A Brief Look at International Data on Crime Very Brief

What to Display? Typically economists like GDP per capita as a variable for many things? Why? What would be better in the context of crime? Why?

So let us use GDP per capita

Not very informative!

Lots of poor countries. Suppose we restrict it to under $5,000 Clearly, there are a lot of poor countries!

Sadly, we only have 51 countries reporting burglary rates

Nonetheless, we can scatter plot GDP and the Burglary rate Not too informative. Is there or is there not some relationship?

Let’s try log(GDP), an old standby to spread GDP A bit better.

Try log(BURG99) and log(GDP99) Better yet

What is our guess at the relationship?

Or in Levels:

So what is the relationship? It is some kind of equation that has been estimated…..

Here is what generated those predictions

So what does it look like? Ln(BURG)=-0.89+0.73*ln(GDP) What that means is that a 10% increase in per capita income is associated with a 7.3% increase in burglaries per 100,000. This is because dln(x)=(dx/x) means percentage change. That is: dln(BURG)=%age change in burglaries

Algebra And dln(GDP) is the percentage change in GDP across countries. Thus 0.73 is what? It is the ratio of: ln(BURG)/dln(GDP). And what do we call the ratio of percentages? Right, an elasticity!

There are plenty of other international data, but we will tend to look at national units for some time.