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Youth Gangs as Pseudo-Governments: Implications for Violent Crime

  • Russell S. Sobel

    (Department of Economics, West Virginia University)

  • Brian J. Osoba

    (Department of Economics, Central Connecticut State University)

We hypothesize the failure of government to protect the rights of individuals from violence committed by youths has led to the formation of youth gangs as protective agencies. Our theory predicts an opposite direction of causality between gang activity and violent crime than is widely accepted. While areas with more gang activity also have more violence, our results suggest gangs form as protection agencies precisely in areas with high violent crime rates. While gangs, like governments, use violence to enforce rules, the net impact of gangs is likely to lower violent crime. We test this hypothesis and offer policy implications.

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File URL: http://www.be.wvu.edu/phd_economics/pdf/09-09.pdf
File Function: First version, 2009
Download Restriction: no

Paper provided by Department of Economics, West Virginia University in its series Working Papers with number 09-09.

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Length: 39 pages
Date of creation: 2009
Date of revision:
Handle: RePEc:wvu:wpaper:09-09
Contact details of provider: Postal: P.O. Box 6025, Morgantown, WV 26506-6025
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Web page: http://www.be.wvu.edu/phd_economics/
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  1. Oriana Bandiera, 2003. "Land Reform, the Market for Protection, and the Origins of the Sicilian Mafia: Theory and Evidence," Journal of Law, Economics and Organization, Oxford University Press, vol. 19(1), pages 218-244, April.
  2. Konrad, Kai A. & Skaperdas, Stergios, 1999. "The Market for Protection and the Origin of the State," CEPR Discussion Papers 2173, C.E.P.R. Discussion Papers.
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  7. Isaac Ehrlich, 1996. "Crime, Punishment, and the Market for Offenses," Journal of Economic Perspectives, American Economic Association, vol. 10(1), pages 43-67, Winter.
  8. Stergios Skaperdas, 2001. "The political economy of organized crime: providing protection when the state does not," Economics of Governance, Springer, vol. 2(3), pages 173-202, November.
  9. Steven D. Levitt & Sudhir Alladi Venkatesh, 2000. "An Economic Analysis Of A Drug-Selling Gang'S Finances," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 755-789, August.
  10. Hamilton, James D, 1983. "Oil and the Macroeconomy since World War II," Journal of Political Economy, University of Chicago Press, vol. 91(2), pages 228-48, April.
  11. Davis, Michael L, 1988. "Time and Punishment: An Intertemporal Model of Crime," Journal of Political Economy, University of Chicago Press, vol. 96(2), pages 383-90, April.
  12. Nuno Garoupa, 1999. "Optimal law enforcement and criminal organization," Economics Working Papers 366, Department of Economics and Business, Universitat Pompeu Fabra.
  13. Dowd, Kevin, 1997. "Anarchy, Warfare, and Social Order: Comment on Hirshleifer," Journal of Political Economy, University of Chicago Press, vol. 105(3), pages 648-51, June.
  14. Hirshleifer, Jack, 1995. "Anarchy and Its Breakdown," Journal of Political Economy, University of Chicago Press, vol. 103(1), pages 26-52, February.
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