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Jealous of the Joneses: conspicuous consumption, inequality, and crime

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  • Daniel L. Hicks
  • Joan Hamory Hicks

Abstract

Empirical research on the relationship between economic inequality and crime has focussed on income inequality, despite the fact that income is not easily observed by potential criminals. We extend this literature by shifting the focus from income to its visible manifestation—conspicuous consumption. Using variation within US states over time, we document a robust association between the distribution of conspicuous consumption and violent crime. Our results link violent crime to inequality in visible expenditure, but not to inequality in total expenditure, suggesting that information plays a key role in the determination of crime. Furthermore, focussing on conspicuous expenditure allows for new tests of competing theories of crime. Our findings are consistent with social theories that link crime with relative deprivation, but provide little support for traditional economic theory.

Suggested Citation

  • Daniel L. Hicks & Joan Hamory Hicks, 2014. "Jealous of the Joneses: conspicuous consumption, inequality, and crime," Oxford Economic Papers, Oxford University Press, vol. 66(4), pages 1090-1120.
    • Handle: RePEc:oup:oxecpp:v:66:y:2014:i:4:p:1090-1120.
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    File URL: http://hdl.handle.net/10.1093/oep/gpu019
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    Cited by:

    1. Leighton Vaughan Williams & Chunping Liu & Hannah Gerrard, 2019. "How well do Elo-based ratings predict professional tennis matches?," NBS Discussion Papers in Economics 2019/03, Economics, Nottingham Business School, Nottingham Trent University.
    2. Sorin M. S. Krammer & Addisu A. Lashitew & Jonathan P. Doh & Hari Bapuji, 2023. "Income inequality, social cohesion, and crime against businesses: Evidence from a global sample of firms," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 54(2), pages 385-400, March.
    3. Désirée I Christofzik & Sebastian G Kessing, 2024. "On the public provision of positional goods," Oxford Economic Papers, Oxford University Press, vol. 76(3), pages 708-721.
    4. Punarjit Roychowdhury, 2018. "Visible consumption, relative deprivation, and health: evidence from a developing country," Economics Bulletin, AccessEcon, vol. 38(3), pages 1366-1380.
    5. Luisa Blanco & Robin Grier & Kevin Grier & Daniel Hicks, 2021. "Household responses to escalating violence in Mexico," Applied Economics Letters, Taylor & Francis Journals, vol. 28(4), pages 315-318, February.
    6. Jaikumar, Saravana & Singh, Ramendra & Sarin, Ankur, 2018. "‘I show off, so I am well off’: Subjective economic well-being and conspicuous consumption in an emerging economy," Journal of Business Research, Elsevier, vol. 86(C), pages 386-393.
    7. Pazzona, Matteo, 2024. "Revisiting the Income Inequality-Crime Puzzle," World Development, Elsevier, vol. 176(C).
    8. Youngho Chang & Zheng Fang & Shigeyuki Hamori & Dawn Chow, 2018. "A Sustainable Metropolis: Perspectives of Population, Productivity and Parity," Sustainability, MDPI, vol. 10(11), pages 1-17, November.
    9. King Yoong Lim & Pengfei Jia, 2019. "Police spending and economic stabilization in a monetary economy with crime and differential human capital," NBS Discussion Papers in Economics 2019/02, Economics, Nottingham Business School, Nottingham Trent University.
    10. Che, Yi & Xu, Xun & Zhang, Yan, 2018. "Chinese import competition, crime, and government transfers in US," Journal of Comparative Economics, Elsevier, vol. 46(2), pages 544-567.
    11. Süß Philipp, 2020. "Regional Market Income Inequality and its Impact on Crime in Germany: A Spatial Panel Data Approach with Local Spillovers," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 240(4), pages 387-415, August.
    12. Mejía, Daniel & Restrepo, Pascual, 2016. "Crime and conspicuous consumption," Journal of Public Economics, Elsevier, vol. 135(C), pages 1-14.
    13. Esposito, Lucio & Villaseñor, Adrián & Rodríguez, Enrique Cuevas & Millett, Christopher, 2020. "The economic gradient of obesity in Mexico: Independent predictive roles of absolute and relative wealth by gender," Social Science & Medicine, Elsevier, vol. 250(C).
    14. Livio Di Matteo & Robert Petrunia, 2022. "Does economic inequality breed murder? An empirical investigation of the relationship between economic inequality and homicide rates in Canadian provinces and CMAs," Empirical Economics, Springer, vol. 62(6), pages 2951-2988, June.
    15. Ori Heffetz, 2018. "Expenditure Visibility and Consumer Behavior: New Evidence," NBER Working Papers 25161, National Bureau of Economic Research, Inc.
    16. Richard Henry Rijnks & Sierdjan Koster & Philip McCann, 2019. "The Neighbour’s Effect on well‐Being: How Local Relative Income Differentials Affect Resident's Subjective Well‐Being," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 110(5), pages 605-621, December.
    17. Itskovich, Eran & Factor, Roni, 2024. "An experimental-causal-chain design to explore three mechanisms linking economic inequality and crime," Journal of Criminal Justice, Elsevier, vol. 92(C).
    18. Dutta, Nabamita & Jana, Dipparna & Kar, Saibal, 2020. "Does state-level per capita income affect juvenile delinquency? An empirical analysis for Indian states," Economic Modelling, Elsevier, vol. 87(C), pages 109-120.
    19. Lucio Esposito & Shatakshee Dhongde & Christopher Millett, 2021. "Smoking habits in Mexico: Upward and downward comparisons of economic status," Review of Development Economics, Wiley Blackwell, vol. 25(3), pages 1558-1575, August.
    20. Christine Mayrhuber & Matthias Firgo & Hans Pitlik & Alois Guger & Ewald Walterskirchen, 2018. "Sozialstaat und Standortqualität," WIFO Studies, WIFO, number 61006.

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