Crime and social expenditure: A political economic approach

Abstract

High-income and less unequal societies are associated with both lower rates of economic crimes and larger public programs to deter crime. This paper suggests that redistributive effects generated by a crime-control program help to explain these facts. Retirees and honest individuals are beneficiaries of the system because they do not offend. Despite paying more taxes, high-income dishonest agents become net receivers, as they devote relatively less time to criminal activities than poorer agents; thus, a regressive intra-generational redistributive effect arises. Consequently, a crime-control program may be politically supported by a coalition of retirees, honest individuals and high-income dishonest young agents.