Robert J. Stonebraker, Winthrop University
The Joy of
Economics: Making Sense out of Life
Robert J. Stonebraker, Winthrop
University
Safety in Numbers
You will be safest in the middle.
.....Ovid
I speed. I routinely set my cruise control at three miles per hour (mph) above the posted speed limits, and routinely am ignored by the police. At only three mph above the limit, I am among the slowest drivers on the road. Why would a police officer bother with me when others are traveling even faster? How many cars can an officer stop? There is safety in numbers.
Speeding is not the sole example. As a pedestrian, I am reluctant to cross against a light except when in New York City. In Manhatten, no one pays attention to DO NOT WALK signs. Neither do I. They cannot arrest us all. There is safety in numbers.
Consider the looting that often occurs in the aftermath of riots or earthquakes. Store windows have been smashed, alarm systems are down, doors are knocked in. Even with television news cameras rolling, looters swarm through the aisles grabbing as much as they can carry. Why? When interviewed most looters appear to be average law-abiding citizens with no particular economic need nor grudge. Yet when the looting began, they joined the fray. After all, the police could not arrest them all. There is safety in numbers.
Costs and benefits
Of course, it is all economics. Choices are not made in a vacuum. We compare expected costs and benefits. Should I eat another hot dog? Only if the additional benefits exceed the additional costs. Should I stuff one more scoop of ice cream into the bowl? Only if the additional benefits exceed the additional costs.
The same process is at work in decisions about such scofflaw behavior as speeding, jaywalking and looting. The benefits of these activities are easy to identify: saving time, saving time, and a free flat-screen television set respectively. The costs depend upon potential legal penalties and, more importantly, on the probability of being caught. Even a draconian penalty such as hot dog deprivation is no deterrent if the chance of being caught is zero.
The above
examples share a common thread. In
each case the number of criminal actions swamp what law enforcement agents can
reasonably bring to trial. The sheer volume of crime congests the system
and lowers the likelihood of being caught. This cuts the expected costs of
crime and encourages even more criminal activity. In other words, once
congestion occurs and apprehension rates drop, crime begets crime. There is
safety in numbers.
Are you still with me? Will you acknowledge that such nefarious behaviors as speeding and jaywalking can fit an economist's model of rational choice? Will you concede that even criminals might accede to calculations of costs and benefits?If so, will you take one more step? Will you apply the same concepts to murder?
Bloody murder
Yes, murder. Murder as in bang, bang, you're dead. If New York's reputation for jaywalking is poor, it is even worse for such violent crimes as murder. The Big Apple homicide rate is three times that of the U.S. in general. Why? Perhaps it is because the justice system is congested with jaywalkers. Or, maybe it is just too much spicy food.
Colombia is worse. No matter how daunting a dark dash through Central Park may seem, compared to one in the country of Colombia, it is like a Sunday afternoon stroll down main street Mayberry. Homicide rates in Colombia, generally considered among the world's most violent countries, are quadruple the NYC level and are some 50 times higher than those generally found in Europe. Colombian rates for carjackings, kidnappings and thefts are similarly high.
Until the late 1970s Colombia was relatively peaceful. It was democratic with few racial or religious tensions to fuel violent conflicts. Television commercials often would depict Juan Valdez and his burro ambling through mountain fields, carefully picking only ripest Colombian coffee beans for your morning brew. Juan's modern counterparts are likely to be toting automatic weapons.
What happened? The easy answer is cocaine. After a right-wing military coup drove drug traffickers from Chile in the 1970s, the displaced dealers shifted operations to Colombia. Violence erupted as rival firms vied for market share. Bullets to the brain proved a quick and effective way to eliminate both competitors and uncooperative government officials. However, once cartel power became firmly established, drug violence subsided. With all competitive threats literally buried, the market stabilized.
Colombian violence remains high, but relatively less is associated with drugs or the continuing rebel insurgent groups fighting the government. A recent study by economist Alejandro Gaviria reports that more than 80 percent of Colombian homicides are unrelated to major drug or rebel organizations.1 The problem, according to Gaviria, is that the earlier drug violence congested the law enforcement system and lowered the probability of being caught. The low chance of apprehension lowered the cost of murder and attracted an increased supply of assassins. By the time drug violence had subsided, non-drug-related homicides had increased.
Other crimes in Colombia also rose, but only after the increase in homicides. Once murder investigations congested the system, enforcement officials had little time or energy to pursue less serious crimes. As an economist would predict, this lower likelihood of prosecution sparked an increase in infractions from petty theft to kidnapping. It becomes a vicious cycle. Crime creates law enforcement congestion. Congestion lowers the probability of being caught and convicted which, in turn, lowers the cost of crime and creates even more crime.
Multiplier effects
Economists often discuss the multiplier effects of macroeconomic policies. Changes in government spending or taxes can create additional effects that ripple through the economy. For example, an increase in government spending for economics professors creates new income for economics professors. They use the new income to buy additional cartons of Breyer's Ice Cream (vanilla). This creates new income for Breyer's employees and owners who, in turn, spend their new income for tickets to see the Pittsburgh Pirates. This increases income for the Pirates, who then shell out the big bucks needed to hire a free-agent center-fielder. The center-fielder spends his new income to buy hot dogs and fries. This creates new income for the hot dog vendors, etcetera, etcetera, etcetera. The initial burst in government spending is multiplied into a much larger amount of private spending. Spending begets more spending.
The multiplier effects of crime are similar. Crime creates enforcement congestion, and congestion creates additional crime. The policy message is clear. To avoid spiraling crime, nip it in the bud. Hit it hard. Hit it early. Swift and sure justice. Get it before any self-propagating multiplier effects take root.
Simple enough? Maybe not. The day after drafting this article I found myself driving in downtown Pittsburgh. After a matinee at the Pittsburgh Public Theater, my wife and I turned down Penn Avenue. We reached Heinz Hall just as the symphony crowd was beginning to exit. An elderly couple, walking with canes, began to cross the street. They were in the middle of the street. They were jaywalking. Incipient crime. My brain is yelling: "Nip it in the bud. Hit it hard. Hit it early. Swift and sure." But, what do I do? Should I run them down? I envision the local TV news flash: "Elderly couple leveled by crazed economist. Graphs at eleven." So I slow. I slow to a crawl to let them pass. But the moment I slow, forty others see their opening and lurch into the street with the elderly couple. Two are multiplied into forty. And I wait. There is safety in numbers.
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Notes:
1. Gaviria, Alejandro, "Increasing Returns and the Evolution of Violent Crime: The Case of Colombia," Journal of Development Economics, February 2000, volume 61, number 1, pp. 1-25. Colombian crime rates have fallen since 2002, but remain very high by world standards.
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Testing Yourself
To test your understanding of the major concepts in this reading, try answering the following:
1. Explain how an increase in crime can create a multiplier effect that creates even more crime.
2. Use this crime multiplier effect to explain the continued violence in Colombia.