Essays on the economics of crime

The economic approach to crime issues is a recent field of research, which spawned from Becker’s (1968) seminal work. In this PhD thesis we contribute to the existing literature with three original research papers. The first paper deals with an under-explored field of research, namely the origins of the Sicilian Mafia. We follow an approach closer to that of historians such as Lupo (2004) and Pezzino (1987). In their work, Mafia was strictly linked with the socio and economic struggles amongst emerging classes which took place after the end of feudalism. We tested this hypothesis using a new measure of Mafia activity and new explanatory variables derived from previously under-explored primary sources. Our key findings are that Mafia was likely to be active in councils dominated by large properties, with high land values, lower density of population and where there were few peasants who owned the land. In the second paper, we explore the channels that favoured the expansion of Italian gangs in the centre and north of Italy in the second half of the XX century. We empirically investigate the role of forced re-settlement and migration through the creation of a panel dataset at the provincial level for the period 1983-2008, again using data from previously under-explored primary sources. Consistent with the community network approach (Bauer and Zimmermann, 1997; Moretti, 1999), we find that migration is by far the most important predictor of Mafia presence in the hosting provinces. In the final paper, we evaluate the impact of trust on crime in five Caribbean countries: Jamaica, Suriname, Guyana, Trinidad and Tobago and Dominican Republic. We use individual data taken from Americas Barometer for 2010, which contains information on victimization experiences. In order to tackle endogeneity we employ an instrumental variable approach. The results show that our measure of trust exerts a crime reducing effect on property but not violent crimes.
As we argue in the introductory chapter, all three contributions could be considered in the light of the new institutional economics approach. In particular, both organised crime and social capital provide extra legal solutions to securing property rights.