Crime does pay (at least when it's violent)! on the compensating wage differentials of high regional crime levels
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Lüneburg: Institut für Volkswirtschaftslehre der Universität Lüneburg, 2008. (Working paper series in economics; No. 91).
Research output: Working paper › Working papers
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TY - UNPB
T1 - Crime does pay (at least when it's violent)!
T2 - on the compensating wage differentials of high regional crime levels
AU - Braakmann, Nils
N1 - Literaturverz. S. 12 - 13 : Version: July 21, 2008
PY - 2008
Y1 - 2008
N2 - This paper investigates whether high regional crime levels lead to a compensating wage differential paid by firms in the respective region. Using data from German social security records and official police statistics for 2003 to 2006, we consider both violent and non-violent crimes and use three-way error-components estimators to control for individual and regional heterogeneity. Our findings suggest a positive and rather large compensating differential for the risk of falling victim to a violent crime while no such effect exists for other criminal activities. However, our results also suggest that the wage effects for most individuals are rather small due to small variation in the crime rates.
AB - This paper investigates whether high regional crime levels lead to a compensating wage differential paid by firms in the respective region. Using data from German social security records and official police statistics for 2003 to 2006, we consider both violent and non-violent crimes and use three-way error-components estimators to control for individual and regional heterogeneity. Our findings suggest a positive and rather large compensating differential for the risk of falling victim to a violent crime while no such effect exists for other criminal activities. However, our results also suggest that the wage effects for most individuals are rather small due to small variation in the crime rates.
KW - Economics
KW - Compensating wage differentials
KW - crime
KW - three-way error-components model
KW - Compensating wage differentials
KW - crime
KW - three-way error-components model
M3 - Working papers
T3 - Working paper series in economics
BT - Crime does pay (at least when it's violent)!
PB - Institut für Volkswirtschaftslehre der Universität Lüneburg
CY - Lüneburg
ER -