Lost in the Mail: A Field Experiment on Crime

19 Pages Posted: 20 Nov 2013

See all articles by Marco Castillo

Marco Castillo

Department of Economics, Texas A&M University; IZA Institute of Labor Economics

Ragan Petrie

Texas A&M University - Department of Economics; University of Melbourne - Melbourne Institute of Applied Economic and Social Research

Maximo Torero

International Food Policy Research Institute (IFPRI)

Angelino Viceisza

Spelman College; International Food Policy Research Institute (IFPRI)

Date Written: January 2014

Abstract

Stealing, shirking, and opportunistic behavior in general can create barriers to the development of markets. The costs associated with such behavior are shared by both firms and individuals and can be large enough to even prevent the initiation of trade. Measurement of these costs is difficult because information is not available for transactions that fail to occur. We use a field experiment to identify opportunistic crime in a task that is important and relevant for trade: the delivery of mail. We subtly manipulate the content and information available in mail sent to households across neighborhoods that vary by income, and detected high levels of shirking and stealing. Eighteen percent of the mail never arrived at its destination, and significantly more was lost if there was even a slight hint of something additional inside the envelope. Our results demonstrate the importance of transaction costs created by crime and that not all populations are equally affected. MiddleÔÇÉincome neighborhoods suffer the most.

JEL Classification: C93, K42, H41, L87, O21

Suggested Citation

Castillo, Marco and Petrie, Ragan and Torero, Maximo and Viceisza, Angelino, Lost in the Mail: A Field Experiment on Crime (January 2014). Economic Inquiry, Vol. 52, Issue 1, pp. 285-303, 2014. Available at SSRN: https://ssrn.com/abstract=2357245 or http://dx.doi.org/10.1111/ecin.12046

Marco Castillo

Department of Economics, Texas A&M University ( email )

Allen Building
4228 TAMU
College Station, TX 77843-3137
United States

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Ragan Petrie

Texas A&M University - Department of Economics ( email )

4228 TAMU
College Station, TX 77843-4228
United States

University of Melbourne - Melbourne Institute of Applied Economic and Social Research ( email )

Level 5, FBE Building, 111 Barry Street
Parkville, Victoria 3010
Australia

Maximo Torero

International Food Policy Research Institute (IFPRI) ( email )

1201 Eye St, NW,
Washington, DC 20005
United States

Angelino Viceisza

Spelman College ( email )

350 Spelman Lane S.W.
Atlanta, GA 30314-4399
United States

International Food Policy Research Institute (IFPRI) ( email )

2033 K Street, NW
Suite 400
Washington, DC 20006
United States
+1-202-862-8196 (Phone)
+1-202-467-4439 (Fax)

HOME PAGE: http://sites.google.com/site/viceisza/

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