Abstract

" This paper develops a model of simultaneous equations to study the determinants of various types of crime at a regional level in Chile between 1988 and 2000. This paper innovates by addressing various endogenous effects that are present in the determination of crime. The main results are the following; i) the different types of crime have heterogeneous determinants; ii) the predicted effects of the opportunities for legal/illegal income are validated for several types of crime, including the rate of unemployment; iii) there is a double causality between the level of crime and police efficiency, which provides evidence in favour of the ""police congestion hypothesis""; iv) increases in police force have two distinct effects on the observed level of crime; a positive effect due to increases in crime reporting, and a negative effect due to its deterrent effect and v) the local allocation of police resources is a function of past crime levels. These results suggest that a proper analysis of the determinants of crime and the design of public policies must address and disentangle the various and complex effects that take part in the determination of crime, such as those analysed in this paper. "