Search for a theory of organized crimes

Juin-jen Chang, Huei-chung Lu and Ping Wang

European Economic Review, 2013, vol. 62, issue C, 130-153

Abstract: Casual empirical observations reveal no systematic relationship between the overall crime rate and organized criminal activity. We develop a search-theoretic framework to study the interactions not only between formal labor and crime sectors but also between individual and organized crimes. In equilibrium, individual and organized criminals face different arrest risks, success rates, reward structures and outside options. We characterize agents' “occupational choices,” the gang's hierarchical structure and the responses of unemployment, crime rates and crime composition to changes in labor-market conditions and crime-deterrence policies. We further assess the effectiveness of arrest versus punishment policies in deterring individual and organized crimes.

Keywords: Individual versus organized crimes; Occupational choice; Crime composition; Interdiction and risk-sharing effects (search for similar items in EconPapers)
JEL-codes: D83 J24 K42 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:62:y:2013:i:c:p:130-153

DOI: 10.1016/j.euroecorev.2013.05.004

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