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The impact of crime on housing land prices and the effects of police boxes and voluntary groups on crime prevention in Japan

Author

Listed:
  • Ryuji Kutsuzawa

    (Regional and Land Planning Bureau, Ministry of Land, Infrastructure, Transport and Tourism)

  • Noriko Mizutani

    (Faculty of Economics, Toyo University)

  • Fumio Ohtake

    (Institute of Social and Economic Research, Osaka University)

  • Hisaki Yamaga

    (School of Economics, Kwansei Gakuin University)

Abstract

Many people now fear crime in Japan, which has had the image of being a safe country, because the crime rate has increased dramatically and the rate of crime detection has decreased at the same time. As demand for low-crime residential areas becomes stronger, low-crime rates may affect land prices in Japan. High levels of land prices may reflect the high economic value of low-crime neighborhoods. However, the Ordinary Least Square (OLS) estimate may cause a bias because the crime rate is not necessarily an exogenous determinant of land price. Therefore, in this study, we adopt the instrumental variable (IV) method, and use instrumental variables such as distance from police boxes and existence of voluntary anti-crime groups, and analyze the effects of property crime rates on residential land prices. The results show that a 10% decrease in the rate of burglaries causes an average rise in residential land prices of 1%.

Suggested Citation

  • Ryuji Kutsuzawa & Noriko Mizutani & Fumio Ohtake & Hisaki Yamaga, 2010. "The impact of crime on housing land prices and the effects of police boxes and voluntary groups on crime prevention in Japan," Discussion Paper Series 60, School of Economics, Kwansei Gakuin University, revised Oct 2010.
    • Handle: RePEc:kgu:wpaper:60
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    More about this item

    Keywords

    Property Crime; Police box; Voluntary crime-prevention group; Instrumental Variable; Propensity Score Matching;
    All these keywords.

    JEL classification:

    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
    • R22 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Other Demand
    • R28 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Government Policy

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