Crime. Chapter 12. Purpose. In this chapter we explore one of the problems associated with urban areas, crime. We examine the behavior of a utility maximizing criminal why crime rates are higher in big cities, and the policy response. FBI Index Crimes, 1960 – 2003.
In this chapter we explore one of the problems associated with urban areas, crime. We examine
victim in physical danger
crimes of stealth rather than force
Expected utility from crime:
0.50*12 + 0.50*8 =10 utils
Not commit the crime
Commit the crime
Earn the lawful income – time lost in prison
Earn the lawful income
Earn the lawful income + loot
= 0.25•12 + 0.75•8 =9 utils
Supply curve as marginal-cost curve
Should society create a zero crime environment?
How does the increase in the penalty for burglary affect the number of burglaries and armed robberies?
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