Download Crime and the business cycle

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INTRODUCTION
Conventional Wisdom: “street” crime is
countercyclical
Controversy: many exceptions
1982: year the worst postwar recession hit
bottom
1960s: period of sustained economic growth
and declining unemployment
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EXAMPLES OF WHY MIGHT CRIME BE LINKED
TO ECONOMIC CONDITIONS
1.Legitimate Opportunities
2.Criminal Opportunities
3.Use of Criminogenic Commodities
4.The Criminal Justice System Response
to Crime
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SOCIAL ASPECTS OF THE BUSINESS CYCLE –
THOMAS (1927)
• Related various detrended measures of crime
with an indicator of business conditions for
Britain
• Findings
• Robbery and Burglary (-.44)
• Larceny (-.25)
• Violent Crimes (+.06)
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AN ECONOMIC ANALYSIS OF CRIME AND PUNISHMENT
IN ENGLAND AND WALES, 1894-1967 – WOLPIN (1978)
•
•
Analyzed unemployment, GDP per capita, and weekly wage for manual
manufacturing workers against crime data
Findings:
• Robbery and burglary
• Homicide
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CRIME AND THE BUSINESS CYCLE – COOK AND ZARKIN
(1985)
“For two important types of crimes, robbery and
burglary, there is strong evidence of a
countercyclical pattern. Recessions do indeed
increase the rate at which these crimes are
committed. These conclusions are supported by
both nonparametric and regression analysis of
U.S. crime rates since 1933.”
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10 YEAR CRIME TREND IN NORTH CAROLINA
6,000
5,000
4,000
3,000
2,000
1,000
0
Index Rate
Violent Rate
Property Rate
Murder Rate
Rape Rate
Robbery Rate
Assault Rate
Burglary Rate
Larceny Rate
Source: North Carolina Department of Justice
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2007-2009: DECLINE IN CRIME IN NC
Source: North Carolina Department of Justice, Census Estimates
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2007-2009: DECLINE IN CRIME IN NC
Source: North Carolina Department of Justice, Census Estimates
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WHY DID CRIME NOT INCREASE?
1. Drug Markets
A. 1970’s: Heroin
B. Late 1980’s – Early 1990’s: Crack
2. Policing
A. Compstat-type accountability systems
B. Real-time crime information
3. Target Hardening
A. Cell phones/cameras
B. New car security systems
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WHY DID CRIME NOT INCREASE?
4. Economic Stimulus
A.
Economic stimulus spending, especially unemployment
benefits
5. Declining Criminal Opportunities
A. High unemployment rates -> occupied houses
B. People carry less cash/valuables
6. Demographics
A. Median age at highest point ever in 2010
7. Incarceration
A. US has highest incarceration rate
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