On the political economy of income redistribution and crime

Ayşe Imrohoroǧlu, Antonio Merlo, Peter Rupert

    Research output: Contribution to journalArticlepeer-review

    Abstract

    This article analyzes a general equilibrium model in which agents choose to specialize in either legitimate or criminal activities. Expenditures on police to apprehend criminals, as well as income redistribution, are determined endogenously through majority voting. We investigate how crime, redistribution, and police expenditures depend on characteristics of the underlying distribution of income-earning abilities and on the apprehension technology. Our model accounts for the positive correlation between inequality and crime, the positive correlation between expenditures on police and redistribution, and the lack of correlation between crime and redistribution observed in U.S. data.

    Original languageEnglish (US)
    Pages (from-to)1-26
    Number of pages26
    JournalInternational Economic Review
    Volume41
    Issue number1
    DOIs
    StatePublished - Feb 2000

    ASJC Scopus subject areas

    • Economics and Econometrics

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