American Economic Journal:
Microeconomics
ISSN 1945-7669 (Print) | ISSN 1945-7685 (Online)
A Theory of Crime and Vigilance
American Economic Journal: Microeconomics
vol. 14,
no. 3, August 2022
(pp. 255–303)
Abstract
This paper develops a theory of crime in which potential victims elect their vigilance levels. When vigilance expenses are greater than expected property losses, an increase in penalties raises crime, namely, a criminal Laffer curve emerges. This curve is higher and peaks earlier when victims face higher costs. Thus, the government may wish to subsidize vigilance rather than increase penalties. Indeed, an increase in penalties may shift the vigilance levels further away from their socially optimal ones. Finally, the crime rate first rises and then falls in the property value at stake, which is consistent with the empirical evidence.Citation
Vásquez, Jorge. 2022. "A Theory of Crime and Vigilance." American Economic Journal: Microeconomics, 14 (3): 255–303. DOI: 10.1257/mic.20190339Additional Materials
JEL Classification
- D91 Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
- H76 State and Local Government: Other Expenditure Categories
- K42 Illegal Behavior and the Enforcement of Law
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