Wednesday, January 13, 2010

Crime Causes Poverty

It seems this recession is challenging some old hypotheses about the relationship between poverty (especially unemployment) and crime. Causality used to go one way: from poverty to crime. But could it go the other way? In the United States, instead of a recession-induced crime wave there appears to be a crime wane. The same is happening in the UK.

The latest CSO statistics show a reassuring fall in violent crimes, shown in the chart. And while some categories are up - such as burglaries - and therefore 'explainable' in terms of rising unemployment; other, much bigger categories have fallen steeply such as criminal damage and disorderly conduct. So does economics influence crime?

Anti-Dismal argues that New Zealand economists are at a loss to explain the unemployment-crime relationship. But here in Ireland we have a better idea thanks to work at the Geary Institute. It all boils down to the supply of potential criminals: specifically, young men (key word here is 'potential' I hasten to add). But their supply peaked some years ago, and so the number of potential criminals is falling, as - coincidently - are the number of flathulach consumers.

Crime is still a problem, of course. Especially for its victims. But the other victims of crime are the families of the criminals. Families without fathers are more likely to experience poverty than those with fathers. Which is why providing jobs for young men is of such benefit to society: not just in terms of economics, but also in terms of family life and the next generation.

5 comments:

  1. Its a long time since I looked at this literature but much of the research distinguishes between crimes against property (burglary e.g.) and crimes against the person (murder, rape for example) as there are often different patterns and responses to particular variables.
    In the report that you kindly cite we couldn't find a sniff of a labour market effect. Being labour economists, we certainly looked.

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  2. The findings cited in your blog seem to echo the hypothesis put forward by Leavitt et al, - the authors of Freakonomics. They argue that the fall in crime in the US from the 1970s to the present could be a result of the Supreme Court's legalisation of abortion in the US at that time. According to them, this resulted in the abortion of hundreds of thousands of unwanted children who would have been born into poor, single-parent, deprived families where they would almost certainly have turned to crime. The authors have been lambasted for this theory, but it's hard to contradict their conclusions.

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  3. Hugh: its actually not that hard to contradict. The Leviit & Donahue abortion paper has, perhaps predictably, been subject to fairly exhaustive analysis as well as a lot of heat. While I haven't followed the debate exhaustively, my impression is that the result doesn't hold up, they simply omitted some obvious controls.
    I am not sure the whole business is a good advertisement for economics.
    In any event, I doubt there is a bridge to our work on burglary in Ireland. Do you think we should selectively abort lots of male foetuses?

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  4. Kevin, I wasn't agreeing with Leavitt's abortion theory, merely highlighting the clear parallels with Gerard's musings in his post. If you like, Leavitt and co have taken Gerard's argument to its logical conclusion. As to their theory being hard to contradict, are you in a position to contradict it with hard facts? I doubt it. And I do not propose the abortion of a single foetus - male or female.

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  5. Hugh: well I am yes. Or at least the people who have exhaustively gone over the data do:
    Abortion and Crime: A Review
    Theodore J. Joyce, NBER Working Paper No. 15098*. in June 2009

    There you go!

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