IDEAS home Printed from https://ideas.repec.org/a/ukm/jlekon/v53y2019i1p105-119.html
   My bibliography  Save this article

The Economic of Deterrence: A Wrong Policy or A Misplaced Strategy?

Author

Listed:
  • Lau, Evan

    (Department of Economics Faculty of Economics and Business Universiti Malaysia Sarawak 94300 Kota Samarahan MALAYSIA)

  • Hamzah, Siti Nur Zahara

    (Management Development Institute of Singapore (MDIS) Level 17, (Office Tower) No. 108, Johor Bahru City Square 106, Jalan Wong Ah Fook 80000 Johor Bahru Johor MALAYSIA)

  • Habibullah, Muzafar

    (Institut of Agricultural and Food Policy Studies Universiti Putra Malaysia 43400 UPM Serdang Selangor Darul Ehsan MALAYSIA Putra Business School 43400 Serdang Selangor MALAYSIA)

Abstract

This paper investigates the impact of economics conditions and deterrence variables on disaggregated crime data in Sarawak, using yearly time-series data spanning more than 40 years using a vector error correction estimates. It is proven that economic variables studied serve as motivation of crime in Sarawak and imprisonment does not deter crime in the time period studied. It is evident that imprisonment in the case of Sarawak is less influential in deterring crime or the society were ill informed of the severity of punishment. While the study established a long-run relationship between economics and crime, it is also a noble approach in understanding deterrence in the context of Sarawak. Both economics and deterrence variables are important in explaining the decline in crime and in formulating efficient strategy and policies to combat crime. Government should shift the focus of increasing number of police force to increasing awareness on severity of punishments. At the same time, increasing opportunity for legal jobs would be important to deter crime.

Suggested Citation

  • Lau, Evan & Hamzah, Siti Nur Zahara & Habibullah, Muzafar, 2019. "The Economic of Deterrence: A Wrong Policy or A Misplaced Strategy?," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 53(1), pages 105-119.
    • Handle: RePEc:ukm:jlekon:v:53:y:2019:i:1:p:105-119
    DOI: http://dx.doi.org/10.17576/JEM-2019-5301-9
    as

    Download full text from publisher

    File URL: http://www.ukm.my/jem/wp-content/uploads/2021/06/jeko_531-9.pdf
    Download Restriction: no
    File URL: https://libkey.io/http://dx.doi.org/10.17576/JEM-2019-5301-9?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Paresh Kumar Narayan & Ingrid Nielsen & Russell Smyth, 2010. "Is There a Natural Rate of Crime?," American Journal of Economics and Sociology, Wiley Blackwell, vol. 69(2), pages 759-782, April.
    2. Muzafar Shah Habibullah & Badariah H.Din & Baharom Abdul Hamid, 2016. "Good governance and crime rates in Malaysia," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 43(3), pages 308-320, March.
    3. Kahan, Dan M, 1998. "Social Meaning and the Economic Analysis of Crime," The Journal of Legal Studies, University of Chicago Press, vol. 27(2), pages 609-622, June.
    4. Engle, Robert & Granger, Clive, 2015. "Co-integration and error correction: Representation, estimation, and testing," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 39(3), pages 106-135.
    5. Raphael, Steven & Winter-Ember, Rudolf, 2001. "Identifying the Effect of Unemployment on Crime," Journal of Law and Economics, University of Chicago Press, vol. 44(1), pages 259-283, April.
    6. Mats Persson & Claes-Henric Siven, 2007. "The Becker Paradox And Type I Versus Type Ii Errors In The Economics Of Crime," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 48(1), pages 211-233, February.
    7. Habibullah, M.S. & Law, Siong-Hook, 2008. "Property crime and macroeconomic variables in Malaysia: Some empirical evidence from a vector error-correction model," MPRA Paper 12112, University Library of Munich, Germany.
    8. John Luiz, 2001. "Temporal Association, the Dynamics of Crime, and their Economic Determinants: A Time Series Econometric Model of South Africa," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 53(1), pages 33-61, January.
    9. Ehrlich, Isaac, 1975. "The Deterrent Effect of Capital Punishment: A Question of Life and Death," American Economic Review, American Economic Association, vol. 65(3), pages 397-417, June.
    10. H. Naci Mocan & Hope Corman, 2000. "A Time-Series Analysis of Crime, Deterrence, and Drug Abuse in New York City," American Economic Review, American Economic Association, vol. 90(3), pages 584-604, June.
    11. Steven D. Levitt, 1996. "The Effect of Prison Population Size on Crime Rates: Evidence from Prison Overcrowding Litigation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 111(2), pages 319-351.
    12. Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
    13. Levitt, Steven D, 1997. "Using Electoral Cycles in Police Hiring to Estimate the Effect of Police on Crime," American Economic Review, American Economic Association, vol. 87(3), pages 270-290, June.
    14. Mirko Draca & Stephen Machin, 2015. "Crime and Economic Incentives," Annual Review of Economics, Annual Reviews, vol. 7(1), pages 389-408, August.
    15. Irving Piliavin & Rosemary Gartner & Craig Thornton & Ross L. Matsueda, 1986. "Crime, Deterrence, and Rational Choice," Mathematica Policy Research Reports 108e576df4ff4e768e3b2bc8b, Mathematica Policy Research.
    16. Corman, Hope & Mocan, Naci, 2005. "Carrots, Sticks, and Broken Windows," Journal of Law and Economics, University of Chicago Press, vol. 48(1), pages 235-266, April.
    17. Cherry, Todd L. & List, John A., 2002. "Aggregation bias in the economic model of crime," Economics Letters, Elsevier, vol. 75(1), pages 81-86, March.
    18. Samuel L. Myers, 1983. "Estimating the Economic Model of Crime: Employment Versus Punishment Effects," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 98(1), pages 157-166.
    19. John M. MacDonald & Jonathan Klick & Ben Grunwald, 2016. "The effect of private police on crime: evidence from a geographic regression discontinuity design," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 179(3), pages 831-846, June.
    20. Todd Cherry, 1999. "Unobserved heterogeneity bias when estimating the economic model of crime," Applied Economics Letters, Taylor & Francis Journals, vol. 6(11), pages 753-757.
    21. Grogger, Jeffrey, 1991. "Certainty vs. Severity of Punishment," Economic Inquiry, Western Economic Association International, vol. 29(2), pages 297-309, April.
    22. Bruce Chapman & D. Weatherburn & C.A. Kapuscinski & M. Chilvers & S. Roussel, 2002. "Unemployment Duration, Schooling and Property Crime," CEPR Discussion Papers 447, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    23. Bruce Weinberg & Eric Gould & David Mustard, 1998. "Crime Rates and Local Labor Market Opportunities in the United States: 1979-1995," Working Papers 98-11, Ohio State University, Department of Economics.
    24. Siti Nur Zahara Hamzah & Evan Lau, 2011. "Is peniaphobia an incentive to crime?," Global Crime, Taylor & Francis Journals, vol. 12(4), pages 312-326, November.
    25. Cornwell, Christopher & Trumbull, William N, 1994. "Estimating the Economic Model of Crime with Panel Data," The Review of Economics and Statistics, MIT Press, vol. 76(2), pages 360-366, May.
    26. Isaac Ehrlich, 1996. "Crime, Punishment, and the Market for Offenses," Journal of Economic Perspectives, American Economic Association, vol. 10(1), pages 43-67, Winter.
    27. Christopher A. Sims, 1982. "Policy Analysis with Econometric Models," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 13(1), pages 107-164.
    28. Johansen, Soren, 1995. "Likelihood-Based Inference in Cointegrated Vector Autoregressive Models," OUP Catalogue, Oxford University Press, number 9780198774501.
    29. Ehrlich, Isaac, 1973. "Participation in Illegitimate Activities: A Theoretical and Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 521-565, May-June.
    30. Mustard, David B., 2010. "How Do Labor Markets Affect Crime? New Evidence on an Old Puzzle," IZA Discussion Papers 4856, Institute of Labor Economics (IZA).
    31. Raphael, Steven & WINTER-EBMER, RUDOLF, 1998. "Identifying the Effect of Unemployment on Crime," University of California at San Diego, Economics Working Paper Series qt5hb4h56g, Department of Economics, UC San Diego.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Altindag, Duha T., 2012. "Crime and unemployment: Evidence from Europe," International Review of Law and Economics, Elsevier, vol. 32(1), pages 145-157.
    2. Entorf, Horst & Winkler, Peter, 2001. "The economics of crime: investigating the drugs-crime channel: empirical evidence from panel data of the German states," ZEW Discussion Papers 01-37, ZEW - Leibniz Centre for European Economic Research.
    3. Thomas A. Garrett & Lesli S. Ott, 2008. "City business cycles and crime," Working Papers 2008-026, Federal Reserve Bank of St. Louis.
    4. Horst Entorf & Peter Winker, 2001. "The Economics of Crime: Investigating the Drugs-Crime Channel," Law and Economics 0108001, University Library of Munich, Germany.
    5. Entorf, H. & Winker, P., 2008. "Investigating the drugs-crime channel in economics of crime models: Empirical evidence from panel data of the German States," International Review of Law and Economics, Elsevier, vol. 28(1), pages 8-22, March.
    6. Mohamad Kassem & Amjad Ali & Marc Audi, 2019. "Unemployment Rate, Population Density and Crime Rate in Punjab (Pakistan): An Empirical Analysis," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 8(2), pages 92-104, June.
    7. Deiana, C, 2016. "Local Labour Market Effects of Unemployment on Crime Induced by Trade Shocks," Economics Discussion Papers 16529, University of Essex, Department of Economics.
    8. Denis Fougère & Francis Kramarz & Julien Pouget, 2009. "Youth Unemployment and Crime in France," Journal of the European Economic Association, MIT Press, vol. 7(5), pages 909-938, September.
    9. Paolo Buonanno, 2003. "The Socioeconomic Determinants of Crime. A Review of the Literature," Working Papers 63, University of Milano-Bicocca, Department of Economics, revised Nov 2003.
    10. Povilas Lastauskas & Eirini Tatsi, 2017. "Spatial Nexus in Crime and Unemployement in Times of Crisis," Bank of Lithuania Working Paper Series 39, Bank of Lithuania.
    11. Naci Mocan & Kaj Gittings, 2010. "The Impact of Incentives on Human Behavior: Can We Make it Disappear? The Case of the Death Penalty," NBER Chapters, in: The Economics of Crime: Lessons For and From Latin America, pages 379-418, National Bureau of Economic Research, Inc.
    12. Loureiro, Paulo R.A. & Mendonça, Mário Jorge Cardoso de & Moreira, Tito Belchior Silva & Sachsida, Adolfo, 2009. "Crime, economic conditions, social interactions and family heritage," International Review of Law and Economics, Elsevier, vol. 29(3), pages 202-209, September.
    13. Matthew J. Baker & Niklas J. Westelius, 2013. "Crime, expectations, and the deterrence hypothesis," Chapters, in: Thomas J. Miceli & Matthew J. Baker (ed.), Research Handbook on Economic Models of Law, chapter 12, pages 235-280, Edward Elgar Publishing.
    14. Mejía, Daniel & Restrepo, Pascual, 2016. "Crime and conspicuous consumption," Journal of Public Economics, Elsevier, vol. 135(C), pages 1-14.
    15. Chihiro Muroi & Robert Baumann, 2009. "The Non-Linear Effect of Wealth on Crime," Working Papers 0907, College of the Holy Cross, Department of Economics.
    16. Horst Entorf & Hannes Spengler, 2008. "Is Being 'Soft on Crime' the Solution to Rising Crime Rates?: Evidence from Germany," Discussion Papers of DIW Berlin 837, DIW Berlin, German Institute for Economic Research.
    17. Alejandro Gaviria & Carlos Medina & Jorge Tamayo, 2010. "Assessing the Link between Adolescent Fertility and Urban Crime," Borradores de Economia 6860, Banco de la Republica.
    18. Maurice J. G. Bun & Richard Kelaher & Vasilis Sarafidis & Don Weatherburn, 2020. "Crime, deterrence and punishment revisited," Empirical Economics, Springer, vol. 59(5), pages 2303-2333, November.
    19. Martin Nordin & Daniel Almén, 2017. "Long-term unemployment and violent crime," Empirical Economics, Springer, vol. 52(1), pages 1-29, February.
    20. Nikolaos Dritsakis & Alexandros Gkanas, 2009. "The effect of socio-economic determinants on crime rates: An empirical research in the case of Greece with cointegration analysis," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 2(2), pages 51-64, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ukm:jlekon:v:53:y:2019:i:1:p:105-119. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Muhammad Asri Abd Ghani (email available below). General contact details of provider: https://edirc.repec.org/data/feukmmy.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.