Economic Analyses of Crime in England and Wales

This thesis includes three empirical studies detecting the determinants of crime in England and Wales. We firstly apply time series analyses to look for cointegrating relationships between property crimes and unemployment as well as law enforcement instruments. We extend our study by employing panel data and corresponding techniques to control for area-specific fixed effects as well as the endogeneity of law enforcement variables. In our third study, we allow crime rate to have spatial spillover effect, in other words, the crime rate in one area is affected by, in addition to its local crime-influential factors, the crime rates and crime-related factors in its neighbouring areas. We demonstrate this result by constructing a theoretical model and testing it by applying spatial analysis regressions. Our main findings can be summarized as follows: First, property crimes are better explained by economic models of crime than violent crimes. Second, law enforcement instruments always have negative effects on both property and violent crimes, indicating their deterrence and incapacitation effects as predicted. Third, social-economic factors, such as unemployment and income level, have two effects on property crimes: opportunity and motivation. Their net effects on property crime rates depend on the type of crime as well as the time period being examined. And finally, there is indeed spillover effect existing in crime rate. For burglary, theft and handling, and robbery, the crime rate in one area is positively and significantly correlated with the crime rates from its neighbouring areas. Furthermore, the crime rate of sexual offences of one area is negatively related to such crime rates in neighbouring areas