The Impact of Inflation on Property Crime

17 Pages Posted: 27 May 2016

See all articles by John M. Nunley

John M. Nunley

University of Wisconsin - La Crosse

Michael L. Stern

Auburn University; Phoenix Center for Advanced Legal & Economic Public Policy Studies

Alan Seals

Auburn University - Department of Economics

Joachim Zietz

EBS University, EBS Business School

Date Written: July 2016

Abstract

Using U.S. data from 1950 to 2010, we analyze to what extent inflation raises the incidence of property crime. To match our theoretical predictions, we consider different types of property crime (larceny, burglary, motor vehicle theft, and robbery) and broad and narrow definitions of inflation separately. We control for the state of the business cycle and demographic changes over time explicitly. Unobserved or difficult‐to‐measure determinants of property crime are captured through a stochastic‐trend specification within a state‐space framework. We find a robust statistical link between inflation and each of the four property crime rates. Our findings are robust to alternative definitions of inflation and the inclusion or exclusion of different control variables. In terms of policy, our findings suggest that monetary policy that creates inflation has costly spillover effects.

JEL Classification: J10, J11

Suggested Citation

Nunley, John M. and Stern, Michael L. and Seals, Richard A and Zietz, Joachim, The Impact of Inflation on Property Crime (July 2016). Contemporary Economic Policy, Vol. 34, Issue 3, pp. 483-499, 2016. Available at SSRN: https://ssrn.com/abstract=2785000 or http://dx.doi.org/10.1111/coep.12156

John M. Nunley (Contact Author)

University of Wisconsin - La Crosse ( email )

1725 State Street
La Crosse, WI 54601
United States

Michael L. Stern

Auburn University ( email )

415 West Magnolia Avenue
Auburn, AL 36849
United States

Phoenix Center for Advanced Legal & Economic Public Policy Studies

5335 Wisconsin Avenue, NW
Suite 440
Washington, DC 20015
United States

Richard A Seals

Auburn University - Department of Economics ( email )

0326 Haley Center
Auburn University, AL 36849-5049
United States
334-844-2907 (Phone)

Joachim Zietz

EBS University, EBS Business School ( email )

Gustav-Stresemann-Ring 3
Wiesbaden, Hessen 65189
Germany

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