Economic Development and the Economics of Crime

Dr. Gholamhossein Biabani; Secretary of the Iranian Association for the Development of Detective Science and Innovation Studies

Ehrlich, one of the well-known criminologists, was the first to examine this issue. He developed a model of participation in illegal activities in which individuals decide how to allocate their time between lawful and unlawful behavior.

Although many theoretical developments have taken place since then, most of his findings still provide a fundamental perspective on the field. His model, using average income level as an indicator of economic development, predicts that development has an ambiguous effect on crime rates.

Compared to other variables, inequality has received the greatest attention. Chiu and Madden have recently extended a model that analyzes in detail the factors influencing theft rates.

Similarly, Glaeser and Sacerdote focused on the relationship between urbanization and crime, analyzing the likelihood of committing offenses. Based on this, other development-related variables that may be important in determining crime rates include education and institutional development.

Education can influence criminal behavior by changing individual attitudes or reporting behavior. Institutional development can strengthen public trust in the system, thereby increasing reporting rates and improving the efficiency of government record-keeping.

Although all these variables are believed to play a role in determining crime rates, their relative importance remains an empirical question. Moreover, the effect of development itself — theoretically ambiguous — continues to be debated.

Empirical evidence on the factors influencing interregional differences in crime rates generally focuses on the effects of inequality and development, such as income level or poverty indicators. Since our attention is also directed toward these two variables, this theoretical review and much of the subsequent discussion will be devoted to them.

Accordingly, the results of several studies reviewed suggest that they seek to explore the effects of inequality and development on crime rates.

These findings are not intended to provide an exhaustive review of all available evidence or a detailed description of the techniques and strategies used in different studies. Rather, their goal is to present a broad picture of the overall results and how criminologists themselves perceive the current situation.

The statistical approaches employed in these studies are largely diverse; therefore, we have focused only on examining the units and dimensions of analysis, the types of crimes studied, and the authors’ main conclusions.