Category Archives: Understand Relationships

Crime and Economics

Crime has always been a problem for society. Over the course of human history there have been plenty of instances in which the level of criminal activity rose to an uncontrollable level. One example of this calamitous process of increasing social upheaval was observed in the events leading up to the French Revolution. Late nineteenth century England provides another equally applicable illustration. Clearly, it would be prudent to find whether there is a root cause attributed to these surges in social lawlessness.

This is not the first time such an endeavor has been carried out in data science. The reason for the spike in violent crime that occurred throughout the late 1990s across the United States has long been a subject of debate. Strangely enough one of the more credible arguments attributes the violent crime to emissions from gasoline with a lead additive. This practice of adding lead to gasoline was finally ended in 1986 but the psychological damage to the children that grew up breathing in those fumes had already taken its toll.

Case Study – Seattle WA

The purpose of this report is to determine what possible causes, if any, may account for increasing crime trends. These possible causes have been isolated to only include socioeconomic variables that are deemed reliable in their estimation. The research was done only for the city of Seattle WA for the six year period beginning in 2008. However, it was structured in order that the process could be repeated in other cities. My research plan included the following stages:

  1. Researching theories of notable experts in the field.
    • Primary expert used was Gary Becker and his ‘Economic Model of Crime’
  2. Empirical analysis of raw data and analysis of quantified results.
    • This was accomplished using a time series, multiple regression model. The independent variables used were CPI, unemployment (with lags), economic growth index, and population.
  3. Interview of law enforcement official along with researching of historical validity.
  4. Recommendation of further study and actions the public can take to prevent increasing crime trends.

I found a strong connection between economic indicators and reported criminal activity. The results of the model detailed that increased inflation (consumer price index) had the largest impact on increasing crime. These results could be interpreted as the following:

A 1% increase in in prices (CPI) causes a

  • 3% increase in Assaults
  • 4% increase in Burglaries
  • 5% increase in Robberies

This study was done in the hopes of finding an economic variable that would not just predict but allow prevention of sudden increases in crime. The link between crime and increased prices provides a relationship that helps decision makers understand the crime problem and may suggest proactive steps society can take, given that the model and results are accurate.

For further details, please see the full report.