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

Draca, M., Koutmeridis, T. and Machin, S. (2018) The changing returns to crime: do criminals respond to prices? Review of Economic Studies, (doi:10.1093/restud/rdy004) (Early Online Publication)

Draca, M., Koutmeridis, T. and Machin, S. (2018) The changing returns to crime: do criminals respond to prices? Review of Economic Studies, (doi:10.1093/restud/rdy004) (Early Online Publication)

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Abstract

To what extent does crime follow the pattern of potential gains to illegal activity? This paper presents evidence on how criminals respond to this key incentive by reporting crime-price elasticities estimated from a comprehensive crime dataset containing detailed information on stolen items for London between 2002 and 2012. Evidence of significant positive crime-price elasticities are shown, for a panel of 44 consumer goods and for commodity related goods (jewellery, fuel and metal crimes). The reported evidence indicates that potential gains are a major empirical driver of criminal activity and a crucial part of the economic model of crime. The changing structure of goods prices helps to explain over 10-15 per cent of the observed fall in property crime across all goods categories, and the majority of the sharp increases in the commodity related goods observed between 2002 and 2012.

Item Type:Articles
Status:Early Online Publication
Refereed:Yes
Glasgow Author(s) Enlighten ID:Koutmeridis, Dr Theodore
Authors: Draca, M., Koutmeridis, T., and Machin, S.
College/School:College of Social Sciences > Adam Smith Business School > Economics
Journal Name:Review of Economic Studies
Publisher:Oxford University Press
ISSN:0034-6527
ISSN (Online):1467-937X
Published Online:22 January 2018
Copyright Holders:Copyright © 2018 The Authors
First Published:First published in Review of Economic Studies 2018
Publisher Policy:Reproduced in accordance with the publisher copyright policy

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