Employment, Dynamic Deterrence and Crime

66 Pages Posted: 3 Apr 2001

See all articles by Susumu Imai

Susumu Imai

Queen's University - Department of Economics

Kala Krishna

Pennsylvania State University - Department of Economics; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: January 15, 2001

Abstract

Using monthly panel data we solve and estimate, using maximum likelihood techniques, an explicitly dynamic model of criminal behavior where current criminal activity adversely affects future employment outcomes. This acts as "dynamic deterrence" to crime: the threat of future adverse effects on employment payoffs when caught committing crimes reduces the incentive to commit them.

We show that this dynamic deterrence effect is strong in the data. Hence, policies which weaken dynamic deterrence will be less effective in fighting crime. This suggests that prevention is more powerful than redemption since the latter weakens dynamic deterrence as anticipated future redemption allows criminals to look forward to negating the consequences of their crimes. Static models of criminal behavior neglect this and hence sole reliance on them can result in misleading policy analysis.

JEL Classification: J20, K42, C23, C25

Suggested Citation

Imai, Susumu and Krishna, Kala, Employment, Dynamic Deterrence and Crime (January 15, 2001). Available at SSRN: https://ssrn.com/abstract=261181 or http://dx.doi.org/10.2139/ssrn.261181

Susumu Imai (Contact Author)

Queen's University - Department of Economics ( email )

99 University Avenue
Kingston K7L 3N6, Ontario
Canada

HOME PAGE: http://qed.econ.queensu.ca/pub/faculty/imai/

Kala Krishna

Pennsylvania State University - Department of Economics ( email )

523 Kern Graduate Building
University Park, PA 16802-3306
United States
814-865-1106 (Phone)
814-863-4775 (Fax)

National Bureau of Economic Research (NBER)

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United States

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