The Korean Economic Review
Mobility-Based Explanation of Crime Incentives
Yoonseok Lee (University of Michigan) and Donggyun Shin (Kyung Hee University)Year 2012Vol. 28No. 1
The canonical economic model of crime is extended to include individuals’ expectation offuture income mobility as an additional crime determinant. The model predicts that withall else being held constant including net gain from current criminal activity, reducedupward mobility among the poor increases crime rate whereas enhanced downwardimmobility among the rich decreases crime rate. These predictions are empirically supportedby country-level panel data. In addition, a typical change in income distribution wasimplemented, such that both the poor and the rich groups contribute to crime rate with agreater contribution among the poor.