Econ 522 – Lecture 23 (April 28 2009)Chapter 12 of Cooter and Ulen gives a number of empirical facts about crime in the U.S.- In 2005, the U.S. had over 2,000,000 prisoners in jails and prisons, up from half a million in 1980; nearly another 5 million are on probation or parole- 93% are male- Among those in federal prisons, 60% are in for drug-related offenses- The incarceration rate in the U.S. – around 0.7% – is more than 7 times that in Western Europe.Some recent history- Crime rates in the U.S. (relative to population) decreased steadily from the mid-1930s till the early 1960s- From the early 1960s to the late 1970s, the rate of all crimes increased sharply. - From the early 1980s to the early 1990s,o the rate of nonviolent crimes committed by adults dropped sharplyo the rate of violent crimes by adults dropped slightlyo but the rate of violent crimes by young people went up- From the mid 1990s till now, both violent and nonviolent crimes have been dropping, sharply in the 1990s and more slowly since 2000.o Nonviolent crime rates have been going up overseas, so that nonviolent crime rates in the U.S. are similar or even below some European countries.o Violent crime rates are still significantly higher in the U.S., but well belowtheir peak – from 1991 to 2004, murder rate in the U.S. fell by one-third.- Criminals in the U.S. are disproportionally young males, with crime rates generally following trends in the share of the population between ages 14 and 25- Both violent criminals and their victims are disproportionally African-American.- A relatively small number of people commit a large fraction of violent crimes.- The book gives a few consistent characteristics of that group, they’re things you’dexpecto they come from dysfunctional familieso have relatives who are criminalso do poorly in schoolo are alcohol- and drug-abuserso live in poor and chaotic neighborhoods- 1 -o and being misbehavior at a young age.Cooter and Ulen try to estimate the social cost of crime- The easy part to calculate is money spent on crime prevention and punishment, which is over $100 billion a year.o One third is on policeo One third is on prisonso One-third is on courts, prosecutors, public defenders, probation officers, and so on.- They estimate nearly another $100 billion of private money is spent on crime prevention, such as alarms and security systems, private guards, and so on.- They don’t really give numbers for the direct cost of crimes – stolen property, injuries, and so on- They estimate the total social cost of crime to be $500 billion, or 4% of GDPCooter and Ulen discuss several empirical attempts to measure the extent to which punishment deters crime.- As we mentioned Thursday, it’s often difficult to separate two separate effects:o deterrence – when punishment gets more severe, crime rates may go down because people are more afraid of being caughto incapacitation – when punishment gets more severe, say, through longer prison terms, so crime rates may go down just because more criminals are already in jail- The early literature didn’t deal so directly with this problem, but did find that higher conviction rates and harsher punishments were associated with lower crimerates.- Two studies, rather than looking at high-level crime rates, studied individual people who were likely to commit crimes: convicted criminals being released from prisono Within this population, there was still a deterrence effect:o Those with a high chance of being convicted again were arrested less in the months following release.- One paper (by Dan Kessler and Steve Levitt) used a “natural experiment” to separate the deterrent effect from the incapacitation effecto In 1982, voters in California passed a ballot initiative which added 5 years to sentences for certain serious crimes for each prior conviction by the criminalo Any immediate change in crime rates should be due to deterrence, since the number of criminals in prison would only respond graduallyo They found an almost immediate 4% drop in the crimes that were eligible for these “sentence enhancements”o So there did seem to be a clear deterrent effect- 2 -The evidence on how crime rates respond to general economic conditions is more mixed- The studies tend to use national economic conditions, but you’d expect crime rates to respond more to local conditions in high-crime areasThe paper on the syllabus by Isaac Ehrlich assumes that potential criminals compare the gains from illegal activity to the wages they could earn in legal jobsThere is an interesting paper by Wilson and Abrahamse that explicitly does this calculation- They looked at a number of “career criminals”.- Two-thirds of them had relatively stable jobs when they were out of prison, and therefore at least had a reasonable estimate of their “legitimate” wages o averaged a little under $6 an hour (this was in early 1990s)- Wilson and Abrahamse came up with estimates of the income from criminal activity, and compared it with the income from legitimate work- They separated the criminals into two groups: “high-rate” offenders and “mid-rate” offenders.- They found that among mid-rate offenders, crime mostly didn’t payo working paid higher than criminal activity for most types of crime (although not for auto theft)- Among the high-rate offenders, however, crime mostly did payo criminal activity paid higher than legitimate wages for most types of crimes- However, when the cost of punishment (imprisonment) were added, this finding reversed itselfo adjusted for expected punishment, criminal activity paid worse than legitimate work.- Wilson and Abrahamse considered, but rejected, the notion that crimes were committed because of a lack of opportunity for legal work, or because of problems with alcohol and drugso Two-thirds of the offenders did have alcohol or drug problems, but the authors concluded that this didn’t preclude them holding down legal jobs- They instead concluded that career criminals are “temperamentally disposed to overvalue the benefits of crime and to undervalue its costs” because they are “inordinately impulsive or present-oriented.”- 3 -We saw before that the crime rate in the U.S. dropped significantly in the 1990sA number of different explanations have been given:- deterrence and incapacitation- the decline of crack cocaine, which had driven much of the crime in the 1980s- the economic boom of the 1990s- more precaution taken by
View Full Document
Unlocking...