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Why does more police reduce crime, again?

So far, we talked about the importance of obtaining regression results that have both causal interpretation and clear policy implication.

Existing research evidence strongly suggests that police matters. When the level of police presence goes up, crime goes down significantly. But there are several theoretical issues that remain relatively unexplored, which deserve further research.

First, there is little research on the empirical relationship between police and the probability of arrest and punishment. Recall that the rational choice model predicts more police would increase the probability of arrest and punishment. Knowing this, a potential criminal would become less likely to offend because of increased costs of crime.

Intuitively, this argument makes a lot of sense. If my neighborhood has a lot of police officers and I keep running into them every block, I would expect that my probability of arrest upon committing some crime is pretty high. Alternatively, when my local police department receives a big grant from the federal government to acquire new high-tech crime-fighting equipment, I would expect that the probability of arrest in my neighborhood is now higher.

But would criminals also react to the increased police presence and improved police technology in the way I just described?

Suppose government introduces major policy interventions that increase the size of the police force and/or improve police technology. If potential offenders are not aware of these changes and do not adjust their expectation on the probability of punishment, the deterrent effect of these expensive interventions would be minimal. Unfortunately, we know little about how offenders form their expectations on the probability of punishment. The data on potential criminals’ expectations is usually not available, and it would be even more difficult to collect data on how they update their expectations on arrest and punishment following government policy reforms.

Another important question worth exploring is the optimal allocation of police resources. We already saw that big increases in police budget led to significant crime decreases in the U.S. and U.K., but these studies do not tell us how the additional police budget should be spent to maximize its crime-reduction effect. Should it be used to hire more staff, give a pay raise to the existing staff, or acquire improved police technology?

Existing research suggests that each of them has some crime-reduction effect. Economist Alex Mas shows that a pay raise for police officers through a successful wage arbitration led to higher arrest rates and lower crime rates in New Jersey. Luis Garicano and Paul Heaton find that increased computer use by police (in areas of crime analysis, investigation, and data processing) made them more effective in catching criminals. Jennifer Doleac finds that the introduction of a DNA database for convicted offenders across the U.S. states reduced the probability of reconviction by 17 percent for serious violent offenders and 6 percent for serious property offenders.

However, we still know little about the golden portfolio that would lead to the biggest crime reduction with the same police budget.


  • Doleac, Jennifer L. “The Effects of DNA Databases on Crime.” American Economic Journal: Applied Economics, forthcoming.
  • Garicano, Luis, and Paul Heaton. “Information Technology, Organization, and Productivity in the Public Sector: Evidence from Police Departments.” Journal of Labor Economics 28.1 (2010): 167-201.
  • Mas, Alexandre. “Pay, Reference Points, and Police Performance.” Quarterly Journal of Economics 121.3 (2006): 783-821.

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Economics of Crime

Hanyang University

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