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Prices, Policing and Policy: The Dynamics of Crime Booms and Busts

Kirchmaier, Tom, Machin, Stephen, Sandi, Matteo and Witt, Robert (2018) Prices, Policing and Policy: The Dynamics of Crime Booms and Busts [Working Paper]

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Abstract

In many historical episodes, the extent of criminal activity has displayed booms and busts. One very clear example is the case of metal crime, where in the face of big increases in value driven by world commodity prices, the incidence of metal thefts in the UK (and elsewhere) rose very sharply in the 2000s. Early in the current decade, they fell sharply again. This paper studies the roles of prices, policing and policy in explaining these crime dynamics. The empirical analysis shows sizeable and significant metal crime-price elasticities, in line with the idea that changing economic returns do shape crime. However, the rapid upward and downward trends are not only due to price changes. Their temporal evolution is also explained by changes in policing and policy. On the former, a difference-in-differences approach is used to document an important role of policing as a consequence of an anti-metal crime operation introduced in 2012. On the latter, the introduction of the Scrap Metal Dealers Act 2013 is exploited to study the impact of policy on the economic activity of scrap metal dealers in England and Wales. Results from our difference-in-differences specification suggest that the tougher regulatory system introduced by the policy hindered the economic activity of pre-existing dealers, reflecting the reduced market size for potential metal criminals to sell what they have stolen.

Item Type: Working Paper
Divisions : Faculty of Arts and Social Sciences > School of Economics
Authors :
NameEmailORCID
Kirchmaier, Tom
Machin, Stephen
Sandi, Matteo
Witt, RobertR.Witt@surrey.ac.uk
Date : March 2018
Copyright Disclaimer : © T. Kirchmaier, S. Machin, M. Sandi and R. Witt, submitted 2018. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means without the prior permission in writing of the publisher nor be issued to the public or circulated in any form other than that in which it is published. Requests for permission to reproduce any article or part of the Working Paper should be sent to the editor at the above address.
Uncontrolled Keywords : Metal Crime; Metal Prices; Commodity Prices
Additional Information : Paper No. CEPDP1535
Depositing User : Clive Harris
Date Deposited : 20 Apr 2018 07:23
Last Modified : 05 Nov 2018 14:23
URI: http://epubs.surrey.ac.uk/id/eprint/846270

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