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Inequality, crime and private protection

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  • Corvalan, Alejandro
  • Pazzona, Matteo

Abstract

There is a consensus that inequality increases the supply of crime. As disparity in income grows within a society, the incentives for low-income individuals to engage in criminal activities also increase. However, in a context of high inequality, better-off individuals invest in deterring those who want to appropriate their resources. We examine this twofold effect of inequality in an equilibrium model of crime and private protection. We show that inequality unambiguously increases investment in private protection, but the relationship between inequality and crime is ambiguous, depending on how protection responds to private investment.

Suggested Citation

  • Corvalan, Alejandro & Pazzona, Matteo, 2022. "Inequality, crime and private protection," Economics Letters, Elsevier, vol. 210(C).
    • Handle: RePEc:eee:ecolet:v:210:y:2022:i:c:s0165176521004432
    DOI: 10.1016/j.econlet.2021.110184
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    References listed on IDEAS

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    Cited by:

    1. Zhe Song & Chen Hao, 2022. "Housing price and criminal crime in China: direct and indirect influence," Applied Economics, Taylor & Francis Journals, vol. 54(40), pages 4647-4663, August.
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    3. Pazzona, Matteo, 2024. "Revisiting the Income Inequality-Crime Puzzle," World Development, Elsevier, vol. 176(C).

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    More about this item

    Keywords

    Inequality; Crime; Private protection;
    All these keywords.

    JEL classification:

    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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