Stirring Up a Hornets' Nest: Geographic Distribution of Crime

Abstract

This paper develops a model of the geographic distribution of crime in an urban area. When the police protect some neighborhoods (concentrated protection), the city becomes segregated. When the police are evenly deployed across the city (dispersed protection), an integrated city emerges. Unequal societies face a difficult dilemma in that concentrated protection maximizes aggregate welfare but exacerbates social disparities. Taxes and subsidies that can be employed to offset the disadvantages to agents left unprotected. Private security makes an integrated city less likely. Even under dispersed public protection, rich agents may use private security to endogenously isolate themselves in closed neighborhoods.