A Dynamic Analysis of Criminal Networks

Luca Colombo, Paola Labrecciosa () and Agnieszka Rusinowska
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Paola Labrecciosa: Monash Business School - Department of Economics, Australia

Documents de travail du Centre d'Economie de la Sorbonne from Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne

Abstract: The paper presents a novel approach based on differential games to the study of criminal networks. We extend the static crime network game (Ballester et al., 2004, 2006) to a dynamic setting. First, we determine the relationship between the Markov Perfect Equilibrium (MPE) and the vector of Bonacich centralities. The established proportionality between the Nash equilibrium and the Bonacich centrality in the static game does not hold in general in the dynamic setting. Next, focusing on regular networks, we provide an explicit characterization of equilibrium strategies, and conduct comparative dynamic analysis with respect to the network size, network density, and implicit growth rate of total wealth in the economy. Contrary to the static game, where aggregate equilibrium increases with network size and density, in the dynamic setting, more criminals or more connected criminals can lead to a decrease in total crime, both in the short run and at the steady state. We also examine another novel issue in the network theory literature, i.e., the existence of a voracity effect, occuring when an increase in the implicit growth rate of total wealth in the economy lowers economic growth. We do identify the presence of such a voracity effect in our setting

Keywords: differential games; Markov Perfect Equilibrium; social networks; criminal networks; Bonacich centrality (search for similar items in EconPapers)
JEL-codes: C73 D85 K42 (search for similar items in EconPapers)
Date: 2022-02
New Economics Papers: this item is included in nep-gth, nep-net, nep-soc and nep-ure
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Related works:
Working Paper: A Dynamic Analysis of Criminal Networks (2023)
Working Paper: A Dynamic Analysis of Criminal Networks (2023)
Working Paper: A Dynamic Analysis of Criminal Networks (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:mse:cesdoc:22006

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