Expected Returns to Crime and Crime Location

Braakmann, N., Chevalier, A. and Wilson, T. (2022) Expected Returns to Crime and Crime Location. Discussion Paper. IZA Institute of Labor Economics, Bonn, Germany. (doi: 10.2139/ssrn.4204339).

Abstract

We provide first evidence that temporal variations in the expected returns to crime affect the location of property crime. Our identification strategy relies on the widely held perception in the UK that households of South Asian descent store gold jewellery at home. Price movements on the international market for gold exogenously affect the expected gains from burgling these households, which become relatively more lucrative targets as the gold price increases. Using a neighbourhood-level panel on reported crime and difference-in-differences, we find that burglaries in South Asian neighbourhoods are more sensitive to variations in the gold price than other neighbourhoods in the same municipality, confirming that burglars react rationally to variations in the expected returns to their activities. We conduct a battery of tests on neighbourhood and individual data to eliminate alternative explanations.

• Item Type: Research Reports or Papers (Discussion Paper)
• Additional Information: IZA Discussion Paper No. 15520.
• Status: Published
• Refereed: No
• Glasgow Author(s) Enlighten ID: Wilson, Dr Tanya
• Authors: Braakmann, N., Chevalier, A., and Wilson, T.
• College/School: College of Social Sciences > Adam Smith Business School > Economics
• Research Group: Applied Economics
• Publisher: IZA Institute of Labor Economics