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How does digital finance reduce urban crime rate?

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  • Li, Lin
  • Sun, Chenghao

Abstract

The fast development of digital finance led to profound changes in various aspects of social life, including social governance. This paper analyzes the impacts of digital finance on urban crime rates, focusing on the cost-benefit analysis of crime and verifying that digital finance can potentially decrease urban crime rates significantly. This impact is mainly attributed to digital money's transactional ease and convenience, which diminishes criminal activity by decreasing the expected return and raising opportunity costs. These findings offer novel insights into the impacts of digital finance and shed light on establishing a social governance mechanism in the digital era.

Suggested Citation

  • Li, Lin & Sun, Chenghao, 2024. "How does digital finance reduce urban crime rate?," Finance Research Letters, Elsevier, vol. 63(C).
    • Handle: RePEc:eee:finlet:v:63:y:2024:i:c:s1544612324004124
    DOI: 10.1016/j.frl.2024.105382
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    References listed on IDEAS

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