pablo & Lederman, Daniel & Loayza, Norman, 2002. "What causes violent crime?," European Economic Review, Elsevier, vol. 46(7), pages 1323-1357, July.
    6. Paul Collier & Anke Hoeffler, 2002. "Greed and Grievance in Civil War," Economics Series Working Papers WPS/2002-01, University of Oxford, Department of Economics.
    7. Fleisher, Belton M, 1970. "The Effect of Income on Delinquency: Reply," American Economic Review, American Economic Association, vol. 60(1), pages 257-257, March.
    8. Deininger, Klaus & Squire, Lyn, 1996. "A New Data Set Measuring Income Inequality," World Bank Economic Review, World Bank Group, vol. 10(3), pages 565-591, September.
    9. Bourguignon Francois, 2009. "Crime as a Social Cost of Poverty and Inequality: A Review Focusing on Developing countries," Revista Desarrollo y Sociedad, Universidad de los Andes - CEDE, September.
    10. Fajnzylber, Pablo & Lederman, Daniel & Loayza, Norman, 2002. "Inequality and Violent Crime," Journal of Law and Economics, University of Chicago Press, vol. 45(1), pages 1-40, April.
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