Does Globalisation Affect Crime? Theory and Evidence

32 Pages Posted: 5 Oct 2016

See all articles by Arghya Ghosh

Arghya Ghosh

UNSW Australia Business School, School of Economics

Peter E. Robertson

The University of Western Australia

Marie-Claire Robitaille

University of Nottingham Ningbo China

Date Written: October 2016

Abstract

Globalisation sceptics argue that trade liberalisation has high social costs, including an increase in expropriative behaviour such as civil conflict, coercion of labour and crime. We show that a theoretical relationship between trade and expropriation exists, but the sign differs for developed and developing economies. We verify this empirically using data on crime rates. Specifically, we find that trade liberalisation, as measured by both higher openness and lower import duty rates, tends to increase burglaries and theft in very labour‐abundant countries. For other countries, however, we find that trade liberalisation has either a small negative effect on crime or no effect, depending on the country's capital abundance.

Suggested Citation

Ghosh, Arghya and Robertson, Peter E. and Robitaille, Marie-Claire, Does Globalisation Affect Crime? Theory and Evidence (October 2016). The World Economy, Vol. 39, Issue 10, pp. 1482-1513, 2016, Available at SSRN: https://ssrn.com/abstract=2848001 or http://dx.doi.org/10.1111/twec.12422

Arghya Ghosh (Contact Author)

UNSW Australia Business School, School of Economics ( email )

High Street
Sydney, NSW 2052
Australia

Peter E. Robertson

The University of Western Australia ( email )

Marie-Claire Robitaille

University of Nottingham Ningbo China ( email )

199 Taikang East Road
Ningbo, Zhejiang 315100
China

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