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On the Political Economy of Income Redistribution and Crime

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Author Info
Imrohoroglu, Ayse
Merlo, Antonio
Rupert, Peter

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Abstract

This article analyzes a general equilibrium model in which agents choose to specialize in either legitimate or criminal activities. Expenditures on police to apprehend criminals, as well as income redistribution, are determined endogenously through majority voting. We investigate how crime, redistribution, and police expenditures depend on characteristics of the underlying distribution of income-earning abilities and on the apprehension technology. Our model accounts for the positive correlation between inequality and crime, the positive correlation between expenditures on police and redistribution, and the lack of correlation between crime and redistribution observed in U.S. data. Copyright 2000 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.

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Publisher Info
Article provided by Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association in its journal International Economic Review.

Volume (Year): 41 (2000)
Issue (Month): 1 (February)
Pages: 1-25
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Handle: RePEc:ier:iecrev:v:41:y:2000:i:1:p:1-25

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Sheshinski, Eytan, 1972. "The Optimal Linear Income-Tax," Review of Economic Studies, Blackwell Publishing, vol. 39(3), pages 297-302, July. [Downloadable!] (restricted)
  2. Ehrlich, Isaac, 1996. "Crime, Punishment, and the Market for Offenses," Journal of Economic Perspectives, American Economic Association, vol. 10(1), pages 43-67, Winter. [Downloadable!] (restricted)
  3. Juster, F Thomas & Stafford, Frank P, 1991. "The Allocation of Time: Empirical Findings, Behavioral Models, and Problems of Measurement," Journal of Economic Literature, American Economic Association, vol. 29(2), pages 471-522, June. [Downloadable!] (restricted)
  4. Rao Aiyagari, S. & Peled, Dan, 1995. "Social insurance and taxation under sequential majority voting and utilitarian regimes," Journal of Economic Dynamics and Control, Elsevier, vol. 19(8), pages 1511-1528, November. [Downloadable!] (restricted)
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  5. Witte, Ann Dryden, 1980. "Estimating the Economic Model of Crime with Individual Data," The Quarterly Journal of Economics, MIT Press, vol. 94(1), pages 57-84, February. [Downloadable!] (restricted)
  6. Roberts, Kevin W. S., 1977. "Voting over income tax schedules," Journal of Public Economics, Elsevier, vol. 8(3), pages 329-340, December. [Downloadable!] (restricted)
  7. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January. [Downloadable!] (restricted)
  8. Edward L. Glaeser & Bruce Sacerdote, 1996. "Why Is There More Crime in Cities?," NBER Working Papers 5430, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  9. Harris, John R, 1970. "On the Economics of Law and Order," Journal of Political Economy, University of Chicago Press, vol. 78(1), pages 165-74, Jan.-Feb.. [Downloadable!] (restricted)
  10. Freeman, Richard B, 1996. "Why Do So Many Young American Men Commit Crimes and What Might We Do about It?," Journal of Economic Perspectives, American Economic Association, vol. 10(1), pages 25-42, Winter. [Downloadable!] (restricted)
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  11. A. Mitchell Polinsky & Steven Shavell, 1982. "The Optimal Use of Fines and Imprisonment," NBER Working Papers 0932, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  12. DiIulio, John J, Jr, 1996. "Help Wanted: Economists, Crime and Public Policy," Journal of Economic Perspectives, American Economic Association, vol. 10(1), pages 3-24, Winter. [Downloadable!] (restricted)
  13. McGrattan, Ellen R., 1994. "The macroeconomic effects of distortionary taxation," Journal of Monetary Economics, Elsevier, vol. 33(3), pages 573-601, June. [Downloadable!] (restricted)
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  14. Ehrlich, Isaac, 1973. "Participation in Illegitimate Activities: A Theoretical and Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 521-65, May-June. [Downloadable!] (restricted)
  15. Kydland, Finn E & Prescott, Edward C, 1982. "Time to Build and Aggregate Fluctuations," Econometrica, Econometric Society, vol. 50(6), pages 1345-70, November. [Downloadable!] (restricted)
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  16. Meltzer, Allan H & Richard, Scott F, 1981. "A Rational Theory of the Size of Government," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 914-27, October. [Downloadable!] (restricted)
  17. Gary S. Becker, 1968. "Crime and Punishment: An Economic Approach," Journal of Political Economy, University of Chicago Press, vol. 76, pages 169. [Downloadable!] (restricted)
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  18. J. A. Mirrlees, 1976. "Optimal Tax Theory: A Synthesis," Working papers 176, Massachusetts Institute of Technology (MIT), Department of Economics.
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  19. Tauchen, Helen & Witte, Ann Dryden & Griesinger, Harriet, 1994. "Criminal Deterrence: Revisiting the Issue with a Birth Cohort," The Review of Economics and Statistics, MIT Press, vol. 76(3), pages 399-412, August. [Downloadable!] (restricted)
  20. Stigler, George J, 1970. "The Optimum Enforcement of Laws," Journal of Political Economy, University of Chicago Press, vol. 78(3), pages 526-36, May-June. [Downloadable!] (restricted)
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  21. Stern, N. H., 1976. "On the specification of models of optimum income taxation," Journal of Public Economics, Elsevier, vol. 6(1-2), pages 123-162. [Downloadable!] (restricted)
  22. Sala-I-Martin, X., 1992. "Public Welfare and Growth," Papers 666, Yale - Economic Growth Center.
  23. Furlong, William J., 1987. "A general equilibrium model of crime commission and prevention," Journal of Public Economics, Elsevier, vol. 34(1), pages 87-103, October. [Downloadable!] (restricted)
  24. Ehrlich, Isaac, 1981. "On the Usefulness of Controlling Individuals: An Economic Analysis of Rehabilitation, Incapacitation, and Deterrence," American Economic Review, American Economic Association, vol. 71(3), pages 307-22, June. [Downloadable!] (restricted)
  25. Hellwig, Martin F., 1986. "The optimal linear income tax revisited," Journal of Public Economics, Elsevier, vol. 31(2), pages 163-179, November. [Downloadable!] (restricted)
  26. Romer, Thomas, 1975. "Individual welfare, majority voting, and the properties of a linear income tax," Journal of Public Economics, Elsevier, vol. 4(2), pages 163-185, February. [Downloadable!] (restricted)
  27. McKelvey, Richard D, 1979. "General Conditions for Global Intransitivities in Formal Voting Models," Econometrica, Econometric Society, vol. 47(5), pages 1085-1112, September. [Downloadable!] (restricted)
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