Police and Crime in Developing Economies: Evidence from Firm Surveys
36 Pages Posted: 18 Dec 2011 Last revised: 14 May 2013
Date Written: September 17, 2012
Economic theory predicts that a rise in police presence will reduce criminal activity. However several studies in the literature have found mixed results. This study adds to the literature by exploring the relationship between the size of police and crime against firms. Using survey data for about 12,000 firms in a cross-section of 27 developing countries we find that increasing the police force is negatively associated with crime against firms. Results are confirmed using a panel of firms for a subset of countries for which data are available. We also find that this negative relationship is stronger under certain macro-economic circumstances.
Keywords: crime, firms, development, police size
JEL Classification: K42, O10, O50
Suggested Citation: Suggested Citation