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The changing returns to crime: do criminals respond to prices?

Draca, Mirko, Koutmeridis, Theodore and Machin, Stephen (2015) The changing returns to crime: do criminals respond to prices? CEP Discussion Papers (CEPDP1355). Centre for Economic Performance, London School of Economics and Political Science, London, UK.

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Abstract

In economic models of crime individuals respond to changes in the potential value of criminal opportunities. We analyse this issue by estimating crime-price elasticities from detailed data on criminal incidents in London between 2002 and 2012. The unique data feature we exploit is a detailed classification of what goods were stolen in reported theft, robbery and burglary incidents. We first consider a panel of consumer goods covering the majority of market goods stolen in the crime incidents and find evidence of significant positive price elasticities. We then study a particular group of crimes that have risen sharply recently as world prices for them have risen, namely commodity related goods (jewellery, fuel and metal crimes), finding sizable elasticities when we instrument local UK prices by exogenous shifts in global commodity prices. Finally, we show that changes in the prices of loot from crime have played a role in explaining recent crime trends.

Item Type: Monograph (Discussion Paper)
Official URL: http://cep.lse.ac.uk/_new/publications/series.asp?...
Additional Information: ©2015 The Authors
Divisions: Centre for Economic Performance
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HV Social pathology. Social and public welfare. Criminology
JEL classification: K - Law and Economics > K4 - Legal Procedure, the Legal System, and Illegal Behavior > K42 - Illegal Behavior and the Enforcement of Law
Sets: Research centres and groups > Centre for Economic Performance (CEP)
Date Deposited: 30 Jun 2015 16:35
Last Modified: 08 Sep 2019 23:27
Funders: Economic and Social Research Council
URI: http://eprints.lse.ac.uk/id/eprint/62588

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