Thieves, Thugs, and Neighborhood Poverty
50 Pages Posted: 28 Oct 2008
Date Written: July 3, 2008
This paper develops a model of criminal behavior that analyzes how such behavior may be associated with both individual and neighborhood poverty. Importantly, this model distinguishes between basic property crimes such as burglary and larceny, and interpersonal violent crimes such as robbery and assault. The model shows that even under relatively minimal assumptions, a connection between individual poverty and both types of crime will arise, and moreover, "neighborhood" effects can develop, but will differ substantially in nature across crime types. A key implication of the model is that greater economic segregation in a city should have no effect or even a negative effect on basic property crime, but a positive effect on violent crime. Using Instrumental Variable methods, I show this implication to be consistent with the empirical evidence.
Keywords: Poverty, Crime, Instrumental Variables, Neighborhood Effects, Segregation
JEL Classification: R50, K42, Z13
Suggested Citation: Suggested Citation